Laborers' Pension Fund v. Blackmore Sewer Const.
| Decision Date | 24 July 2002 |
| Docket Number | No. 00-1975.,No. 00-1112.,00-1112.,00-1975. |
| Citation | 298 F.3d 600 |
| Parties | LABORERS' PENSION FUND and Laborers' Welfare Fund of the Health and Welfare Department of the Construction and General Laborers' District Council of Chicago and Vicinity, Plaintiffs-Appellees, v. BLACKMORE SEWER CONSTRUCTION, INCORPORATED, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Stanley Eisenstein (argued), Katz, Friedman, Eagle, Eisenstein & Johnson, Chicago, IL, for Plaintiffs-Appellees.
Ralph A. Mantynband (argued), Shefsky & Froelich, Chicago, IL, for Defendant-Appellant.
Before: HARLINGTON WOOD, JR., KANNE and ROVNER, Circuit Judges.
Blackmore Sewer Construction, Inc. (hereafter "Blackmore") employs a shotgun approach in this appeal of a grant of summary judgment in favor of Laborers' Pension Fund and Laborers' Welfare Fund of the Health and Welfare Department of the Construction and General Laborers' District Council of Chicago and Vicinity (hereafter "the Funds"). We conclude that all of Blackmore's arguments miss the broad side of the barn in this appeal, and we affirm.
The Funds are large, multi-employer pension, health and welfare funds. Blackmore was a long-time contributing employer to the Funds, but in March 1998, Blackmore suddenly ceased submitting reports and contributions to the Funds. The Funds brought suit under Section 515 of the Employment Retirement Security Act of 1974 ("ERISA") and Section 301 of the Labor Management Relations Act ("LMRA") to recover unpaid contributions and to force Blackmore to submit reports on which the Funds relied to administer their accounts. See 29 U.S.C. § 1145 and 29 U.S.C. § 185. The Funds, acting as an agent for the Construction and General Laborers' District Council of Chicago and Vicinity (hereafter "the Union") also sought recovery of union dues owed by Blackmore under a collective bargaining agreement with the Union.
We begin by considering the contracts on which the Funds base their claims. On August 15, 1991, Blackmore entered into a collective bargaining agreement (hereafter "the Agreement") with the Union. The original term of the Agreement ran through May 31, 1995, but the Agreement provided that Blackmore would be bound to successive agreements unless it provided the Union with notice of its intent to terminate the Agreement:
This Agreement shall remain in full force and effect through the 31st day of May, 1995 and shall continue thereafter unless there has been given not less than sixty (60) days nor more than ninety (90) days from the expiration date written notice by registered or certified mail by either party hereto of the desire to modify and amend this Agreement through Negotiations. In the absence of such notice the EMPLOYER and the UNION agree to be bound by the area-wide negotiated contracts with the various Associations incorporating them into this Agreement and extending this Agreement for the life of the newly negotiated contract.
R. 18, Ex. A, ¶ 9. Blackmore does not dispute that it never gave this notice, and Blackmore thus became bound to two successor agreements, one that covered the time period from June 1, 1995 through May 31, 1998, and one that began on June 1, 1998 and covered the time period involved in this case. Although contribution rates changed with the successive agreements, the duties and obligations of the participating employers, at least as they relate to this case, remained the same.
Each Agreement bound Blackmore to Declarations of Trust establishing the Funds, and set forth Blackmore's contribution obligations into the respective Funds:
The EMPLOYER agrees ... to become bound by and be considered a party to the Agreements and the Declaration of Trust creating said Trust Funds as if (he)(it) had signed the original copies of the Trust Instruments and amendments thereto....
The EMPLOYER further affirms and re-establishes that all prior contributions paid to the Welfare and Pension Funds were made by duly authorized agents of the EMPLOYER at the proper rates for the appropriate periods of time and that by making said prior contributions the EMPLOYER evidences the intent to be bound by the terms of the Trust Agreement and Collective Bargaining Agreements which were operative at the time the contributions were made, acknowledging the report form to be a sufficient instrument in writing to bind the EMPLOYER to the applicable agreements.
R. 18, Ex. A, ¶ 3.
A master collective bargaining agreement, which was incorporated into Blackmore's shorter memorandum agreement with the Union, established the contribution rates, and also obligated Blackmore (and other employers) to produce their books and records to the Funds on request so that the Funds could determine compliance with the Agreement. Blackmore never terminated its participation in the Funds, and for six and a half years, it remained a contributing employer, regularly submitting a monthly contribution report and paying contributions at the prevailing contractual rates. With each monthly report, Blackmore signed a statement further binding itself to the then current collective bargaining agreement as well as the respective trust agreements:
EMPLOYER'S WARRANTY AND ACCEPTANCE:
The undersigned employer hereby warrants that this report accurately states all hours worked by all laborers in its employ. In addition, the employer hereby agrees to be bound to the terms of the current collective bargaining agreement executed between the Construction and General Laborers' District Council of Chicago and Vicinity and the relevant Multi-Employer Associations. Further, the undersigned hereby expressly accepts and agrees to be bound by the trust agreements governing Laborer's Pension and Welfare, et al. and accepts all of the terms thereof with the intention of providing benefits to its laborers.
R. 17, Ex. C. Blackmore signed this statement repeatedly, made contributions and submitted reports as it was obliged to do under the various agreements. In March 1998, Blackmore ceased submitting reports and contributions.1
The Funds brought suit on August 7, seeking to audit Blackmore's books and records and to recover all delinquencies. The district court characterized the case as a routine ERISA collection action and, in an Order dated August 17, set the case on an expedited discovery and trial schedule. Discovery was to be completed by November 30, and the parties were to be ready for trial on five days' notice any time after November 30. When Blackmore failed to answer or otherwise plead in a timely fashion, the district court entered a default judgment in favor of the Funds on October 14. Blackmore subsequently moved to vacate the default, and the court granted that motion on November 10. The court again ordered that discovery be closed November 30, and set a trial date of December 14. On November 19, the Funds moved for summary judgment on liability only and sought an order compelling an audit to determine the amount of the delinquent contributions. Blackmore responded with a demand for arbitration and a motion to stay the case pending the arbitration. The court denied the motion to stay pending arbitration. Blackmore responded to the motion for summary judgment and served a Request for Admissions on the Funds on November 25. On November 30, the district court entered judgment in favor of the Funds on liability and ordered Blackmore to submit to an audit. Following the audit, the Funds moved for judgment in a sum certain. Blackmore opposed that motion. On December 29, 1999, the district court entered judgment in the amount of $78,106.54, which represented unpaid contributions and union dues, liquidated damages, interest, costs, and attorney's fees. The Funds subsequently sought an adjustment to the award of attorney's fees, which the district court granted in part. Finally, the district court granted the Funds' motion for a turnover order pursuant to a citation served on the Suburban Bank of Barrington. Blackmore appeals.
Blackmore raises several challenges to the district court's judgment in favor of the Funds. First, Blackmore maintains that the Funds failed to respond to Requests for Admission served on the Funds on November 25, and that the Funds' silence must be construed as an admission of all of the allegations contained therein. In an adjunct argument, Blackmore maintains that its Requests for Admission were not untimely under the District Court's discovery order because requests for admission are not items of discovery and thus were not subject to the court's discovery cutoff date. Second, Blackmore contends that the trial court erred in resolving against Blackmore the question of whether Blackmore had evidenced an unequivocal intent to be bound by a collective bargaining agreement negotiated by a trade association of which Blackmore was not a member and which Blackmore had not authorized to act on its behalf. Third, Blackmore faults the district court for relying on the signed monthly reports which contained a statement binding Blackmore to future collective bargaining agreements because Blackmore maintains that it made a mistake of fact in signing these documents. Fourth, Blackmore posits that the district court abused its discretion and denied it due process when it refused to allow Blackmore to respond to the Funds' motion for a turnover order. Fifth, Blackmore objects to the amount of attorney's fees awarded the Funds, claiming the court made no finding regarding the reasonableness of the fees claimed. Finally, Blackmore contends that the contracts in question were subject to the Federal Arbitration Act.
We will address the issues related to the Requests for Admission first because many of Blackmore's arguments depend on the outcome of these issues. Blackmore served its Requests for Admission on the Funds on November 25. The district court had previously set...
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