Local 495 UAW v. Diecast Corp.

• Decision Date: 28 March 1974
• Docket Number: No. 2,Docket No. 16206,2
• Citation: 217 N.W.2d 424,52 Mich.App. 372
• Parties: , 86 L.R.R.M. (BNA) 3004, 74 Lab.Cas. P 10,033 LOCAL 495 UAW, a collective bargaining agency, Plaintiff-Appellant, v. DIECAST CORPORATION and Jackson Die Company, Defendants-Appellees
• Court: Court of Appeal of Michigan — District of US

Page 424

217 N.W.2d 424

52 Mich.App. 372, 86 L.R.R.M. (BNA) 3004,

74 Lab.Cas. P 10,033

LOCAL 495 UAW, a collective bargaining agency, Plaintiff-Appellant, v. DIECAST CORPORATION and Jackson Die Company, Defendants-Appellees.

Docket No. 16206.

Court of Appeals of Michigan, Division No. 2.

March 28, 1974.

Released for Publication May 8, 1974.

Richard L. Wilkins, Rappleye, Bannasch & Wilkins, Jackson, for plaintiff-appellant.

Charles C. Hawk, Miller, Johnson, Snell & Cummiskey, Grand Rapids, for defendants-appellees.

Before LESINSKI, C.J., and HOLBROOK and BASHARA, JJ.

HOLBROOK, Judge.

Defendant Diecast Corporation initiated a profit-sharing plan for its employees on October 1, 1961. Under the terms of the plan, Diecast Corporation was required to contribute a sum equal to 20% Of the net profits of the company for each fiscal year in excess of 6% Of the book value of the company at the beginning of the year. However, the contribution was not to exceed 15% Of the compensation otherwise paid or accrued during that fiscal year to all participants in the program.

In 1965 Diecast Corporation and the plaintiff entered into a collective bargaining agreement. The agreement provided under article XIII, section 4:

'The profit-sharing program now in effect will be continued for the duration of this agreement. Employee distributions will be made by March 10 of each year. Certification by the corporate officer filing the federal tax return is conclusive. This program is not subject to the grievance procedure.'

This provision has been in each collective bargaining agreement since 1965.

Diecast Corporation paid nothing under the profit sharing plan to plaintiff's members in 1970, allegedly because there were insufficient profits to allow any contributions for profit sharing benefits. Diecast's failure to pay benefits in 1970 precipitated this suit. Plaintiff filed a complaint on June 23, 1971, against Diecast Corporation, and thereafter on September 1, 1971, filed an amended complaint which among other things added the defendant Jackson Die Company as a defendant. Pertinent portions of the original complaint and amended complaint containing plainiff's allegations read as follows:

Original Complaint

'6. That in the year 1970, the defendant Diecast Corporation reported its profits to be so low that it was unable to participate in the profit sharing plan as set out above.

'7. That all records, vouchers and books of the business are kept by the officers of the defendant at its principal place of business and the plaintiff officers have not been permitted to see such documents for the purpose of examination of the said records. For this reason plaintiff has no means at its command to determine the amounts due the employees under this profit sharing plan with the defendant.

'8. That during the period that this profit sharing plan has been in operation the defendant, Diecast Corporation, has never accounted to plaintiff, as representative of the employees of Diecast Corporation, for the amounts paid under the profit sharing plan.

'9. That defendant should be required to account to plaintiff for such net profits received by the defendant. And in order that said accounting may properly be had, the defendant should be required to show the records of its net profits for the fiscal year of 1970.'

Amended Complaint, Count I

'4. That defendant Diecast Corporation should be required to certify to plaintiff the book value of defendant Diecast Corporation at the beginning of each year from the inception of said profit sharing plan to and including January 1, 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.

'5. That defendant Diecast Corporation should be required to certify to plaintiff the net profit of defendant Diecast Corporation, as that term is defined under said profit sharing plan, for each year from the inception of said profit sharing plan to and including the net profits for the year 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.

'6. That defendant Diecast Corporation should be required to certify to plaintiff the total amount of defendant Diecast Corporation's contribution to said profit sharing plan for each year from the inception of said profit sharing plan to and including the year 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.

'7. That defendant Diecast Corporation should be required to certify to plaintiff the total number of full days worked by all employees participating in said profit sharing plan for each year from the inception of said profit sharing plan to and including the year 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.

'8. That defendant Diecast Corporation should be required to furnish to plaintiff the federal income tax returns of defendant Diecast Corporation for each year from the inception of said profit sharing plan to and including the year 1971 for verification of the amount of net profit of defendant Diecast Corporation for each year from the inception of said profit sharing plan to and including the year 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.

'9. That defendant Diecast Corporation should be required to provide to plaintiff records of defendant Diecast Corporation for verification of the book value of defendant Diecast Corporation at the beginning of each year from the inception of said profit sharing plan to and including the year 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.

'10. That defendant Diecast Corporation should be required to certify to plaintiff the total number of employees participating in said profit sharing plan for each year from the inception of said plan through and including the year 1971, which defendant Diecast Corporation has failed, refused and/or neglected to do.'

Amended Complaint, Count II

'9. Because of the fiduciary duty owed to the employees of Diecast Corporation, because of the fact that Jackson Die Company may derive all its revenue from Diecast Corporation and because of the fact that Diecast Corporation and Jackson Die Company are conducting their business as a single corporate entity, instead of distinctive separate entities, defendants Diecast Corporation and Jackson Die Company should account to plaintiff for all revenues paid to Jackson Die Company for work performed by employees of Jackson Die Company, and should account to plaintiff for all receipts from Jackson Die Company for rent, utilities and other expenses of operating Jackson Die Company which would normally be paid by Jackson Die Company, but on information and belief are not so paid, and should furnish to plaintiff all records necessary to determine whether excessive amounts have been paid to Jackson Die Company.'

On October 4, 1972, the defendants filed a motion for accelerated judgment, alleging that the circuit court lacked jurisdiction to hear the case. On December 27, 1972, the trial judge granted the defendant's motion on the grounds that the allegations in plaintiff's complaint, if proved, constituted an unfair labor practice under § 8(a)(5) of the National Labor Relations Act (hereinafter NLRA), 29 U.S.C.A. § 158(a)(5), and was, therefore, solely within the jurisdiction of the National Labor Relations Board (hereafter NLRB), under the preemption rule announced in San Diego Building Trades Council v. Garmon, 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775 (1959). Plaintiff now appeals, claiming the trial court erred in holding that it did not have subject matter jurisdiction to hear this case.

The jurisdictional rules in this area are fairly straightforward. San Diego Building...