Colgan v. Rae-Ann Elec. Co.

• Decision Date: 31 December 1980
• Docket Number: Nos. 80-109,80-110 and 80-111,RAE-ANN,s. 80-109
• Citation: 91 Ill.App.3d 386,47 Ill.Dec. 227,414 N.E.2d 1343
• Parties: , 47 Ill.Dec. 227, 93 Lab.Cas. P 55,317 Robert W. COLGAN, John Ostrow, Frank H. Bertke, H. E. Autrey, Donald E. Cates, Carl T. Hinote, Joe R. Devish, John D. Hilburn, Sr., Allen L. Bader, Warren E. Losh, and Charles W. Stroupe, Trustees of the National Electrical Industry Fund, Plaintiffs-Appellants, v.ELECTRIC CO., a corporation, Defendant-Appellee, v. G & S ELECTRIC COMPANY, a corporation, Defendant-Appellee, v. Kenneth L. STALZER, d/b/a Peyla Electrical Company, a Corporation, Defendant-Appellee.
• Court: United States Appellate Court of Illinois

Page 1343

414 N.E.2d 1343

91 Ill.App.3d 386, 47 Ill.Dec. 227,

93 Lab.Cas. P 55,317

Robert W. COLGAN, John Ostrow, Frank H. Bertke, H. E.

Autrey, Donald E. Cates, Carl T. Hinote, Joe R. Devish, John

D. Hilburn, Sr., Allen L. Bader, Warren E. Losh, and Charles

W. Stroupe, Trustees of the National Electrical Industry

Fund, Plaintiffs-Appellants, v. RAE-ANN ELECTRIC CO., a corporation, Defendant-Appellee, v. G & S ELECTRIC COMPANY, a corporation, Defendant-Appellee, v. Kenneth L. STALZER, d/b/a Peyla Electrical Company, a

Corporation, Defendant-Appellee.

Nos. 80-109, 80-110 and 80-111.

Appellate Court of Illinois, Third District.

Dec. 31, 1980.

Rehearing and Certificate of Importance Denied Jan. 27, 1981.

George F. Mahoney, III, Herschbach, Tracy, Johnson, Bertani & Wilson, Joliet, for plaintiffs-appellants.

Bruce Falk, Codo, Bonds & Zumstein, P. C., Joliet, for defendant-appellee.

SCOTT, Justice:

These three cases, Colgan v. Peyla Electrical Company, Colgan v. G & S Electric, and Colgan v. Rae-Ann Electric, were consolidated for hearing below by the Circuit Court of Will County. In each case, the Circuit Court ruled against the plaintiffs who alleged they were third-party beneficiaries under a collectively bargained labor contract. We conclude, as did the court below, that the issues and facts in each case are sufficiently similar as to permit the three cases to be determined in a consolidated fashion. This decision will consider the facts and issues in each of the three cases and will set forth the relevant law in each instance.

The National Electrical Contractors Association (hereinafter N.E.C.A.) bargains on behalf of the employers of workers in the electrical trades to reach an agreement with the union representing such workers, the International Brotherhood of Electrical Workers (hereinafter I.B.E.W.). The agreement reached between N.E.C.A. and I.B.E.W. becomes a nationwide model for all labor contracts between electrical workers and their employers. The model contract has historically been adopted in the Joliet, Illinois, region by way of an Inside Agreement between the Joliet Chapter of N.E.C.A. and Local 176 of I.B.E.W. When the Inside Agreement containing the regional version of the labor contract is complete, the practice in the Joliet region has been to solicit an assent to the contract from each employer who hires union workers. These three disputes concern the enforcement of the terms of the Inside Agreement in the absence of an employer's assent.

On June 1, 1977, the Joliet Chapter of N.E.C.A. and Local 176 of I.B.E.W. reached an Inside Agreement, which along with other provisions and consistent with the nationwide model agreement, required the employers to make contributions to a National Electrical Industry Fund (hereinafter N.E.I.F.). The N.E.I.F. was established as a trust fund to fulfill numerous purposes, including the payment of costs relating to public relations for the industry, industry development, and employer's collective bargaining. The Inside Agreement containing the N.E.I.F. provision was sent to Kenneth L. Stalzer, an agent for Peyla Electrical Company, with a request for Peyla's assent to the terms of the labor contract. No express, written assent was ever given in response to the solicitation made although Peyla continued to employ tradesmen from Local 176. Consistent with Peyla's refusal to assent to the contract terms was its failure to make contributions to the N.E.I.F. as required by the contract.

The first of these three actions is brought against Peyla by the trustees of the N.E.I.F. who allege that in their fiduciary capacities they are third-party beneficiaries of the June 1, 1977, Inside Agreement, and that as a party to the agreement Peyla must make contributions to the N.E.I.F. As recounted at the outset, the circuit court, after reviewing the documents and listening to the evidence, determined that Peyla was not a party to the June 1, 1977, agreement and thus had no contractual duty to the plaintiff-trustees as third-party beneficiaries. The trustees believe that decision was in error and have appealed.

The first alleged error brought to our attention by the plaintiffs involves a finding by the trial judge. He determined that it was a custom of the Joliet Chapter and Local 176 to evidence in writing each employer's assent to a new inside agreement. Specifically, the judge below found that the custom in the Joliet region was to solicit a new assent from electrical contractors whenever a new agreement was reached. The trustees object to such a finding and rely on Traff v. Fabro (1949), 337 Ill.App. 83, 84 N.E.2d 874; Wilke Metal Products, Inc. v. David Architectural Metals, Inc. (1968), 92 Ill.App.2d 265, 236 N.E.2d 303; Marler v. Moultrie-Shelby Farm Service (1973), 11 Ill.App.3d 204, 295 N.E.2d 744; and Denniston v. Skelly Oil Co. (1977), 47 Ill.App.3d 1054, 6 Ill.Dec. 77, 362 N.E.2d 712. Essentially, each of these cases recites the judicial preference for multiple sources of evidence in proving matters of custom and usage. We have no quarrel with the preference set forth in the cited cases, but we do quarrel with the trustees' contention that only the testimony of Peyla's agent Stalzer supports the conclusion reached by the trial court. Our review of the record reveals that the custom and usage as determined by the court below was verified not only by the oral testimony of Stalzer but also by the documentary evidence of Peyla's 1971 letter of assent, its 1973 letter of assent, and its 1975 letter of assent. Further, the testimony of plaintiff's own witness, Harvey Shriver, tends to support the same finding. We believe these multiple sources of evidence, in addition to similar documentary evidence before the court in the companion cases, provides a more than adequate foundation for the conclusion reached by the circuit court regarding custom and usage in the Joliet region.

It is next argued by the plaintiffs that even if the defendant did not expressly assent to the 1977 agreement requiring N.E.I.F. contributions, nevertheless defendant is still bound to the terms of the 1977 agreement by reason of the continuing authority of the assent executed by defendant in 1975. That assent provides as follows:

"In signing this letter of assent, the undersigned firm does hereby authorize Joliet Chapter, National Electrical Contr. Assoc., Inc. as its collective bargaining representative for all matters contained in or pertaining to the current approved Inside labor agreement between the Joliet Chapter, National Electrical Contr. Assoc. Inc. and Local Union 176, I.B.E.W. This authorization, in compliance with the current approved labor agreement, shall become effective on the 1st day of June, 1975. It shall remain in effect until terminated by the undersigned employer giving notice to the Joliet Chapter, National Electrical Contr. Assoc. Inc. and to the Local Union at least one hundred fifty (150) days prior to the then current anniversary date of the aforementioned approved labor agreement."

The plaintiff-trustees urge us to interpret the quoted language as creating a continuing agency between the Joliet Chapter and the defendant whereby the latter, as principal, would be bound by contracts negotiated by the former until the agency was terminated with the requisite 150 day notice. Our construction of the provision is the same as applied by the court below.

We have read the cases cited by the plaintiffs in support of their construction of the letter of assent executed in 1975: Local Union No. 269 of the International Brotherhood of Electrical Workers v. John G. Fineran, Electrical Contractor, Inc. (1976), No. C-2630-75, Superior Court of New Jersey; Curtis L. Williams v. ITT Grinnel Industrial Piping, Inc. (1980), No. 780562-B,...