Thomas J. Duffey v. Central States, Southeast and Southwest Areas Pension Fund, Earl L. Jennings, Jr., Harold J. Yates

829 F.2d 627, 1987 U.S. App. LEXIS 13776
CourtCourt of Appeals for the Seventh Circuit
DecidedSeptember 16, 1987
Docket86-1130
StatusPublished
Cited by7 cases

This text of 829 F.2d 627 (Thomas J. Duffey v. Central States, Southeast and Southwest Areas Pension Fund, Earl L. Jennings, Jr., Harold J. Yates) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thomas J. Duffey v. Central States, Southeast and Southwest Areas Pension Fund, Earl L. Jennings, Jr., Harold J. Yates, 829 F.2d 627, 1987 U.S. App. LEXIS 13776 (7th Cir. 1987).

Opinion

HARLINGTON WOOD, JR., Circuit Judge.

This diversity case was resolved by summary judgment on cross motions. Attorney Thomas J. Duffey, a former trustee of the Central States, Southeast and Southwest Areas Pension Fund, sued the Fund and its trustees (together “the Fund”) for the sum of $12,599.81, which allegedly was the balance due to him for his time and expenses spent in preparing for and testifying in various litigated matters involving the Fund. The Fund counterclaimed for the sum of $36,865.74, claiming that Duffey already had been overcompensated and that therefore he should reimburse the Fund for the fees previously paid. The court granted Duffey’s motion for summary judgment. Since the same issues were involved, the court treated the Fund’s counterclaim as if it were pending on the Fund’s cross motion for summary judgment and awarded Duffey judgment on the counterclaim as well. 1

I. BACKGROUND

Duffey’s Fund duties while he was still a trustee consisted in part of screening or causing to be screened applications for loans or modifications of existing loans so he could recommend appropriate final action to the other trustees. He became particularly involved in the granting of five loans totalling $42 million to the Aladdin Hotel Corporation in Las Vegas, Nevada, during the years 1972 through 1976.

Those loans became the focus of considerable attention by the government and others. It became apparent to the trustees that the Fund likely would be seriously involved in widespread litigation, both civil and criminal, which could continue even after the individual trusteeships had terminated. The trustees, anticipating these serious legal diversions that could threaten their future financial interests, sought protection by adopting a resolution applicable to the various loans. The resolution provided generally for reimbursement to a trustee for costs arising out of testimony or providing information about the Fund in any Fund-related investigation, trial, or other proceeding. “Costs” was defined as including “reasonable attorneys’ fees.” 2

*629 The resolution soon proved convenient to Duffey as he began to be very busy preparing for and appearing at various places in different Fund-related matters, including several federal grand jury investigations. 3 As this developed, Duffey in 1977 wrote to Daniel Shannon, a representative of the Fund, about reimbursement under the resolution. Duffey received in reply a letter about the process to be followed and the information to be supplied. 4

Thereafter in accordance with that arrangement Duffey from time to time submitted detailed statements entitled “For Services Rendered, Time Expended and Costs Advanced.” The statements described his itemized charges covering such services as reviewing transcripts, telephone conferences and other preparation, travel, correspondence, testifying, etc., indicating the time consumed with each charge. The statements summed up the charges as “Total Attorney’s Fees.” The fees due were computed at Duffey’s rate of $100 per hour multiplied by the total of the hours spent, plus Duffey’s out-of-pocket expenses. Duffey deducted from that total any overlapping reimbursement he had received from the government, since he was on occasion subpoenaed by the government.

Submitted on statements in that general form and paid in full by the Fund at various times was something in excess of $44,-000. The counterclaim sought to recover about $37,000 of that sum as an overpayment. There appears to have been no problem with Duffey’s compensation until he submitted his final bill for $12,599.81, which was connected with the second trial of one of the matters.

II. ANALYSIS

The Fund argues on appeal that summary judgment was inappropriate to dispose of the complaint and counterclaim, asserting there are material factual disputes.

The Fund argues first that there is a fact issue about the intended meaning of the compensation agreement, which it says was misconstrued by the trial judge. The trial judge found that Duffey was not an ERISA-defined “fiduciary” after his trusteeship had terminated, but was instead a party in interest for ERISA purposes and was therefore entitled to reasonable compensation. Accordingly, the judge found Duffey’s services were necessary and reasonable for the operation of the plan. 5

The Fund claims that the intended meaning of the compensation paragraph is a material issue in dispute and a jury question, arguing that it was misconstrued in its text as well as contrary to the intent and practice of the parties. The Fund points out that the letter from the Fund to Duffey in response to his prior inquiry shows the error. Duffey had asked whether he was entitled to reimbursement of income lost as a result of his time spent preparing and giving testimony in Fund-re *630 lated matters. The Fund answered the question in a letter requesting certain information relative to Duffey’s billings: (1) that Duffey’s hourly rate for legal services would be the same as he had charged the Fund; (2) that the hours charged to the Fund were not compensated by some other source; and (3) that Duffey had sustained an actual loss of income equal to the amount charged the Fund. The Fund now argues Duffey suffered no loss of income, because his firm had $12,000 a month in retainers received from other clients totally unrelated to the Fund.

We see no need to impanel a jury to interpret the compensation arrangement. When interpreting a contract a court must determine the intent of the parties, which may be found in the language of the contract. If there is a conflict in interpretation because some part is susceptible to more than one meaning, the court will look to the practical construction applied by the parties in performing under the agreement, which is highly probative of intent. William B. Tanner Co. v. Sparta-Tomah Broadcasting Co., 716 F.2d 1155, 1158-59 (7th Cir.1983) (citing Zweck v. D P Way Corp., 70 Wis.2d 426, 435, 234 N.W.2d 921, 926 (1975)). If there is no dispute about which documents constitute the contract, the contract may be construed as a matter of law. Lakeside Bridge & Steel Co. v. Mountain State Construction Co., 446 F.Supp. 1163,1168 (E.D.Wis.1978), rev’d on other grounds, 597 F.2d 596 (7th Cir.1979), cert, denied, 445 U.S. 907, 100 S.Ct. 1087, 63 L.Ed.2d 325 (1980).

The wording of the compensation paragraph is not offended by the parties’ past performance under the agreement, which serves as the best indication of the parties’ mutual interpretation.

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829 F.2d 627, 1987 U.S. App. LEXIS 13776, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thomas-j-duffey-v-central-states-southeast-and-southwest-areas-pension-ca7-1987.