Hines v. Anchor Motor Freight, Inc.

Anchor Motor Freight, Inc. (Anchor) (defendant) employed Burtice Hines and other truck drivers (collectively, the drivers) (plaintiffs). In June 1967, Anchor discharged the drivers for allegedly abusing Anchor’s lodging-reimbursement policy by seeking reimbursement for motel expenses that exceeded the amounts the drivers had actually paid. The drivers’ union (defendant) asserted the drivers’ innocence, and the parties agreed to arbitrate the matter pursuant to their collective-bargaining agreement (CBA). At the arbitration, Anchor presented motel receipts and sworn statements supporting the discharge. Neither the drivers nor the union presented any evidence contradicting Anchor’s evidence, and the arbitration committee sustained the discharge. Subsequently, it was revealed that the motel clerk was the true culprit and that he had recorded false receipts in the motel’s records and stolen money paid by the drivers. The drivers sued Anchor and their local and international unions, alleging that Anchor had discharged the drivers without cause in violation of the CBA. The drivers further asserted that the unions had violated their duty to fairly represent the drivers by failing to fully investigate Anchor’s allegations. Anchor asserted that the arbitrators’ decision sustaining the discharge was binding on the drivers under a CBA provision stating that arbitral decisions were final and binding on all parties. The trial court granted summary judgment for Anchor and the unions based on the finality of the arbitrators’ decision. The appellate court affirmed the grant of summary judgment for Anchor and the international union but reversed with respect to the local union, finding that there were sufficient facts to infer the union’s bad faith or arbitrary conduct. However, the appellate court stated that the CBA’s finality-of-arbitration provision had to be observed because there was no evidence of any misconduct by Anchor or any conspiracy between the unions and Anchor. The United States Supreme Court granted certiorari.