Dwyer v. Climatrol Industries, Inc.

• Decision Date: 06 October 1975
• Docket Number: No. 73-C-201.,73-C-201.
• Citation: 403 F. Supp. 683
• Parties: Arthur DWYER et al., Plaintiffs, v. CLIMATROL INDUSTRIES, INC., a Foreign Corporation et al., Defendants.
• Court: U.S. District Court — Eastern District of Wisconsin

403 F. Supp. 683

Arthur DWYER et al., Plaintiffs, v. CLIMATROL INDUSTRIES, INC., a Foreign Corporation et al., Defendants.

No. 73-C-201.

United States District Court, E. D. Wisconsin.

October 6, 1975.

Eugene A. Kershek, Milwaukee, Wis., and Leonard W. Schulz, Big Bend, Wis., for plaintiffs.

Foley & Lardner by Herbert P. Wiedemann, Stanley S. Jaspan, Milwaukee, Wis., for Climatrol.

Zubrensky, Padden, Graf & Bratt by George F. Graf and Herbert S. Bratt, Milwaukee, Wis., for Union.

DECISION and ORDER

MYRON L. GORDON, District Judge.

The defendants have moved for summary judgment. The plaintiffs have moved to add Fedders Corporation as a party defendant and also to have a preliminary determination of law regarding the "doctrine of virtual representation." In view of my finding that the motions for summary judgment submitted by the defendants must be granted, there is no occasion for my resolving the plaintiffs' applications.

The nature of this action was considered by the court in a memorandum dated February 4, 1975, at which time the court considered the motion for dismissal filed by the defendant union as well as other motions. No useful purpose would be served by my repeating here the analysis of the complaint contained in the February 4, 1975, decision.

In connection with the motions for summary judgment, the parties have submitted a substantial amount of material, much of it uncontested. The court now has before it not only the contracts in question but also many meaningful affidavits. A consideration of all these materials persuades me that no substantial issues of fact remain in dispute. Only issues of law remain, and they are capable of resolution upon the records and files presently before the court.

A "Plant Closedown Agreement" was signed between Fedders and the union on December 15, 1971. It is my conclusion that such closedown agreement does not constitute a violation of either the collective bargaining agreement or the pension plan agreement. The latter contract, which was signed on March 1, 1970, contains the following provision (section 12.01):

"The Plan may be modified, altered or amended upon mutual agreement of the Company and the Union."

Pursuant to that authorization, an amendment of section 9.01 was consummated on December 15, 1971; it provided that the company would contribute $160,000 to the pension fund, and upon such payment, it would have "no further funding obligation under the Plan." Thus, when the $160,000 was paid into the trust fund, the financial responsibility of the employer was contractually satisfied.

The plaintiffs urge that the closedown agreement was ineffective because the unions were without legal capacity to negotiate away the plaintiffs' rights. This contention is effectively negated by the express terms of section 12.01 of the pension plan agreement quoted above. Accordingly, it is my opinion that the closedown agreement is binding upon the plaintiffs as a matter of contract law, and it is unnecessary to determine whether the plaintiffs, as individuals, ratified the amendment. In Waters v. Wisconsin Steel Works of International Harvester Co., 427 F.2d 476, 489 (7th Cir.), cert. denied, 400 U.S. 911, 91 S.Ct. 137, 27 L.Ed.2d 151 (1970), the court said:

"Since parties to a labor contract are always free to amend their agreements, we do not see how an amendment through the ordinary processses of collective bargaining can be considered a breach of contract." 427 F.2d at 489.

The plaintiffs urge, however, that they had vested interests in the pension program and that they qualified as third party beneficiaries whose interests could not be altered by the original contracting parties. In my opinion, the case of Thornberry v. MGS Co., Inc., 46 Wis.2d 592, 176 N.W.2d 355 (1970), contradicts this contention. The plaintiffs' rights under...