637 F.3d 718
7th Cir.2011Background
- Fund sued Auffenberg under ERISA for unpaid contributions; district court granted summary judgment for Fund; Auffenberg previously withdrew from Fund in 1997 and paid withdrawal liability; 2001 CBA included evergreen clause and a contested oral end-of-contribution agreement not memorialized in writing; Local 50 and Auffenberg allegedly agreed in 2001 to end contributions when CBA expired, but no written modification; Local 50 negotiations in 2006 produced oral assertion that contributions could cease as of April 30, 2006; notices in 2006 acknowledged alleged oral agreement but Fund disputed it; new CBA in 2007 accepted as ending obligations under old CBA but disputed nine‑month back-amount ($46,500) for period after 2001 CBA expiration; court concluded oral 2001 agreement barred by parol evidence and ERISA].
- Auffenberg participated in the Fund from 1980 to 1997; its withdrawal liability was paid in full in 1997; 2001 CBA sought to reinstate contributions with a five-year “free look” and included an evergreen clause; in 2006, Scott Alexander was told of an oral agreement ending contributions; Fund refused to recognize the 2006 oral agreement; February 2007 CBA ended old duties but Fund sought back contributions for 9 months pending new CBA; district court held 2001 oral agreement barred by parol evidence and ERISA; Auffenberg appeals.
- The Fund argues ERISA requires written instruments for benefit plans and LMRA requires a written basis for contributions; the 2001 evergreen clause cannot be modified orally; Behnke and Gerber Truck provide context; no written modification submitted before Feb 10, 2007; 2006 oral agreement contradicts written obligations and is unenforceable.
- The court AFFIRMS the district court’s summary judgment and rejects enforcement of the 2001 or 2006 oral agreements to modify written contribution obligations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is the 2006 oral agreement enforceable to end contributions despite the written evergreen clause? | Auffenberg argues 2006 oral agreement modified 2001 CBA. | Fund contends only written modifications are effective under ERISA/LMRA; oral is not enforceable. | No; oral modification ineffective; must be written. |
| Does ERISA/LRMA require a written instrument to establish employee benefit contributions even if notice of an oral agreement is given? | Auffenberg relies on written notices to support modification. | ERISA requires written instrument; LMRA requires written basis for payments. | Yes; written instrument required. |
| Can an oral agreement from 2001 modify the CBA despite the evergreen clause? | Auffenberg claims oral agreement ended contributions in 2001. | Behnke prohibits oral modification of such contributions. | No; parol evidence and ERISA prevent modification by oral agreement. |
| Is the 2007 CBA effective to end the obligation to contribute under the old CBA, affecting back charges for 2006? | Fund accepted new CBA as ending old duty but sought back amounts. | No modification without written agreement; back amount remains due. | New CBA does not retroactively negate prior oral modifications; back amount still due if not properly extinguished. |
| Did the district court properly grant summary judgment based on parol evidence? | Auffenberg argues the 2006 discussions should be considered. | Parol evidence rule bars oral modifications contradicting written terms. | Yes; summary judgment affirmed. |
Key Cases Cited
- Central States, Southeast & Southwest Areas Pension Fund v. Gerber Truck Serv., Inc., 870 F.2d 1148 (7th Cir. 1989) (ERISA/LMRA require written basis for employee contributions; oral modifications are not enforceable)
- Behnke v. Central States, Southeast & Southwest Areas Pension Fund, 883 F.2d 454 (6th Cir. 1989) (oral CBA modifications not allowed where written agreements specify contributions)