Myhalyk v. Lewis

• Decision Date: 18 January 1960
• Citation: 88 A.L.R. 2d 486,158 A.2d 305,398 Pa. 395
• Parties: , 88 A.L.R.2d 486 Mike MYHALYK v. John L. LEWIS, Henry G. Schmidt, Josephine Roche, Trustees of United Mine Workers of America Welfare and Retirement Fund and United Mine Workers of America Welfare and Retirement Fund, Appellants, and (Pittsburgh Consolidation Coal Company, Garnishees).
• Court: Pennsylvania Supreme Court

Page 305

158 A.2d 305

398 Pa. 395, 88 A.L.R.2d 486

Mike MYHALYK v. John L. LEWIS, Henry G. Schmidt, Josephine Roche, Trustees of United Mine Workers of America Welfare and Retirement Fund and United Mine Workers of America Welfare and Retirement Fund, Appellants and (Pittsburgh Consolidation Coal Company, Garnishees).

Supreme Court of Pennsylvania.

Jan. 18, 1960.

Rehearing Denied March 10, 1960.

A. E. Kountz, Alexander Unkovic, Kountz, Fry & Meyer, Pittsburgh, for appellant.

Charles E. McKissock, Pittsburgh, for appellees.

Before CHARLES ALVIN JONES, C. J., and BELL, BENJAMIN R. JONES, COHEN, BOK and McBRIDE, JJ.

BENJAMIN R. JONES, Justice.

The basic issue in this appeal is the amenability of the United Mine Workers of America Welfare and Retirement Fund (herein termed Fund) to a writ of foreign attachment issued in Pennsylvania. The determination of this issue is of vast importance not only to the Fund but also to hundreds of bituminous coal miners, resident in Pennsylvania, who, in the event that the Fund is not amenable to such writ of foreign attachment in this state, would be compelled to present claims against the Fund in the District of Columbia.

Pursuant to the provisions of Section 302(c) of the Labor-Management Relations Act of 1947 ¹ certain bituminous coal operators and the United Mine Workers of America on March 5, 1950 entered into a written agreement which established the Fund. That agreement created the Fund as an 'irrevocable trust' to be administered by three 'trustees'. Insofar as relevant, the stipulated facts are: (1) the office of the Fund--where its meetings are held and records maintained is in Washington, D. C.; (2) with the exception of the monthly royalties due from the coal operators, the assets of the Fund--all personalty--are located in Washington; (3) the Fund maintains two 'area medical locations' in Pennsylvania--Johnstown and Pittsburgh--and numerous Pennsylvania residents have received and are receiving benefits from the Fund; (4) the Pennsylvania bituminous coal operators on the 10th of each month pay, by check, directly to the Fund's office in Washington all royalties due from them on coal mined during the preceding calendar month and such payments are deposited in the Fund's General Account in Washington; (5) the Fund has established in Washington another account known as the Pension Account utilized for the payment of pensions and annuities to beneficiaries of the Fund and 'from time to time the Trustees by formal action provide for and direct the transfer of certain sums of money from the General Account * * * to the said separate Pension Account' to be used exclusively for the payment of pensions; (6) on numerous occasions in order to enforce the obligation of the coal operators to pay royalties into the Fund, the Fund has instituted legal proceedings in the Western and Middle District Federal Courts in Pennsylvania.

The modus operandi of the Fund is: the bituminous coal operators each month pay into the Fund 40cents per ton for each ton of coal mined; from such moneys, the Fund makes disbursements (1) 'for medical or hospital care, pensions on retirement or death of employees, compensation for injuries or illness resulting from occupational activity or insurance to provide any of the foregoing, or life insurance, disability and sickness insurance or accident insurance; (2) benefits with respect to wage loss not otherwise compensated for at all or adequately by tax supported agencies created by federal or State law; (3) benefits on account of sickness, temporary disability, permanent disability, death or retirement; (4) benefits for any and all other purposes which may be specified * * *; and (5) benefits for all other related welfare purposes as may be determined by the Trustees * * *.'

Myhalyk, the appellee, a resident of Allegheny County, on December 12, 1958 caused a writ of foreign attachment, followed by a complaint, to be filed in the Court of Common Pleas of Allegheny County wherein the Fund's three trustees and the Fund were named defendants and the Pittsburgh Consolidation Coal Co., garnishee. Myhalyk's complaint averred, inter alia: (1) his place of residence and his membership in the United Mine Workers of America; (2) that the garnishee coal company had moneys in its possession due and owing to the Fund and to that extent the Fund had property whose situs was in Pennsylvania; (3) a statement of the requirements set up by the Fund's trustees which must be met by applicants for pension benefits together with an averment that Myhalyk met such requirements; (4) that, on July 20, 1952, Myhalyk applied for pension benefits and that the Fund has not only refused to pay such pension benefits but has even refused to accept his application for such benefits. Myhalyk's complaint sought a judgment against the Fund and the issuance of a direction to the Fund that he, Myhalyk, be paid a monthly pension of $100 beginning July 20, 1952, Myhalyk and the garnishee entered into a stipulation wherein the garnishee argeed that it had in its possession $15,000 due the Fund and Myhalyk agreed that the garnishee pay all amounts in excess of $15,000 to the Fund. On January 21, 1959, counsel for the Fund and its trustees entered an appearance de bene esse and filed preliminary objections raising the question of the jurisdiction of the Court of Common Pleas of Allegheny County. After the parties had entered into a stipulation of facts, the Court below dismissed appellants' preliminary objections and that order is the subject of this appeal.

Appellants contend that the Fund is a trust, and, in view of Congress' ordination in the Labor-Management Act of 1947, supra, that a welfare fund be created and operated as a trust, the Pennsylvania courts must hold the Fund to be a trust; as a trust, the Fund and its trustees are not amenable to a writ of foreign attachment in Pennsylvania; in the event that the Pennsylvania courts assert jurisdiction, appellants are deprived of property without due process and equal protection of the law in violation of the Constitution of the United States, Amend. 14.

Foreign attachment, an extraordinary process, can take place only within the framework of Rules 1251 et seq. of the Rules of Civil Procedure, 12 P.S. Appendix. Rule 1252 provides that foreign attachment may be issued to attach property of a defendant * * * when (1) defendant is a non-resident individual, although present in Pennsylvania, (2) defendant is a partnership or unincorporated association without a regular place of business in Pennsylvania and the action is against defendant in its firm or association name, and (3) defendant is a foreign corporation or similar entity even though registered in Pennsylvania. To sustain a foreign attachment proceeding not only must non-residence and the situs of real or personal property within Pennsylvania be established (Fairchild Engine & Airplane Corporation v. Bellanca Corporation, 391 Pa. 177, 137 A.2d 248) but the defendant must fall within one of the classifications embraced within Rule 1252, supra.

The identical problem herein presented was before the Superior Court in Stampolis v. Lewis, 186 Pa.Super. 285, 142 A.2d 348, allocatur refused Supreme Ct., certiorari denied 359 U.S. 907, 79 S.Ct. 582, 3 L.Ed.2d 572. Judge Ervin, speaking for the majority of that Court, stated (186 Pa.Super. at pages 287, 288, 142 A.2d at page 349): 'The writ was issued pursuant to Pa.R.C.P. No. 1251 et seq., which provide that foreign attachment may be issued to attach the property of a defendant upon any cause of action at law or in equity in which the relief sought includes a judgment or decree for the payment of money when the defendant is an unincorporated association without a regular place of business in the Commonwealth or is a foreign corporation or similar entity. Rule No. 2151 defines 'association' as meaning an unincorporated association conducting any business or engaging in any activity of any nature whether for a profit or otherwise under a common name. Rule 2176 defines 'similar entity' as any insurance association or exchange or any other association which is regarded as an entity distinct from the members composing the association. The word 'association' is defined in Black's Law Dictionary, Third Edition, as: 'The act of a number of persons in uniting together for some special purpose or business. The persons so joining. It is a word of vague meaning used to indicate a collection of persons who have joined together for a certain object.' 7 C.J.S. Associations § 1 sets forth that the word 'association' 'is used to indicate a collection of persons who have united or joined together for some special purpose or business. * * * The term 'associati...