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Branch v. White

Decided: February 16, 1968.

WILLIAM R. BRANCH, ANTHONY VENTRIERA, JACOB SASONKIN, AND BEN GRIFFIES, PLAINTIFFS-APPELLANTS,
v.
J. CHESTER WHITE, HAROLD E. O'NEILL, THOMAS J. REGAN, WILLIAM P. RIDER, DONALD A. REISER AND FRED E. CRANE, OR THEIR SUCCESSORS, TRUSTEES OF THE JOINT PENSION FUND, LOCAL 164, I.B.E.W., DEFENDANTS-RESPONDENTS



Conford, Collester and Labrecque. The opinion of the court was delivered by Collester, J.A.D.

Collester

This is an appeal from a judgment entered in favor of defendants in the Chancery Division dismissing plaintiffs' class action for a declaration of their rights in a joint union-management pension fund administered by defendants as trustees.

Since 1947 a series of collective bargaining agreements have been in force between the Hudson-Bergen Division of the New Jersey Chapter of the National Electrical Contractors Association (Association) and Local 164 of the International Brotherhood of Electrical Workers A.F.L.-C.I.O. (Local 164). Prior to 1953 Local 164 had its own pension plan requiring $2 monthly contributions from its members. By a supplement to the collective bargaining contract, entered into on September 29, 1953, the Association and Local 164 provided for the establishment of a new pension fund for employees. Under its terms all contractors doing work within

the jurisdiction of Local 164 were required to contribute to the pension fund 5% of the gross labor payroll for each journeyman in their employ. This applied not only to pay of employees who were members of Local 164 but to that of all other employees who were employed by contractors within the jurisdiction of Local 164.

In accordance with the collective bargaining agreement the Association, Local 164 and the defendant trustees (three union-nominated trustees and three employer-nominated trustees) on April 13, 1954 entered into a trust agreement whereby the trustees were granted authority to administer the pension fund. The fund was to be comprised of the 5% contributions by the employers mentioned above, income from investments, and employee payments in the sum of $2 per month. The trustees were designated as the persons to receive the money and to hold the same in trust for the purpose of the trust thus created. They were given power to demand, collect and receive such contributions. The agreement further provided that the trustees were to "promptly agree upon and formulate the provisions, regulations and conditions of the pension program * * * including those relating to eligibility, retirement age, and other terms required to carry out the intent and purposes of the pension program, and any and all other matters relating thereto" which they deemed appropriate for the determination of benefits and the administration of the program. Copies of the pension plan adopted by the trustees were to be distributed upon request "to the Union, the Association or to any Employer." The plan was designed, among other things, to be formulated in such manner as to qualify the employer contributions for deductions for income tax purposes.

Pursuant to the agreement defendants on September 30, 1954 prepared and adopted a pension plan which provided that all journeymen electrical workers working in the jurisdiction of Local 164 were eligible to become participants in the plan. Article II "(Requirements for Participation)" thereof reads as follows:

"Section 1. Employees Eligible to Participate. All journeymen electrical workers working in the jurisdiction of the Local No. 164 are eligible to become Participants in this Pension Plan. An electrical worker who ceased work in Covered Employment before October 1, 1953 is not eligible to become a Participant.

Section 2. Requirements for Participation. A journeyman electrical worker who is eligible to participate shall be deemed a Participant in this Plan if and only if he contributes $2 per month to the Pension Fund starting with the first month in which he is employed in Covered Employment, but in no event for any month before October, 1953. This contribution of $2 a month shall be a condition of participation in this Plan but any person so participating shall not have any right, title or interest in his contribution or in any other part of the Pension Fund except for his entitlement to pension benefits as a result of fulfilling all of the terms of eligibility set forth in this Plan.

Section 3. Termination of Status as a Participant. A person's status as a Participant shall terminate in the month following the month in which he last contributes or in the month he retires. When an Employee ceases to be a Participant for reasons other than retirement he shall not retain any right or interest in the contributions he made to the Pension Fund." (Emphasis ours)

Article III ("Benefit Eligibility and Amounts"), ยง 1 provides that a participant shall be eligible for a pension if, at retirement, (a) he has attained age 65, (b) has credit for 20 years or more of employment under I.B.E.W. contracts, and (c) has credit for employment under Local No. 164 contracts for the last 10 years (or more) immediately preceding his retirement.*fn1

A booklet prepared by defendants, designated "Brief Explanation of the Pension," contained the following questions and answers:

"Q. Who is covered by the pension plan?

A. All journeymen electrical workers who are working under Local No. 164 contracts and who contribute $2.00 a month to the

pension fund are covered under the pension plan. An electrician who does not contribute $2.00 a month to the pension fund is not covered under the pension plan.

Q. When does an electrician begin to make contributions to the pension fund?

A. An electrician working under Local No. 164 contracts begins to make contributions to the pension fund as soon as he becomes journeyman. If an electrician was a journeyman in October 1953, his contribution began at that time."

When the pension plan was adopted on September 30, 1954, application for approval by the Internal Revenue Service was made and such approval was subsequently granted.*fn2 The money paid by Local 164 members under their previous pension plan was returned. The booklet prepared by the trustees, above referred to, was mailed to all employees who were covered under the prior plan, namely, members of Local 164, and to all employers included in the new plan. In addition to receiving the booklet members of Local 164 had the plan explained to them at Local union meetings.

On June 22, 1965 plaintiffs William R. Branch, Ben Griffies, Jacob Sasonkin and Anthony Ventriera, for themselves and other employees similarly situated, brought a class action against defendants pursuant to R.R. 4:36-1. Plaintiffs were members of I.B.E.W. (the international union) but not members of Local 164. When the pension plan was adopted on September 30, 1954 they were "covered employees," i.e., they were employed by contractors who were members of the Association. As such they were "eligible" to become a "participant" in the pension plan under its provisions upon payment of the $2 monthly payment during the first month following its effective date, subject to continuation of such payment each month thereafter. Branch, Griffies and Sasonkin were employed under contracts within

the jurisdiction of Local 164 but had not as of the commencement of the action accumulated the years of service or attained the retirement age required for a pension under the plan. Ventriera had worked for over 20 years under the aegis of I.B.E.W. and over 10 years under Local 164 contracts when he retired in 1964 at 65 years of age and thus would presumably qualify for a pension had he been a "participant."

In their action plaintiffs claimed that they and other employees who were not members of Local 164 had never been informed of the terms and conditions of the trust agreement and pension plan and, more particularly, of the requirement that the $2 monthly payments had to be made in order to become a participant in the pension plan and further -- that only members of Local 164 had been so informed. They alleged that as representatives of a class of employees similarly situated and having a common interest in the trust agreement and pension plan they were entitled to a declaration of their rights in and to the pension fund and a preservation of the fund to secure such rights.*fn3 They further alleged that the provisions of the plan had been used to limit pension eligibility to members of Local 164.

Defendants answered alleging that they had made every reasonable effort to notify all employees of the terms and conditions of the trust agreement and pension plan; that plaintiffs had failed and refused to become participants therein and thus were not entitled to its benefits. They further alleged that plaintiffs were not entitled to ...


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