The opinion of the court was delivered by: BRIEANT
By an order to show cause issued February 28, 1984, heard and fully submitted on March 5, 1984, defendants, on the eve of trial, moved to strike the jury demand set forth in the complaint herein.By this action filed July 14, 1983, plaintiff, Angelo Paladino, seeks a declaratory judgment with respect to his rights to receive pension benefits from the Taxicab Industry Pension Fund. Subject matter jurisdiction is founded on ERISA, 29 U.S.C. § 1001, et seq., and more particularly, § 1132(a)(1)(B) thereof. The Court has subject matter jurisdiction under 29 U.S.C. § 1132(e).
Plaintiff alleges that a pension fund was established in the 1966 Collective Bargaining Agreement between the New York City Taxidrivers Union, Local 3036, AFL-CIO, and employers operating New York City Fleet Medallioned Taxicabs, and that as of July 1, 1976, the terms of the pension trust were amended to comply with the statute. Defendants are or were trustees, and have a fiduciary duty to plaintiff. Plaintiff alleges that he was employed from 1950 until May 18, 1978, that during the years 1950-1954 and 1956-1957, 1959-1962, 1966-1967, 1969, 1972-1977, he worked at least 200 days per year, driving a medallioned taxicab for member employers, and should have received sufficient service credits as a result thereof so as to be vested with at least 20 years of service as of July 1, 1973. Because of a subsequent disability incurred May 18, 1978, plaintiff is no longer employed in the industry, and is presently receiving Workmens Compensation benefits and Social Security disability payments.
Plaintiff became age 62 on February 22, 1980, and applied for a pension. The pension was denied by the trustees on February 26, 1980. Plaintiff alleges as his first claim that the trustees were arbitrary and capricious in denying the pension and demands the sums presently due, which he would have received if the pension had been granted.As a second claim, plaintiff alleges a breach of fiduciary duty in connection with his application, and by a third claim pleaded, charges the trustees with intentional or reckless tort and seeks the customary One Million Dollars in damages for emotional distress.
The trustees, in their answer, in addition to pleading a general denial, assert that plaintiff has not accumulated the 25 service credits as defined in § 1.10 of the Plan, and also has not accumulated at least 15 service credits in order to assert permanent and total disability, as defined by § 2.06 of the Plan. As a fourth affirmative defense the trustees plead that the application not timely under the Plan.
The motion presents the Court with the single legal issue of whether plaintiff is entitled to a jury trial as a matter of right. The Court concludes that he is.
We begin our analysis by agreeing with the defendants that there is no Seventh Amendment right to jury trial in ERISA actions. The actions are essentially equitable in nature.Plaintiff seeks to have the Court review the exercise of fiduciary powers by trustees within the rubric of "arbitrary and capricious," or according to the standard of whether the decision is supported by substantial evidence. The trier of fact in an ERISA enforcement action is not authorized to substitute him, her or its judgment and discretion for that of the trustees. However, beneath this seemingly "equitable" issue, there lurks a simple question: whether plaintiff had a break in his service in the taxicab industry which forfeited his prior service credit. This represents a pure issue of fact and is the sort of question which is particularly appropriate for resolution by a trial jury.
To find that there is no Seventh Amendment right to jury trial does not answer the entire question. Even where there is no constitutional right to a jury trial, a court must examine the statute which created the new right of action, in this case ERISA, to ascertain whether Congress impliedly provided a right to jury trial. The Seventh Amendment does not prevent Congress from providing a right to jury trial where a newly contrived statutory remedy is made availably to litigants. See The Propeller Genesee Chief v. Fitzhugh, 53 U.S. (12 How.) 443, 13 L. Ed. 1058 (1851).
This Court believes that on balance it was the intent of Congress that ERISA plan enforcement actions be regarded as legal in nature, and that litigants be entitled to a jury trial. Essentially, the right to a pension may be regarded as arising out of contract. The would be pensioner is a third-party beneficiary of the agreement between his labor union, the employers and the trustees.
Nor is it rational to assume that Congress intended that the right to a jury trial vel non should depend on whether immediate benefits are available, as they apparently are in this case, in which event, the lawsuit is an action for a money judgment, or whether a declaratory judgment is sought that benefits will be available at a future time. In the latter action, the would be pensioner wants to adjudicate his rights in advance of entitlement, while the witnesses are available and in order that he may make plans for his future. There is no logical reason to require plaintiff in the latter case to give up his right to a jury simply because no payment is currently due.
We do not write on a clean slate; in Pollock v. Castrovinci, 476 F. Supp. 606, 609 (S.D.N.Y. 1979), aff'd without opinion, 622 F.2d 575 (2d Cir. 1980), Judge Goettel of this Court considered the question of whether a beneficiary of a pension trust, suing pursuant to ERISA and alleging a violation fiduciary duty and diversion of assets by the trustees, could demand a jury trial. In a detailed analysis of the issue, the Court in Pollock found that a jury trial was available. The Court held:
"The legislative history of ERISA indicates that section 502 actions should be guided by the caselaw developed under section 301 of the Labor-Management Relations Act of 1947, 29 U.S.C. section 185. The Joint Explanatory Statement of the Committee of Conference reads, in relevant part, as follows:
"All such actions in Federal or State courts are to be regarded as arising under the laws of the United States in similar fashion to those brought under section 301 of ...