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ROCA v. WESTBURY TRANSP. INC.

September 8, 1998

ALEX ROCA, DENNIS FARRELL, ROBERT CORBETT AND PETER FURTADO, as Trustees and Fiduciaries of the Teamsters Local 814 Pension, Annuity and Welfare Funds, Plaintiffs, against WESTBURY TRANSPORT INC., Defendant.


The opinion of the court was delivered by: TRAGER

MEMORANDUM AND ORDER

 TRAGER, District Judge:

 This case arises from a dispute between the trustees and fiduciaries of the Teamsters Local 814 Pension, Welfare, and Annuity Trust Funds (the "Fund") and one of their contributing employers, Westbury Transport, Inc. ("Westbury"), a trucking service for retail merchants, over whether contributions must be paid by Westbury for a particular employee under circumstances described below.

 Background

 The Fund was created by two separate Agreements and Declarations of Trust ("Trust Agreements") - one for a pension and welfare fund and a second for an annuity fund - between a multi-employer association of movers to which Westbury belongs and the Teamsters Local 814, affiliated with the International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America. Additionally, Westbury has been a party to a series of collective bargaining agreements ("CBA's") with the Teamsters Local 814. The Twenty-Seventh ("Welfare Plan") Article and the Twenty-Eighth ("Annuity Plan") Article of the latest collective bargaining agreement obligate Westbury to contribute to Local 814's Welfare and Annuity Funds certain sums for "each seniority employee." The term is not explicitly defined in the collective bargaining agreement, but in their papers, the parties have equated the term with employees on the "seniority list" as spelled out in the Eleventh Article entitled, "Seniority:"

 
An employee employed forty-five (45) consecutive working days shall be entitled to a position on the seniority list by classification.

 Following an audit of Westbury in 1995, the Fund's accountants notified Westbury that it was delinquent in making contributions to the Fund. Westbury disputed the claims and specifically contended that under the provisions of the CBA, James Dawson, one of Westbury's employees, should not be on its seniority list.

 Mr. Dawson was formerly an employee on Westbury's seniority list, but he resigned in April, 1993, thereby losing his seniority status. In July, 1993, however, Dawson was rehired. To regain his seniority, Dawson had to again work forty-five consecutive working days, which he did between mid-October and late December. There is, however, a provision within the Eleventh Article of the collective bargaining agreement indicating that "the Employer may employ seasonal employees between September 1st and December 31st, of any year, as needed." Westbury contends that, by working the required forty-five days during this seasonal period, Dawson was merely a "seasonal employee" and never attained seniority.

 On the other hand, the Fund maintains that because Dawson worked part-time during other parts of the year, he is not a seasonal employee. The Fund contends that in the case of an employee, like Dawson, who works periodically throughout the year, the forty-five consecutive days worked should count toward seniority, even if a portion or all of the forty-five days occurred during the September-December period. Following the Fund's view of who is entitled to be on the seniority list, it asserts that Westbury has failed to pay contributions for 696 hours worked by Dawson and asks for $ 2,147.40 in principal, plus interest and liquidated damages.

 Each of the parties argues that its own interpretation of the agreements is the only reasonable one and that there is, therefore, no issue of material fact left to be determined. Accordingly, both have moved for summary judgment and oppose the other party's motion.

 Discussion

 (1)

 There is a preliminary issue that must first be resolved. It concerns the standard of review that should apply in evaluating the Fund's interpretation of the collective bargaining agreement. The Fund argues that its reading of Westbury's obligations to the welfare fund under the collective bargaining agreement should be rejected only if it was "arbitrary and capricious." If its interpretation of the bargaining agreement survives that test, the Fund asserts that it is entitled to summary judgment. Although Westbury contends that even under the arbitrary and capricious standard, it should prevail, its argument is that on a number of occasions the Fund did not consistently apply the interpretation it made with respect to Dawson. But this argument is not convincing. While prior practice is certainly relevant, if it involves only a few employees -- as it apparently did -- it is unlikely to establish a deliberate practice that would be evidence of how the CBA should be interpreted. It might well be, therefore, that Westbury owes additional contributions.

 Westbury contends that the Fund's interpretation should not receive the insulation from a rigorous judicial review that the arbitrary and capricious standard provides. Instead, Westbury suggests that normal contract interpretation principles should be applied, and, accordingly, the Fund's interpretation of the collective bargaining agreement should be reviewed de novo.

 Because the court agrees with Westbury's position, the question of whether there is any material issue of fact becomes a more difficult one. While both parties suggest that the contract perfectly clearly says what they say it says, evaluation of the Eleventh Article reveals that it contains ambiguities that ...


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