The opinion of the court was delivered by: NEALON
The plaintiff ("Union") filed the instant action on January 28, 1980 seeking monetary and injunctive relief for breach of a collective bargaining agreement. Subject matter jurisdiction rests on Section 301(a) of the Labor Management Relations Act, 29 U.S.C. § 185(a). Retail Clerks International Association v. Lion Dry Goods Association, 369 U.S. 17, 18, 82 S. Ct. 541, 542, 7 L. Ed. 2d 503 (1962).
The complainant charges that the employer violated two terms of the contract, viz., a pension plan and a union security clause. The matter was tried without a jury on April 6, 1981. After careful consideration of the evidence and relevant law, the court finds that the defendant transgressed the security provision but not the pension scheme.
Great Northern Press, a printing firm located in Wilkes Barre, is a sole proprietorship owned and operated by Larry N. Llewellyn. In May 1976, the defendant's workers joined the Union. The employer agreed to abide by a collective bargaining agreement based on a model contract between the plaintiff and other printers in the Wilkes Barre area. This compact was set to expire in 1978. Efforts for a successor agreement began during the latter year.
Significantly, the Union did not negotiate directly with Great Northern for a new contract. Rather, the complainant opened discussions with an "Association" of thirteen printing businesses in and around Wilkes Barre. The Union intended that the terms of this arrangement would later be incorporated into separate agreements with other firms, such as Great Northern, which did not belong to the Association and took no part in the actual bargaining. Talks between the Union and the Association continued until 1979. The resulting contract was printed in a bound document known as the "White Book."
On August 15, 1979, a representative of the plaintiff named Thomas Dale approached Great Northern and proffered terms for a new contract.
Llewellyn agreed to almost every proposal contained in the White Book. He did, however, have problems with the pension clause which he criticized as too costly for his business. In response, Dale maintained that some sort of pension scheme was crucial. The Union representative explained that in the event Great Northern would not accept the proposed plan, an alternate could be drafted if: (1) the employees unanimously voted to accept the change, and (2) the new proposal offered comparable benefits to the workers.
Llewellyn, nevertheless, insisted that his firm could not provide any such plan for at least another five years. Dale stated that while he was "ninety-nine percent" certain that the Union would demand a pension clause, he would call the national headquarters for verification. Llewellyn then signed page 17 of the White Book, thereby indicating that he had accepted the overall contract. Significantly, Llewellyn did not fill out page 12, which concerned the pension details.
Approximately one week later, Dale telephoned Great Northern and stated that his original version of the Union's position on the pension issue was correct. At that point, Llewellyn repudiated the entire agreement. During the months that followed, Great Northern adhered to many provisions of the contract, such as the pay scale. Nevertheless, the union security and pension clauses were not followed.
A suit which seeks relief for breach of a collective bargaining arrangement is governed by federal, rather than state, law. Complete Auto Transit, Inc. v. Reis, 451 U.S. 401, 101 S. Ct. 1836, 1838, 68 L. Ed. 2d 248 (1981); Textile Workers Union of America v. Lincoln Mills of Alabama, 353 U.S. 448, 456-57, 77 S. Ct. 912, 917-18, 1 L. Ed. 2d 972 (1957). Yet the court may look to general contract principles and scholarly treatises for guidance as long as the rules they prescribe do not controvert national labor policy. See Roadway Express, Inc. v. General Teamsters, Chauffeurs and Helpers Union, 330 F.2d 859, 863-64 (3d Cir. 1964). See also Local 1330, United Steel Workers v. United States Steel Corporation, 631 F.2d 1264, 1269-79 (6th Cir. 1980); Acheson v. Falstaff Brewing Corporation, 523 F.2d 1327, 1329-30 (9th Cir. 1975). In the instant case, it is necessary to resolve a threshold parol evidence issue before the merits can be considered.
As a general rule, parol evidence may not be admitted to vary the provisions of an unambiguous written contract which contains all the items to which the parties agreed. 8 P.L.E. Contracts § 172 (1971). The plaintiff maintains that the White Book constitutes a complete and fully-integrated compact and, for that reason, evidence from outside the "four corners" of the document may not be considered. The court cannot accept this contention. First, Great Northern is not attempting to alter the substance of the collective bargaining agreement. On the contrary, the defendant maintains that no contract ever came into existence. The relevant case law holds that parol evidence may be admitted to bolster this type of claim.
In Lewis v. Mears, 297 F.2d 101 (3d Cir. 1962), cert. denied, 369 U.S. 873, 82 S. Ct. 1142, 8 L. Ed. 2d 276 (1962), trustees of a union pension plan sued a mine operator on the ground that the defendant had breached a contractual duty to make payments to the fund that they administered. The employer admitted that he had signed the agreement, but also claimed that according to an oral understanding between the parties, the compact was not binding until the final document was fully-executed and returned to the operator. The defendant contended that he had not incurred any contractual liability, because this condition precedent had never been satisfied. The district court permitted oral evidence on the issue, and the jury found for the employer. The Court of Appeals affirmed. On behalf of a unanimous panel, Judge Kalodner first noted that according to a "well-settled" common law principle, "parol evidence is admissible to prove that a contract did not exist." Id. at 104. He then stated the following: "In our opinion, national labor policy does not require the exclusion of parol evidence which shows the lack of an effective acceptance of an offer." Id. at 105.
Concededly, the precedential value of Mears was impaired somewhat by the fact that four judges, half the Court of Appeals, dissented from the decision to deny a rehearing. Speaking for this group, Judge Biggs explained that the federal judiciary had a duty to guarantee that collective bargaining agreements could not become "modified or nullified by covert conditions or stipulations entered into between the employer and the Union." 297 F.2d at 101. On this basis, the dissenters concluded that the operator should not have been permitted to impeach with parol evidence the plain meaning of the written contract. Subsequent authority, however, indicates that the Mears rule is still good law, at least on the facts of the instant litigation.
Lewis v. Seanor Coal Company, 382 F.2d 437 (3d Cir. 1967) concerned another attempt by a mine operator to overturn a contractual duty to contribute to a pension fund. In essence, the defendant attempted to introduce evidence of a subsequent oral modification to the original collective bargaining agreement. The majority recognized that such a theory might well succeed under traditional common law rules, especially since the written contract was somewhat ambiguous. Yet the Court of Appeals was clearly influenced by the Mears dissent. Seanor disqualified the parol evidence on the ground that admission:
would expose employer and union representatives alike to the temptations of corrupt bargains, for it would permit the union to extract from an employer a secret promise to pay some other amount into the fund without requiring such payments to become a matter of record and thus would frustrate the purpose of the Labor Management Relations Act.
382 F.2d at 443. Significantly, this decision did not overrule Mears. Indeed, Seanor addressed the ...