Opinion ID: 2823457
Heading Depth: 2
Heading Rank: 1

Heading: The April 3, 2007 Letter

Text: Pursuant to the statewide agreement's termination provision, Labonte Drywall was required to give[] notice of termination of this agreement in accordance with the applicable notice provisions in the collective bargaining agreement. The notice provision of the collective bargaining agreement in effect from September 1, 2005 through August 31, 2009 required that either party to this Agreement give[] notice in writing to the other party to terminate the agreement. Therefore, to terminate its statewide agreement with the Union, Labonte Drywall was required to provide a notice of termination in writing to the other party. Plaintiffs contend that the April 3, 2007 letter could not have terminated the statewide agreement because it was not a notice of termination and was not provided to the other party. We address each issue in turn.
A party's stated intent to withdraw from [a collective bargaining relationship] is effective only if it is both timely and unequivocal.4 Haas Elec., Inc. v. NLRB, 299 F.3d 23, 27 (1st 4Relying on cases from the Sixth Circuit, plaintiffs contend that a notice of termination must be clear and unambiguous to be effective. Pls.' Br. at 25 (citing Office & Prof'l Emp. Int'l Union, Local 42, AFL-CIO v. United Auto., Aerospace & Agr. Implement Workers of Am., Westside Local No. 174, UAW, 524 F.2d - 11 - Cir. 2002) (Stahl, J., concurring) (citing Retail Assocs., Inc., 120 N.L.R.B. 388, 393-95 (1958)). The decision to withdraw must contemplate a sincere abandonment, with relative permanency, of the multiemployer unit. See Retail Assocs., Inc., 120 N.L.R.B. at 394. Plaintiffs contend that the April 3, 2007 letter did not communicate an unequivocal intent to terminate Labonte Drywall's agreement with the Union because it makes no mention of 'termination' and does not mention either the [s]tate[w]ide [a]greement or the collective bargaining agreement. Pls.' Br. at 28. Plaintiffs' argument implicates two legal questions. The first question is whether the terms of the statewide agreement required Labonte Drywall to use any particular language in its notice of termination. See OfficeMax, Inc. v. Levesque, 658 F.3d 94, 97 (1st Cir. 2011) (Contract interpretation, when based on contractual language without resort to extrinsic evidence, is a 1316, 1317 (6th Cir. 1975); Int'l Union of Operating Eng'rs, Local No. 181 v. Dahlem Constr. Co., 193 F.2d 470, 475 (6th Cir. 1951)). Yet, plaintiffs never explain how this clear and unambiguous standard is different from the timely and unequivocal standard that the National Labor Relations Board articulated in Retail Assocs., Inc., 120 N.L.R.B. at 393, which we applied in Haas Elec., Inc. See 299 F.3d at 27 (Stahl, J., concurring); id. at 36 (Torruella, J., dissenting). To the extent there is a difference between the legal standards, we are bound by the timely and unequivocal standard. - 12 - 'question of law' that is reviewed de novo.). The second question is whether Labonte Drywall's letter expressed an unequivocal intent to withdraw from the collective bargaining relationship so as to be a legally effective termination.5 See, e.g., Univ. Emergency Med. Found. v. Rapier Investments, Ltd., 197 F.3d 18, 20 (1st Cir. 1999). We address each in turn.
Regarding the first question, we agree with the district court's conclusion that the statewide agreement's termination provision does not require any specific terminology to be effective. Labonte Drywall Co., 2014 WL 2566136, at . Nothing in the four corners of the statewide agreement requires a party's notice of termination to explicitly include the words termination, statewide agreement, or collective bargaining agreement. The termination provision simply requires a notice of termination in writing. See ITT Corp. v. LTX Corp., 926 F.2d 1258, 1265 (1st Cir. 1991) (rejecting party's attempt to insert condition into agreement since no such clause or statement appears within the contract's four corners). 5 Although a party's stated intent to terminate its obligations under a collective bargaining agreement must be both timely and unequivocal, Haas Elec., Inc., 299 F.3d at 27 (Stahl, J., concurring), the parties do not dispute that the letter was timely. - 13 -
Regarding the second question, we also agree with the district court's determination that the April 3, 2007 letter expressed an unequivocal intent to terminate Labonte Drywall's collective bargaining relationship with the Union. See Labonte Drywall Co., 2014 WL 2566136, at . The April 3, 2007 letter clearly states that Labonte Drywall has not . . . done work in the union now since December of 2005 and is no longer bidding or doing any more union work. The letter, on its face, contained no language suggesting that Labonte Drywall was equivocal in its desire to no longer work with the Union. See Haas Elec., Inc., 299 F.3d at 29 (Stahl, J., concurring) (finding that employer's letter expressed an unequivocal intent to terminate collective bargaining relationship even though it admittedly did not use precise language in articulating its intent to withdraw); cf. Louisiana Bricklayers & Trowel Trades Pension Fund & Welfare Fund v. Alfred Miller Gen. Masonry Contracting Co., 157 F.3d 404, 409 n.12 (5th Cir. 1998) (finding termination letter ineffective when it equivocated by agreeing to abide by the terms of the [collective bargaining agreement] 'for the immediate future.'). Moreover, the collective bargaining agreement in effect from 2005 to 2009 provided that all workers hired by an employer, who worked more - 14 - than seven days, had to become (or seek to become) members of the Union, as long as the employer was engaged in the kind of work covered by this agreement. Since the collective bargaining agreement, by its terms, does not allow an employer to perform drywall work without hiring Union workers, the letter's statement that Labonte Drywall was no longer bidding or doing any more union work clearly indicated its intent to terminate the ongoing relationship with the Union. The parties' conduct after Dany Labonte sent the April 3, 2007 letter confirms that they understood that the letter had terminated the collective bargaining relationship between Labonte Drywall and the Union. Cf. Haas Elec., 299 F.3d at 29 (Stahl, J., concurring) (finding that employer's letter to union terminated collective bargaining relationship where the union did not question[] the meaning of the letter at the time and the employer's subsequent conduct was consistent with its stated intent to withdraw). Labonte Drywall last employed Union workers in December 2005, and there is no evidence in the record that the company solicited Union work or performed any other Union-related activity after that time. Importantly, between the end of 2007 and the beginning of 2010, Union representatives visited Labonte Drywall multiple times to request that the company rejoin the Union. Besides these visits, Labonte Drywall received no - 15 - communication from the Union or the Agency until the February 2010 letter requesting an audit of Labonte Drywall's records. Labonte Drywall was no longer receiving copies of the collective bargaining agreements from the Union. Labonte Drywall also had stopped receiving copies of the Union's wage and benefit packages. The Union's director of contractor relations testified that the Agency stop[s] sending these wage and benefit packages to signatory employers if they are no longer members of the Union and had terminated their collective bargaining relationship with the Union. In short, the parties' actions demonstrate that both understood that the April 3, 2007 letter had ended their agreement.
Plaintiffs also argue that the April 3, 2007 letter was not a valid termination because Labonte Drywall did not send the letter to the Union, which is the other party to the statewide agreement. Dany Labonte sent the letter to Donohue, an employee of the Agency, not the Union. Plaintiffs contend that the Union and the Agency are separate legal entities, and that Donohue was not a de facto agent of the Union. Thus, they insist that Labonte Drywall did not provide notice of termination to the Union. Labonte Drywall does not contest that the Union and the Agency are separate entities as a matter of law. Nor does it argue that Donohue was an agent for the Union. Instead, Labonte Drywall - 16 - contends, and the district court found, that the Union received actual notice of Labonte Drywall's termination of the collective bargaining relationship. See Labonte Drywall Co., 2014 WL 2566136, at . The district court's finding implicates both legal and factual questions. The legal question, which we review de novo, is whether actual notice is sufficient to terminate the collective bargaining relationship under the terms of the statewide agreement. The factual question, which we review for clear error, is whether the Union received actual notice of the April 3, 2007 letter. We address each in turn.
Although the statewide agreement's termination provision states that written notice should be given to the other party, the agreement must be read in a reasonable and practical way, consistent with its language, background, and purpose. Bukuras v. Mueller Grp., LLC, 592 F.3d 255, 262 (1st Cir. 2010) (internal quotation marks omitted). The primary purpose of the termination provision is to ensure that the other party to the agreement receives the notice of termination in a timely fashion. Actual notice that is timely achieves that purpose. See In re Redondo Constr. Corp., 678 F.3d 115, 123 (1st Cir. 2012) ([S]trict conformity with a contract's written notice provision is not - 17 - required as long as the counterparty receives substantially the same information through timely actual notice and suffers no prejudice from the non-conformity. (emphasis added)); Univ. Emergency Med. Found. v. Rapier Investments, Ltd., No. CIV.A. 97549-T, 1998 WL 34100601, at  (D.R.I. Oct. 16, 1998) aff'd, 197 F.3d 18 (1st Cir. 1999) (Even where a contract requires a particular method of giving notice, notice given by a different method is effective if it is actually received unless the method by which notice is given is an essential element of the transaction. (citing 1 Maurice H. Merrill, Merrill on Notice § 603, at 662–63 (1952)) (emphasis added)); see also Univ. Emergency Med. Found., 197 F.3d at 22 (finding termination notice valid although party failed to strictly comply with notice provision because that provision did not itself, confer any benefit upon either party and was merely a collateral term intended to enhance the probability that mailed notice will arrive promptly in the proper hands).6 Courts have consistently found termination notices valid 6 when the other party actually received the notice in a timely fashion. See, e.g., Univ. Emergency Med. Found., 197 F.3d at 22; (noting that a mailed termination notice is valid so long as it is actually received by the noticee, even where it is mailed to an incorrect address (emphasis added)); Mason Tenders Dist. Council Welfare Fund v. All Union, Inc., No. 01 CIV. 0152(AGS), 2002 WL 31115181, at  (S.D.N.Y. Sept. 23, 2002) (finding termination letter valid because evidence shows that the Union actually received the [letter] even though it may not have been sent by certified mail in accordance with the terms of the collective - 18 - In this case, plaintiffs make no argument that actual notice, if received by the Union, would be untimely, prejudicial, or somehow undermine an essential element of Labonte Drywall's collective bargaining relationship with the Union. We, therefore, hold that if the Union received actual notice of the April 3, 2007 letter, Labonte Drywall's termination of the collective bargaining relationship would be valid.
At trial, plaintiffs argued that the Agency and the Union operated as wholly separate entities, and, therefore, a notice sent to Donohue would not be received by the Union. Labonte Drywall Co., 2014 WL 2566136, at . However, the district court did not find this blanket assertion credible as a description of their communications regarding Labonte Drywall, in part because the same attorney (Souris) represented both entities and pursued their interests together in their dealings with Labonte Drywall. Id. For example, the record demonstrates that, on the same day in April 2010, Attorney Souris sent Labonte Drywall two letters: one on behalf of the Agency requesting compliance with the 2010 audit, bargaining agreement (emphasis added)); U.S. Broad. Co. v. National Broad. Co., 439 F. Supp. 8, 10 (D. Mass. 1977) (finding termination notices valid because it would be hypertechnical in the extreme to hold that notice actually received was ineffective where it is clear that plaintiff and plaintiff's counsel timely received both notices (internal quotation marks omitted) (emphasis added)). - 19 - and another on behalf of the Union requesting compliance with the collective bargaining agreement. These seemingly concerted actions, through the same attorney, indicate that there was actual communication between the Union and Agency about Labonte Drywall. As the district court reasonably concluded, the plaintiffs' rebuttal -- that the Agency and Union were operating as wholly separate entities -- was not credible in light of their cooperation on matters involving Labonte Drywall. Moreover, the court credited plaintiffs' testimony that the Union is in regular communication with the Agency regarding the status of employers who are no longer active in the Union or who request to terminate the collective bargaining relationship. Id. at  n.6. The record demonstrates that the Union and the Agency regularly communicate when an employer is removed from the list of signatory employers and is no longer active with the Union, which supports the district court's reasonable inference that the two entities communicated regarding Labonte Drywall's notice of termination. The Union's actions after the April 3, 2007 letter was sent also demonstrate that the Union received Labonte Drywall's notice of termination. As explained above, besides visits from Union representatives asking Labonte Drywall to rejoin the Union, Labonte Drywall received no communication from the Union or the - 20 - Agency. The company no longer received copies of the collective bargaining agreements or the Union's wage and benefit packages. We, therefore, find no clear error with the district court's finding that the Union -- the other party to the statewide agreement -- had actual notice of Labonte Drywall's April 3, 2007 termination letter.7