Prestridge v. Shinault

552 So. 2d 643, 1989 WL 134347
CourtLouisiana Court of Appeal
DecidedNovember 1, 1989
Docket20,907-CA
StatusPublished
Cited by13 cases

This text of 552 So. 2d 643 (Prestridge v. Shinault) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Prestridge v. Shinault, 552 So. 2d 643, 1989 WL 134347 (La. Ct. App. 1989).

Opinion

552 So.2d 643 (1989)

Herbert PRESTRIDGE, et al., Appellees,
v.
Jessie E. SHINAULT, et al., Appellants.

No. 20,907-CA.

Court of Appeal of Louisiana, Second Circuit.

November 1, 1989.
Rehearing Denied December 1, 1989.

Madison, Garrett, Brandon, Hamaker, Wilson & Tugwell by Ralph N. Jackson, Sterlington, for plaintiffs/appellees.

Sooter & Foote by Victor H. Sooter, Alexandria, for defendants/appellants, Const. Systems, Inc. & United Fidelity and Guar. Co.

Stassi & Rausch by John A. Stassi, II, New Orleans, for defendant/appellee, Mississippi Extended Care Centers, Inc.

Before HALL, NORRIS and LINDSAY, JJ.

NORRIS, Judge.

Plaintiffs, trustees of a union Health and Welfare Fund, sued in state court for contributions *644 allegedly due under a collective bargaining agreement. Against all defendants the plaintiffs sought the contributions, interest, penalties and fees allowed by a federal statute. Against the general contractor, its surety and the property owner the plaintiffs sought recognition of and execution on a lien as allowed by a state statute. The general contractor and surety petitioned for and received removal to federal district court, where the claims against the subcontractor (the actual employer) were dismissed. The claims against the remaining defendants were remanded to state district court where the plaintiffs received a money judgment against the general contractor and its surety, and recognition of the lien rights against the surety. The general contractor and its surety now appeal. For the reasons expressed, we reverse the judgment and dismiss the lawsuit.

Facts

The plaintiffs are trustees of the Shreveport Electrical Health and Welfare Fund and the International Brotherhood of Electrical Workers, Local No. 194, a labor organization as defined by the Labor Management Relations Act of 1947 (29 U.S.C.A. § 186). The trust fund was established pursuant to a collective bargaining agreement. The trustees are fiduciaries and the trust funds involved are "employee welfare benefit plans" and "welfare plans" as defined by the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C.A. §§ 1001 et seq. The trust funds receive their capital from employer contributions for covered employees. The trustees are charged with collecting contributions from employers who fail to make payments voluntarily.

Union members Wierick, Cranford and Scroggins were employed by Jessie Shinault, doing business as DeSoto Electrical Co. Shinault was signatory by a letter of assent to a collective bargaining agreement between the union and the Northeast La. Chapter of National Electrical Contractors Association. He was performing electrical subcontracting for the construction of the Westwood Manor Nursing Home in Shreveport. This property was owned by Mississippi Extended Care Centers Inc.; the general contractor was Construction Systems Inc. ("CSI"). CSI was not a member of the contractors association and was not a party to the collective bargaining agreement.

Shinault defaulted on his employer contributions to the fund. The fund filed a lien on March 30, 1984, in Caddo Parish, pursuant to the Louisiana Private Works Act, LSA-R.S. 9:4801 et seq. The plaintiffs brought the instant lawsuit against Shinault and the property owner on December 12, 1984, demanding judgment for the balance of the contributions, interest, penalties, attorney fees and costs, as provided by ERISA, 29 U.S.C.A. § 1132(g)(2). The plaintiffs also demanded recognition of their lien rights, as provided by the Private Works Act, LSA-R.S. 9:4803 A(3). CSI subsequently secured a bond from United States Fidelity and Guaranty Co. ("USF & G") to cover the claim, thus cancelling the lien. The plaintiffs then added CSI and USF & G as defendants.

CSI and USF & G petitioned for removal to federal district court on the basis that the plaintiffs' action arose under ERISA, a law of the United States. In federal court, CSI and USF & G moved to dismiss on several grounds, including supersedure by federal law; the plaintiffs moved to remand the case to state court. By order of July 3, 1985, the court granted the motion to dismiss, citing lack of subject matter jurisdiction. The court noted, nevertheless, that the lien claim would not be preempted by ERISA. See Memorandum Ruling (7/3/85), 9. Later the court amended this order sua sponte. By order filed September 27, 1985, it dismissed the claims against Shinault and remanded the claims against the other defendants to state court. The federal court reasoned that these claims, asserting a state law lien, against these defendants, who are not employers under ERISA, provided no basis for federal jurisdiction. The court further noted that a claim based on a state law does not arise under federal law merely because a defendant may defend on the ground that the *645 state law is preempted by a federal law. See Memorandum Ruling (9/26/85).

Back in state court the defendants urged various exceptions including lack of subject matter jurisdiction and no cause of action in that the state statute, R.S. 9:4803 A(3), was preempted by ERISA. The trial court overruled all exceptions and ultimately rendered judgment on September 22, 1988 in favor of the plaintiffs and against defendants CSI and USF & G, for $10,696.19 plus interest. The judgment recognized the plaintiffs' lien rights against the USF & G bond. From this judgment CSI and USF & G appeal, urging the trial court erred in holding that R.S. 9:4803 A(3) was not preempted by ERISA or by the Labor Management Relations Act. The plaintiffs answered the appeal but ultimately abandoned their answer. Plaintiff's Orig.Br., 3.

Discussion

Louisiana's Private Works Act provides in pertinent part:

§ 4803. Amounts secured by claims and privileges
A. The privileges granted [by the act against the property owner] and the claims granted [by the act against the contractor] secure payment of:
* * * * * *
(3) Amounts owed under collective bargaining agreements with respect to a laborer's or employee's wages or other compensation for which a claim or privilege is granted and which are payable to other persons for vacation, health and welfare, pension, apprenticeship and training, supplemental unemployment benefits, and other fringe benefits considered as wages by the secretary of labor of the United States * * *. Trustees, trust funds, or other persons to whom the employer is to make such payments may assert and enforce claims for the amount in the same manner and subject to the same procedures provided for other amounts due laborers or employees granted a claim or privilege under this Part. (emphasis added)

The act therefore expressly provides that trustees or trust funds may assert a lien on an immovable for the amount owed under a collective bargaining agreement for laborers' or employees' health and welfare funds. This would include claims on behalf of an ERISA fund.

ERISA is a "massive undertaking" that comprehensively regulates, among other things, employee welfare benefit plans that, "through the purchase of insurance or otherwise," provide medical, surgical, or hospital care or benefits in the event of sickness, accident, disability or death. 29 U.S.C.A. § 1002(1). ERISA places limits on where certain persons are empowered to bring a civil action. 29 U.S.C.A. § 1132 provides:

§ 1132. Civil enforcement
(a) Persons empowered to bring a civil action

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Cite This Page — Counsel Stack

Bluebook (online)
552 So. 2d 643, 1989 WL 134347, Counsel Stack Legal Research, https://law.counselstack.com/opinion/prestridge-v-shinault-lactapp-1989.