Court Opinion

ID: 5710492
Source: CourtListenerOpinion
Date Created: 2022-01-12 15:53:18.709407+00
Date Added: 2024-06-11T08:40:30.536782
License: Public Domain

Stevens, J.
(dissenting). I dissent and vote to affirm. There is no arbitrable issue within the terms of the agreement nor indeed any contract to arbitrate this issue.
Briefly, a noncontributing employee pension plan, herein called Plan, effective as of January 1, 1958, was established unilaterally by Gimbels Brothers, Inc., the parent corporation of petitioner-respondent, herein referred to as Saks. The Plan extended to all regular employees in units of the corporation and subsidiaries designated by the board of directors. The Plan was extended to and included Saks. Article II of said Plan provided, in part: “ An employee complying with the following eligibility requirements shall be a participant in the Plan as herein provided:
“ (a) he shall be engaged in regular employment; and
“ (b) he shall not be a participant or be eligible for participation in any plan providing retirement or similar benefits adopted before or after the effective date of this Plan, the cost of which is borne, directly or indirectly, in whole or in part by the Com-*331pony and which, plan is established or maintained by or in conjunction with any labor organization”. (Emphasis supplied.)
The administration of the Plan is vested in a committee appointed by the board of directors who are given the power to “ make all rules governing the administration and interpretation of the Plan.”
Harry Share, an employee of Saks and a member of respondent-appellant, herein called Union, is retiring. The Union claims that he is entitled to both severance pay under the union contract and retirement benefits under the Plan. The question of his eligibility was submitted to the committee for the Plan which ruled under date of April 16, 1959, that severance pay which Share was claiming was plainly “ retirement or similar benefits ” received under a Union contract and receipt of the same would disqualify him as a participant to receive benefits under the Plan.
The Union then served a demand for arbitration, claiming that under its written contract, dated May 26,1958, there was a dispute for arbitration on its contention that Share was entitled to both severance pay and pension benefits.
The contract between Saks and the Union provided with reference to severance pay that persons employed “ for five (5) years or more shall be paid in a lump sum upon termination of employment an amount equal to one (1) week’s pay for each year or major fraction thereof actual employment in such Departments [23 and 723] but said amount of severance pay shall in no event exceed an amount equal to eight (8) weeks’ earnings computed as above.”
It was provided in paragraph 12 of the bargaining agreement, the section dealing with arbitration, the Union “ shall designate a Standing Committee of its own choice to take up with the Employer or an authorized representative of the Employer any matter arising out of the application of this Agreement ” and that “ [a]ny dispute, claim, grievance or difference arising out of or relating to this Agreement” not settled “shall be submitted to arbitration ”. (Emphasis supplied.)
Paragraph 17 of the agreement, so far as pertinent, states: ‘ ‘ Any pension plan, additional vacation or additional holiday granted to salespeople in the New York Store generally shall also he extended automatically to employees covered by this contract.” (Emphasis supplied.)
The Union contends that this is a dispute which falls within the terms of its collective bargaining agreement and that the Union may not be deprived of its right to arbitrate the issue.
*332Saks argues that there is no agreement to arbitrate disputes arising under the Plan, and that it is for the court to determine what issues are arbitrable.
It is to be noted that the Plan is separate and distinct from the collective bargaining agreement. Indeed the only reference to the Plan is found in paragraph 17 of the collective bargaining agreement. The condition precedent or concurrent to its extension to employees covered by the agreement is that it (the Plan) be granted “ to salespeople in the New York Store generally ”.
When the Plan is extended, it is extended in toto, subject to any limitations contained therein as well as the conferring of any benefits for which it provides. The Plan declares that no vested rights are obtained prior to retirement, and that no employee shall be a participant therein if he is the beneficiary of any other plan or benefits ‘1 the cost of which is borne, directly * # * or in part by the Company and which plan
is established or maintained by or in conjunction with any labor organization ’ ’. The Plan provides that the committee shall have the sole power to determine the eligibility of participants.
Whether or not a bona fide dispute exists under an arbitration agreement is a matter of law. (Alpert v. Admiration Knitwear Co., 304 N. Y. 1.) “ [T]he mere assertion by a party of a meaning of a provision which is clearly contrary to the plain meaning of the words cannot make an arbitrable issue. It is for the court to determine whether the contract contains a provision for arbitration of the dispute tendered, and in the exercise of that jurisdiction the court must determine whether there is such a dispute.” (Matter of International Assn. of Machinists [Cutler-Hammer, Inc.], 271 App. Div. 917, 918, affd. 297 N. Y. 519.) The arbitration provision of the agreement dealt with “ [a]ny dispute, claim, grievance or difference arising out of or relating to this Agreement ”. (Emphasis supplied.)
As pointed out the Plan is separate from and independent of the agreement. The Union seeks, in effect, to have the Plan transplanted and its terms incorporated bodily or by reference so as to bring its provisions within the orbit of any dispute, etc., arising out of the agreement. If the desired construction be given, its effect is to compel a change in an independent Plan and to discriminate in favor of Union’s members. This Saks should not be compelled to do for it has no such obligation. (Cf. Matter of General Elec. Co. [United Elec., etc. Workers], 300 N. Y. 262.) Its only obligation is to apply the benefits of the Plan equally.
The withholding of benefits under the Plan when an employee receives a separate benefit, the expense of which is borne in *333whole or in part by the company, is both rational and logical In my view there is no possible basis for a charge of discrimination, and by that token, no possible ground for arbitration.
The Union is not a party to the Plan, and in the view I take the Plan is not a part of the collective bargaining agreement and a mere provision for extension of its benefits does not make it so. The company had sole control over the Plan including the right to terminate it if it so desired. There is no contract to arbitrate. The burden is upon Union to show that there is an arbitrable dispute (Matter of Essenson [Upper Queens Medical Group], 307 N. Y. 68), and this it has not done. It has merely asserted in the face of the plain language of the Plan and of the agreement that Share is entitled to both benefits, i.e., severance pay and pension. (Cf. Matter of Minkin [Halperin], 279 App. Div. 226, affd. 304 N. Y. 617.)
The order appealed from should be affirmed.
Valente and McNally, JJ., concur with Breitel, J. P.; Stevens, J., dissents and votes to affirm, in opinion in which M. M. Frank, J., concurs.
Order reversed, on the law, with $20 costs and disbursements to appellant and the motion to stay arbitration denied, with $10 costs.