Morgan v. Laborers Pension Trust Fund for Northern California

81 F.R.D. 669, 27 Fed. R. Serv. 2d 1303, 1979 U.S. Dist. LEXIS 14329
CourtDistrict Court, N.D. California
DecidedFebruary 20, 1979
DocketNo. C-76-1250-CBR
StatusPublished
Cited by14 cases

This text of 81 F.R.D. 669 (Morgan v. Laborers Pension Trust Fund for Northern California) is published on Counsel Stack Legal Research, covering District Court, N.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Morgan v. Laborers Pension Trust Fund for Northern California, 81 F.R.D. 669, 27 Fed. R. Serv. 2d 1303, 1979 U.S. Dist. LEXIS 14329 (N.D. Cal. 1979).

Opinion

MEMORANDUM OF OPINION

RENFREW, District Judge.

On June 21, 1976, plaintiffs, four hourly laborers who had been unable to qualify for pension benefits from defendant Laborers Pension Trust Fund for Northern California (“Trust Fund”), brought suit against the Trust Fund and its trustees in this Court. Claiming that the eligibility structure of the Trust Fund’s pension plan arbitrarily and capriciously excluded a significant number of covered workers from pension benefits in violation of the Employee Retirement Income Security Act, 29 U.S.C. §§ 1001 et seq. (“ERISA”), and the Taft-Hartley Act, 29 U.S.C. § 186(c)(5), plaintiffs sought injunctive relief, declaratory relief, and monetary damages.

On November 3, 1978, plaintiffs filed two motions for the Court’s consideration. The first sought leave to file an amended com-. plaint naming three additional parties plaintiff, or, in the alternative, leave for these parties to intervene. The second sought an order certifying this action as a class action. These are the motions now hefore the Court.

AMENDMENT OF COMPLAINT

There are four plaintiffs presently named in the action before this Court: Edmon Morgan, Walter Brice, Gilbert Stone, and Jeff Dodson. Plaintiffs’ counsel seeks to amend the complaint to add three additional plaintiffs: Robert Pelts, George Dyer, and Daniel C. Greathouse. They contend that the addition of these three new plaintiffs would “provide the court with both a broader and a more representative sample of factual situations relating to the class allegations in this action.”

Rule 15 of the Federal Rules of Civil Procedure permits a party to amend his pleading if the court finds that “justice so requires.” Rule 21 further states that “[pjarties may be * * * added by order of the court on motion of any party * * * at any stage of the action and on such terms as are just.” These rules, as is the case with all the federal rules, are intended to be liberally construed. In this case they will be construed to permit amendment.

Plaintiffs’ lawsuit directs a challenge at three of the Trust Fund’s pension eligibility criteria: (1) the two-year break-in-service rule that was in effect prior to August 1, 1975; (2) the age and length-of-service vesting requirements that were in effect prior to February 1,1973; and (3) the method used by the Trust Fund to compute pension credit in years and fractions of years. The addition of the three new plaintiffs will aid the Court in its consideration of the issues raised by presenting factual situations that more completely illustrate the nature and application of these challenged criteria.

Plaintiff Pelts worked for 17 years as a laborer in employment covered by the Trust Fund. In 1968 he stopped working due to a back problem, and he therefore incurréd a [674]*674break in service two years later. At that point he was 53 years old and, due to the manner in which the Trust Fund computed pension credits, he had accumulated only 13V4 credits. Because he was neither 50 years old with at least 15 years of credit, nor 55 years old with at least 10 years of credit, he did not vest under Trust Fund rules and he therefore forfeited his credits and did not qualify for a pension.

Plaintiff Pelts’ case demonstrates how the Trust Fund’s age and length-of-service requirement might cause a laborer who has worked continuously for many years to be denied a pension. None of the four originally named plaintiffs present a comparable fact situation.1 Although the Court of course takes no position as to whether the age and length-of-service requirement, alone or in conjunction with other provisions, is arbitrary or capricious, it does conclude that the addition of plaintiff Pelts would help in its understanding of the nature of the problem alleged.

Plaintiff Dyer worked as a laborer in covered employment from 1946 to 1967, earning 18 years of pension credit. In 1968, allegedly because of the scarcity of work in covered employment, he obtained work outside of the Laborers’ Union. Because he was 48 years old at the time, and not 50 as required by the then existing vesting rules, his resulting break in service caused him to forfeit his years of accumulated pension credit.

Plaintiff Dyer’s case illustrates how the age requirement for vesting might cause a laborer to forfeit substantial pension credits because he had not reached a certain age when he was no longer able to obtain substantial employment through the union. No other plaintiff presents this situation as clearly.2 Therefore, the Court finds that the addition of plaintiff Byer would also help in its understanding of the application of the challenged rules.

Plaintiff Greathouse worked as a laborer in covered employment from 1944 to 1963. In that year, he was dispatched by the Laborers’ Union hiring hall to work for American Pipe Company. After two years of employment at American Pipe Co., he learned that his new employer did not contribute to the Trust Fund and that as a result he had incurred a break in service, causing a forfeiture of the 93/4 years of accumulated pension credit he had previously earned. In 1967, Greathouse returned to covered employment, accumulating 4% years of credit before retirement.

Plaintiff Greathouse illustrates how the break-in-service rule might operate to bar a laborer from pension eligibility when the laborer mistakenly, but in good faith, takes employment outside the covered employment. Again, the Court finds that the addition of this plaintiff would be helpful in its consideration of plaintiffs’ case.

Although plaintiffs assert that the addition of these plaintiffs would be in the interest of justice, defendants contend that it would be both futile and prejudicial for the Court to permit the requested amendment of the complaint. These arguments must be rejected.

The claim that this amendment would be futile is based on defendants’ assertion that none of the three additional plaintiffs has exhausted the appeals procedures established by the Trust Fund, and therefore the Court could not find them to be proper class representatives. As will be shown later in this opinion, however, plaintiffs’ failure to exhaust does not preclude them from continuing in the action. Any appeal they might have taken would have been denied. Therefore, their failure to appeal their pension denials should not prevent them from entering this action. Furthermore, in light of the nature and purpose of their lawsuit, no policy of ERISA favoring individualized eligibility determinations compels a different result. See p. 682, infra.

[675]*675The claim that amendment would be prejudicial is based on defendants’ contention that they need to take discovery of these additional plaintiffs in order adequately to prepare their defense. The Court is sympathetic to this argument. However, it concludes that the proper response is to extend defendants’ discovery time rather than to deny plaintiffs’ motion to amend the complaint.

For these reasons, the motion to amend will be granted.

CLASS ACTION

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Bluebook (online)
81 F.R.D. 669, 27 Fed. R. Serv. 2d 1303, 1979 U.S. Dist. LEXIS 14329, Counsel Stack Legal Research, https://law.counselstack.com/opinion/morgan-v-laborers-pension-trust-fund-for-northern-california-cand-1979.