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October 21, 1971

In the Matter of the Application of Penny Singleton et al., Petitioners,
Ephraim M. Abramson et al., Respondents

Lasker, D.J.

The opinion of the court was delivered by: LASKER


Deadlocked decisions about the administration of a labor union welfare trust fund prompt these cross-petitions seeking the appointment of an impartial umpire by this court. Authority for such action is found in § 302(c)(5) of the Labor Management Relations Act of 1947, 29 U.S.C. § 186(c)(5)(B), and Article III, paragraph 10(a), of the Agreement and Declaration of Trust of the American Guild of Variety Artists for its Welfare Trust Fund ("Trust Agreement"). *fn1"

 Petitioners are Trustees of the Welfare Trust Fund ("Fund"), created in 1953 for the benefit of employees in the variety entertainment field and their families. Three of the Trustees represent the American Guild of Variety Artists ("AGVA") and three represent the "Operators" (i.e., employers) who have collective bargaining agreements with AGVA and who make contributions to the Fund. *fn2"

 By the spring of 1970, several issues had become bones of contention between the AGVA Trustees and the Operator Trustees. The AGVA Trustees, determining that the Board was hopelessly deadlocked as to some of the issues, petitioned this court to appoint an umpire to break the even division of trustee votes. Respondents, the Operator Trustees, contest the propriety of submitting any of these issues to an umpire, and in turn file a cross-petition seeking appointment of an umpire to resolve a separate impasse.

 Five deadlocked issues are posed for resolution by a court-appointed umpire. The first four are the ones brought here by the AGVA Trustees:

 (1) Whether or not to amend the Trust Fund Agreement pursuant to Article III, paragraph 10(s), to provide that Operator Trustee vacancies shall be filled in some method other than by selection by the remaining Operator Trustees in order to assure that actual Operators, or persons closely linked to them, serve as Operator Trustees and not persons with no ties to the Operators, as is allegedly now the case.

 (2) Whether or not under Article III, paragraph 10(d), of the Trust Agreement, which requires that the Fund provide fidelity bonds for all persons who collect contributions for the Fund, the Fund is obliged to provide a bond for AGVA employees who collect such contributions.

 (3) Whether or not the present manager of the office of the Fund should be replaced pursuant to Article II, paragraph 3, and Article III, paragraph 11.

 (4) Whether or not the present Operator Trustees and Alternate should be removed since none are actually Operators or related to Operators, as the petitioners contend is mandated by paragraphs 6 and 16 of Article III.

 The final issue is raised by the respondents as cross-petitioners: (5) Whether or not Penny Singleton as Trustee and Sally Rowe and Paul Benson as Alternate Trustees should be permitted to participate on the Board of Trustees since their status as paid employees of AGVA violates Article III, paragraph 11, and Article VII, paragraph 4, of the Trust Agreement.


 The relevant portions of 29 U.S.C. § 186 (c)(5)(B) require as to a statutory trust fund such as this that "in the event the employer and employee groups deadlock on the administration of such fund and there are no neutral persons empowered to break such deadlock, such agreement must provide that the two groups shall agree on an impartial umpire to decide such dispute, or in event of their failure to agree within a reasonable length of time, an impartial umpire to decide such dispute shall. . . be appointed by the district court . . ."

 Under this statutory mandate, petitioners must satisfy the court that (a) a genuine deadlock exists on an issue of administration, (b) no agreed neutral person is available to break the impasse, (c) the parties fail to agree on an impartial umpire. *fn3" The issue must be one which the trustees have the authority under the trust agreement to decide. Mahoney v. Fisher, 277 F.2d 5, 6 (2d Cir. 1960). As was stated in Barrett v. Miller, 276 F.2d 429, 431 (2d Cir. 1960), "while a trustee petitioning for the appointment of an umpire need not demonstrate that his interpretation that the issue was one the trustees could decide is the correct one, he must at least establish that it is a possible one."

 Examining each of the five issues in light of the statutory requirements, it appears that the first three are ripe for ...

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