Court Opinion

ID: 7269
Source: CourtListenerOpinion
Date Created: 2010-04-25 05:26:37+00
Date Added: 2024-06-11T16:46:16.517934
License: Public Domain

United States Court of Appeals,

                                 Fifth Circuit.

                                  No. 94-20652

                                Summary Calendar.

                James C. PICKROM, Plaintiff-Appellant,

                                         v.

         BELGER CARTAGE SERVICE, INC., et al., Defendants,

   Central States, Southeast and Southwest Areas Pension Fund,
Defendant-Appellee.

                                 July 11, 1995.

Appeal from the United States District Court for the Southern
District of Texas.

Before JONES, BARKSDALE and BENAVIDES, Circuit Judges.

     BENAVIDES, Circuit Judge:

     Plaintiff-Appellant James C. Pickrom ("Pickrom") appeals the

district court's granting of Defendant-Appellee Central States

("Central States") motion for summary judgment and denial of

Pickrom's     motion    for    summary     judgment.     The   district   court

concluded that the Trustees of the Central States Pension Fund

("the Pension Fund") made a correct legal interpretation of the

record, and thus their decision to deny Pickrom benefits was not an

abuse of discretion.          We affirm.

                                         I.

     In May 1985, Pickrom wrote to the Pension Fund to determine

the years of credited service he had accumulated towards a pension

under   the   Pension     Plan.      Since     1949,   Pickrom   held   various

employment positions normally covered by Teamster Union contracts.

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For example, he worked at Sullivan Transfer Company ("Sullivan")

from April 1979 to May 1985, Belger Cartage Company ("Belger") from

sometime in 1972 to December 1978, Wells Transportation Company

("Wells") from sometime in 1969 to sometime in 1972 and Johnson's

Specialty ("Johnson's") from sometime in 1949 to sometime in 1961.

The Pension Fund determined that Wells and Johnson's were not

participating employers under the Pension Plan.         The Pension Fund

also determined that for the Teamsters Local Union No. 988 ("Local

988"), of which Pickrom was a member, Belger was only a participant

in the Central States Health and Welfare Fund, not the Pension

Plan.   In order for Pickrom to qualify for a twenty-year service

pension from the Pension Fund, he had to have at least twenty years

of credited service in accordance with the requirements of the

Pension Plan, with the employer making pension contributions for at

least ten of those years.

      Pickrom subsequently applied for a pension.       The Pension Fund

granted him a total of 7.6 years of contributory service for his

work at Sullivan, which made him eligible to receive 7.6 years

credit for non-contributory service for a total of 15.2 years of

credited service. The Pension Fund also determined that Belger did

not participate in the Pension Plan while Pickrom was employed

there because it was rejected for pension participation on two

prior occasions, once in 1978 and again in 1981.        The Pension Fund

informed Pickrom of its findings.

      On December 9, 1986, Belger sent a check to the Pension Fund

for   $732.00   for   pension   contributions   on   behalf   of   Pickrom.

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Pickrom was informed that the Pension Fund was unable to accept the

contributions    because   Belger    was    rejected     for   Pension    Fund

participation on two occasions for its Local 988 members.                  The

money sent by Belger was instead used to credit Belger for balances

owed to the Pension Fund for eligible employees at other Belger

terminals.    The Pension Fund subsequently denied Pickrom's claim

for a twenty-year service pension on February 25, 1986.                 Pickrom

exhausted administrative appeals and presented his appeal to the

Trustees.    They denied his claim at a meeting held on February 17,

1989, concluding    that   1)    Belger    was   not   obligated   to    submit

contributions to the Pension Fund relative to Pickrom or any other

Local 988 employee from October 1, 1975 through September 30, 1978

and 2) the aggregate contributory service credit for Pickrom was

7.6 years, less than the minimum requirements for eligibility for

a twenty-year service pension.

     On August 28, 1989, Pickrom filed suit in federal court

against Belger, Local 988 and Central States pursuant to the

Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. §

1001, et seq.   In an amended complaint, Pickrom dropped Belger and

Local 988 as defendants.        Then on February 25, 1992, the parties

filed a Joint Stipulation and Agreed Statement of Facts, stating

that the sole issue to be resolved by the district court, upon

cross-motions for summary judgment, was Pickrom's entitlement to a

twenty-year service pension under the requirements of the Pension

Plan.   Resolution of the issue required the court to determine

whether Pickrom should receive contributory service credit for his

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three years of employment with Belger between 1975 and 1978.          On

August 4, 1994, the district court denied Pickrom's motion for

summary judgment and granted Central States' motion for summary

judgment, concluding that the Pension Fund Trustees' interpretation

of the Pension Plan was legally correct, and thus Pickrom was

ineligible for contributory service credit during his years at

Belger because Belger was not a "contributing employer" under the

terms of the Pension Fund's Plan Document.

                                 II.

      At issue is whether the Trustees properly denied Pickrom

contributory service credit for the nearly three years he worked

for Belger, and denied him eligibility for a twenty-year service

pension.    The parties agree that the Trustees had final and

discretionary authority to determine Pickrom's eligibility for

pension    benefits.   When   the       plan   administrator   has   such

discretionary authority, a reviewing court applies an abuse of

discretion standard.   Firestone Tire & Rubber Co. v. Bruch, 489

U.S. 101, 115, 109 S.Ct. 948, 956-57, 103 L.Ed.2d 80 (1989).          We

review de novo the district court's holding that the Trustees did

not abuse their discretion in determining that Pickrom was not

eligible for a twenty-year contributory service pension under the

requirements of the Pension Plan.        Chevron Chemical Co. v. Oil,

Chemical and Atomic Workers Local Union 4-447, 47 F.3d 139, 144

(5th Cir.1995) (quoting Sweatman v. Commercial Union Ins. Co., 39

F.3d 594, 601 (5th Cir.1994)).      We apply the abuse of discretion

standard through a two-step inquiry.           First, we must determine

                                    4
whether the Trustees gave the Pension Plan a legally correct

interpretation.        If we determine that the interpretation was not

legally correct, we must then determine whether the Trustees'

decision constituted an abuse of discretion.                 Id. at 145 (quoting

Wildbur v. ARCO Chemical Co., 974 F.2d 631, 637 (5th Cir.),

modified on other grounds, 979 F.2d 1013 (5th Cir.1992).

                                       III.

          To   address     the     question      of   whether       the   Trustees'

interpretation of the Pension Plan was legally correct, we consider

three factors: 1) whether the Trustees have given the Pension Plan

a uniform construction; 2) whether the Trustees' interpretation is

consistent with a fair reading of the Pension Plan;                 and 3) whether

different interpretations of the Pension Plan will result in

unanticipated costs. Id. (citations omitted). We find no evidence

in the record regarding whether the Trustees have given a uniform

construction      to     the     Pension      Plan    or     whether      different

interpretations of the Pension Plan will result in unanticipated

costs. Therefore, we will base our decision concerning the legally

correct interpretation of the Pension Plan on whether the Trustees'

interpretation is consistent with a fair and reasonable reading of

the Pension Plan.        James v. Louisiana Laborers Health and Welfare

Fund, 29 F.3d 1029, 1033 (5th Cir.1994).              To address this factor,

we will review the facts in the record and the language of the

Pension Plan itself.

      Pickrom contends that the Trustees' interpretation of the

Pension    Plan   to     require    that    an    employer     be    accepted   for

                                        5
participation as a contributing employer before an employee can

begin    to    accumulate    contributory       service   credit       is   legally

incorrect because none of the provisions expressing requirements

for accumulating contributory service credits indicate that an

employee's accumulation of service credits depends on whether an

employer or local union has been accepted by the Pension Fund.                       He

argues that the unilateral addition of such a requirement through

the    guise   of    interpretation    is,     effectively,      a   Pension     Plan

amendment that makes the reading of the Pension Plan unfair and

unreasonable.

       Section 1.07 of the Central States Southeast and Southwest

Areas Pension Plan defines "contributing employer" as:

       any association or individual employer which has agreed or
       shall agree, in writing, to be bound by the Trust Agreement
       and to make Employer Contributions to the Pension Fund
       according to a Collective Bargaining Agreement, and which has
       been accepted by the Board of Trustees as a Contributing
       Employer.

(emphasis added).       Our review of the record reveals that although

Belger applied twice for retroactive participation in the Pension

Fund    for    its   Local   988   members,    the    Trustees       rejected    both

applications.         Therefore,      Belger    was    never     accepted       as   a

contributing employer under the Pension Plan, and thus never fit

the definition of a contributing employer under the Pension Plan.

In addition, Belger never contributed to the Pension Fund for any

Local 988 members, including Pickrom, during the period that

Pickrom was employed by Belger.

        Our reading of the Pension Plan and review of the facts leads

us to the conclusion that the Trustees' interpretation of the

                                        6
Pension Plan is consistent with a fair and reasonable reading of

the Pension Plan.      Thus, we find that the Trustees' interpretation

of   the    Pension   Plan   was   legally   correct.       Having   found   the

Trustees' interpretation legally correct, we need not proceed to

the second inquiry for the abuse of discretion standard.                Id. at

146 (citing Jordan v. Cameron Iron Works, Inc., 900 F.2d 53, 58

(5th Cir.), cert. denied, 498 U.S. 939, 111 S.Ct. 344, 112 L.Ed.2d

308 (1990)).

                                      IV.

      For    the   reasons   articulated     above,   the   judgment   of    the

district court is AFFIRMED.

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