Rush v. Martin Petersen Co., Inc.

• Decision Date: 10 May 1996
• Docket Number: No. 95-2727,95-2727
• Citation: 83 F.3d 894
• Parties: 20 Employee Benefits Cas. 1316, Pens. Plan Guide P 23920W Jack A. RUSH, Plaintiff-Appellant, v. MARTIN PETERSEN COMPANY, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 894

83 F.3d 894

20 Employee Benefits Cas. 1316, Pens. Plan Guide P 23920W

Jack A. RUSH, Plaintiff-Appellant, v. MARTIN PETERSEN COMPANY, INC., Defendant-Appellee.

No. 95-2727.

United States Court of Appeals Seventh Circuit.

Argued Feb. 16, 1996.

Decided May 10, 1996.

Christa A. Reisterer, argued, Jeffery R. Brodek, Demark, Kolbe & Brodek, Racine, WI, for Plaintiff-Appellant.

Thomas B. Hartley, argued, Paul B. Wokwicz, Guttormsen, Hartley & Guttormsen, Kenosha, WI, for Defendant-Appellee.

Before EASTERBROOK, RIPPLE, and TERRANCE T. EVANS, Circuit Judges.

TERRANCE T. EVANS, Circuit Judge.

Jack Rush was hired by the Martin Petersen Company as an office manager in 1962. The Martin Petersen Company was a small organization, consisting at that time of six or seven sheet metal workers, Vice President Earl Cowen, and the president of the company, Martin Petersen, Jr. In 1966, the Sheet Metal Workers' National Pension Fund was established, and the company began to contribute to it on behalf of its unionized sheet metal workers. As office manager, Rush was responsible for the administrative work that the pension plan entailed. His duties included the preparation of monthly reports listing all employees in the pension plan and the number of hours they worked, in order to determine how much to contribute to the pension plan on behalf of each worker. Rush did everything but sign the checks; once the remittance amounts were calculated, the checks were presented for signature to Cowen or Petersen.

The company contributed to the fund not only in the names of the sheet metal workers, but also on behalf of Rush, who was neither a sheet metal worker nor a member of the union. These payments continued until 1986, when the pension fund informed the company that payments on behalf of nonunion employees had been made erroneously; only union members were eligible to participate in the plan. The company was informed that it could choose to either file an application for a class-wide exception to the plan's eligibility requirements, or request a refund of all erroneous contributions to the fund. The company chose to request a refund of the contributions made on behalf of Rush since 1966. Eventually, a refund of $30,436 was received from the plan.

In 1972, the Martin Petersen Company established a profit-sharing plan for its nonunion employees and began to make contributions to the new plan on Rush's behalf. When Rush retired from the company in June of 1987, he received a lump-sum payment of about $96,000 from the profit-sharing plan.

Dissatisfied with his $96,000 retirement benefit, Rush filed a complaint in the Eastern District of Wisconsin in September of 1992. The complaint raised only one claim: breach of fiduciary duty. This claim was based on an alleged oral promise made in 1966. The case went to trial in 1995.

Rush, during the trial, gave a great deal of contradictory testimony. One thing he was sure of, however, was that sometime in 1966 someone at the Martin Petersen Company told him he would receive a retirement benefit in the form of an annuity and this benefit was somehow related to the pension plan. He first said this promise had been made by Cowen. This assertion was the basis for a company move to get out of the case on summary judgment, in part because Cowen had died, and Rush could not base a claim on an alleged oral agreement with a deceased employee. Rush then said it may have been Petersen who made the promise, and he later testified at the trial that both men were present when the promise was made. After sorting through this testimony, and looking to the evidence of consistent benefit payments...