There is a famous case in which one farmer thought he was expressing a nonbinding opinion about selling his farm, but the other farmer believed he made a binding promise to buy the farm, and the Court made clear that the undiscussed intention of a party is not reIevant under an objective theory of assent. (See, Lucy v. Zehmer, 196 Va. 493, 84 S.E.2d 516 (1954)).
The problem of a party making what was believed to be a nonbinding proposal but, in reality, was a binding promise is an old one. (See, e.g., Embry v. Hargadine, McKittrick Dry Goods Co., 105 S.W. 777 (1907)). The context, of course, cannot be ignored in determining whether or not a statement constituted a gratuitous "pledge" or a binding promise. As Restatement (Second) observed:
The meaning given to words or other conduct depends to a varying extent on the context and the prior experience of the parties. Almost never are all the connotations of a bargain exactly identical for both parties; it is-enough that there is a core of common meaning sufficient to determine their performances with reasonable certainty or to give a reasonably certain basis for an appropriate legal remedy. (See, SS 20, comment b, p. 59 (1981), emphasis added).
As the U.S. Supreme Court has made clear, an arbitrator is a "creature of contract;" and an arbitration award is enforceable "only so long as it draws its essence from the collective bargaining agreement." (See, United Steelworkers of America v. Enterprise Wheel & Car Corp., 363 U.S. 593 (1960)). Contractual language is the best evidence of the parties' promissory intent. One arbitrator concluded:
It is a basic and fundamental concept in the arbitration process that an arbitrator's function in interpreting and applying contract language is to first ascertain and then enforce the intention of the parties as reflected by the language of the pertinent provisions involved. As a necessary and essential corollary is the principle that if the language being construed is clear and unambiquous language is itself the best evidence of the intention of the parties. And when language so selected by the parties leaves no doubt as to the intention, this should end the arbitrator's inquiry. (See, Ohio Chemical & Surgical Epuipment Company, 49 LA 377, 380-381 (1967), emphasis added).
The Employer asserted that it intended to make a "pledge" in the Joint Statement according to which it pledged itself to help eliminate violent behavior in the workplace. Management did not intend its "pledge" to constitute an enforceable promise because "there was no intent to alter, amend, or modify the National Agreement." (See, Tr. 58). The Union responded that its intent was to enter into an enforceable promise with management.
An examination of the purpose for the Joint Statement, the actual verbiage itself, and dispute resolution processes used by the parties provide objective manifestations of their intent. It is unrebutted that the principle purpose of the parties in publishing the Joint Statement was to lend their mutual weight to an anti-violence campaign in the workplace. Words used by the parties expressed their concern that combating violence in the workplace was such a high priority it was necessary to take an unprecedented step of jointly issuing a credo against violence. To convey the intensity of their commitment to reducing violence in the workplace, the parties stated:
The United States Postal Service as an institution and all of us who serve that institution must firmly unequivocally commit to do everything within our power to prevent further incidents of work-related violence. But let there be no mistake that we mean what we say and we will enforce our commitment to a workplace where dignity, respect, and fairness are basic human rights, and where those who do not respect those rights are not tolerated, (See,Joint Exhibit No. 4, emphasis added).
A representative of each party signed the document. Without regard to the unexpressed intentions of the parties, the document makes clear that the parties made promises to each other to take action. The parties addressed their statements to every member of the postal organization. They stated that:
'Making the numbers' is not an excuse for the abuse of anyone. Those who do not treat others with dignity and respect will not be rewarded or promoted. Those whose unacceptable behavior continues will be removed from their positions. (See, Joint Exhibit No. 4), emphasis added). On one hand, the Employer argued that management was completely serious about an intent to take action in order to end violence in the workplace. On the other hand, theEmployer asserted that it lacked the requisite intent to be contractually bound by the language of the Joint Statement. The Employer contended that, as expressed in the Joint Statement, the parties made a "pledge" of their efforts to accomplish objectives set forth in the document. The reference to the understanding between the parties as a "pledge" indicated to the Employer that the parties merely were communicating their disdain for violence in the workplace and were pledging themselves to end such misconduct. As the Employer viewed it, the Joint Statement definitely was not a contract but, rather, an effort to "send a message to stop the violence." (See, Employer's post-hearing Brief, 13).
The Employer supported its theory of the case with testimony from representatives present at discussions that led to the Joint Statement. As Mr. D. C., Manager of Management Association Relations, testified:
Following an exploration, again, of the circumstances leading to the tragedy [at Royal Oaks), the thought developed at the table that we should perhaps communicate what it is that we are doing. We are working collegally, We are trying to jointly approach these issues, as complex as they are. There has been a recognition here that there is something about the postal culture and perhaps something about the postal climate that we need to address and address in a more universal way than management exclusively issuing a statement or the labor union exclusively issuing a statement. (See, Tr, 90-91, emphasis added).
According to the Employer, it sought, in the aftermath of the "Royal Oaks" incident, to quell anxieties of employees by reaffirming an intent to end violence.
While it might be possible to interpret the word "pledge" in the Joint Statement as a nonpromissory commitment, the Statement must be interpreted as a whole document in order to assess its effect. It is a deeply rooted rule in aid of contract interpretation that a document should be interpreted so that its provisions make sense when read together. As Restatement (Second) observed, "since an agreement is interpreted as a whole, it is assumed in the first instance that no part of it is superfluous," ((SS 203, comment b, 93 (1981),
The objective of reading a whole document is to give significance to each part and an interpretation is preferred that produces such a result.
Words in the last sentence of the Joint Statement such as "pledge" and "efforts" must be read in conjunction with strong language throughout the prior six paragraphs which referred to "time to take action to show that we mean what we say," or "we will enforce our commitment," and "no tolerance of violence."
Such statements indicated that the parties' past efforts had been less than successful and that the "Royal Oaks" tragedy signalled to the parties their need to make a drastic change in postal culture. The Joint Statement marked a departure from the past and pointed the way to organizational change. This was a document that evidenced an intent to take action rather than a mere statement of opinions and predictions. It was a "manifestation of intention to act" which justified a conclusion that a commitment had been made. After making strong promissory statements, the parties signed the document, signaling more than a gratuitous pledge.
The parties' conduct in negotiating the Joint Agreement added support to a justifiable conclusion that they exhibited an objective manifestation to be contractually bound. When approaching management with the idea of issuing a Joint Statement, Mr. Vincent Sombrotto, President of the National Association of Letter Carriers, doubted that the Employer would enter into such an agreement. (See, Tr. 69). In response to Mr, Sombrotto's proposal, the Employer did not flinch but, instead, asserted, "Try me." (See, Tr. 69).
Such negotiation behavior exhibited an objective intent of the parties to make legally binding commitments to each other and, if not performed, legally enforceable promises that could be the basis of a remedy. The language of the Joint Statement itself as well as the objective conduct of the parties evidenced their mutual assent to be legally bound by the Joint Statement.
Since the turn of the twentieth century, contract jurisprudence has recognized that an agreement can be "instinct with an obligation" and, therefore, enforceable as a contract. A relationship between parties is "instinct with an obligation" when it is "infused" or "imbued" or "filled" or "charged" with an obligation. (See, e.g., Wood v. Lucy, Lady DuffGordon , 118 N.E. 214 (N.Y. 1917)).
The Joint Statement committed the parties to a course of action and created obligations for them. Even if the expression of the parties' intent in the Joint Statement was less than perfect, the language they used was instinct with an obligation which overcame any asserted indefiniteness in the document, The Joint Statement itself was clear in its manifestation of an intent to be bound; but even if one concluded that there was an imperfect expression of the parties' intent, the document was instinct with an obligation which supplied the binding requirement of the transaction.
Moreover, courts have found that an agreement may be instinct with an obligation based on principles arising from the relationship of the parties and their course of conduct. (See, Toussaint v. Blue Cross and Blue Shield of Michigan, 292 N.W.2d 880 (1980)). A reasonable person would have viewed the surrounding circumstances of this transaction as contractually obligating the parties to each other.
C. Enforcing the Joint Statement
The Joint Statement did not specify a method concerning how to enforce the agreement. It is logical to presume that the parties intended to use standard enforcement mechanisms for disputes that night arise between the parties, namely, their negotiated grievance procedure set forth in the collective bargaining agreement. Such an interpretation is consistent with the parties' agreement.
Article 15.1 of the parties' agreement makes clear that the negotiated grievance procedure is not limited to disputes under the National Agreement which has been negotiated in the traditional way. The Agreement states that:
A grievance is defined as a dispute, difference, disagreement or complaint between the parties related to wages, hours, and conditions of employment, A grievance shall include, but is not limited to, the complaint of an employee or of the Unions which involves the interpretation, application of, or compliance with the provisions of this Agreement or any local Memorandum of Understanding not in conflict with this Agreement. (See, Joint Exhibit No. 1, p. 75, emphasis added),
The parties agreed that the grievance procedure could be used to resolve "a dispute, difference, or complaint" related to "conditions of employment." Moreover, there is an indication in the parties' agreement that, when they intended to make available some other dispute resolution process in lieu of the negotiated grievance procedure, they expressly said so in the agreement.
For example, Article 16.9 makes clear that dispute resolution under the Veteran's Preference Act remains available to relevant employees.(See, Joint Exhibit No. 1, p. 91), In some cases, there is access to the Merit Systems Protection Board. (See, Joint Exhibit No. 1, p. 89), The parties clearly understood how to draft language into their agreement which expressed their intent that there would be an election of a forum different from the negotiated grievance procedure. (See, e.g., Exhibit No. 1, p. 14, Article 6(f)(l)).
The inference is clear that the collective bargaining agreement is presumed by the parties to be the enforcement mechanism used to resolve their disputes, differences, disagreements, and complaints with regard to conditions of employment. The Joint Statement did not provide an alternative means of enforcement, It is concerned with a condition of employment. Accordingly, it is reasonable to conclude that the Union may use the negotiated grievance procedure to resolve disputes under the Joint Statement on Violence and Behavior in the Workplace.
The Employer argued that using the negotiated grievance procedure is inappropriate because there is no quid pro quo. In other words, the Union allegedly gave up nothing to receive this additional benefit. In effect, the Employer argued that, even if there were a promissory undertaking on the part of the parties, it was an illusory promise based on a lack of consideration, The modern day requirement is that consideration be bargained for. But, except in instances not relevant in this case, courts do not test the economic equivalence of the bargain. As one court concluded: The doing of an act by one at the request of another, which may be a detriment or inconvenience, however slight, to the party doing it, or may be a benefit, however slight, to the party at whose request it is performed, is a legal consideration for a promise by such requesting party. The judgment of the purchaser is the best arbiter of whether the thing is of any value, and how great, to him. (See, Hardesty v. Smith, 3 Ind. 39 (1851)).
The rule that courts do not test the economic equivalent of a bargain is long standing. As another court observed, "the rule is almost elementary that where parties get all the consideration they bargained for, they cannot be heard to complain of the want or inadequacy of consideration." (See, Chicago and Atlantic Railways v. Derkes, 3 N.E. 239 (1885)). If there is consideration, there is no requirement of benefit to a party. What constitutes consideration has bedazzled students for generations. The rule is that, with several exceptions not relevant in this case, "any performance which is bargained for is consideration." (See, Restatement(Second) of Contracts, SS 72, p. 177 (1981)). The usual consideration is a return promise, and even that may be an implied promise. The question is whether there was a promise or, possibly, a performance given in exchange for a promise. The bargain theory of consideration supports a conclusion that the mutual exchange of promises in this case constituted consideration. me mutual exchange of promises involved a commitment from each party "to make the workroom floor a safer, more harmonious, as well as a more productive workplace." (See, Joint Exhibit No. 4).
Use of the negotiated grievance procedure was an incidental result of the promissory exchange between the parties. Moreover, there was unrebutted evidence that the Employer, in fact, has benefited from the exchange between the parties and has used the Joint Statement in regional arbitrations against workers who exhibited behavior inconsistent with the Joint Statement. There, in fact, was consideration in the bargained-for exchange between the parties.
The grievance procedure of the National Agreement may be used to enforce the parties' bargain, and arbitrators have available to them the flexibility found in arbitral jurisprudence when it comes to formulating remedies, including removing a supervisor from his or her administrative duties. As the U.S. Supreme Court instructed:
There (formulating remedies] the need is for flexibility in meeting a wide variety of situations. The draftsmen may never have thought of what specific remedy should be awarded to meet a particular contingency. (See, United Steelworkers of America v. Enterprise Wheel and Car Corp. 363 v.s. 593 (1960)).
Having carefully considered all evidence submitted by the parties concerning this matter, the arbitrator concludes that the Joint Statement on Violence and Behavior in the Workplace constitutes a contractually enforceable agreement between the parties. Accordingly, the Union shall have access to the negotiated grievance procedure set forth in the parties' collective bargaining agreement to resolve disputes arising under the Joint Statement. It is so ordered and awarded.