Trustees of Local 478 Trucking and Allied Industries Pension Fund v. Siemen's Corp.
| Decision Date | 18 November 1983 |
| Docket Number | No. 82-5719,82-5719 |
| Citation | 721 F.2d 451 |
| Parties | 114 L.R.R.M. (BNA) 3401, 99 Lab.Cas. P 10,563, 4 Employee Benefits Ca 2634 TRUSTEES OF the LOCAL 478 TRUCKING AND ALLIED INDUSTRIES PENSION FUND, and The Joint Welfare Fund of Employers and Local 478, International Brotherhood of Teamsters, Plaintiffs-Appellants, v. SIEMENS CORP., Defendant-Appellee and Third-Party Plaintiff, v. LOCAL 478, INTERNATIONAL BROTHERHOOD OF TEAMSTERS and Joseph P. Uzzolino, President of said Local Union, and Joseph A. Uzzolino, Business Agent of said Local Union, Third-Party Defendants. |
| Court | U.S. Court of Appeals — Third Circuit |
John A. Craner, Stephen A. Satkin (argued), Mountainside, N.J., Robert J. Preminger, Craner & Nelson, P.A., Perth Amboy, N.J., for plaintiffs-appellants.
Marvin M. Goldstein (argued), Donald B. Shanin, Grotta, Glassman & Hoffman, P.A., Roseland, N.J., for defendant-appellee and third-party plaintiff.
Before SEITZ, Chief Judge, SLOVITER, Circuit Judge and POLLAK, District Judge. *
The issue on appeal is whether trustees of a pension fund (Trustees) who contend the employer failed to contribute to the fund as required by the collective bargaining agreement may maintain a court action despite an arbitration clause in that agreement. The district court dismissed the Trustees' action for lack of subject-matter jurisdiction, holding that the Trustees' contention must be raised in arbitration, a proceeding which can be instituted against the employer only at the discretion of the union. We reverse, grounding our decision on policy considerations as well as our interpretation of the relevant agreements at issue.
Plaintiffs are Trustees of the Local 478 Trucking and Allied Industries Pension Fund ("Pension Fund" or "Fund"), a multi-employer employee benefit plan within the meaning of section 302(c)(5) of the Labor-Management Relations Act (LMRA), 29 U.S.C. Sec. 186(c)(5) (1976 & Supp. V 1981) and the Employee Retirement Income Security Act (ERISA), 29 U.S.C. Sec. 1002(1-3) (1976 & Supp. V 1981). Defendant Siemens Corporation ("Siemens"), although not a trucking-industry employer and hence not a party to the National Master Freight Agreement or the Local 478 Rider to it, has a single-employer bargaining relationship with Local 478. Through the Siemens-Local 478 collective bargaining agreement, Siemens undertook to participate in the Fund. Therefore, it executed an Agreement and Declaration of Trust (the Trust Agreement) defining its participation.
Under the Trust Agreement, Siemens must contribute to the Fund "the amount required by the Collective Bargaining Agreements in effect" between Local 478 and Siemens. The collective bargaining agreement in effect from April 1, 1981 to March 31, 1984 requires that Siemens pay the full cost of Pension Fund contributions for its employees. The agreement further provides that "in the event the Trucking Industry Employers who have Labor Contract [sic] with the Union increase their contributions for each of their employees to the Pension Fund, during the term of this Contract, [Siemens] will increase its contributions accordingly, for each employee."
In 1981, pursuant to the collective bargaining agreement, Siemens increased its employees' wages by $.70 per hour and its contributions to the Pension Fund by $.15 per hour. At the same time, the Union-Trucking Industry Committee negotiated a cost-of-living wage increase of $.42 per hour to be paid by the trucking industry employers. The membership of Local 478 voted to apply $.21 of its cost-of-living increase to the pension fund contribution effective April 1, 1981. The administrator of the Fund thereafter requested all of the Fund's participating employers, including Siemens, to make such a contribution, even though the Siemens-Local 478 collective bargaining agreement does not specifically provide for a cost-of-living adjustment. This would require an increase by Siemens of $.21 in pension contributions over and above the $.15 directly negotiated.
Siemens denied that its collective bargaining agreement obligated it to pay any pension fund increase stemming from a cost-of-living increase, but offered to divert $.21 of the $.70 negotiated wage increase to the pension fund. Local 478 declined, but has pressed no grievance with Siemens over the interpretation of the collective bargaining agreement.
The Trustees filed suit against Siemens in New Jersey state court seeking the contributions they alleged were due. Siemens removed the action to the United States District Court on the basis of federal jurisdiction under Sec. 301(a) of the LMRA, 29 U.S.C. Sec. 185(a) (1976), and Sec. 502 of ERISA, 29 U.S.C. Sec. 1132(a) (1976). On removal, Siemens filed a third-party complaint against Local 478 for a declaratory judgment and monetary relief in the event Siemens is held liable to the Fund. Siemens also filed a motion to dismiss the complaint and argued that the issue fell within the compulsory arbitration clause of the collective bargaining agreement. The Trustees contended that clause was inapplicable. The district court agreed with Siemens. It entered an order dismissing the complaint and stated from the bench, The Trustees appeal. 1
The issue before us is difficult because it requires us to choose between the competing policies of protecting the integrity of pension funds and of favoring arbitration as a mechanism to resolve disputes. Three circuits have recently considered this issue. Two circuits, the Fifth and the Eighth, have held that trustees are not bound by the arbitration clause. Bugher v. Consolidated X-Ray Service, 705 F.2d 1426, 1430 (5th Cir.1983), petition for cert. filed, --- U.S. ----, 104 S.Ct. ----, 77 L.Ed.2d ---, 52 U.S.L.W. 3191 (Sept. 20, 1983); Robbins v. Prosser's Moving and Storage Co., 700 F.2d 433, 442-43 & n. 8 (8th Cir.1983) (in banc), cert. granted, --- U.S. ----, 104 S.Ct. 66, 77 L.Ed.2d --- (1983). The Seventh Circuit, construing a somewhat broader arbitration clause, held to the contrary. Central States, Southeast and Southwest Areas Pension Fund v. Howard Martin, Inc., 625 F.2d 171, 172 (7th Cir.1980); see also Trustees of National Benefit Fund for Hospital and Health Care Employees v. Constant Care Community Health Center, Inc., 669 F.2d 213, 215 (4th Cir.1982) (dictum).
The strong national policy favoring arbitration of labor disputes has led the Supreme Court to establish a strong presumption in favor of arbitration through broad interpretation of arbitration clauses. Nolde Brothers, Inc. v. Local 358, Bakery & Confectionery Workers, 430 U.S. 243, 254, 97 S.Ct. 1067, 1073, 51 L.Ed.2d 300 (1977); Steelworkers Trilogy: United Steelworkers v. American Mfg. Co., 363 U.S. 564, 80 S.Ct 1343, 4 L.Ed.2d 1403 (1960); United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. 574, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (1960); United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593 (1960). Nevertheless, "a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit." United Steelworkers v. Warrior & Gulf Navigation Co., 363 U.S. at 582, 80 S.Ct. at 1353; Eberle Tanning Co. v. Section 63L, 682 F.2d 430, 433 (3d Cir.1982).
The language of the arbitration clause in the Siemens-Local 478 collective bargaining agreement does not explicitly require arbitration of the Trustees' complaint. The arbitration clause does not mention the Fund, the Trustees, or pension disputes. It provides:
Should any dispute arise between the Employer and an employee, or the Employer and the Union, concerning the application or interpretation of any provision of this Contract, the Representatives of the Employer and of the Union shall attempt to adjust the controversy between themselves. In the event they are unable to adjust same, the dispute shall within two (2) days after the request of either party, be submitted to ... Arbitration. The Arbitrator's decision shall be final and binding upon the parties hereto ...
(emphasis added). It is agreed by the parties that resolution of the dispute between the Trustees and Siemens will depend upon the "interpretation of [a] provision of [the collective bargaining] Contract." 2 Siemens contends that the Trustees, though not parties to its collective bargaining agreement with Local 478, are nonetheless bound by that agreement. If Siemens is correct, then the Trustees, who cannot invoke arbitration, can raise their dispute with Siemens only through the union in arbitration.
However, the separate Trust Agreement between Siemens and the Trustees specifically provides that the Trustees may bring suit in certain circumstances:
The failure of any Employer to pay the contributions required hereunder promptly, when due, in accordance with the Collective Bargaining Agreement, or rules and regulations adopted by the Trustees, shall be a violation of such Employer's obligations hereunder .... The Trustees may take any action necessary to enforce payment of the contributions due hereunder, together with said penalty, interest, attorneys' fees, court costs and accountant's charges, as provided hereunder, either by proceedings at law or in equity.
(emphasis added).
Siemens construes this language in the Trust Agreement to permit direct legal action by the Trustees only in "simple collection cases" for delinquent contributions. It contends that where, as here, the dispute concerns a contested interpretation of the bargaining agreement, then the governing provision is the arbitration clause of the collective bargaining agreement.
Applying standard contract interpretation principles, it is difficult to accept Siemens' argument. The Trustees are parties...
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...prior to suit for violation of 29 U.S.C. Sec. 1140).16 Our decision in Trustees of Local 478 Trucking and Allied Industries Pension Fund v. Siemens Corp., 721 F.2d 451 (3d Cir.1983), on which Barrowclough relies, is inapposite. The arbitration clause did not apply to the trustees who brough......
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