FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

U.A. LOCAL 342 APPRENTICESHIP & 

TRAINING TRUST; LARRY BLEVINS,

No. 03-16018 Trustee,

Plaintiffs-Appellees, D.C. Nos.  CV-01-04327-TEH

v. CV-02-00098-TEH

BABCOCK & WILCOX CONSTRUCTION OPINION CO., INC.,

Defendant-Appellant. 

Appeal from the United States District Court

for the Northern District of California

Thelton E. Henderson, District Judge, Presiding

Argued and Submitted

December 9, 2004—San Francisco, California

Filed February 1, 2005

Before: Alex Kozinski, William A. Fletcher and

Jay S. Bybee, Circuit Judges.

Opinion by Judge Kozinski

1305
COUNSEL

Nancy Winkelman, Philadelphia, Pennsylvania; Stephen H.

Dye, Schnader Harrison Segal & Lewis LLP, San Francisco,

California, for the defendant-appellant. 

William J. Flynn, Neyhart, Anderson, Freitas, Flynn & Grosboll, San Francisco, California, for the plaintiffs-appellees. 

OPINION

KOZINSKI, Circuit Judge: 

Seven and a half cents doesn’t buy a helluva lot,

Seven and a half cents doesn’t mean a thing,

But give it to me ev’ry hour,

Forty hours ev’ry week,

That’s enough for me to be

Livin’ like a king.1

Facts

Babcock & Wilcox Construction Co. entered into the

National Industrial Maintenance Agreement (“NIMA”), a collective bargaining agreement, with the United Association of

1Richard Adler & Jerry Ross, Seven and a Half Cents, in The Pajama

Game (1954). 

U.A. LOCAL 342 v. BABCOCK & WILCOX CONSTRUCTION 1307
Journeymen and Apprentices of the Plumbing and Pipe Fitting

Industry of the United States and Canada (“U.A.”). Whenever

local U.A. unions work on projects that fall within the scope

of the NIMA, the terms of any local labor agreements to

which the unions may also be parties apply only to the extent

that the NIMA incorporates them. 

One area in which the NIMA refers to local agreements is

benefit fund contribution obligations. For example, the NIMA

incorporates required apprentice training fund contributions:

Welfare Funds, Pension Funds, Apprentice Training Funds and other monetary funds called for in the

Local Union Labor Agreement shall be paid in

accordance with the Local Union Labor Agreement

. . . . 

NIMA, art. IX ¶ 34. Industry promotion fund contributions,

however, are not mandatory:

Industry Advancement or Promotion Funds called

for in the Local Union Labor Agreement may be

paid at the discretion of the Employer. 

Art. IX ¶ 36. 

The local agreement at issue here provides for a variety of

fund contributions, including 75 cents per hour of work to the

U.A. Local No. 342 apprentice training fund and 25 cents to

industry promotion funds. It also requires employers who do

not contribute to industry promotion funds to pay an equal

amount into the apprentice training fund. See Master Labor

Agreement Between Local Union 342 and Northern California Mechanical Contractors Association (“local agreement”),

art. X ¶ 81(E), (I), (J). 

Babcock properly exercised its discretion under article IX

¶ 36 of the NIMA and declined to pay the 25 cents into the

1308 U.A. LOCAL 342 v. BABCOCK & WILCOX CONSTRUCTION
industry promotion funds. However, it did not contribute an

equal amount into the apprentice training fund, as required by

the local agreement. The apprentice training fund sued. The

district court granted the fund’s motion for summary judgment and referred the remaining matters, including damages,

to a magistrate judge. The parties agreed to a stipulated judgment in conformity with the district court’s order. Babcock

appeals. 

Discussion

1. Stipulated judgments are usually not appealable. See Slaven v. Am. Trading Transp. Co., Inc., 146 F.3d 1066, 1070

(9th Cir. 1998). However, both parties agree that the purpose

of the stipulated judgment was to set an amount of damages

to facilitate Babcock’s appeal. We therefore have appellate

jurisdiction because it is clear that Babcock “intended to preserve its right of appeal.” See Christian Sci. Reading Room

Jointly Maintained v. City & County of S.F., 784 F.2d 1010,

1017 (9th Cir. 1986). 

[1] 2. The text of the NIMA supports the fund’s position.

The local agreement requires employers who do not pay a

quarter into the industry promotion funds to turn that quarter

over to the apprentice training fund. Babcock’s choice not to

contribute to the industry promotion funds—a choice protected by the NIMA, which makes such contributions

discretionary—thus created a requirement under the local

labor agreement to contribute to the apprentice training fund.

That requirement is incorporated into the NIMA, which provides that “Apprentice Training Funds . . . shall be paid in

accordance with the Local Union Labor Agreement.” Art. IX

¶ 34. 

[2] 3. Babcock suggests that we defer to the judgment of

the NIMA Policy Committee, which considered this same

question and concluded that requiring employers to pay into

apprentice trust funds as an alternative to paying into industry

U.A. LOCAL 342 v. BABCOCK & WILCOX CONSTRUCTION 1309
promotion funds would be “contrary to the spirit and intent”

of the NIMA. This is not, strictly speaking, a statement that

the NIMA does not require such contributions. However, even

if we were to interpret it as such, the Policy Committee’s

determination is not entitled to deference in this case. 

[3] One function of the Policy Committee is to adjudicate

grievances between parties. Art. VI ¶ 28. We generally afford

great deference to the decisions of arbitrators in disputes

between parties to a collective bargaining agreement who,

after all, agreed to the arbitrator’s authority. See, e.g., Grammer v. Artists Agency, 287 F.3d 886, 890-91 (9th Cir. 2002);

Haw. Teamsters & Allied Workers Union, Local 996 v. UPS,

241 F.3d 1177, 1183 (9th Cir. 2001). But appellees, as nonparties to the agreement, have never agreed to submit to the

decisions of the Policy Committee. 

[4] Even without their consent, appellees could nonetheless

be required, as third-party beneficiaries of the NIMA, to go to

arbitration, in which case the Policy Committee’s interpretation of the contract would be binding on them. But an intent

to subject third-party beneficiaries to arbitration is not presumed; it must appear from “the language of the contract, or

the circumstances under which it was executed.” See Schneider Moving & Storage Co. v. Robbins, 466 U.S. 364, 371

(1984). No such intent appears here: The NIMA does not give

the Policy Committee authority to interpret the NIMA in the

context of disputes with non-parties.2

We don’t doubt the benefits of delegating interpretive

power over a complex collective bargaining agreement to an

expert body in the way Babcock suggests, but the NIMA here

didn’t actually grant the Policy Committee such power. 

AFFIRMED.

2We do not give any weight to the Policy Committee secretary’s statement that “[t]he Committee has exclusive authority to administer and

interpret” the NIMA. This is a legal opinion about the interpretation of a

contract, not a fact. 

1310 U.A. LOCAL 342 v. BABCOCK & WILCOX CONSTRUCTION