Kennet v. United Mineworkers of America

• Decision Date: 16 May 1960
• Docket Number: Civ. A. No. 1616-57.
• Citation: 183 F. Supp. 315
• Parties: James E. KENNET, Plaintiff, v. UNITED MINEWORKERS OF AMERICA, Defendants.
• Court: U.S. District Court — District of Columbia

183 F. Supp. 315

James E. KENNET, Plaintiff, v. UNITED MINEWORKERS OF AMERICA, Defendants.

Civ. A. No. 1616-57.

United States District Court District of Columbia.

May 16, 1960.

Warren Miller, Washington, D. C., on behalf of the plaintiff.

Edward L. Carey, and Charles L. Widman, Washington, D. C., on behalf of the defendants.

HOLTZOFF, District Judge.

This action involves the rights of beneficiaries of a welfare and retirement fund established under the auspices of the United Mineworkers of America, and more specifically, the extent and scope of judicial review of actions of trustees of the fund in passing upon applications for benefits under the fund.

This is the trial of an action brought by a former coal miner to establish his right to an old-age pension under the welfare and retirement fund created by the United Mineworkers of America. The case has been tried without a jury.

The plaintiff had applied for a pension, his pension had been granted and he received some payments for a comparatively short period of time. Subsequently, on further investigation, his pension was terminated. This action was brought, in effect, to set aside the decision of the trustees terminating the plaintiff's pension and seeking judgment establishing his right to a pension and judgment for past installments claimed to be due.

One of the outstanding social problems that has bothered mankind for centuries has been the plight of elderly people when they reach an age when they were no longer able to earn a livelihood. The average person, as he approached that age, looked with dread upon what the future held in store for him. It was only in our own times that a successful attempt was made to solve this problem on a large scale. This far-reaching step has been one of the great advances in our social life. Financial security in old age is something that mankind has sought but never achieved until recent years. This has been accomplished in part by the Social Security Act, 42 U.S.C.A. § 301 et seq. and in part by the establishment of individual welfare and pension funds.

Insofar as the ranks of labor are concerned, the Labor Management Relations Act of 1947, Act of June 23, 1947, 61 Stat. 157, 29 U.S.C.A. § 186, authorized the establishment of welfare funds by employers for the sole and exclusive benefit of the employees of the employer and their families and dependents, either separately or jointly with the employees of other employers making similar payments. The Act provided that such payments might be made by the employer to a representative of the employees and were to be held in trust for medical or hospital care, pensions on retirement or death, compensation for injuries or illness, unemployment benefits, and similar purposes. The statute further provided that the detailed basis on which such payments were to be made was to be specified in a written agreement with the employer and, further, that the employees and employers were to be equally represented in the administration of that fund, together with such neutral persons as the two groups might agree upon.

Pursuant to this statutory authority, the operators of coal mines entered into an agreement with the labor union representing coal miners, known as the United Mineworkers of America, on March 5, 1950. This agreement is known as the National Bituminous Coal Wage Agreement of 1950. In general it prescribed with a considerable degree of particularity, the terms of employment that were to govern the employees of coal mines whose owners were parties to the agreement. Among other things it regulated the number of hours constituting a work day, the rate of wages to be paid to employees, and various other matters relating to conditions of employment. In addition, this agreement created a fund, known as the United Mineworkers of America Welfare and Retirement Fund of 1950. It provided that each operator was to pay into the fund a certain specified amount per ton of coal produced by him. The fund was to be operated by a Board of Trustees named in the agreement. It was further provided that certain payments were to be made for purposes enumerated in the instrument. Among such purposes were benefits on account of retirement. The trustees were given authority with respect to questions of coverage and of eligibility, amounts of benefits, and the like, subject to the stated purposes of the fund and within the terms and provisions of the Labor Management Relations Act.

Acting pursuant to this agreement, the trustees of the fund promulgated a set of regulations entitled Resolution 20, governing the payment of pensions to members of the United Mineworkers of America. The pertinent provisions of these regulations relate to eligibility to a pension. Three requirements are contained in the regulations governing eligibility: first, the applicant for a pension must have been a member of the United Mineworkers of America who had completed twenty years of service in the coal industry on or after May 29, 1946; second, he must have attained the age of sixty-two on May 29, 1946, or earlier; and, third, he must have retired from the bituminous coal industry on or after May 29, 1946.

On May 2, 1949, the plaintiff, James E. Kennet, filed an application for a pension with the trustees of the fund. This application showed that the plaintiff had been employed in the coal industry from April 1901 until June 1931, and again from September 1948 to March 1949. On the face of the application the plaintiff came within the terms of eligibility and a pension was granted to him. Subsequently, an investigation was made by the trustees, who reached the conclusion that the last employment of the plaintiff in the coal industry claimed to have been between September 1948 and March 1949 was colorable and not bona fide and that, therefore, the plaintiff was not entitled to a pension. Accordingly, the pension was terminated and this suit was brought.

The first question to be determined is the nature of the rights of employees for whose benefit the fund was established and the scope of judicial review of decisions of the trustees of the fund. It seems to be urged, in effect, that employees for...