TEAMSTERS, LOCAL U. NO. 688 v. Crown Cork & Seal Co., Inc.

Decision Date26 December 1973
Docket NumberNo. 73-1084.,73-1084.
Citation488 F.2d 738
PartiesTEAMSTERS, LOCAL UNION NO. 688, Affiliated With the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, a Labor Organization, Plaintiff-Appellant, v. CROWN CORK & SEAL COMPANY, INC., Defendant-Appellee.
CourtU.S. Court of Appeals — Eighth Circuit

Earl B. Wilburn, St. Louis, Mo., for appellant.

Edwin D. Akers, Jr., St. Louis, Mo., for appellee.

Before LAY and BRIGHT, Circuit Judges, and EISELE,* District Judge.

BRIGHT, Circuit Judge.

Teamsters Local Union No. 688 (the Union), affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, brought this breach of contract action against Crown Cork & Seal Company, Inc., (the Employer) seeking a money judgment representing the difference between actual contributions made by the Employer to an employees' pension fund after April 1970, and the greater amounts allegedly required by the then-existing collective bargaining agreement between the parties. Federal jurisdiction rests on Section 301(a) of the Labor Management Relations Act, 29 U.S. C. § 185(a) (1970). The district court construed the pertinent pension provision of the contract against the Union and denied it relief. The Union brings this timely appeal. We reverse for reasons stated below.

In the collective bargaining agreement between the parties covering a three-year period of March 1, 1970 to February 28, 1973, the article governing pension contribution read:

Effective MARCH 5th, 1969, the Company agrees to contribute to the Central States, Southeast and Southwest Areas Pension Fund the sum of TEN ($10.00) DOLLARS per week for each employee who has been on the payroll thirty (30) days or more.
The Company thereafter (but for a period not exceeding the termination of this Contract) agrees to contribute to said Central States, Southeast and Southwest Areas Pension Fund such amount or amounts as are or may be in the future from time to time required to be paid by other contributory Employers to said Fund for each employee covered by the Central States Area Local Cartage Agreement. (Emphasis added.)

The appellee-Employer pursuant to this agreement has paid the pension fund ten dollars per week for each qualified production employee covered by the agreement but has refused to make any additional contributions measured by increased pension contributions in the current Central States Area Local Cartage Agreement. This latter agreement was completed in July 1970, and provided that employer parties pay into a pension fund $11 per week effective April 1970, $12 per week effective January 1, 1971, $13 per week effective June 1, 1972, and $14 per week effective January 1, 1973, for each qualified employee.

As explained by the testimony presented at the trial, this Central States Local Cartage Agreement embodies a labor agreement applicable to employers engaged in the local cartage industry in the metropolitan area of St. Louis, Missouri. Appellee is not in the cartage business, and neither it nor appellant-Local No. 688 has ever been a signatory to the labor agreement covering the cartage industry of metropolitan St. Louis.

The appellant-Union contends that the reasonable interpretation of the provision of the labor contract here in issue would compel the Employer to pay, as pension contributions on behalf of its employees, the same amounts contributed to the pension fund by employers who are bound by the Central States Local Cartage Agreement. As previously noted, the appellee-Employer has paid the pension fund ten dollars per week for each qualified employee as required by the first paragraph of the questioned pension provision but contends that the second paragraph only becomes operative during the contract period if and when it hires truck drivers who are protected by the Cartage Agreement.

The trial court determined the questioned second paragraph to be ambiguous in meaning and subject to the interpretation urged by either party to the contract. Applying principles of contract law, the trial court adopted the Employer's construction of the provision and held that when part of a contract is unclear or open to different constructions, it is construed most strongly against the party who prepared it and at whose urging it was inserted into the contract. See Miravalle Supply Co. v. El Campo Rice Milling Co., 181 F.2d 679, 683 (8th Cir.), cert. denied, 340 U.S. 822, 71 S.Ct. 56, 95 L.Ed. 604 (1950). We disagree with this conclusion and hold that the Union has correctly construed this disputed contract provision.

According to appellee's argument, since the reading of the questioned terms produces ambiguity of meaning, this court should affirm on the basis of the "clearly erroneous" rule in Fed.R.Civ.P. 52(a). However, Rule 52(a) does not apply to appellate review of a contract issue resting upon the construction of written documents. We must reach an independent judgment as to the meaning of the contract. Dingman v. United States, 429 F.2d 70, 72 (8th Cir. 1970); Arrow Equipment, Inc. v. M-R-S Mfg. Co., 416 F.2d 152, 154 (8th Cir. 1969). See Eddy v. Prudence Bonds Corp., 165 F.2d 157, 163 (2d Cir. 1947), cert. denied, 333 U.S. 845, 68 S. Ct. 664, 92 L.Ed. 1128 (1948). Appellee cites the case of St. Louis Typographical Union No. 8 v. Herald Company, 402 F. 2d 553 (8th Cir. 1968), in support of its Rule 52(a) argument; however, that case is distinguishable on its face because there the existence of pension provisions rested solely upon disputed oral testimony.

As a basic proposition we note that contract principles of state law do not control in the construction of collective bargaining agreements which are the subject of Section 301(a) suits under the L.M.R.A. The Supreme Court in Textile Workers v. Lincoln Mills, 353 U.S. 448, 456-457, 77 S.Ct. 912, 918, 1 L.Ed.2d 972 (1957), said:

We conclude that the substantive law to apply in suits under § 301(a) is federal law, which the courts must fashion from the policy of our national labor laws. * * * Federal interpretation of the federal law will govern, not state law. * * * But state law, if compatible with the purpose of § 301, may be resorted to in order to find the rule that will best effectuate the federal policy.

Subsequently, the Court in United Steelworkers v. American Mfg. Co., 363 U.S. 564, 567, 80 S.Ct. 1343, 1346, 4 L.Ed.2d 1403 (1960), elaborated further on this doctrine:

In our role of developing a meaningful body of law to govern the interpretation and enforcement of collective bargaining agreements, we think special heed should be given to the context in which collective bargaining agreements are negotiated and the purpose which they are intended to serve.

Thus, in conformity to this instruction, we need examine with special care the context in which the disputed bargaining agreement was negotiated.

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