1 F.4th 608
8th Cir.2021Background
- The Greater St. Louis Construction Laborers Welfare Trust is a multi‑employer ERISA trust governed by a 12‑member Board of Trustees (6 employer appointees, 6 union appointees) created under 29 U.S.C. § 186(c)(5).
- The Trust Agreement requires equal representation, compliance with the LMRA and ERISA, authorizes trustees to employ counsel and to allocate specific trustee responsibilities, but expressly forbids trustees from amending the Trust Agreement.
- At a May 19, 2019 trustees’ meeting, Employer Trustees moved to allow each faction (employer and union) to hire and have the Trust pay for separate counsel who would advise only that faction; the motion produced a 6–6 deadlock.
- The Trust Agreement provides that deadlocks on matters "arising in connection with the administration of the Plan, or on any matter within their jurisdiction" are to be decided by an impartial umpire agreed by the parties or appointed by the federal district court if they cannot agree.
- Employer Trustees sought a district‑court appointment of an umpire under §302(c)(5); Union Trustees moved to dismiss, arguing the motion was an extraordinary modification (violating equal‑representation and beyond trustee authority). The district court dismissed; the Eighth Circuit affirmed.
Issues
| Issue | Employer Trustees' Argument | Union Trustees' Argument | Held |
|---|---|---|---|
| Whether the district court should appoint an impartial umpire under §302(c)(5) to resolve the deadlock over hiring separate faction‑counsel | The Trust Agreement authorizes trustees to employ counsel and to allocate trustee responsibilities, so the deadlocked motion is within "administration" and arbitrable by an umpire | The proposed arrangement would violate the LMRA equal‑representation requirement and exceed trustees' authority because it effectively delegates Trust resources to a faction and would amend the Trust Agreement | Court: No appointment. The motion would require amending the Trust Agreement and is not a matter of trust "administration" under §302(c)(5), so an umpire was not authorized |
| Whether the deadlocked motion concerns "administration" (ordinary day‑to‑day matters) under §302(c)(5) | Hiring counsel to assist trustees in performing their duties is an administrative function within §302(c)(5) | Allowing faction‑exclusive counsel paid by the Trust is an extraordinary delegation/amendment beyond "day‑to‑day" administration and conflicts with equal representation | Court: The motion concerns an amendment/delegation beyond day‑to‑day administration; §302(c)(5) does not require an umpire for such extraordinary matters |
| Whether the Trust Agreement itself authorizes the proposed delegation | Employer Trustees say sections authorizing employment of counsel and allocation of trustee responsibilities permit the arrangement | Union Trustees say nothing in the Agreement permits permanent delegation to a faction or authorizes amending the Agreement (Trustees lack amendment power) | Court: The Agreement does not permit indefinite delegation to a faction; the proposal would amend the Agreement and is therefore beyond trustees' power |
Key Cases Cited
- Arroyo v. United States, 359 U.S. 419 (describes §302 purpose to prevent corruption in labor‑management relations)
- Local 144 Nursing Home Pension Fund v. Demisay, 508 U.S. 581 (explains §302(c)(5) exceptions and equal‑representation requirement)
- Farmer v. Fisher, 586 F.2d 1226 (defines "administration" as day‑to‑day trust management; distinguishes extraordinary matters)
- Geigle v. Flacke, 768 F.2d 259 (trust agreement language can make particular disputes arbitrable by an umpire)
- Ader v. Hughes, 570 F.2d 303 (recognizes ordinary vs extraordinary matters; amendments not within "administration")
- NLRB v. Amax Coal Co., 453 U.S. 322 (trustee is a fiduciary whose duty to beneficiaries can trump loyalty to appointing party)
- Quad City Builders Ass’n v. Tri City Bricklayers Union No. 7, 431 F.2d 999 (discusses equal‑representation requirement under §302(c)(5))