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NYSA-ILA MED. & CLINICAL SERVS. FUND v. CARCO

April 28, 1985

NYSA-ILA Medical And Clinical Services Fund, Plaintiff
v.
Carco, Inc., Defendant



The opinion of the court was delivered by: STERN

Counsel:

 In this action NYSA-ILA Medical and Clinical Services Fund ("the Fund") charges that Carco, Inc. breached certain terms of a collective bargaining agreement and of an employee benefit plan, established under the Labor-Management Relations Act, 29 U.S.C. § 186. Specifically, the plaintiff contends that Carco has failed to make contributions to the Fund on behalf of its employees as required by the collective bargaining agreement. On its motion for summary judgment, plaintiff Fund seeks recovery of unpaid contributions, pursuant to 29 U.S.C. § 1132, as well as an injunction, interest, and attorney's fees. We now grant summary judgment in favor of plaintiff, having determined that defendant is precluded from proving prior oral understandings to vary the terms of the agreement both by the parol evidence rule and by national labor policy. For the reasons following we also grant plaintiff's motion for attorney's fees and double interest under 29 U.S.C. § 1132(g). Finally, we decline to enter an injunction upon the oral representations from defendant's attorney at the hearing on March 25, 1985 that restraints are unnecessary to prevent future violations of the collective bargaining agreement.

 FACTS

 Plaintiff is a joint labor-management trust fund established in accord with section 302 of the Labor-Management Relations Act, 29 U.S.C. § 186 (1976). The Fund was created by the New York Shipping Association-International Longshoreman's Association ("ILA"), AFL-CIO, collective bargaining agreements and an Agreement and Declaration of Trust and Plan in March 1961. It provides medical and clinical services to eligible longshoremen covered under collective bargaining agreements between the shipping association and the ILA and between other employers and affiliated locals of the ILA, including Local 1478-2. See Fier Aff. at para. 3. Defendant Carco, Inc. is a New Jersey corporation which services piers for automobiles and employs individuals who participate in the plaintiff Fund. See Answer at para. 4.

 Defendant admits that on September 1, 1979 it entered into a collective bargaining agreement ("1979 Agreement") with Local 1478-2, ILA. See Answer at Counterclaim para. 1. Paragraph 16 of this 1979 Agreement required Carco to "contribute for all hours worked, also holidays and vacations to the Clinic and Clinical Services in Port Newark," i.e., to plaintiff Fund. See Fier Aff., Exh. A. The 1979 Agreement was to continue for three years, ending August 31, 1982, but would be "automatically renewed from year to year unless written notification be given by either party . . . at least sixty days prior to the expiration hereof, that changes in the agreement are desired." See 1979 Agreement at para. 17, Fier Aff., Exh. A.

 Carco's president, Alan S. Husak, claims that he notified the Fund, in a letter of May 6, 1981, that defendant intended to end its relationship with the Fund by the end of 1981 "due to the high cost of double coverage . . .". Husak Aff., Exh. A. Subsequent conversations with plaintiff's representative allegedly resulted in "an Agreement" that Carco would end its relationship with the Fund on August 1, 1982. Husak Aff. at para. 8. Apparently, this "Agreement" was never memorialized in writing. By letter of August 10, 1981, Husak notified the union's president, Vincent Cuzzo, that Carco would withdraw from the medical plan as of August 1, 1982. See Husak Aff., Exh. B. Again, plaintiff neither presents evidence, nor alleges, that the medical fund or the union agreed to this withdrawal in writing.

 The following year, in July 1982, the union submitted to defendant a proposed form of a collective bargaining agreement dated September 1, 1982 ("the 1982 Agreement"). This 1982 Agreement was "much the same" as the 1979 Agreement. Husak Aff. at para. 10. Defendant refused to sign it since it still included paragraph 16, requiring Carco to make payments to plaintiff Fund. Id. at P 11. Neither plaintiff Fund, nor Carco claims that defendant ever signed the proposed 1982 Agreement.

 Nonetheless, in August 1982, defendant did execute an "amendment to the 1979 Agreement" ("the 1982 Amendment"). Id. at P 13. This document provides, in pertinent part, that "The current Collective Bargaining Agreement between the undersigned employer and union is hereby extended for a period of three [3] years to and including August 31, 1985 except for the following changes . . ." Fier Aff., Exh. B. The only "change" listed concerning medical coverage provides:

 
4. Blue Cross/Blue Shield coverage shall be continued for all employees except that coverage for employees hired on or after 9/1/82 shall not begin until they have completed thirty (30) days of employment with the employer within a four and one half (4 1/2) month calendar period.
 
Likewise, such coverage shall continue for a period of thirty (30) days after the termination of employment of an employee for any reason.

 Id. There is no mention of removing the medical coverage provided by payments to plaintiff Medical Fund.

 However, Mr. Husak claims that he signed the 1982 Amendment only because the union president assured him that it would not obligate defendant to continue to make contributions to the Fund. See Husak Aff. at para. 13. He asserts further that he was under pressure to sign due to an "impending strike of the defendant's employees as a result of the unexecuted 1982 draft." Id.

 Nevertheless, defendant made at least six payments to the Fund after executing the 1982 Amendment. Copies of these checks, dated September 1982 through February 1983, are appended to the Fund's moving papers. See Fier Aff., Exh. C. Defendant neither denies nor explains these payments.

 In moving for summary judgment, the Fund asserts that the 1982 Amendment, on its face, incorporates the entire 1979 Agreement -- including paragraph 16. Carco counters that it never executed the 1982 Agreement, and that it signed the 1982 Amendment under duress -- the strike -- and only because union representatives falsely represented that the Amendment removed the need for payments to the Fund. Thus, defendant argues that this 1982 Amendment is not a valid enforceable contract. In reply, ...


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