3 Scott on Trusts, 2d ed. § 294.1 (Parenthesis this court's.)
Further, the Insurance Company contends that the above release is fair, and that it is therefore binding on not only the other parties thereto, but also on the beneficiaries of the trust 'regardless of the previous conduct of the parties.' But this clearly argues in a circle. Of course, if the settlement is in fact fair, it is binding, but the 'previous conduct of the parties' has a very important bearing on the decision of whether the settlement is fair. Specifically, if perchance, as the complaint alleges, the Trustees who participated in the release had joined in defrauding plaintiffs of large sums of money belonging to the Trust Fund, and if, as alleged, the Insurance Company had 'assisted' them in this, with knowledge, by empowering their agent, Saperstein, to that end, clearly mutual releases, exchanged between these parties to this conspiracy to defraud plaintiffs, must be closely scrutinized to see if in fact it was fair to plaintiffs. For it is quite reasonable to assume, if the allegations of the complaint are correct, that the payment of $ 125,000 in settlement of a claim aggregating some $ 1,000,000, was motivated in part by the hope of the parties to the releases, that their execution would forestall the litigation now brought by plaintiffs against all such parties. In short, it is by trial alone that this issue of the fairness of the settlement can be determined.
Again, defendants raise the objection that the Union constitution and by-laws present channels through which the plaintiffs must first seek to obtain their rights before resort to the courts. To this it need only be said that two years of inaction by the Union and its high officials in taking any steps against those primarily responsible, plus the alleged participation by high Union officials in these frauds, combine to make it apparent that any such intra-Union remedy is presently without avail. Doubtless it is for that very reason that plaintiffs have filed the present suit. See also Upholsterers' International Union of North America v. Leathercraft Furniture Co. (supra).
Finally, it should be borne in mind that these individual employee members of the local Union, so far distant from the alleged prime movers, defendants Saperstein and James, and from the defendant trustee Chasmar, and the Security Mutual Life Insurance Company, are naturally, as they claim, quite ignorant personally of the true facts, as allegedly developed at the hearings before the United States Senate Committee. They claim that such facts are evidentially locked in the breasts of these defendants, and of the other similar defendants whom they have sued in the other courts above noted. Thus, on the present motion, as to the responsibility of defendants Chasmar and Security Mutual Life Insurance Company, plaintiffs are unable to present affidavits on the merits in opposition. Under such circumstances, this court, when such charges have been properly, though generally, pleaded, will deny a motion for summary judgment, in order to permit plaintiffs to take the discovery requisite for them to support the above charges.
'Should it appear from the affidavits of a party opposing the motion that he cannot for reasons stated present by affidavit facts essential to justify his opposition, the court may refuse the application for judgment or may order a continuance to permit affidavits to be obtained or depositions to be taken or discovery to be had or may make such other order as is just.' F.R.C.P. 56(f).
The above motions of defendants Chasmar and Security Mutual Life Insurance Company will accordingly be denied.
An order may be entered accordingly.