Operating Engineers Pension Trust v. Beck Engineering & Surveying Co.

• Citation: 746 F.2d 557
• Decision Date: 01 November 1984
• Docket Number: Nos. 83-6455,83-6498,s. 83-6455
• Parties: 117 L.R.R.M. (BNA) 3041, 102 Lab.Cas. P 11,249, 5 Employee Benefits Ca 2417 OPERATING ENGINEERS PENSION TRUST and Operating Engineers Health & Welfare Fund, Plaintiffs-Appellants and Cross-Appellees, v. BECK ENGINEERING & SURVEYING CO., etc., et al., Defendants-Appellees and Cross- Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

Page 557

746 F.2d 557

117 L.R.R.M. (BNA) 3041, 102 Lab.Cas. P 11,249,

5 Employee Benefits Ca 2417

OPERATING ENGINEERS PENSION TRUST and Operating Engineers Health & Welfare Fund, Plaintiffs-Appellants and Cross-Appellees, v. BECK ENGINEERING & SURVEYING CO., etc., et al Defendants-Appellees and Cross- Appellants.

Nos. 83-6455, 83-6498.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Sept. 7, 1984.

Decided Nov. 1, 1984.

Wayne Jett, Los Angeles, Cal., for plaintiffs-appellants and cross-appellees.

James G. Johnson, Hill, Farrer & Burrili, Los Angeles, Cal., for defendants-appellees and cross-appellants.

Appeal from the United States District Court for the Central District of California.

Before TUTTLE, ¹ Senior Circuit Judge, and NORRIS and BEEZER, Circuit Judges.

TUTTLE, Senior Circuit Judge:

This action was brought under Section 301 of the Labor Management Relations Act (LMRA) (29 U.S.C. Sec. 185) and Section 502(a)(3) of the Employee Retirement Income Security Act (ERISA) (29 U.S.C. Sec. 1132(a)(3)) by two employee benefit trust funds seeking recovery of delinquent amounts claimed under a collective bargaining agreement. Plaintiffs and defendants both moved for summary judgment. The district court granted in part and denied in part each motion and rendered summary judgment disposing of all issues, from which plaintiffs have appealed and defendants have cross-appealed.

For the reasons stated below, we affirm the summary judgment in all respects.

BACKGROUND

The employee in this case, Gary Giesseman, was employed from August 1978 by BBB Engineering and Survey Company ("BBB Engineering") as an office manager and secretary. BBB Engineering was a partnership between Victor Beck and Martin Bromberg, which was incorporated in June 1962 under the laws of California. It was engaged in the business of civil engineering and land surveying. Giesseman was the company's only employee at all times relevant hereto.

In February 1962, BBB Engineering had signed a short form agreement with Local 12 of the International Union of Operating Engineers ("Local 12"), binding itself to Local 12's Master Survey Agreement ("MSA") with the predecessor of the Southern California Association of Civil Engineers and Land Surveyors ("Association"). The MSA was subsequently renewed and modified in 1965, 1969, 1974, 1977, 1980 and 1983. The Association executed the 1977 and 1980 agreement.

Articles XIV and XV of the MSA (XV and XVI of the 1977 MSA) provided that employers were to pay fringe benefit contributions to the Operating Engineers Pension Trust and the Operating Engineers Health and Welfare Fund (hereinafter collectively "the Trusts") for each hour "worked by (or paid) each employee under this Agreement." In 1972 an identical provision in Local 12's Master Labor Agreement ("MLA") with another industry association was interpreted by a joint Labor Management Adjustment Board as requiring contributions based on all hours worked by a covered employee, even if his time was split between covered and non-covered work.

Ordinarily an individual employer would sign a short form agreement with Local 12 incorporating by reference the appropriate master agreement, depending on the type of covered work in which the employees were engaged. The MSA covered employees who worked as members of field survey parties. Field survey parties use surveying instruments and techniques to establish the location of boundary lines on real property or the location of particular features or improvements of real property. Often this is done at construction sites in connection with specific construction projects, both proposed and ongoing. Surveying jobs, such as the location of boundaries, may also be completely unrelated to construction.

Prior to October 1979, BBB Engineering had no employees doing work covered by the MSA. In October of that year Giesseman began doing some surveying work for BBB Engineering after he, Giesseman, was orally assured by someone at Local 12 that BBB Engineering would be required to pay fringe benefit contributions only for the hours in which he performed surveying work.

Giesseman joined Local 12 on October 3, 1979, and did his first surveying job on October 22, 1979. Giesseman prepared the employer monthly reports to the two Trusts and the contribution checks, reporting and paying on only those hours in which he had done surveying work.

In the spring of 1980, Bromberg retired and BBB Engineering was dissolved. Beck then formed his own surveying company, called Beck Engineering and Surveying Company ("Beck Engineering"), in May 1980, employing Giesseman in the same capacity as before. At Giesseman's urging, Beck agreed to sign a labor agreement with Local 12. The two of them met with Thomas Wadman, Local 12's business agent, on May 5, 1980. According to Giesseman, Beck told Wadman he could not hire Giesseman as a surveyor unless Giesseman could be utilized as a part-time surveyor and have fringe benefit contributions paid to the Trusts based only upon the actual number of hours worked in the field. Beck further guaranteed that contributions would be paid for not less than 200 hours per quarter. After consulting with Giesseman, Wadman then verbally assented. Beck then signed a new short form agreement. The written agreement, however, made no mention of the limitation on Beck's reporting requirement which allegedly had just been verbally arranged with Wadman.

In the fall of 1980, auditors for the Trusts determined that BBB Engineering and Beck Engineering were both liable for contributions on Giesseman's office work from the time that he began doing covered surveying work as well. When representatives of Local 12 and the Trusts refused to go along with the arrangement which Beck claimed had been orally worked out with Wadman, Beck sent a letter to Verne Dahnke of Local 12, dated January 30, 1981, advising him of Beck's intention "to terminate my company's Field Survey Agreement. Termination is to be effective as soon as permissible under the terms of the Agreement." Local 12 received this letter on February 3, 1981.

Further discussions concerning the company's liability for Giesseman's office hours continued until May 1981, but the dispute was not resolved. Meanwhile, Beck Engineering continued reporting Like BBB Engineering, Beck Engineering was engaged in the business of civil engineering and land surveying. In a declaration, Beck estimated that ninety percent of his surveying work was related to ongoing or proposed construction. This included the preparation of topographical maps to be used during the course of construction for grading and other purposes, and the laying out of construction boundary stakes, related both to site preparation and excavation and to building placement. The remaining ten percent of the company's business consisted primarily of the location of property boundaries. Giesseman's surveying work was divided between construction and non-construction jobs in the same proportion.

Giesseman's surveying hours at least until August 1982. The short form agreement which Beck had signed specified that it would remain in effect for the same term as the MSA and that it could be terminated only upon written notice by either party not less than 90 nor more than 120 days prior to the MSA's termination date. The MSA then in effect was not due to expire until August 1, 1983.

On motions for summary judgment, the Trusts claimed that BBB Engineering and Beck Engineering owed benefit contributions for all hours worked by Giesseman from the time he began doing surveying work in October 1979 through December 31, 1982. The defendants claimed that, by virtue of the oral assurances made by Local 12's representatives, including Wadman, they were not liable for contributions on Giesseman's hours not spent on surveying work, and that Beck Engineering was not liable for anything after Beck sent his letter of January 30, 1981, terminating the agreement. The district court, in ordering summary judgment, found that the MSA required BBB Engineering and Beck Engineering to pay contributions on all hours worked by Giesseman from the time he began performing covered work and that the oral representations could not be relied upon as modifications of their obligations. However, he concluded further that Beck's short form agreement with Local 12 was a construction industry pre-hire agreement permitted under Sec. 8(f) of the LMRA (29 U.S.C. Sec. 158(f)), terminable at the will of either party prior to the union's attainment of majority status, and that Beck Engineering effectively repudiated the agreement upon Local 12's receipt of Beck's letter on February 3, 1981. The court thus concluded that Beck was no longer bound by his agreement with Local 12 after that date. Damages for unpaid fringe benefit contributions for unreported hours worked by Giesseman as office manager from October 1979 through February 3, 1981, were fixed at $8,047.58. In addition, the Trusts were awarded $3,910.39 in prejudgment interest and an identical amount in statutory liquidated damages pursuant to 29 U.S.C. Sec. 1132(g)(2)(C). Costs and attorneys fees were also awarded to the plaintiff Trusts.

DISCUSSION

In reviewing the summary judgment, the test is whether, with respect to any dispositive issue, there is any genuine issue as to any material fact and, if not, whether viewing the evidence and inferences which may be drawn therefrom in the light most favorable to the adverse party, the movant is entitled to prevail as a matter of law. Fruehauf Corp. v. Royal Exchange Assurance of America, Inc., 704 F.2d 1168, 1171 (9th Cir.1983); Retail Clerks Union Local 648 v. Hub Pharmacy, Inc., 707 F.2d 1030, 1033 (9th Cir.1983). The appellate court's task is identical to that of the trial court and the evidence is to be reviewed de novo. Ward v. United States Department of Labor, 726 F.2d 516, 517 (9th Cir.1984).

A. The Plaintiffs' Appeal

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