Short v. United Mine Workers of America 1950 Pension Trust, 83-1220

• Decision Date: 28 February 1984
• Docket Number: No. 83-1220,83-1220
• Citation: 728 F.2d 528
• Parties: 115 L.R.R.M. (BNA) 3017, 234 U.S.App.D.C. 247, 100 Lab.Cas. P 10,844, 5 Employee Benefits Ca 1532 Arthur E. SHORT v. UNITED MINE WORKERS OF AMERICA 1950 PENSION TRUST, et al., Appellants.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 528

728 F.2d 528

115 L.R.R.M. (BNA) 3017, 234 U.S.App.D.C. 247,

100 Lab.Cas. P 10,844,

5 Employee Benefits Ca 1532

Arthur E. SHORT v. UNITED MINE WORKERS OF AMERICA 1950 PENSION TRUST, et al., Appellants.

No. 83-1220.

United States Court of Appeals District of Columbia Circuit.

Argued Nov. 23, 1983.

Decided Feb. 28, 1984.

Appeal from the United States District Court for the District of Columbia (Civil Action No. 82-2180).

William F. Hanrahan, Washington, D.C. with whom Jeanne K. Beck, Washington, D.C., was on brief, for appellants.

David J. Frantz, Washington, D.C., for appellee.

Before MIKVA and EDWARDS, Circuit Judges, and BAZELON, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge HARRY T. EDWARDS.

HARRY T. EDWARDS, Circuit Judge:

This case is an appeal from a decision of the District Court granting summary judgment for plaintiff Arthur E. Short, a retired mine worker whose pension application was denied by the Trustees of the United Mine Workers of America 1950 Pension Trust. Short was forced to retire from coal industry employment at age 46 because of black lung disease; he would have been eligible for a pension when he reached age 55 if the eligibility criteria in effect at the time of his retirement had not subsequently been changed.

In granting summary judgment for Short, the District Court relied on a line of cases holding that it is unreasonable, and hence a breach of fiduciary duty, for the Trustees to adopt new eligibility requirements and apply them to deny the pension application of a miner in Short's situation. Those cases were decided, however, at a time when the Trustees had full authority to establish and apply eligibility criteria. In the present case, in contrast, the Trustees are required to enforce the eligibility requirements set forth in the industry's collective bargaining agreement. This case is therefore governed by the Supreme Court's decision in United Mine Workers of America Health & Retirement Funds v. Robinson, 455 U.S. 562, 102 S.Ct. 1226, 71 L.Ed.2d 419 (1982). That decision establishes that federal courts do not have authority to review collectively bargained eligibility requirements for reasonableness and that, absent conflict with federal law or policy, trustees do not breach their fiduciary duties in administering pension trusts pursuant to the terms established in lawful collective bargaining agreements. Because the District Court failed to give full effect to Robinson, we reverse and remand.

I. BACKGROUND

Plaintiff Arthur E. Short was born on October 8, 1924. He began work in the coal industry in Kentucky in 1946 and worked in classified (nonsupervisory) jobs during various periods until January 25, 1971. On that date he permanently ceased employment in the coal industry because of coal workers' pneumoconiosis, commonly known as black lung disease. On February 14, 1972, the Workmen's Compensation Board of the State of Kentucky awarded Short disability compensation for "the occupational disease of silicosis/coal workers pneumoconiosis," retroactive to January 25, 1971. ¹

At the time of Short's retirement on January 25, 1971, pensions were provided to mine workers from the United Mine Workers of America Welfare and Retirement Fund of 1950 ("1950 Fund"). The 1950 Fund had been established by the National Bituminous Coal Wage Agreement of 1950 ("1950 Wage Agreement"), which was a collective bargaining agreement signed by the United Mine Workers of America ("the Union") and the Bituminous Coal Operators' Association, Inc. ("the Operators"). The 1950 Wage Agreement provided that:

Subject to the stated purposes of this Fund, the Trustees shall have full authority, within the terms and provisions of the "Labor-Management Relations Act, 1947," and other applicable law, with respect to questions of coverage and eligibility, priorities among classes of benefits, amounts of benefits, methods of providing or arranging for provisions for benefits, investment of trust funds, and all other related matters. ²

The Trustees exercised this "full authority" by adopting a succession of eligibility resolutions. The eligibility resolution in effect at the time of Short's retirement on January 25, 1971, was Resolution 63, which provided in paragraph I.A that:

An Applicant who subsequent to February 1, 1965, permanently ceases work in the bituminous coal industry as an employee of an employer signatory to the National Bituminous Coal Wage Agreement of 1950, as amended, shall be eligible for a pension if he has:

1. Attained the age of fifty-five (55) years or over at the date of his application for pension.

2. Completed twenty (20) years' service in the coal industry in the United States, as described in paragraph II A hereof.

3. Permanently ceased work in the coal industry immediately following regular employment for a period of at least one (1) full year as an employee in a classified job for an employer signatory to the National Bituminous Coal Wage Agreement, as defined in paragraphs II B hereof. ³

Resolution 63 further provided that the above eligibility regulations "shall be subject to amendment, revocation and revision at the discretion of the Trustees." (Emphasis added.)

Short was not eligible to receive a pension under Resolution 63 when he retired from the coal industry. He was then only 46 years old and had completed, at most, 18 1/4 years of service. Had the resolution remained in effect until October 8, 1979, however, Short would then have been eligible for a pension. On that date he would have attained the age of 55, and well before that date he would have accrued an additional four years of industry service under paragraph II.A. (1)(b) of the resolution, which provided for the award of up to four years of service credit to a miner who "[r]eceived workmen's compensation payments pursuant to an award as a result of an occupational disease or injury sustained in the mine while employed in a classified job."

Resolution 63 did not remain in effect, however. It was superseded on April 1, 1971, two months after Short's retirement, by Resolution 83, which in turn was superseded on January 1, 1973, by Resolution 90. More significantly for this case, in 1974, because of their concerns about compliance with minimum funding standards of the Employee Retirement Income Security Act of 1974 ("ERISA") and about the actuarial soundness of the 1950 Fund, the Union and the Operators agreed to restructure the industry's benefit program. ⁴ They decided to replace the single 1950 Fund with four separate trust funds: the 1950 Pension Trust, the 1950 Benefit Trust, the 1974 Pension Trust, and the 1974 Benefit Trust. For each fund there was a trust agreement and a plan. The plans set forth the eligibility requirements and the amount of benefits payable. The trust agreements and plans were incorporated by reference and made a part of the collective bargaining agreement. Thus, Article XX, Section (b) of the National Bituminous Coal Wage Agreement of 1974 ("1974 Wage Agreement") provided in part:

Effective December 6, 1974, the name of the 1950 Fund is changed to the United Mine Workers of America 1950 Pension Trust ("1950 Pension Trust"). The 1950 Pension Trust is incorporated by reference and made a part of this Agreement. The terms of the 1950 Fund are hereby amended by substituting the terms of the 1950 Pension Trust and of the United Mine Workers of America 1950 Pension Plan ("1950 Pension Plan"). The 1950 Pension Plan is incorporated by reference and made a part of this Agreement. The pensions to be paid from the 1950 Pension Trust are as set forth in the 1950 Pension Plan.

Effective December 6, 1974, there is established a benefit plan and trust, which trust shall be known as the United Mine Workers of America 1950 Benefit Plan and Trust ("1950 Benefit Trust"). The 1950 Benefit Trust is incorporated by reference and made a part of this Agreement. The 1950 Benefit Trust provides health and other benefits, not including pension benefits, and the terms and conditions under which those benefits will be provided are as set forth in the plan under the 1950 Benefit Trust.

Article XX, Section (c) similarly established the 1974 Trusts and Plans, which are not at issue in this case. ⁵ The trust agreements and plans were amended by the collective bargaining parties in 1978, and the amended trust agreements and plans were incorporated by reference and made a part of the National Bituminous Coal Wage Agreement of 1978 ("1978 Wage Agreement"). Thus, in contrast to the 1950 Wage Agreement, which gave the Trustees "full authority" to establish eligibility requirements, the 1974 and 1978 Wage Agreements specified the eligibility requirements and directed the Trustees to enforce those requirements.

Short attained age 55 on October 8, 1979. On January 25, 1980, he applied to the Trustees for a pension. At that time, pension eligibility was governed by the 1950 Pension Plan as incorporated in the 1978 Wage Agreement. That Plan provides two bases for pension eligibility. First, under Article II.A, entitled "Continuation of Pension Under 1950 Fund," "[a] participant entitled to receive a pension benefit on [December 6, 1974] pursuant to the eligibility rules of the United Mine Workers of America Welfare and Retirement Fund of 1950 shall be eligible for a pension under this Plan." ⁶ Second, under Article II.B, entitled "Persons Retiring Before 1976":

A participant who ceased or ceases to perform classified work for an Employer prior to December 31, 1975 ... shall be eligible for a pension under this Plan if he has:

(1) Attained the age of fifty-five (55) years, and

(2) Either completed twenty (20) years of credited service, including the required amount of signatory service as set forth in Article IV(C)(4) or completed at least ten (10) years of signatory service, including at least three (3) years of signatory service after December 31, 1970.

Article IV.C. (4)...