471 F. Supp. 856 | S.D.N.Y. | 1979
OPINION
Plaintiff Joseph Agro (“Agro”), a plumber by trade, seeks a declaratory judgment that he is entitled to pension benefits from the defendant Joint Plumbing Industry Board (the “Board”). The Board administers a Pension Fund (the “Fund”) established on July 1, 1950, such Fund consisting of revenues from employer contributions made pursuant to agreements with Local Union No. 2 of the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry (the “Union”), of which Agro is a member. Agro claims he is entitled to the pension pursuant to the Pension Plan (the “Plan”) adopted by the trustees of the Fund. Jurisdiction is claimed under 28 U.S.C. § 1331 et seq. and 29 U.S.C. §§ 185, 186 and 1132.
The initial plan, adopted in 1952, predicated pension eligibility on the following conditions: (A) attainment of age 65, (B) membership in good standing of the Union for at least 15 years, (C) such membership to be for at least five consecutive years immediately preceding the date of pension application, (D) employment for a contributing employer in each of the two annual periods immediately preceding the date of the pension application and (E) employment at the plumbing trade for at least 1,250 days during the period of membership in the Union. The Plan has been amended three times since 1952,
It is undisputed that Agro, a member of the Union since 1939, worked for a contributing employer in each of 13 separate years since 1950 and that during those years he worked at least 1,466 days for contributing employers. Agro asserts that he should be given credit as having worked for contributing employers for two additional years, 1952 and 1956, bringing his total to 15 years. Further, it is undisputed that even with 15 years of credit service Agro does not qualify under the Plan as amended in either 1966 or 1971. Therefore, plaintiff seeks to have the eligibility rules of the Plan, as amended in 1966 and 1971, declared to be arbitrary and capricious as applied to him. Additionally, Agro also seeks qualification under the grandfathering provision referred to at trial by a trustee of the Fund, Mr. Morris Olshina, asserting that as of the time of the 1966 amendment he had already qualified for his pension benefits. In sum, Agro seeks to recover under either of two main theories:
(1) That the 1966 and 1971 amendments are arbitrary and capricious as applied to him and that he need only satisfy the requirements existing after the 1963 amendment; or
(2) That by having already qualified for benefits at the time of the 1966 amendment, except for reaching the age of 65, he is entitled to benefits under the grandfathering policy.
(1) 1966 and 1971 Amendments
Agro first claims that the 1966 and 1971 amendments were arbitrary and capricious as applied to him. In the pre-trial order and pre-trial brief, and at trial, plaintiff did not contest the validity of the 1966 and 1971 amendments or the 15 consecutive year rule therein. His claim is that such rule, as applied to him, is arbitrary and capricious. This Court finds otherwise.
The 15 consecutive year requirement was suggested by the Fund’s actuary for financial reasons and to prevent undeserving claimants from invading the Fund. See Mitzner v. Jarcho, 44 N.Y.2d 39, 403 N.Y. S.2d 490, 374 N.E.2d 388 (1978). In light of such reasons, the decision by the trustees to deny Agro pension benefits was not arbitrary or capricious. Agro did not comply with either the 15 year requirement or the continuous service requirement. His failure to work for a contributing employer from 1966 through 1969 was a voluntary decision on his part,
Agro also asserts that he was not notified of the 1966 and 1971 amendments to the Plan, that his failure to comply with the requirements was therefore excusable and it was arbitrary and capricious to deny him pension benefits. It is unclear who Agro claims was under a duty to inform him of the new amendments, the Union, the Board, or both. Since subsequent to the 1963 amendment Union membership had nothing to do with the eligibility require-
Furthermore, there has been no showing by Agro that the Union or the Board attempted to conceal the amendments from him or that he made any periodic effort to determine the then current eligibility requirements under the Plan. Finally, Agro introduced no evidence or testimony that had he known of the amendments he would have attempted to comply with them. Therefore, based upon all of the foregoing, the denial of pension benefits was not arbitrary or capricious.
(2) Grandfather Provision
The grandfathering provision referred to by the witness Olshina provides that a pension will be given to one who has qualified as of the time of an amendment to the Plan. Under this provision Agro seeks pension benefits on the ground that as of the 1966 amendment he qualified under the Plan. To succeed, Agro must establish that by the time of the 1966 amendment he qualified under the Plan as amended in 1963.
There is controversy over the eligibility requirements established by the 1963 amendment and therefore those in effect at the time of the 1966 amendment. This controversy arises from the recent Appellate Division decision in Huffe v. Jarcho, 64 A.D.2d 960, 408 N.Y.S.2d 793 (1st Dept. 1978) interpreting the 1963 amendment. This decision states that the 1963 amendment had the effect of requiring 15 years of non-consecutive service for a contributory employer. Agro asserts that he qualifies even under the interpretation set forth in Huffe. To succeed in this claim Agro must establish that he is entitled to credit for 1952 and 1956 as having worked for a contributory employer, bringing his total to 15 years. Alternatively, Agro contends that the decision in Huffe was incorrect, and that under the correct analysis of the 1963 amendment there is no 15 year requirement and that, irrespective of 1952 and 1956, he qualified for benefits as of the 1966 amendment. For the reasons set forth below, this court holds (i) that Agro does not qualify under the 1963 amendment as interpreted by the Appellate Division in Huffe, but that (ii) the Huffe decision incorrectly interpreted the decision of the Court of Appeals in Mitzner v. Jarcho, 44 N.Y.2d 39, 403 N.Y. S.2d 490, 374 N.E.2d 388 (1978) and that therefore the 1963 amendment added no requirement of 15 years of non-consecutive service for a contributory employer.
1. Eligibility Under Huffe
To qualify under the 1963 amendment as interpreted in Huffe Agro must establish that he had 15 years of service for an employer who contributed, directly or indirectly, to the Fund. To satisfy this requirement Agro need obtain credit for the years 1952 and 1956.
Further, the Fund made no representations, or otherwise accepted responsibility for informing plumbers, as to whether a plumber was working for a contributory employer. However, as a service, it did provide a list of contributing employers to assist plumbers in their determination of who was a contributing employer. There was no allegation that either Eckhaus or Precise were on such list.
Absent 15 years of contributory employment, Agro has not complied with the requirements as set forth in the 1963 amendment, as interpreted in Huffe. However, alternatively, Agro contests the analysis and holding of the Appellate Division in Huffe.
2. Applicability of Huffe
The decision with which the court is now faced is whether the decision in Huffe correctly interpreted the holding of the Court of Appeals in Mitzner, supra. The defendant does not dispute the existence of a grandfathering policy and that if Agro’s interpretation of the 1963 amendment is accepted he qualified, other than having attained the age of 65, for pension benefits at the time of the 1966 amendment. Benefits will not be denied plaintiff on the basis he was not 65 years of age at the time of the 1966 amendment, assuming all other requirements are satisfied. See Lee v. Nesbitt, 453 F.2d 1309 (9th Cir. 1971). This plaintiff is not a claimant undeserving of the benefits of the Plan, but one who has been loyal to his trade; further, there has been no showing that the Plan will be adversely affected by allowing this claim. See generally Kraft v. Felder, 452 F.Supp. 933 (S.D.N.Y.1978); Mosley v. National Maritime Union Pension & Welfare Plan, 451 F.Supp. 226 (E.D.N.Y.1978). The question therefore is relegated to a determination of whether or not the 1963 amendment required 15 years of non-consecutive service for a contributing employer.
The Plan, as adopted in 1952, contained five requirements for eligibility. See discussion supra. In 1963 the Plan was amended to delete union membership as a condition for eligibility. The amendment substituted the requirement of “participant” status for that of union membership, a participant being defined as one who, among other things, works for a contributing employer. However, the amendment also deleted subdivision B and C of the 1952 requirements.
Defendants rely almost exclusively on the recent Appellate Division holding in Huffe v. Jarcho as support for its position. There the Appellate Division, in following what it believed to be the mandate of the Court of Appeals in Mitzner v. Jarcho, supra, held that the 1963 amendment added a requirement of 15 non-consecutive years of employment with contributing employers. It is this court’s opinion that the Appellate Division not only misinterpreted the contractual provisions here in issue (see discussion supra), but also the language of the Mitzner court. The language relied upon is as follows:
“. . .in 1963 the plan was further amended to delete union membership as a condition of eligibility. Instead, employment with a contributing employer, regardless of union membership, qualified one for fund benefits. In 1966 the pension plan was again amended . benefit claimants were now required to have accumulated 15 consecutive years of employment . . ” (emphasis added)
Mitzner, supra, 44 N.Y.2d at 43, 403 N.Y. S.2d at 492, 374 N.E.2d at 389. The Court of Appeals, when referring to the 1963 amendment, made no mention of any 15 year rule. When referring to the 1966 amendment the court stated that then, for the first time, a 15 consecutive year employment requirement was added. The Appellate Division would limit the “now” reference as to only the consecutive requirement. However, there is no support for such an interpretation. Therefore, the language of the Court of Appeals as to what the effect of the ’66 amendment was must be interpreted as stating that both the 15 year and consecutive requirements were added in 1966. Further support for this conclusion is that the Court of Appeals also stated that “prior to the 1966 amendment one could qualify for a full pension, having worked for contributing employers for only a very brief period.” (emphasis added). Mitzner, supra at 47, 403 N.Y.S.2d at 494, 374 N.E.2d at 392. Under defendants’ interpretation though, no longer period was added by the ’66 amendment, only the consecutive requirement. Also, in the context of this Plan the Court of Appeals could not have been referring to a 15 year requirement as a “very brief period”.
The mandate of the higher New York court, the Court of Appeals in Mitzner, as to the interpretation of the contractual provisions in issue is clear: the 1963 amendment added no requirement of 15 years of employment for a contributing employer. This court will follow the mandate of the higher New York court. Absent the 15 year requirement, Agro qualified, except as to attaining age 65, for benefits prior to the ’66 amendment. For the reasons set forth above, he is therefore entitled to receive pension benefits. These benefits will be computed from August 1971, since this
This opinion shall constitute this court’s findings of fact and conclusions of law. The parties are directed to submit judgment on notice within ten days from the date of this opinion.
IT IS SO ORDERED.
. There was also a 1960 amendment affecting disabled employees, such amendment not being relevant to this action.
. Agro’s claim that he was forced to leave due to the nature of the constructing trades and the lack of employment opportunities is unpersuasive. Such a claim would be relevant had he attacked the 1966 and 1971 amendments themselves, since such a claim, if true, would have affected all plumbers in the industry. This claim is of little relevance to his assertion that the application of the ’66 and ’71 amendments were arbitrary and capricious as applied to him.
. Even if the Union was required to give Notice, the evidence at trial, which was uncontradicted by the plaintiff, indicated that the amendments were brought up and discussed at Union meetings.
. The amendment is as follows:
“RESOLVED, that Subdivisions ‘B’ and ‘C’ of the Eligibility Requirements be deleted, and that in Subdivision ‘E’ of such Eligibility Requirements the words ‘during his total membership in good standing in the Union’ be deleted and in the place and stead thereof there shall be inserted ‘during the time employed by contributing employers or by a contributing employer.’ ”
. Subdivision B stated: “He has been a member in good standing of the Union for at least fifteen years.”