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COLLINS v. UMW WELFARE & RETIREMENT FUND OF 1950

April 22, 1969

Shelby Collins, Plaintiff,
v.
United Mine Workers of America Welfare and Retirement Fund of 1950 et al., Defendants


Holtzoff, D.J.


The opinion of the court was delivered by: HOLTZOFF

This case relates to the Welfare and Retirement Fund established by the United Mine Workers of America, a labor union representing coal miners. Two questions are presented. The first is whether the courts have power to set aside as arbitrary and capricious, a regulation adopted by the trustees of the fund, prescribing eligibility for applicants for benefits. The second is whether a particular regulation, which is being questioned in this case, should be set aside as arbitrary and capricious.

 This action is brought by a retired coal miner against the trustees of the Fund to recover a retirement pension that he claims is due him. The salient facts are not in dispute. The Welfare Fund for the purpose of paying retirement pensions and other benefits to coal miners, was created by an agreement between the United Mine Workers of America and a group of owners and operators of coal mines. The Fund is made up of contributions made by the latter. Each operator periodically pays into the Fund a specified amount based on the quantity of coal produced by his mine. The Fund originated in 1946. The creation of such funds was recognized and sanctioned by Congress in the Labor Management Relations Act, 1947 (Taft-Hartley Act), 29 U.S. Code § 186(c)(5).

 A new agreement executed in 1950 between the Union and the operators is now in existence, with some amendments adopted from time to time, that are not germane to this action. This agreement established a Fund designated as "The United Mine Workers of America Welfare and Retirement Fund of 1950". The Fund consists of contributions made by each coal mine operator signatory to the agreement, amounting to thirty cents on each ton of coal produced by his mine. It is administered by a Board of Trustees. It is an irrevocable trust. The purposes of the Fund are to make payments of benefits to employees of mine operators, their families and dependents, for medical or hospital care, pensions on retirement or death of employee, and benefits of other types specified in the agreement that are not relevant to this action. Subject to the stated purposes of the Fund, the trustees are given full authority to determine questions of coverage and eligibility to receive benefits and all other related matters. A portion of the Fund was to be set aside for pensions or annuities for retired members of the Union, their families or dependents.

 The trustees in due course adopted and promulgated regulations prescribing qualifications for eligibility to receive a pension. The existing regulations involved in this case were issued by the trustees on January 4, 1965, and are contained in what is known as Resolution No. 63. The requirements for a pension are as follows:

 
I. Eligibility.
 
A. An applicant who subsequent to February 1, 1965, permanently ceases work in the bituminous coal industry as an employee of an employer signatory to the National Bituminous Coal Wage Agreement of 1950, as amended, shall be eligible for a pension if he has:
 
1. Attained the age of fifty-five (55) years or over at the date of his application for pension.
 
2. Completed twenty (20) years' service in the coal industry in the United States . . . .
 
3. Permanently ceased work in the coal industry immediately following regular employment for a period of at least one (1) full year as an employee in a classified job for an employer signatory to the National Bituminous Coal Wage Agreement, as defined in paragraphs II B hereof.

 In other words, in order to be eligible to receive a pension, a coal miner who retired subsequently to February 1, 1965, must have been at least fifty-five (55) years of age; have completed twenty (20) years' service in the coal industry; and during one (1) full year immediately preceding his retirement, must have been employed by an employer signatory to the agreement, in other words by a mine operator who made contributions to the Fund.

 The plaintiff, who is a retired coal miner, applied to the trustees for a pension. He was found eligible under paragraphs 1 and 2 of the requirements, but not in compliance with respect to the third requirement, in that during the year preceding his retirement he was employed in a non-union mine instead of by an employer signatory to the agreement. It was found that the mine in which he was employed during his last year of service was a non-union mine, was not signatory to the agreement and, therefore, did not make any contributions to the Fund. This action is brought against the trustees to recover the pension which the plaintiff claims. It is contended in his behalf that this third requirement is invalid and should be set aside by the Court as arbitrary and capricious.

 The following facts were stipulated in the pretrial order. On February 18, 1965, the plaintiff applied to the defendants for a retirement pension. The application was originally approved, but later its allowance was revoked. The plaintiff had been regularly employed in the coal mining industry for more than twenty (20) years immediately prior to filing his application. During the year preceding his retirement and the filing of his application, he was employed by a coal company that was not a signatory to the agreement creating the Welfare Fund and, therefore, made no contributions to it. This fact was the ground of the rejection.

 The evidence shows that out of his long period of employment in the coal industry, the plaintiff worked for over twelve years in union mines that made contributions to the Fund. He testified, by deposition, that he resigned his job with a signatory mine operator because of unsafe conditions of work; and that he was compelled to accept employment in a non-union mine because no other employment was available and he had to support his wife and children.

 In narrating why he resigned his employment with a contributing mine, he said ...


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