Legal Update: Court Rules That Trustees Can Proceed with $700,000 Fund Contribution CaseBondBeebe
Posting by Larry Beebe, CPA
In Trustees of the Sheet Metal Workers’ Local Union No. 33 Profit Sharing Annuity Funds v. Beckley Mechanical Inc., an employer argued that it had agreed to execute Collective Bargaining Agreements (CBAs) in exchange for several promises, including a promise by a union agent to withdraw a criminal action against one of the employer’s executives. The employer said it was not contractually bound to make contributions to the funds because the contract was illegal or void.
The court stated that the union agent’s withdrawal of his criminal complaints did not render the agreement void or illegal as the agent did not have the authority to dismiss the criminal charges. The promise to withdraw changes was only one of seven promises made in the agreement and the court ruled that the criminal action was not “essential or indivisible consideration” that voided the entire agreement.
The court ruled that the trustees could proceed with their case and that other issues remained in dispute. Click here for the full court opinion.