Schneider Moving Storage Company v. Robbins Prosser Moving and Storage Company v. Robbins
| Decision Date | 18 April 1984 |
| Docket Number | Nos. 82-1860,82-1862,s. 82-1860 |
| Citation | 104 S.Ct. 1844,466 U.S. 364,80 L.Ed.2d 366 |
| Parties | SCHNEIDER MOVING & STORAGE COMPANY, Petitioner, v. Loran W. ROBBINS et al. PROSSER'S MOVING AND STORAGE COMPANY, Petitioner, v. Loran W. ROBBINS et al |
| Court | U.S. Supreme Court |
Petitioner employers entered into collective-bargaining agreements with a union that required them to participate in two multiemployer employee-benefit trust funds. The trust agreements required petitioners to contribute to the funds according to the applicable terms of their collective-bargaining agreements. The terms of the trust agreements were incorporated by reference into the collective-bargaining agreements and authorized respondent trustees to initiate "any legal proceedings [that they] in their discretion deem in the best interest of the Fund to effectuate the collection or preservation of contributions." Respondents filed complaints in Federal District Court, claiming that petitioners failed to meet their contribution requirements, and requesting the court to order an accounting and immediate payment of all sums thereby determined to be due. Petitioners defended on the ground that the complaints raised disputed interpretations under the collective-bargaining agreements that first must be submitted to arbitration. The bargaining agreements required arbitration of "differences that arise between the Company and the Union or any employee of the Company as to the meaning or application of the provisions of this agreement," and no parties other than the union or the employer were given access to the arbitration process. The District Court dismissed the suits pending arbitration. The Court of Appeals reversed and remanded, holding that the relevant agreements indicated no intent to require the arbitration of contractual disputes between the trustees and the employers and thus that failure to arbitrate could not bar respondents' suits.
Held: Respondents may seek judicial enforcement of the trust terms against petitioners without first submitting to arbitration an underlying dispute over the meaning of a term in the collective-bargaining agreements. Pp. 1848-1851.
(a) The presumption that a promisor may assert against a third-party beneficiary any defense that he could assert against the promisee if the promisee were suing on the contract, should not be applied so inflexibly as to defeat the intention of the parties. Whether the presumption applies in this case to require respondents, as third-party beneficiaries of the collective-bargaining agreements, to arbitrate disputed terms of the collective-bargaining agreements depends on the contractual intent of the parties to all the agreements at issue. Pp. 1848-1849.
(b) The presumption of arbitrability of disputes between a union and an employer is not applicable in determining whether the parties agreed to require the arbitration of disputes between trustees of employee-benefit funds and employers, even if those disputes raise questions of interpretation under the collective-bargaining agreements. P. 1849.
(c) Neither the trust agreements nor the collective-bargaining agreements at issue here evidence any intent on the part of the parties to condition the contractual right of respondents to seek judicial enforcement of the trust provisions on exhaustion of the arbitration procedures contained in petitioners' collective-bargaining agreements. Pp. 1849-1852.
700 F.2d 433 (8th Cir.1983), affirmed and remanded.
David F. Yates, St. Louis, Mo., for petitioner in No. 82-1860.
Charles W. Bobinette, St. Louis, Mo., for petitioner in No. 82-1862.
Russell N. Luplow, Bloomfield Hills, Mich., for respondents in both cases.
The issue presented in these two cases is whether the trustees of two multiemployer trust funds may seek judicial enforcement of the trust terms against a participating employer without first submitting to arbitration an underlying dispute over the meaning of a term in the employer's collective-bargaining agreement.
Respondents are the trustees of two multiemployer trust funds, the Central States, Southeast and Southwest Areas Pension Fund and the Central States, Southeast and Southwest Areas Health and Welfare Fund (Trust Funds).1 Petitioners are two employers Prosser's Moving & Storage Co. (Prosser's) and Schneider Moving & Storage Co. (Schneider)—who have agreed to participate in the trust funds. Respondents filed separate complaints against petitioners in the United States District Court for the Eastern District of Missouri, claiming that petitioners had failed to meet their contribution requirements and had refused to allow an audit of their payroll records. Respondents requested the District Court to order an accounting and immediate payment of all sums thereby determined to be due. They alleged federal subject-matter jurisdiction under § 301(a) of the Labor Management Relations Act (LMRA), 29 U.S.C. § 185(a), and § 502 of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1132.2 Petitioners defended on the ground that respondents' complaints raised disputed interpretations under the collective-bargaining agreements that first must be submitted to the applicable arbitration procedures.3 The District Court agreed with petitioners and dismissed the suits pending arbitration. It held that although arbitration is not a prerequisite for "simple collection matters" in which the employer's liability under the collective-bargaining agreement is clear, arbitration is required in claims such as these where interpretation of the collective-bargaining agreement is at issue.
A three-judge panel for the Court of Appeals for the Eighth Circuit reversed and held that arbitration was not a prerequisite to federal suit in these two cases. Robbins v. Prosser's Moving & Storage and Schneider Moving & Storage, Nos. 80-2116, 80-2117 (CA8, Mar. 24, 1982) (per curiam). An en banc court of the Eighth Circuit agreed with the panel. After examining competing considerations under the federal labor laws and under the federal laws governing employee trust funds, the court held that the relevant agreements indicated no intent on the part of the parties to require the arbitration of contractual disputes between the trustees and the employers and thus that failure to arbitrate could not bar respondents' suits. The en banc court, therefore, reversed the decision of the District Court and remanded for further proceedings. 700 F.2d 433 (1983). We granted certiorari in view of an apparent conflict among the Circuits on this issue.4 464 U.S. 813, 104 S.Ct. 66, 78 L.Ed.2d 81 (1983). We now affirm.
As resolved by the Court of Appeals, these cases present a narrow question of contract interpretation. The en banc court considered only whether the parties to the collective-bargaining agreements and the trust agreements intended to require the arbitration of disputes between the trustees and the employer before the trustees could exercise their contractual right to sue in federal court.5 Because of its resolution of this issue, the Court of Appeals did not reach respondents' argument that requiring the trustees to submit their disputes with the employer to the applicable arbitration procedures was prohibited as a matter of law. If we agree with the Court of Appeals that the parties did not provide for such an arrangement, we also need not address that argument. We turn first, therefore, to an analysis of the relevant agreements.
Petitioners entered into collective-bargaining agreements with Local 610 of the International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America (Union). These agreements required petitioners to participate in the two multiemployer trust funds, and incorporated the terms of the two trust agreements by reference.6 The trust agreements 7 required petitioners to contribute to the funds according to the applicable terms of their separate collective-bargaining agreements.8 To ensure compliance with the contribution requirements, the trust agreements gave the trustees the authority to examine petitioners' payroll records.9 If the trustees determined that petitioners were not complying with their contribution requirements, they had the authority under the trust agreements to initiate legal proceedings to enforce those requirements:
Pension Fund Agreement, Art. III, Sec. 4, App. 22.
The relevant terms of the two collective-bargaining agreements at issue here are substantially identical. Both required weekly payments to the funds for "each regular Employee." No contributions were required for employees who worked "either temporarily or in cases of emergency." 10 Each collective-bargaining agreement also contained an arbitration clause that required the arbitration of any "differences . . . between the Company and the Union or any employee of the Company as to the meaning or application of the provisions of [the collective-bargaining] agreement." Id., at 55. Arbitration could be demanded by either the Union or the Company in the case of Prosser's collective-bargaining agreement, or by the Union alone in the case of Schneider's collective-bargaining agreement. No other parties were given access to the arbitration process.
Petitioners argue that as third-party beneficiaries of the collective-bargaining...
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