Opinion ID: 3010213
Heading Depth: 2
Heading Rank: 2

Heading: An employee shall be deemed to be an eligible

Text: member employee if such employee has worked at least 60 hours for the Employer during the preceding month. JA at 202-03. Unlike the Eligibility Clause that appeared in the 1983 and 1985 Agreements, this clause included no additional requirement that the employee work at least 45 days prior to eligibility. Webb testified that he called John Kleinfelter, the administrator of the Welfare Fund, to find out how the mistake had occurred, and that John kind of pooh-poohed and ha-ha'd and laughed about it. JA at 302. Webb also contacted Greenawalt, informing him that, unless Local 764 agreed to reform the Eligibility Clause to be identical to that in the 1983 and 1985 Agreements, he would pursue a formal grievance under the parties' collective bargaining agreement. Greenawalt testified that he was as surprised as [Webb] was to learn of the actual language in the Eligibility Clause. JA at 416. However, he further testified that the point at which the error was discovered was so long after the Agreement was signed that he was reluctant to change it unilaterally because he feared the union could be held liable by the Welfare Fund. Therefore, on August 18, 1989 Greenawalt formally advised Webb that Local 764 would not agree to modify the Eligibility Clause and that McCormick should file a grievance with the American Arbitration Association if it wished to pursue the issue. Webb did not pursue a formal grievance. Instead, McCormick adopted a new practice of notifying each newly hired employee that there had been an error in the 1988 Agreement, explaining to each of them that they would become eligible for health and welfare benefits only after they had completed their 45th work day or their 60th calendar day and requiring them to sign a form acknowledging that they were aware of this. In 1991, auditors conducted a routine examination of McCormick's payroll records on behalf of the Welfare Fund and the Pension Fund. This payroll audit revealed that McCormick had not been making contributions on behalf of newly hired employees in accordance with the Eligibility Clause as it actually appeared in the 1988 Agreement. In particular, the auditors discovered that McCormick owed $27,930.00 in delinquent contributions to the Welfare Fund. There is no dispute that under the plain language of the 1988 Agreement, McCormick owes the $27,930.00. Webb testified that after learning of the audit, he again called John Kleinfelter at the Welfare Fund. He testified that during his conversation, Kleinfelter told him [W]e haven't come after you for the money, have we? . . . [W]ell you know it was a mistake. JA at 309. Greenawalt testified, however, that he spoke to Kleinfelter about the language, too, and that Kleinfelter never told him it was a mistake but that it was the standard language they sent at the end of every contract and that if McCormick had not wanted to agree to it, they should have gone back to the Welfare Fund for approval to change it. After failing in its efforts to recover the delinquent funds, the Welfare Fund commenced this action against McCormick on April 22, 1993. Meanwhile, in 1991, Donald Deivert replaced Greenawalt as President of Local 764. On June 17, 1993 -- almost two months after the Welfare Fund filed the instant action in federal court -- Webb executed a Memorandum of Agreement with Deivert, acknowledging that there was an error in the 1988 Agreement. Deivert's testimony, however, indicates that he signed this Agreement out of fear that he and the Union would be sued and the union drivers would lose their jobs if he did not. In March of 1994, both parties filed cross-motions for summary judgment. The district court granted summary judgment in favor of McCormick, finding that the Eligibility Clause in the 1988 Agreement was subject to reformation because the language in the clause was the result of a mutual mistake or a scrivener's error. Central Pennsylvania Teamster Pension Fund, et al. v. McCormick Dray Lines, Inc., No. 93-2118, slip op. at 16 (E.D. Pa. Nov. 21, 1994) (hereinafter Memorandum Opinion). This appeal followed.