Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

GENEVESE v. MARTIN-MARIETTA CORP.

December 18, 1969

Anthony J. GENEVESE et al.,
v.
MARTIN-MARIETTA CORPORATION, Dragon Cement Company Division, Northampton, Pennsylvania



The opinion of the court was delivered by: BODY

OPINION AND ORDER

Plaintiffs seek the return of their respective cash contributions *fn1" made to a contributory pension plan dated December 18, 1963 and promulgated by the defendant, their employer. The relevant facts appear in a stipulation filed by counsel on November 3, 1969 and made a part of the official record of this case. Briefly summarized, they are as follows:

 Sometime prior to August 1, 1965, the plaintiffs became 'salaried employees' of the defendant, some of them working at its Northampton, Pennsylvania, plant and the others at its plant in Thomaston, Maine. As salaried employees, they voluntarily participated in a contributory pension plan dated December 18, 1963, which the defendant promulgated. The 1963 plan was subsequently amended and superseded as of August 1, 1965 by a non-contributory plan covering all salaried employees.

 During the period from September 27, 1965 to February 10, 1966, various Locals of the United Cement, Lime and Gypsum Workers International Union were certified as the collective bargaining agents for plaintiffs. Contract negotiations followed between the union and the defendant-employer, culminating in a series of agreements concluded between August 9, 1966 and December 11, 1967. Pursuant to the terms of these agreements, the plaintiffs were reclassified as 'hourly employees' and thus became ineligible for benefits under the 1965 plan. They were, however, immediately included in the defendant's pension plan covering bargaining unit employees.

 On January 17, 1968, in the proper exercise of its authority under the 1965 plan, the Administrative Committee transferred all contributions made by the plaintiffs under the 1963 plan, together with interest to December 31, 1967, to the bargaining unit pension plan.

 Since a stipulation of facts has been filed, the parties have made individual motions for summary judgment under Fed.R.Civ.P. 56 and have asked the Court to consider the case on that basis. We have agreed to do so.

 Section 10(e) of the 1963 plan reads as follows:

 'If a participant ceases to be classified by the Company as a Salaried Employee the employment of such Participant with the Company shall, for the purposes of the Plan, be deemed to have terminated, and he may elect either to be paid the amount specified in paragraph (a) of this Section 10 *fn2" or to receive payments of Retirement Income commencing at age sixty-five as specified in Paragraph (b) of this Section 10 if he has been a Participant hereunder for at least ten years at the time he ceases to be classified as a Salaried Employee.' (Footnote added)

 Section 15 of the 1963 plan describes the right retained by the defendant to amend the plan. It provides in part:

 * * * The Company shall have the right at any time and from time to time, by an instrument in writing duly executed and acknowledged to modify, alter, or amend the plan in whole or in part; provided * * * that no such amendment shall vest the Company with any right, title or interest in or to the assets held under the Plan or divest a Participant of any credits or values previously accrued for his benefit, or allow any part of the assets held under the Plan to be used or diverted for any purpose other than for the exclusive benefit of Participants * * *.'

 It is apparent, therefore, that although plaintiffs had the right under the 1963 plan to elect a refund of their respective cash contributions in the event they ceased to be classified as salaried employees, the defendant nevertheless retained the right to amend the plan in accordance with the provisions of Section 15. Consequently, it must be decided whether Section 15 permitted the elimination of Section 10(e) by amendment.

 Plaintiffs do not contend, nor is it arguable, that the elimination of Section 10(e) vested the company with any right, title or interest in the assets held under the plan. Plaintiffs do contend, however, that the elimination of Section 10(e) worked a divestment of 'credits or values' previously accrued for their respective benefits. A reading of the 1963 plan discloses that sums contributed by participants are consistently referred to as 'contributions'. *fn3" On the other hand, the phrase 'credits or values' seems more appropriately to refer to actuarial benefits accrued on paper as of some point in time, and concerning which the duty of immediate performance would arise only upon such a future contingency as the retirement, disability or death of a participant. *fn4" The Court's conclusion with respect to this construction is supported by the fact that neither the plaintiffs' brief nor the Court's research has uncovered a case construing a similar pension plan provision in accordance with plaintiffs' present contention. Moreover, the 1963 plan provides in Section 26 that it shall be construed in accordance with the law of Illinois. The courts of that state have repeatedly held that the rights of participants under a private pension plan are governed by the terms of the plan. Smith v. Union Carbide Corp., 350 F.2d 258 (6th Cir. 1965); Hurd v. Illinois Bell Telephone Company, 136 F.Supp. 125 (N.D.Ill.), aff'd 234 F.2d 942 (7th Cir. 1965); Cowles v. Morris & Co., 330 Ill. 11, 161 N.E. 150 (1928); Anderson v. Seaton, 14 Ill.App.2d 53, 143 N.E.2d 59 (1957). It is therefore clear that the terms of the 1963 plan control, and the elimination of Section 10(e) therefrom by means of amendment did not violate the Section 15 prohibition against divesting a participant of any credits or values previously accrued for his benefit.

 The plaintiffs also argue that the elimination of Section 10(e) from the 1963 plan resulted in a portion of the assets held thereunder being used or diverted for some purpose other than for the exclusive benefit of participants. They point out that sometime between August 9, 1966 and December 11, 1967 the plaintiffs received a guarantee of benefits in accordance with the benefit level of the bargaining unit plan and were thereafter in no way dependent upon the actuarial state of that fund. They contend, therefore, that the transfer to the bargaining unit plan of plaintiffs' contributions made under the 1963 plan resulted in no ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.