In re Embassy Restaurant, 24636.

Decision Date28 June 1957
Docket NumberNo. 24636.,24636.
Citation154 F. Supp. 141
PartiesMatter of EMBASSY RESTAURANT, Inc., Bankrupt.
CourtU.S. District Court — Eastern District of Pennsylvania

Nathan I. Miller, Philadelphia, Pa., for trustee.

Richard H. Markowitz, Philadelphia, Pa., for Local 111 and Local 301 Welfare Trust Funds.

Harold K. Wood, U. S. Atty., Philadelphia, Pa., Louis C. Bechtle, Asst. U. S. Atty., Philadelphia, Pa., for United States.

WELSH, District Judge.

This case is before the Court on a petition for review of the disallowance by the Referee in Bankruptcy of certain priority wage claims filed on behalf of the employees of the Bankrupt by the Trustee of the Employees' Welfare Fund of Local Union 111 and by the Trustee of the Employees' Welfare Fund of Local Union 301.

On May 21, 1951, Embassy Restaurant, Inc., entered into a collective bargaining agreement with Local Unions 111 and 301, recognizing said Unions as the sole and exclusive collective bargaining representatives of the employees in all negotiations as to all matters of collective bargaining thereafter to be conducted. Said agreement contained provisions relating to hours, wages, vacations, holidays, seniority and other conditions of employment. Another provision of said agreement related to sick leave with pay for seven days each year which could be accumulated if not used to a maximum of twenty-one days.

In a supplemental agreement, dated January 1, 1953, the Employer and Local Unions agreed to make the provision in the agreement pertaining to sick leave ineffective. In its stead the Employer agreed to contribute certain sums for each employee to a Welfare Plan, the funds to be maintained and utilized to promote life insurance, weekly sick benefits, hospital and surgical benefits and other benefits for the employees.

Subsequently, on July 1, 1956, a collective bargaining agreement was entered into between Greater Philadelphia Restaurant Operators, Inc., acting on behalf of Embassy Restaurant, Inc., and other restaurants, and Local Unions 111 and 301 which provided for contributions to the Welfare Trust Funds of Local Unions 111 and 301.

The foregoing provisions were in effect at the time of the instant bankruptcy.

The Welfare Plans are administered pursuant to a formal written agreement and declaration of trust. Each trust provides that employee shall mean any employee in the collective bargaining unit represented by the Union; and provides further that the purpose of the Welfare Plan shall be to provide welfare benefits for employees. The collective bargaining agreement provides that each employer is required to pay the sum of $8 per month for every employee within the collective bargaining unit represented by the Union. In view of the manner in which the liability to make contributions or payments has been imposed upon the employers arising out of collective bargaining the Trustee of the Welfare Fund has the right in his discretion to file claims in any proceedings in which an insolvent employer is involved;...

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5 cases
  • United States v. Embassy Restaurant, Inc
    • United States
    • U.S. Supreme Court
    • March 9, 1959
  • IN RE LANSDALE TRANSP. CO., INC.
    • United States
    • U.S. Bankruptcy Court — Eastern District of Pennsylvania
    • May 15, 1981
    ...claim nor to their allowances as unsecured claims. 6 See, e.g., In re E.V. Moore, 447 F.2d 1106 (9th Cir. 1971); In re Embassy Restaurants, Inc., 154 F.Supp. 141 (E.D.Pa.1957); In re Otto, 146 F.Supp. 786 (S.D.Cal.1956). But see, Local 140 Security Fund v. Hack, 242 F.2d 375 (2d Cir. 1957) ......
  • In re Victory Apparel Manufacturing Corporation
    • United States
    • U.S. District Court — District of New Jersey
    • July 17, 1957
    ...Restaurant, Inc., rendered June 28, 1957, by Judge Welsh of the United States District Court for the Eastern District of Pennsylvania. 154 F.Supp. 141. As the court there noted, our Court of Appeals has not resolved the matter, and cases in other circuits are not in harmony. That being so, ......
  • Bernard v. Indemnity Ins. Co. of North America
    • United States
    • California Court of Appeals Court of Appeals
    • August 1, 1958
    ...the Trustees of the Welfare Fund filed proofs of claim, seeking priority over tax claims of the United States. The district court, 154 F.Supp. 141, granted the wage priority to the employer contributions and the government appealed. The appellate court said, in affirming the district court ......
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