Robbins v. Lynch

Decision Date06 January 1988
Docket NumberNo. 87-1351,87-1351
Citation836 F.2d 330
Parties127 L.R.R.M. (BNA) 2257, 108 Lab.Cas. P 10,270, 9 Employee Benefits Ca 1519 Loran W. ROBBINS, et al., as trustees of the Central States, Southeast and Southwest Areas Pension Fund, et al., Plaintiffs-Appellees. v. Lee LYNCH and Minnie Lynch, doing business as Lynch Truck Service, Defendants- Appellants.
CourtU.S. Court of Appeals — Seventh Circuit

William M. Giffin, Pree & Pree, Springfield, Ill., for defendants-appellants.

Thomas C. Nyhan, Cent. States Law Dept., Chicago, Ill., for plaintiffs-appellees.

Before EASTERBROOK, MANION and KANNE, Circuit Judges.

EASTERBROOK, Circuit Judge.

Lynch Truck Service signed the national master collective bargaining agreement with the Teamsters in 1975, when it entered the business. The agreement expired on April 1, 1976; Lynch executed on April 2 a promise to be bound by any agreement thereafter concluded by the multiemployer and multiunion bargaining associations. Once agreement was reached, Lynch adhered to its terms. That agreement expired April 1, 1979. Following its practice, Lynch sent the local union on March 29, 1979, a promise to adhere to the next national agreement:

Want To Inform You We Are Willing To Pay What Ever The International And The Truckers Agree On For The New Contract Which Is Due 4-1-79. We Would Like To Contunie [sic] To Operate. If It Is O.K. With The Union And We Will Sign The New Contract. Please Send Us A Letter To That Effect.

The local did not reply, and Lynch never signed the agreement. But until the end of 1981, Lynch paid the wages called for by the 1979-82 agreement, made pension and welfare contributions per the agreement, negotiated and settled grievances under the terms of the agreement, and rendered to the local union the dues withheld from the pay of its members. On January 5, 1982, Lynch sent the local this letter:

Pursuant to Article 39 of the National Master Freight Agreement and Article 63 of the Local Agreement which was [sic] previously entered into, please be advised that Lynch Truck Service desires to cancel and terminate the Agreement and you are hereby notified accordingly.

The health and welfare trust funded under the agreement kept Lynch's employees on the rolls through the end of March 1982; the pension trust credited Lynch's employees with work through the end of March. The trustees of these two funds filed this suit under ERISA, 29 U.S.C. Secs. 1132(g)(2) and 1145, to recover the sums provided by the agreement and the damages authorized by statute for noncompliance. The funds initially requested roughly $10,000, but during discovery they learned that Lynch concealed the identities of some employees from the funds during 1979-82 and had paid nothing on their account. The funds ultimately received a judgment for more than $125,000.

Lynch's principal defense is that it never signed the 1979-82 agreement. So much is undisputed. It is also undisputed that Lynch promised in March 1979 to adhere to the agreement and gave signs of doing so. It paid the union scale, turned over dues under a checkoff system, negotiated grievances, and paid (some) pension and welfare contributions. It later invoked the termination clause of the agreement. Employers may adopt a collective bargaining agreement by a course of conduct. Gariup v. Birchler Ceiling & Interior Co., 777 F.2d 370 (7th Cir.1985); Capitol-Husting Co. v. NLRB, 671 F.2d 237, 243 (7th Cir.1982). Lynch did so.

The district court granted summary judgment to the funds, and Lynch protests that this is improper because it denies intending to be bound by the agreement. This disputed issue of fact calls for a trial, Lynch insists. But only a "material" dispute staves off summary judgment, Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 585-88, 106 S.Ct. 1348, 1355-57, 89 L.Ed.2d 538 (1986), and Lynch's undisclosed intent is not material. References in cases to the importance of "intent to be bound" are misleading if taken literally. As so frequently in law, "intent" is a conclusion rather than a fact. A signatory to a contract is bound by its ordinary meaning even if he gave it an idiosyncratic one; private intent counts only if it is conveyed to the other party and shared. E.g., Skycom Corp. v. Telstar Corp., 813 F.2d 810, 814-15 (7th Cir.1987); E. Allan Farnsworth, Contracts 113-16 (1982). You can't escape contractual obligation by signing with your fingers crossed behind your back, even if that clearly shows your intent not to be bound. The parties are free to sign hortatory as well as binding documents; "intent" is important in the sense that if the parties agree on a hortatory instrument the court may not convert it into a different kind. See Skycom. This sense of "intent" denotes agreement between the parties and is not a license to allow undisclosed intent to dominate. Even statutes, widely said to follow the "intent of the legislature", draw meaning only from visible indicators such as their structure, the nature of the problem at hand, and public statements (as in committee reports). Private intent is irrelevant. See Oliver Wendell Holmes, The Theory of Legal Interpretation, 12 Harv.L.Rev. 417 (1899), reprinted in Collected Legal Papers 203 (1920). So it is here. Lynch may have had a private intent, but the signs visible to the union all pointed to Lynch's acceptance of the collective bargaining agreement. Lynch is bound by its terms.

Albert L. Lynch, Jr., the proprietor of Lynch Trucking Service during the years in question, filed an affidavit contending (1) that the union represented that Lynch had signed the master agreement; (2) that the union threatened to strike unless Lynch included "certain employees within the Union and Pension Fund Contracts"; and (3) that Lynch "would not have complied with the demands of the Union if they had been properly informed of the facts". The only "facts" to which this could refer are the absence of the signed agreement and the threat to strike. Neither is material. The local union's reference to a signed agreement must have come after March 29, 1979, probably substantially afterward (the affidavit does not supply a date). By then Lynch was bound, under the approach of Gariup. The threat to strike is unexceptional. Unions frequently decline to work unless the employer adheres to a collective bargaining agreement. The threat of "no agreement, no work" hardly makes adherence to the agreement involuntary, as Lynch supposes. This is the threat, express or implied, of every contractual negotiation. (E.g., "Unless you pay my price, I won't sell you my iron ore.")

The court should indulge all reasonable inferences in favor of the person opposing the motion for summary judgment, United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962), and one inference...

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