Legal Document

455 U.S. 72 102 Supreme Court Reporter 851 70 United States Reports Lawyer’s Edition 2d Series KF101.8 U54 833 KAISER STEEL CORPORATION, Petitionerv.Julius MULLINS et al. Number 80-1345. Argued Nov. 10, 1981. Decided Jan. 13, 1982. Syllabus Petitioner coal producer, as a party to collective-bargaining agreement between the Mine Workers of America and hundreds producers, agreed contribute specified employee health retirement funds on basis each ton it produced hour worked by its covered employees. The also required an employer report purchases from producers not under contract with union make contributions welfare such purchases. After petitioner failed "purchased-coal" clause, respondents, trustees trust funds, filed suit in Federal District enforce agreement. admitted failure comply purchased but contended that clause was void unenforceable violative §§ 1 2 Sherman Act § 8(e) National Labor Relations (NLRA), which forbids agreements whereby agrees cease doing business with, or handling products of, another (hot cargo provision). entered summary judgment for Appeals affirmed. Both courts rejected petitioner's defense without passing legality purchased-coal either NLRA. Held : entitled plead have adjudicated based alleged illegality clause. Pp. 77-78. (a) Illegal promises will be enforced cases controlled federal law. This rule is rendered inapplicable here asserted grounds employers' are not, themselves standing alone, illegal acts ordering pay would therefore command conduct inherently contrary public policy. Petitioner's obligation money arose measured other who did if this antitrust labor laws, order unlawful conduct. 77-83. (b) Although general do jurisdiction over activity arguably subject 8 NLRA must defer exclusive competence Board determine what unfair practice, court has duty whether violates law before enforcing it. Section renders hot-cargo clauses at their inception all times courts. Thus, where raised designed protect, directed collateral matter portion enforcement sought, entertain defense. 83-86. (c) Assuming, arguendo, 306(a) Multiemployer Pension Plan Amendments 1980—which requires employers multiemployer pension plan accordance employer's terms agreement—is applicable case, does alter result. abolish defenses explicitly only so "inconsistent law," intended simplify collection actions precluding "unrelated" "extraneous" promise contributions. Nor statute's language history indicate Congress implicitly repeal any statute might provision requiring fund. 86-88. 206 U.S.App.D.C. 334, 642 Reporter, 2nd 1302, reversed remanded. Atlantic Douglas Melamed, Washington, D.C., petitioner. Stephen Judge Pollak, respondents. Barbara E. Etkind, Philadelphia, Pa., amicus curiae special leave Court. Justice WHITE delivered opinion issue when sued union, laws. * Bituminous Coal Wage Agreement 1974 (UMW) including steel companies Kaiser Steel Corporation signatory funds. (d)(1) Article XX amounts In addition, section included "each two thousand (2,000) pounds bituminous after production operator, procured acquired [the employer] use sale appropriate Trusts provided been made. . ."1 (d) furnish monthly statements showing full due well tons produced, procured, sale. parties held agency, could demand negotiations respect replacement invalidated provision.2 3 operates mill California mines Utah New Mexico. Its produce high-volatile coal, purchase mid-volatile used manufacturing producer. Since 1959, virtually requirements Mid-Continent Coke company Mid-Continent's employees represented Redstone Workers' Association, wages benefits during period were equal superior those UMW contract. Nevertheless, repeatedly attempted become representative According affidavits submitted Kaiser, taken into account calculating needs revenues various negotiation Agreement.3 4 complied hours miners. It however, others coal. expiration contract, Health Retirement Funds, respondents here, seeking latter's others. Jurisdiction 301 Management Act, 1947 (LMRA), 61 Statutes-at-Large 156, 29 Code KF62 185, 502 Employee Income Security (ERISA), 88 891, 1132. defended ground, among others, these respects 26 209, 15 2, NLRA, 73 543, 158(e). pass nevertheless Kaiser's granted trustees' motion judgment. 466 F.Supp. 911 (1979). affirmed, 1302 (1980), rejecting adjudicating 5 We petition certiorari raising question, had properly foreclosed connection producers. 451 969, 101 2044, 68 347 (1981). now reverse. II 6 There no statutory code law, our doubt McMullen versus Hoffman, 174 639, 19 839, 43 L.Ed. 1117 (1899), bidders work separate bids revealing they share equally one them awarded One secured share. found undertaking refused it, saying: 7 "The authorities earliest time present unanimously hold lend assistance way towards carrying out case action brought necessary prove maintain action, ." Id., 654, S.Ct., 845. "[T]o permit recovery substance because against policy stand. refuses permits defendant set up illegality, regard sets up, interest." 669, 851. 9 confirmed Continental Wall Paper Louis Voight & Sons Co., 212 227, 280, 53 486 (1909), buyer's goods ground itself part bargain "In aid denied, benefit defendant, demands should denied interests individual parties." 262, 292.4 10 position require different statutes, Sections prohibit contracts, combinations, conspiracies restraint trade, monopolization attempts monopolize. urges sections puts non-UMW disadvantage competing sales concerns like penalizes shopping sellers lowest available price.5 11 contracts employer. submits being forced 8(e), provision, dealing major purpose prohibiting protect coerced aiding organizational objectives employers. 12 Appeals, Court, declined apparently view even unlawful, sustained case. disagree. None offered persuasive. 13 agree, first place, assumed commanding argument naked obligated then made If financial burden attached though may contributed plain enough assertedly statutes. 14 agree Kelly Kosuga, 358 516, 79 429, 475 (1959), compels supports both respondent engaged marketing onions. buy substantial onions owned respondent. mutually neither deliver futures market balance trading season. fixing price limiting amount sold State Illinois, thereby "creating false fictitious market" produce. 517, 430. defaulted payments claim his violated Act. said "[a]s plea violation met much favor," id., 518, 431, particularly purchaser recover him sold. Various cited support observation, sustained, distinguished excessive "would very restraints forbidden Act." supra, U.S., 520, 432. went say "[p]ast point precise guided overriding 'of preventing people getting people's property nothing purport buying it.' " 520-521, 432 (quoting 271, 296). Applying approach facts observed: "[W]hile nondelivery court, character assumed, can hardly give legal effect completed fair price. [W]here, lawful consideration constitutes intelligible economic transaction itself, we think inappropriate intent furnished occasion restrictive sort question." 521, 16 Respondents construe Kosuga propositions: first, wholly performed side, performance side entertained;6 second, express remedies added avoidance sanction.7 apparent propositions limitation entertained circumstances rejection laws forbid. there promises, withhold market. former enforced, latter unenforceable. 17 thus contemplated this. illegal, precisely promised linked penalty UMW. withholding done unilaterally. But so, recognized, Here, quite more often than linking illegality. 18 Respondents' reliance Lewis Benedict Corp., 361 459, 80 489, 442 (1960), There, bound When delinquent contributions, no-strike contained strikes company's fund independent conditioned union's strike. Furthermore, setoff trustees, innocent third parties, least absence some indication reduce damages caused striking unions. Just undertaking. Aside default, decision suggests collect pursuant NLRA.8 III question within authority adjudicate respect. vested primary practice. As rule, "is [NLRA]," "must Board." San Diego Building Trades Council Garmon, 359 236, 245, 773, 780, 775 (1959). See Garner Teamsters, 346 485, 490-491, 74 161, 165-166, 98 228 (1953). established, power private exercised restrictions limitations manifested Where policy, refrain exertions judicial power." Hurd Hodge, 334 24, 34-35, 847, 853, 92 1187 (1948) (footnotes omitted). 20 "touchstone" "central theme" protection neutral employers, caught middle dispute party. Woodwork Manufacturers Assn. NLRB, 386 612, 624-626, 645, 87 1250, 1257-1259, 1268, 357 (1967). provides "it shall practice" enter containing "any heretofore hereafter [a clause] extent unenforcible void." strongly implies reach merits place. 21 That hot evident legislative history. enacted close loophole created Carpenters 93, 78 1011, 1186 (1958) (Sand Door). existence practice charge employer, emphasizing observance unlawful. "Section plug gap legislation making 'hot cargo' Sand Door believed create possibility damage breaches 634, 1263. specific performance. 22 further supported Connell Construction Plumbers Steamfitters, 421 616, 95 1830, 44 418 (1975). claiming Respondent exempt authorized 8(e). decide permitted constituted holding NLRB "has instance meant 8(b)(4)." Steamfitters Local Union 100, 483 1154, 1174 (CA5 1973) (footnote "the questions emerge issues suits remedies, laws." 626, 1837 Meat Cutters Jewel Tea 381 676, 684-688, 85 1596, 1599-1601, 640 (1965). addressed allow issue. 633, 1840. result, majority persuaded suggest "labor-law violations exclusive, thought allowing inconsistent remedial scheme NLRA." 1841 23 Connell, decided instance. immune Here recently stated violate "void," "[a]t statute] defensively litigation preclude [a] contract." Transamerica Mortgage Advisors, Incorporated Lewis, 444 11, 18, 100 242, 246, 62 146 Therefore, While provide affirmative practices, Were otherwise, compelled clauses, lawfulness insulated review court. IV 24 On September 26, 1980, nine days issued review, argue established governing availability trustees. urged raise here. Public Law 96-364, 94 1295, 515 ERISA, provides: 25 "Every collectively bargained shall, conditions agreement." 1145 (1976 ed., Supp.V).9 eventually S. 1076 Senate Committee Human Resources. explained "simple converted lengthy, costly complex concerning claims unrelated plans' entitlement contributions," steps "simplify delinquency collection." Resources, 1076—The 1980: Summary Analysis Consideration, 96th Cong., Sess. (Comm. Print, Apr.1980) (1980 Print) (emphasis added). During floor debate, Senator Williams Representative Thompson10 meaning same Print. legislators endorsed (1960); Huge Long's Hauling 590 457 (CA3 1978), cert. 918, 99 2840, 285 (1979); Mill Ridge Coals, Inc., 298 552 (CA6 1962); disapproved Washington Area Carpenters' Welfare Fund Overhead 488 816 (DC 1980), appeal pending, 80-1501 (CADC), Western Laborers-Employers Trust McDowell, 103 L.R.R.M. 2219 (WD Wash.1979), 80-3024 (CA9).11 27 1980 Far abolishing defenses, law." Even construed completely embracing views expressed Thompson, prevented defenses; rather spoke defenses.12 points brief, none "involved contribution Brief Amicus Curiae 28 Neither nor involved sought enforced. contention payment 302(a) LMRA—must reason. necessarily assumes enacting 306(a), repealed "repeals implication disfavored," Allen McCurry, 449 90, 99, 411, 417, 66 308 'the intention legislature clear manifest.' TVA Hill, 437 153, 189, 2279, 2299, 57 117 (1978), quoting Posadas City Bank, 296 497, 503, 56 349, 352, 351 (1936). implying repeal, nowhere mention conflict laws.13 reversed,14 remanded proceedings consistent opinion. 30 So ordered. 31 BRENNAN, whom MARSHALL BLACKMUN join, dissenting. 32 salient sufficiently stressed Court's opinion, bear repeating. 1974. agreement, certain UMW-designated upon mines. obviously value employees, adjudged renegotiation secure quid pro quo life 1977, fully obligations contrast, penny Instead, disclose fact outside applied, reporting 1978—after lost opportunity renegotiate bargain—Kaiser interposed moneys 33 'It similar defence [of illegality] dishonest one, lies ill mouth allege .' 519, 850, (1899). observation peculiarly apt indeed Corporation. my view, exemplifies abuse stop enactment 1980.1 34 reads follows: 35 "DELINQUENT CONTRIBUTIONS 36 1295. 37 evinces unmistakable congressional obligatory made, except construction phrase, application outcome depend. construes suggesting tainted "consequential" illegality—payments "lead to" situations condemned "reap fruits" provisions. Ante, 81-83. Thus read "its forbid." 82. endorsement earlier cases, calling broad law" phrase comport cases. 38 plausible ignored. demonstrates beyond deeply concerned about pre-1980 instability plans, undesirable state affairs largely attributed plans. expressly expedite contractually chose by, inter alia, substantially narrowing scope With history, relieved illegal—for example, nature bribe. sum, once whenever connected activities results, act. An examination makes crystal clear. 39 merely declaratory pre-existing whole satisfied condition assumption clearly erroneous. seriously troubled perception plans highly vulnerable instability,2 identified principal cause vulnerability. Resources concluded: 40 "Recourse current collecting insufficient unnecessarily cumbersome costly. Some simple efficaciously. Sound national providing repudiate promises." Sess., Print 1980) added).3 41 Congress' paramount concern trustees—in words, kind To solve problem, decided, things, narrow comments sponsors House interpretation. 42 House, Thompson "Federal efficaciously, arise labor-management relations law—other 186." 126 Cong.Rec. 23039 (1980) Title 186, "Restrictions transactions," essentially prohibits paying bribes representatives, union.4 evince able interpose claimed resided itself. Senate, theme: "It essential actuaries rely promises. [P]lan participants exchange bill clarifies direct ERISA extraneous defenses." Cong.Rec., 20180 45 later restated defined understanding term, "extraneous," using words had. 23288. 46 cut off previously trustee, falling prohibition 186. perceived trustee third-party beneficiary reached Such take rise obligation. influence aspects are—as 306(a)'s put it—"extraneous" "unrelated plan. From trustee's designated distinct severable irrelevant achieve goal expediting simplifying delinquent-contribution through adopted ensure funding owing those, arising involving inherent 47 ignores prescription, rendering nullity frustrating desire integrity retirement, health, unemployment many working rely. devotes little effort analysis conclusion conflicts significant respects. 48 explain why modest, attributes 306(a). begin reconcile limited manifest vulnerability expected mere existing remedy serious problems addressed. simply expose incredibility. difficulties status quo, satisfaction 49 naturally leads to, turn explains, Williams' Thompson's explicit new disregards manifest." reasoning superficially obvious "repealed" channels injunctive relief damages, normally afforded 457, 465 1978) (concurring opinion). And—with Act—even partial repealer, record us presents plenty "clear manifest" evidence repeal: address evidence. dissatisfaction respecting plans; contributions; legislation, disclosing device—a cross-reference 186—actually chosen purpose. By demanding this, imposes own wisdom guise restraint. 50 below, affirming proffered affirmed attack themselves. Indeed, attempt overdue illegal. Rather, contends "hot cargo" Whatever contentions consequential 51 impair rights vis-a-vis UMW, undercut important policies embodied easily transform causes directly union. still bringing, proper forum, timely rescission declaration committed Huge, opinion).5 distinguishes assure stability prescribes insulation trustees—such respondents—from potentially never-ending disputes management. 52 Because N Dec. Immigration Nationality Decisions believe affirmance dissent. since 1940's. 1964 Agreement, although left free until 1971 penalty. predecessors 158(e), see, e.g., Riverton 453 1035 (CA6), 407 915, 2439, 690 (1972), group boycott See, Pennington, 657, 1585, 626 (1965); South-East Consolidation 434 767 1970), 402 983, 91 1662, 149 (1971). producer increase mined number funds' members increase. 852-853, (1948); D. R. Wilder Manufacturing Corn Products Refining 236 165, 177, 398, 402, 59 520 (1915); Bement Harrow 186 70, 88, 747, 754, 1058 (1902); Connolly Sewer Pipe 184 540, 548-549, 435, 679 (1902). sell lower competitive charged expired, bring evils prevent. cannot term spring enforceable expires. penalizing purchasing less extracted termination promise. presumptively promisee need wait expires ephemeral. Cases confound rule. And suggested waited long assert defense, "rules estoppel thwart purposes statutes States." Sola Electric Jefferson 317 173, 176, 63 172, 174, 165 (1942). Refusing additional Congress. A proffering seeks ask "[A]ny act Congress, constitute good gives person injured right sue, prevent setting defence, proved valid denounced illegal." 754. text, promisor perform he whole. avoid performing perfectly separate, conforms common-law exception contracts. 6A Corbin, Contracts 1518-1531 (1962 ed. Supp. 1964); Comment, U.Chi.L.Rev. 758, n. (1959-1960). "third-party beneficiaries, Trustees nonperforming promisors." 344, 1312 (1980). respect, exempts Only exemption and, discussed Part IV, so. dissent rests entirely absent Chairman manager S.1076, counterpart H.R. 3904, became 1980. Similarly, Education 3904. (remarks Rep. Thompson); 23288 Sen. Williams). Ibid. Williams); (colloquy Matsunaga). 44. dissent, extract Under unavailable contract; avail enforceable, suspended concedes instead relies scraps unconvinced pointed paid sums anticipated trust-fund revenues. unpersuaded bargains been, relied solvency attorney's fees prevailing award reversed. discretion awarding 502(g). "allow reasonable fee costs party" 502. Petitioners contend 502, fees. unnecessary expresses 87. doubt. Ever Schooner Peggy, Cranch 103, 109, (1801), recognized according Recently, Bradley Richmond School Board, 416 696, 711, 2006, 2016, 476 (1974), reaffirmed adherence appellate "apply decision, unless result injustice direction contrary." "in effect," apply manifestly unjust. absolutely applied enactment. 108(c)(1) Amendments, 1267, effective date enactment, indicating soon possible. Moreover, pending appeals. explaining specifically holdings while pending. Thompson). "manifest injustice" sense Bradley, supra. "injustice" "stems unanticipated imposed notice heard." 720, 2021. Application impose "new obligations" Kaiser. contrary, most knew make, back 1974, side. respondents—and, importantly, beneficiaries clause—if "Delinquencies problem Failure fashion variety remain unpaid, loses investment income earned past received invested time. administrative incurred detecting delinquencies. Attorneys efforts. "These detract ability formulate meet standards adversely affect Participants honor heavy cost delinquencies form higher rates. context uncollected add unfunded liability potential withdrawal employers." 43-44 (unnumbered Comm. stress that: foster preservation system mandates discourage collection. already promote prompt assist recovering delinquencies." pertinent part: "(a) association expert, adviser, consultant interest pay, lend, deliver, thing value— "(1) .; "(2) organization, officer thereof, represents, represent, admit membership, "(3) committee excess normal compensation causing indirectly exercise organize representatives choosing; "(4) organization actions, decisions, duties organization." House.

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