Petition — Kenny v. Sanfilippo
Supreme Court brief1977
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SEP 20 1977
in The | MICHAEL RODAK. JR. OUR
——ů— —
1 Court, U. 8.
—
SUPREME COURT OF THE UNITED STATES
October Term, 1977
„ 77445
JOHN KENNY and ROBERT KENNY,
Executors of the Estate of
JOHN J. KENNY, Decd.,
Petitioners,
.
LOUIS SANFILIPPO, et al.,
Respondents
PETITION FOR WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS FOR
THE THIRD CIRCUIT AND APPENDIX
Harry Alan Sherman,
Counsel for Petitioners
1709 Blvd. of the Allies,
Pittsburgh, Pa. 15219
412 471 7777
Petition for Writ of Certiorari....
Opinions BelOW.......eeeceveceveees
JUPISEICE es. 6 6 600%
Questions presented..
Constitutional Provisions Involved.
Statement of the Case.
INDEX TO PETITION
Page
— — DS PUD —
Reasons Rel fed on for Allowance of
the Writ of Certiorari:.......... 12
I,
II.
The Judgment of the Court of
Appeals affirming the District
Court's plain error in failing to
award damages for the entire ten-
year term of the plaintiff's
breached employment contract, is
in conflict with applicable deci-
sions of this Honorable Court... 12
The Judgment of the Court of Appeals
affirming the District Court's un-
warranted failure to award damages
for the unexpired full term of the
plaintiff's breached employment con-
tract conflicts with decisions of
Index to Petition
Reasons Relied on Continued Page
other Courts of Appeals....... 16
III. The Judgment of the Court of
IV.
Appeals affirming the District
Court's unwarranted failure to
award damages for the full unexpired
term of the plaintiff's breached
employment contract conflicts with de-
cisions of the Supreme Court of
e 18
The Judgment of the Court of
Appeals affirming the erroneous
denial of damages for the second half
of plaintiff's breached employment
contract conflicts with established
and applicable principles in the law
of damages, discriminatorily denying
plaintiff below equal protection of
K 19
Index to Petition
3
Reasons Rel ſed on Continued page
V.
The Judgment of the Court of
Appeals sanctions departure by the
District Court from the accepted
and usual course of judicial pro-
ceedings so as to call for exer-
cise of this Court's power of
supervision relative to disregard
of uncontradicted record proof
of exercise of the contract
option to renew so as to avoid
award of damages for the full term
of the unexpired, breached
eee 6866 2
Argument amplifying Reasons Rel ſed on for
Allowance of the Writ......... 21
INDEX TO APPENDIX
Judgment of the United States Court
of Appeals for the Third Circuit
30
Index to Appendix
Page
Opinion of the District Court..... 33
Judgment of the District Court.... 44
Stipulation of Facts below........ 45
Employment contract as amended.... 48
TABLE OF AUTHORITIES
UNITED STATES SUPREME COURT CASES
Page
Ashe v. Swenson, 399 F2d 40, revd.
397 U.S. 436, 90 S.Ct. 1189......... 27
Benjamin v. Hillard, 64 U.S. 149, 167,
c 14, 18
Cross v. Bruning, 413 F2d678, cert.
den. 396 U.S. 970, 90 S.Ct.455,
reh. den. 396 U.S. 1063, 90 S.Ct.
„„ 26
Duncan v. Carter, 289 Fed 179, cert.
den. 370 U.S. 952, 82 S.Ct. 1602. 27
Ferina v. U.S., 340 F2d 837, cert. den.
381 U.S. 902, 85 S.Ct. 1446. 26
Grubbs v. General Electric Credit
Corp., 405 U.S. 699,700 10
Herzog v. U.S., 226 F2d 561 (Cir.9);
cert. den 352 U.S. 8444.
Hicks v. Miranda, 422 U.S. 332, 95
3.88. . e. eee ee eee en ee 26
Hinckley v. Pittsburgh Bessemer Steel
CO.» 121 U.S. 266 „„ 14
Holland v. General Motors Corp., 75
F. Supp. 274; affd. 169 F2d 254; cert.
den. 335 U.S. 68776 12
Kibby v. U.S., 372 F2d 598, cert. den.
387 U.S. 931, 87 S.Ct. 2055......... 26
Table of Authorities
Marchese v. U.S., 378 F2d, 16, cert.
den. 389 U.S. 930, 88 S. Ct. 294, reh.
den. 389 U.S. 1025, 88 S.Ct. 585.... 26
Page
McCray v. Burrell, 516 F2d 357, cert.
granted 423 U.S. 923, 96 S.Ct. 264.. 27
New York Life Ins. Co. v. Viglas, 297
ZS 15
Pierce v. Tennessee Coal, Iron & R.
e ̃ AAA a cee essence 14
Russell v. Barnes Foundation, 52 F.
Supp. 827 (E.D.Pa.) 1943; affd. 143
F2d 871 (Cir. 3); cert. den. 323
eee ese eee eee 13,15,
17
Sykes v. U. S., 373 F2d 607 (Cir. 5);
cert. den. 386 U.S. 977............ . 24
U.S. v. Behan, 110 U.S. 338........... 14
U.S. v. Guest, 246 F. Supp. 475, revd.
333 U.S. 746, GB 8. ee. 11700 26
U.S. v. Killough, 218 F. Supp.339,
Z 26
U.S. v. Vida, 370 F2d 759, cert. den.
ae? U.S. FiO, 8. et. 7166606 26
U.S. Gypsum Co. v. United Steelwkrs.
of Am., 384 F2d 38, cert. den.
389 U.S. 1042, 88 S.Ct. 783......... 26
John Wiley & Sons, Inc. v. Livingston,
eee es eee 13
Table of Authorities
Page
U.S. Circuit Court Cases
Elmor, Inc. v. Cyprus Mines Corp., 467
„L 25
Eng ine Specialities, Inc. v. Bom-
88 Ltd. 454 F2d 527 (Cir. I); 0
Lloyd v. Grinberg, 464 F2d 622 (Cir. 10);
P aan 18
0 ̃ ei os sunken 25
Riggs v. Island Creek Coal Co., 542
L 10
Ring v. The Dimitrios Chandris, 43 F.
Supp. 829 (pa.); affd. 133 F2d 124
... 17
U.S. ex rel Paxon v. Rundle, 491 F2d
5 SE 8 eps 24
U.S. v. State of Florida, 482 F2d 205 (Cir.
e 25
Wright v. Disabled American Veterans,
271 F2d 827 (Cir. D.C.); 1959....... 18
RULES AND DECISIONS
Rule 103 (d), Federal Rules of
tens 27
Looney v. Great American Ins. Co., 71
renne. eee eee eee ee 22
Table of Authorities
page
U.S. CONSTITUTION
Art. 1, sec.10, cl. 1, Contract Clause.20
PURE RINE. oc cncccecseccecnedéonss 20
Fourteenth Amendment 20
U.S. STATUTES
Retirement Income Security Act of 1974,
Sec.502 (e) (1), 29 U.S.C. 1001
ö ͤ „ 8,9
Labor-Management Relations, Act 29
0.3.6. Wi, GOR. TE Dbceccccespedss 9
PENNSYLVANIA SUPREME COURT CASES
Coates v. Allegheny Steel Co., 234
Pa. Wi cccococccedons ebe eee ssen 19
Douglas v. Hustead, 216 Pa.292......... 19
Horvat v. Jenkins School Dist., 337
1 ͤ g?uñ———. seesaw eenis 19
Weaver v. Maryland Cas. Co., 295
.es sees ee ese eee 19
Weinglass v. Gibson, 304 pa. 2033. 19
NEW YORK STATE CASE
Carder Realty Corp. v. State, 23 N.Y.S.2d
395; 260 App. Div. 459; affd. 285
.es ess eee eee 12
Table of Authorities
Page
TEXTS
Restatement of Contracts, sec. 236
SOU i oc kdbdens edness eens Socncasacees 22
Restatement, Conflict of Laws,
Oe We ˙§˙§˙§˙§⅛²Bꝰ! ] ˙¹.A eee 21
6 Williston, Contracts, sec. 1344..... 21
13 Appleman, Insurance Law and Prac-
tice, sec. 7383 (19706)))) . 22
In The
SUPREME COURT OF THE UNITED STATES
October Term, 1977
JOHN KENNY and ROBERT KENNY,
Executors of the Estate of
JOHN J. KENNY, Decd.,
Petitioners,
V.
LOUIS SANFILIPPO, FRANK PRINCE, ROBERT KERN,
RENALD ROSSA, JOSEPH CICARDINI, NORMAN HOWARD,
UMBERTO GUIDOTTI, ARTHUR TATANGELO, GORDON
FLAGG, FRANK BLANDI, W. B. SETTLE, LEO WHITE,
DANIEL DUBANIEWICZ, ADOLPH DONADEO, H. J.
GUEMRICH and FRANCIS KEENAN, All as Trustees
ad litem of THE WESTERN PENNSYLVANIA HOTEL,
CLUB, MOTEL, AND RESTAURANT EMPLOYEES PENSION
FUND, and/or SUCCESSOR TO TRUSTEES OF THE HOTEL
AND RESTAURANT EMPLOYEES ALLIANCE LOCAL UNION
237 INSURANCE AND WELFARE TRUST FUND AND
TRUSTEES OF THE HOTEL AND RESTAURANT EMPLOYEES
ALLIANCE LOCAL UNION 237 PENSION TRUST FUND,
and
Petition for Writ
LOUIS SANFILIPPO, FRANK PRINCE, ROBERT KERN,
RENALD ROSSA, JOSEPH CICARDINI, NORMAN HOWARD,
UMBERTO GUIDOTTI, ARTHUR TATANGELO, GORDON
FLAGG, FRANK BLANDI, W. B. SETTLE, LEO WHITE,
DANIEL DUBANIEWICZ, NICHOLAS ALWINE, H. J.
HUEMRICH and FRANCES KEENAN, all as Trustees ad
litem of THE WESTERN PENNSYLVANIA HOTEL,CLUB,
MOTEL and RESTAURANT EMPLOYEES WELFARE FUND,
and/or SUCCESSOR TO TRUSTEES OF THE HOTEL AND
RESTAURANT EMPLOYEES ALLIANCE LOCAL UNION 237
INSURANCE AND WELFARE TRUST FUND AND TRUSTEES OF
THE HOTEL AND RESTAURANT EMPLOYEES, ALLIANCE
LOCAL UNION 237 PENSION TRUST FUND,
and
HOTEL AND RESTAURANT EMPLOYEES AND BARTENDERS
INTERNATIONAL UNION WELFARE FUND and WILLIAM L.
MEYERS, Individually and trading as WILLIAM L.
MEYERS COMPANY,
Respondents
PETITION FOR WRIT OF CERTIORARI TO THE
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
To The Honorable, the Chief Justice of the
United States and the Associate Justices of
the Supreme Court of the United States:
Petition for Writ
The petitioners, John Kenny and Robert
Kenny, Executors of the Estate of John J. Kenny,
Decd., respectfully pray that a writ of
certiorari issue in the above captioned case
directed to the United States Court of Appeals
for the Third Circuit to review its Judgment
(App.1) in so far as it affirms the District
Court's failure to award to the plaintiff damages
for the full unexpired term of his breached em-
ployment contract in Appeal No. 76-2475 dated
and entered June 23, 1977.
Opinions Below
The opinion of the United States District
Court for the Western District of Pennsylvania
at Civil Action No. 75-40 has not been reported.
A copy thereof and Judgment thereon are appended
hereto (App. 33). The Judgment of the United
States Court of Appeals for the Third Circuit
was not accompanied by an opinion, but affirms
on the Opinion and Judgment of the District
Court. A copy of the Judgment is appended here-
to at (App. 30).
Jurisdiction
Jurisdiction of this Honorable Court is
invoked pursuant to the Act of June 25, 1940,
c. 646, 62 Stat. 928, Title 28 U.S.C. Sec.
1254(1); Supreme Court Rule 19(1)(b); and this
Honorable Court's power of supervision over
Courts of Appeal and District Courts. The
Judgment sought to be reviewed was dated and
entered June 23, 1977. The Opinion and Judgment
of the District Court (App. 33) were dated and
entered on August 2, 1976. The last day for pre-
sentation of the within Petition is September
21, 1977.
Questions Presented for Review
1. In an action for damages for totally
unwarranted breach of plaintiff's written em-
ployment contract, tried without jury, where
the District Court found that the contract was
valid, clear and unambiguous, and that the
“unilateral rescission" thereof and the dis-
continuance of plaintiff's salary thereunder
were without cause, and no asserted affirmative
Questions Presented for Review
defense proven, may the District Court deny
plaintiff damages for the renewal term thereof,
the option for which was plainly exercised of
record without contradiction or contest?
2. May a District Court, without any
stated reason therefor, disregard the unques-
tioned and uncontradicted record exercise by
plaintiff of his undenied right to renew his
employment contract for a second five-year term,
and disallow damages for such future period upon
a completely unsupported conclusion “that it is
not probable that Mr. Kenny would have exercised
his option to renew the contract.." in view of
his age (74 years) and his history of a heart
"attack" 5 years before judgment and 2 years
before assuming employment under the contract?
3. May a District Court deny plaintiff
damages for the second five-year term of his val-
id employment contract found to have been un-
warrantedly unilaterally breached, contrary to
the historic holdings of this Honorable Court
as well as of the decisions of the Court of
Questions Presented for Review
Appeals, the decisions of the Supreme Court of
Pennsylvania, and the established principles of
the law of damages?
4. Where a Court of Appeals, by affir-
mance of the Opinion and Judgment of the District
Court which is clearly erroneous and based on
plain error of record, sanctions departure by
the District Court from the accepted and usual
course of judicial proceedings and denies dam-
ages for unwarranted unilateral breach of an em-
ployment contract's renewed five year term, con-
trary to the holdings of this Honorable Court
and of established policy and principles of law,
effectively depriving the plaintiff of his pro-
perty in the contract without compensation,
should not this Honorable Court exercise its
supervisory power to review and reverse that
portion of the Judgment below denying plaintiff
damages for the second five year term in accor-
dance with the terms of the contract and remand
with directions for allowance thereof?
Constitutional Provisions Involved
Art. 1, sec. 10, cl. 1, Contract Clause
Fifth Amendment...providing against de-
privation of property without due process of
law.
Fourteenth Amendment, providing against
deprivation of property without due process of
law and guaranteeing equal protection of the
law.
Statement of the Case
The original action in the within litiga-
tion was brought in early December, 1974, in the
Court of Common Pleas of Allegheny County,
Pennsylvania. Plaintiff was the Director of
local union employer-employee pension and wel-
fare funds under written contract of employment,
beginning May 1, 1973. He continued in office
and received his contract salary until August
31, 1974, when, without any stated oral or
written reason for so doing, salary payments
were discontinued. At Civil Action No. 75-0040
in the United States District Court for the
Statement of the Case
Western District of Pennsylvania, defendants-
respondents caused the action to be removed from
the State court pursuant to 28 U.S.C. 144]
asserting jurisdiction under Section 502 (e) (1)
of the Retirement Income Security Act of 1974,
29 U.S.C. 1001 et seq, effective December 31,
1974, which states:
„. . . „the District Courts of the
United States shall have exclusive
jurisdiction of civil actions under this
title brought by the secretary or by a
participant, beneficiary or fiduciary
.... against such pension or welfare
trust funds.
After amendments of the complaint and
answers, a non-jury trial was held before the
Chief District Judge, and, on August 3, 1976,
his Findings, Conclusions and Judgment were
filed and served. |
On August 26, 1976, defendants-respondents
filed their notice of appeal; and on August 30,
1976, the cross-appeal was filed by plaintiff.
Both of said appeals were from the final judg-
ment of the District Court in accordance with
Statement of the Case
28 U.S.C. 1291; the plaintiff's appeal being
limited to damages.
The United States Court of Appeals for
the Third Circuit entered a Judgment affirm-
ing on the Opinion and Judgment of the District
Court on June 23, 1977.
At the time of filing the original action
in the Allegheny County Common Pleas the Com-
plaint made reference to the employment con-
tract attached as an exhibit thereto, wherein
authorization for such contract was based upon
employer-employee pension and welfare trust
declarations. Federal jurisdiction warranting
removal pursuant to 28 U.S.C. 1441 actually
arose under Section 301 of the Labor-Management
Relations Act, 29 U.S.C. 185,
which states:
"Suits for violation of contracts be-
tween an employer and a labor organi-
zation representing employees in an
industry affecting commerce as defined
in this chapter or .... may be brought
in any District Court of the United
States...."
When the Retirement Income Security Act of
1974 became effective on December 31, 1974,
9
Statement of the Case
federal jurisdiction became exclusive, as
aforestated.
The United States Court of Appeals raised
a question and required briefing on federal
jurisdiction; and, after argument, limited to
such question, held that federal jurisdiction
existed by reason of: Grubbs v. General Elec-
tric Credit Corp., 405 U.S. 699, 700 and Riggs
v. Island Creek Coal Co., 542 Fed. 334, 343
(Cir. 6).
Although the original complaint was
twice amended after removal by leave of the
District Court, and such amendments added new
causes of action and new parties raising issues
clearly within the purview of the provisions of
ERISA, such issues were barred by ruling of the
trial Judge in holding that since counsel for
respondents agreed that the International Funds
would be treated as constructive trustees below,
the sole issues for trial were the validity of
the contract ab initio and whether any ground
existed for breach or rescission therefor.
10
Statement of the Case
The District Court found: “The con-
tract of employment providing compensation to
Mr. Kenny for his services as Director of
the Funds violated neither the terms of
the trust agreement nor the provisions of
29 U.S.C.A. 1001 et seq. Nor does the evid-
ence disclose just cause for the discon-
tinuance of Mr. Kenny's salary or for the
unilateral rescission of his employment con-
tract.“ In these findings the District
Court is amply supported by the record.
In awarding damages for the unwarran-
ted breach, the learned District Court lim-
ited plaintiff's loss to the unexpired por-
tion of the first five years of the con-
tract, concludingly “that it is not prob-
able that Mr. Kenny would have exercised
his option to renew the contract for an ad-
ditional five-year term." In the latter
conclusion, the District Court was plainly
in error, in view of the unquestioned re-
cord exercise of plaintiff's option.
11
Statement of the Case
The plain error of the District Court
was raised on appeal to the United States
Court of Appeals for the Third Circuit,
without relief.
Reasons Relied on for Allowance of the Writ
of Certiorari
I. The Judgment of the Court of Appeals
affirming the District Court's plain error
in failing to award damages for the entire
ten-year term of the plaintiff's breached
employment contract is tn conflict with ap-
plicable decisions of this Honorable Court
One of the oldest and soundest princi-
ples in our law recognizes the obligation of
contracts; Art. 1 sec. 10, cl. 1, U.S. Con-
stitution; by which “obligation” is meant
the legally binding power requiring the parties
to adhere to an agreement which at the time
of contracting the law recognizes as legally
enforceable; Carder Realty Corp. v. State,
23 N.Y.S. 2d 395; 260 App. Div. 459; affd.
285 N.Y. 803; Holland v. General Motors
Corp., 75 F. Supp. 274; affd. 169 F2d 254;
cert. den. 335 U.S. 887.
12
Reasons Relied on for Allowance of the Writ
for Certiorari
Even the provisions of the contract
setting out conditions for its termination
must be followed; John Wiley & Sons, Inc.
v. Livingston, 376 U.S. 543.
Where, as here, the contract has been
wrongfully breached and unilaterally rescind-
ed contrary to the express provision set out
in paragraph 1 thereof that the plaintiff
as Director "shall not be subject to dis-
charge or removal for said period of time
(ten years) unless by mutual agreement of
the said John J. Kenny and the majority of
the trustees", the breach constitutes such
repudiation of defendants’ obligations there-
under as to entitle plaintiff to full damages
for the entire period of the contract, both
past and prospective, under the time-honored
principle established in the Pennsylvania
State and Federal Courts; Russell v Barnes
Foundation, 52 F. Supp. 827 (E.D.Pa.) 1943;
affd. 143 F2d 871 (Cir. 3); cert. den. 323
U.S. 771; 65 S. Ct. 122.
13
Ressons Relied on for Allowance of the Writ
for Certiorari
In 1859 this Honorable Court, in the
case of Benjamin v. Hillard, 23 How. 149,
167, considered and "reaffirmed" the "rule"
“that the amount that would have been re-
ceived, if the contract had been kept, is
the measure of damages if the contract is
br-ken." "This rule", added the Court, "was
reaffirmed in Hadley v. Baxendale, 10 Exch.
341.“ The rule“ was honored in United
States v. Behan, 110 U.S. 338 and in Hinckley
v. Bessemer Steel Co. 121 U.S. 264.
Forty years following Benjamin, in
the classic decision which has been followed
to this day, this Honorable Court in Pierce
v. Tennessee Coal & Railroad Co., 173 U.S.1,
observed that the rule“ had been widely
accepted and was being firmly written into
the law of contracts, noting:
"But the recent tendency of judicial
decisions in this country, in actions of
contract, as well as in actions of tort,
has been toward allowing entire damages
to be recovered, once for all, in a single
action......This especially appears by well
considered opinions in cases of agreements
. . . to pay wages.
14
Reasons Relied on for Allowance of the Writ
of Certiorari
The learned District Court cited a ref-
erence to the Pierce decision in the Third
Circuit Court of Appeals decision of Russell
v Barnes Foundation, 52 F. Supp. 827, 830;
but the quotation from Barnes in the lower
Court's decision takes something away from
the ſolding in Pierce. Moreover, in later
decisions handed down in this Honorable
Court, the "rule" has been consistently re-
affirmed that where the contract spells out
specifically the monetary obligations of the
obligor, such obligations become the damages
chargeable in case ofunlawful rescission,
breach or repudiation of the contract before
completion of the employee's services there-
under; New York Life Insurance Co. v. Viglas,
297 U.S. 672.
The salary to be paid plaintiff below
for the second five-year term was clearly
spelled out in the contract, just as clearly,
in fact, as it was for the first five years;
but the learned trial Judge, determined to
15
Reasons Relied on for Allowance of the Writ
of Certiorari
disallow the damages for the second five-
year term, "concluded" that “it is not prob-
able that Mr. Kenny would have exercised his
option to renew the contract", overlooking
the undisputed fact that such option had in-
deed been exercised on the record at the very
start of the case, in paragraph 8 of the
Complaint which averred:
"8. Plaintiff has demanded payment
from the Defendants of the sum of $262,209,
being the sum owing under the terms of
the contract and the option of Plaintiff
to renew same, which renewal option is
hereby exercised by Plaintiff..... i
Throughout the entire pleadings below
the claim of the plaintiff was without con-
text or question recognized as having been
asserted on the full ten-year term--except
in the erroneous "conclusion" of the trial
Judge.
II. The Judgment of the Court of
Appeals affirming the District Court's un-
warranted failure to aware damages for the
unexpired full term of the plaintiff's breach-
ed employment contract conflicts with deci-
sions of its own and of other Courts of
Appeals
16
Reasons Relied on for Allowance of the Writ
of Certiorari
Cited by the District Court as basis
for the "full" award for the first five-
year term of the employment contract, is the
leading case of Russell v. Barnes Foundation,
52 F. Supp. 827 (E.D. Pa.) 1943, affd. 143
F2d 871 (Cir. 3); cert. den. 323 U.S. 771,
65 S. Ct. 122. Professor Bertrand Russell,
then aged 71 years, was a leading writer
in the fields of philosophy, mathematics
and social sciences, and was, seven years
later, in 1950, to become the winner of a
Nobel Prize in Literature; yet, though his
ongoing earnings were far greater than his
Salary as a professor under contract to the
Barnes Foundation, he was awarded the full
past and future amounts called for therein,
without credit for his other remunerative
sources of income. The "rule" was followed
and affirmed, as it had been in Ring » The
Dimitrios Chandris, 43 F. Supp. 829; affd.
133 F2d 124 (Cir. 3).
17
Reasons Relied on for Allowance of the Writ Reasons Relied on for Allowance of the Writ
of Certiorari of Certiorari
The United States Court of Appeals, in The Pennsylvania courts have been fol-
Lloyd v. Grinberg, 464 F2d 622 (Cir. 10) like- lowing the rule made so clear in Benjamin
wise followed the historic "rule", as did the without exception; Weinglass v. Gibson,
District of Columbia Court of Appeals in 504 Pa. 203; Douglas v. Hustead, 216 Pa. 292;
Wright y. Disabled American Veterans, 271 Weaver v. Maryland Casualty Co., 295 Pa. 486;
F2d 827. Coates v. Allegheny Steel Co., 234 Pa. 199;
Horvat v. Jenkins School District, 337 Pa. 193.
While the stated “law of the case" in
this within matter appears to honor the rule“,
it is in fact frustrated by the clearly err-
oneous “conclusion” of the District Court
as to the “unexercised" option to renew.
Were it not for the erroneous "conclus-
ion” contrary to the unquestioned, record
fact of plaintiff's exercise of his option
to renew his contract, the rule would like-
ly have been respected herein as well.
III. The Judgment of the Court of
Appeals affirming the District Court's un- IV. The Judgment of the Court of
warranted failure to award damages for the Appeals affirming the erroneous denial of
full unexpired term of the plaintiff's breach- damages for the second half of plaintiff's
ed employment contract conflicts with deci- breached employment contract conflicts with
sions of the Supreme Court of Pennsylvania the established and applicable principles in
the law of damages, discriminatorily denying
The employment contract here invovied plaintiff below equal protection of the law
was drawn and entered into in Pittsburgh,
Pennsylvania, where it was also breached. Obviously the five year term of plain-
Significantly, the contract in Benjamin v. tiff's employment contract for which no com
Hillard. 23 How. 149, 64 U.S. 149, was en- pensation was awarded below is a substantial
tered into in Wilkes-Barre, Pennsylvania. : property amounting to over $150,000.00. The
18 19
Reasons Relied on for Allowance of the Writ
of Certiorari
Constitution, in Art. I sec. 10(1) prohibits
Congress and the States from passing any law
"impairing the obligation of contract".
The Fourteenth Admendment, enjoining leg-
islative action that would take a person's
"life, liberty or property without due process
of law" also prohibits adoption of laws that
would “deny to any person within its juris-
diction the equal protection of the laws".
The Fifth Admendment is broader than the
Fourteenth and broader even than Art. I sec. 10
(1) in that it simple declares: "..... nor shall
any person de deprived of life,
liberty or porperty, without due process of
law". The Fifth Amendment addresses itself
not only to the Legislative bodies, but to
all who administer law, including our Courts.
Due process assuredly does not allude
to the mere appearance of conformity with
justice; and where, as here, a District Court
has totally ignored the plain, admitted
and uncontested fact of record that the plain-
tiff exercised his option which renewed his
20
Reasons Relied on for Allowance of the Writ
of Certiorari
contract for an additional five-year term,
a judicial “conclusion” that “it is not prob-
able" that he “would have exercised his option
to renew" as a means of justifying denial of
damages therefor is a patent denial of due
process and an evasion of the established
principles and rules of law; 6 Williston,
Contracts, sec. 1344; Restatement, Conflict
of Laws, sec. 372.
V. The Judgment of the Court of Appeals
sanctions departure by the District Court
from the accepted and usual course of judi-
cial proceedings so as to call for exercise
of this Honorable Court's power for super-
vision relative to disregard of uncontra-
dicted record proof of exercise of the con-
tract option to renew so as to avoid award
of damages for the full term of the unex-
pired, breached contract
"It is well settled that meaning and
effect should be given if possible to every
part of a contract, and that a construction
which neutralizes any provision of a con-
tract should never be adopted if the contract
21
Reasons Relied on for Allowance of the Writ
of Certiorari
can be construed so as to give effect to al!
the provisions”; RESTATEMENT OF CONTRACTS, sec.
236 (1932); 13 APPLEMAN, INSURANCE LAW AND
PRACTICE, sec. 7383 (1976); Looney v. Great
American Ins. Co., 71 F.R.D. 211 (1976).
It is respectfully submitted that the
learned Chief District Judge disregarded the
record fact that the plaintiff had “exercised
his option to renew the contract for an addi-
tional five year term", as evidenced in his
Complaint, the Petition for Removal, the
Answer, the Amended Answer, Plaintiff's Reply
to the Counterclaim and the Amended Complaint,
without objection, contradiction or dis-
pute. Plaintiff's right to exercise his re-
newal option was at no time questioned by the
defendants in the pleadings or upon trial.
The option clause was clear, unambiguous and
specific; nor was it construed to be other-
wise by the learned Trial Judge. Neverthe-
less, despite its substantial value to plain-
tiff, the Court simply “neutralized” the option
by disregarding the plaintiff's exercise
22
Reasons Relied on for Allowance of the Writ
of Certiorari
thereof on the record, and discounting the
"probability" that plaintiff "would have
exercised" same, upon assumed, and unproved
present or future incapacity to carry out his
contract duties. Such disregard for the value
of the option clause (exercised) in the con-
tract, is most respectfully urged, is clearly
erroneous.
Reference by footnote to plaintiff's
present age 74, and his heart attacks in 197
by the learned Trial Judge as justification
for the presumpcion that he would probably
not exercise his renewal option, moreover,
disregards the record proof that he did not
begin his contract term as director of the
trust funds until May 1, 1973; and that he
would have continued to carry out his dutie.,
eccept for the illegal and unwarranted breach
and rescission as of August 31, 1974. No
evidence whatever supports the finding by
implication that although the plaintiff was
able to carry out his duties while permitted
23
Reasons Relied on for Allowance of the Writ
of Certiorari
so to do, his physical condition did or could
be expected to worsen so as to limit his
future ability so to do.
It is respectfully submitted that in
the circumstances, the "plain error“ in the
District Court should be noticed herein
pursuant to Rule 103(d) of the Federal Rules
of Evidence; and especially since the error
results in substantial deprivation of anti-
cipated salary for the second and renewed
five year contract term to April 30, 1983,
it is prejudicial to plaintiff below; and
even though not brought to the attention of
the District Court, requires exercise of
the plenary powers of this Honorable Court;
Sykes y. U.S., 373 F2d 607 (Cir. 5); cert.
den. 386 U.S. 977; Herzog v. U.S. 226 Fd
561 (Cir. 9); 235 F2d 664; cert. den. 352
U.S. 844; U.S. ex rel. Paxon v. Rundle, 491
F2d 447 (Cir. 3), 1974; especially since the
District Court's unsupportable inference is
drawn not from testimony, but from documents
24
Reasons Relied on for Allowance of the Writ
of Certiorari
or undisputed facts, does the clearly erron-
eous rule here apply; U.S. v. State of Florida,
482 F2d 205 (Cir. 5) 1973; Engine Specialties,
Inc. v. Bombardier Ltd., 454 F2d 527 (Cir.
1) 1972; and review of the whole record will
support the contention of plaintiff that the
learned District Court was clearly erroneous
and mistaken both in its inference and con-
clusion that plaintiff had not yet exercised
his option to renew the contract, and that by
reason of his age and health that he would
probably not do so, requiring correction here-
in; O'Neill v U.S., 450 F2d 1012 (Cir. 3)
1971; and since the contract, including the
option clause, was found to be valid, it is
respectfully submitted that this Honorable
Court's powers of review are not limited by
the clearly erroneous rule; Elmor, Inc., v.
Cyprus Mines Corp., 467 F2d 770 (Cir. 3) 1972.
It is “Hornbook" jaw that as a federal
District Court must ascertain and follow
the view of a majority opinion and judgment
25
Reasons Relied on for Allowance of the Writ
of Certiorari
of the United States Court of Appeals in
whose Circuit the District Court sits, where
such view does not conflict with decisions of
the United States Supreme Court; U.S. v.
Killough, 218 F. Supp. 339, revd. 336 F2d
929; U.S. v. Guest, 246 F. Supp. 475, revd.
383 U.S. 745; so a Court of Appeals must
follow the last views expressed by a majority
decision of the Supreme Court; Marchese v.
U.S., 378 F2d16, cert. den. 389 U.S. 930, 88
S. Ct. 294; reh, den. 389 U.S. 1025, 88 S.Ct.
585; U.S. v. Vida, 370 F2d 759, cert. den.
387 U.S. 910, 87 S.Ct. 1695, Kibby v. U.S.,
372 F2d 598, cert. den. 387 U.S. 931, 87 S.
Ct. 2055; Ferina v. U.S. 340 F2d 837, cert.
den. 381 U.S. 902, 85 S.Ct. 1446; Hicks v.
Miranda, 422 U.S. 332, 95 S.Ct. 2281; U.S.
Gypsum Co. v. United Steelworkers of Am.,
384 F2d 38, cert. den. 389 U.S. 1042, 88
S.Ct. 783; Cross v. Bruning, 413 F2d 678,
cert. den. 396 U.S. 970, 90 S.Ct. 455, reh.
den. 396 U.S. 1063, 90 S. Ct. 760.
26
Reasons Relied on for Allowance of the Writ
of Certiorari
Even where a lower court feels that any
Supreme Court decision or rationale may result
in a “seeming inequity" in a specific case, it
is nevertheless bound by such decision and
rationale; Duncan v. Carter, 289 F2d 179,
cert. den. 370 U.S. 952, 82 S.Ct. 1602;
McCray v. Burrell, 516 F2d 359, cert. grant-
ed, 423 U.S. 923, 96 S.Ct. 264; Ashe v.
Swenson, 399 F2d 40, revd. 397 U.S. 436,
90 S.Ct. 1189.
It is most respectfully submitted that
the lower courts failed to follow the rules
and principles set forth in the clear man-
date of the long line of decisions herein;
and that the unsupported "conclusion" of the
District Court was in effect an evasion there-
of, sO as to warrant exercise of the super-
visory power reposed in this Honorable Court
to reinforce Rule 103(d) of the Federal Rules
of Evidence, and to prevent manifest in-
justice by departure from the accepted and
usual course of judicial proceedings.
27
Conclusion
In view of the amply supported Findings
and Conclusions of the learned Chief District
Judge, who tried the case without jury, that
the defendants failed to establish any cause
for the unilateral rescission of the valid
employment contract, it is respectfully sub-
mitted that the monetary award of damages
should have included the entire ten year
term, especially since the plaintiff has in
fact exercised his option to renew for the
second five year period, contrary to the
District Court's erroneous implication that
he had not done so and that his age and health
would “probably” prevent him from so doing,
which latter finding was not supported by
evidence. Accordingly, it is respectfully
submitted that the plaintiff is entitled to
a total judgment in the sum of $278,773.65,
being the salary which plaintiff would have
earned from September, 1974 to April 30,
1983, in addition to $16,500.00 severance
pay set by the contract; plus the costs of
the within case.
28
Conclusion
WHEREFORE it is respectfully prayed that
this Honorable Court issue a Writ of Certiorari
in the within case directed to the United
States Court of Appeals for the Third Circuit,
to review its Judgment, and that to the extent
that it affirms the denial of compensation for
the second five year term of the employment
contract of the plaintiff below, to reverse
same, and to remand with directions that such
award be added to that for the unexpired
first five year term of the breached employment
contract, together with the costs of these
proceedings.
Respectfully submitted,
HARRY ALAN SHERMAN
Attorney for petitioner
1709 Blvd. of the Allies
_ Pittsburgh, Pa. 15219
412/471-7777
29
Appendix
UNITED STATES COURT OF APPEALS FOR THE
THIRD CIRCUIT
NOS. 76-2475 and 76-2476
JOHN J. KENNY,
Appellant in No. 76-2475
V.
LOUIS SANFILIPPO, FRANK PRINCE, ROBERT KERN,
RENALD ROSSA, JOSEPH CICARDINI, NORMAN HOWARD,
UMBERTO GUIDOTTI, ARTHUR TATANGELO, GORDON
FLAGG, FRANK BLANDI, W. B. SETTLE, LEO WHITE,
DANIEL DUBANEWICZ, ADOLPH DONADEO, H. J.
HUMERICK AND FRANCIS KEENAN, All as Trustees
ad litem of the WEXTERN PENNSYLVANIA HOTEL,
CLUB, MOTEL AND RESTAURANT EMPLOYEES PENSION
FUND, (and/or SUCCESSOR TO TRUSTEES OF THE
HOTEL AND RESTAURANT EMPLOYEES ALLIANCE LOCAL
UNION 237 INSURANCE AND WELFARE TRUST FUND
AND TRUSTEES OF THE HOTEL AND RESTAURANT
EMPLOYEES ALLIANCE LOCAL UNION 237 PENSION
TRUST FUND),
AND
LOUIS SANFILIPPO, FRANK PRINCE, ROBERT KERN,
RENALD ROSSA, JOSEPH CICARDIANI, NORMAN HOWARD,
UMBERTO GUIDOTTO, ARTHUR TATANGELO, GORDON
FLASS, FRANK BLANDI, W. B. SETTLE, LEO WHITE,
DANIEL DUBANEWICZ, NICHOLAS ALWINE, H. J.
HUMERICK and FRANCIS KEENAN, all as Trustees
ad litem of THE WESTERN PENNSYLVANIA HOTEL,
CLUB MOTEL AND RESTAURANT EMPLOYEES WELFARE
FUND, (and/or SUCCESSOR TO TRUSTEES OF THE
30
Appendix
HOTEL AND RESTAURANT EMPLOYEES ALLIANCE LOCAL
UNION 237 INSURANCE AND WELFARE TRUST FUND AND
TRUSTEES OF THE HOTEL AND RESTAURANT EMPLOYEES
ALLIANCE LOCAL UNION 237 PENSION TRUST FUND),
AND
HOTEL & RESTAURANT EMPLOYEES & BARTENDERS
INTERNATIONAL UNION WELFARE FUND & WILLIAM
L. MEYERS
AND
INTERNATIONAL UNION PENSION FUND
Louis Sanfillippo, et al., Appellants in
No. 76-2476
On Appeal from the United States District Court
for the Western District of Pennsylvania
Civil No. 75-40
Argued June 14, 1977
Before: ADAMS, VAN DUSEN AND GIBBONS, Circuit
Judges.
JUDGMENT ORDER
After consideration of the contentions
raised by appellant, | it is
31
:
5 >
Appendix
ADJUDGED AND ORDERED that the judgment : —
of the district court be and is hereby .
affirmed. : IN THE UNITED STATES DISTRICT COURT
7 FOR THE WESTERN DISTRICT OF PENNSYLVANIA
Each side to bear its own costs. ö
wan JOHN J. KENNY,
PLAINTIFF,
v.
LOUSI SANFILIPPO, FRANK PRINCE, )
Circuit Judge ROBERT NERN, RENALD ROSSA,
JOSEPH CICARDINI, NORMAN HOWARD,
UMBERTO GUIDOTTI, ARTHUR TAT- )
ATTEST: ANGELO, GORDON FLASS, FRANK
. BLANDI, W.B. SETTLE, LEO WHITE,
DANIEL DUBANIEWICZ, ADOLPH )
DONADEO, H.J. HUEMRICH and )
Th b 5 . FRANCIS KEENAN, all as Trustees
9 * nn and litem of THE WESTERN PENNSYL-
* VANIA HOTEL, CLUB, MOTEL AND Civil Action
Dated: * EMPLOYEES PENSION
FUND, and/or SUCCESSOR TO
Certified as a true copy and issued in lieu TRUSTEES 8 THE HOTEL AND fected No. 75-40
of a formal mandate on July 15, 1977 RANT EMPLOYEES ALLIANCE LOCAL i+)
UNION 237 INSURANCE AND WELFARE )
Test: TRUST FUND TRUSTEES OF THE HOTEL )
Clerk, United States Court ofAppeals AND RESTAURANT EMPLOYEES ALLIANCE)
for the Third Circuit LOCAL UNION 237 PENSION TRUST ö
T. A question regarding jurisdiction over the *. and
cause of action was raised in this Court.
It would appear, however, that the district LOUIS SANFILIPPO, FRANK PRINCE, )
court had jurisdiction at the time it en- ROBERT KERN, RENALD ROSS,
tered judgment. See, e.g., Grubbs v. General : JOSEPH CICARDINI, NORMAN HOWARD,
Electric Credit Corp., 405 U.S. 699, 700 UMBERTO GUIDOTTI, ARTHUR TAT- )
(1972); Riggs v. Island Creek Coal Co., 542 ANGELO, GORDON FLAGG, FRANK
F.2d 339, 343 (6th Cir. 1967). : BLANDI, W.B. STEELE, LEO WHITE,
32
33
Appendix
DANIEL DUBANIEWICZ, NICHOLAS
ALWINE, H. J. HUEMRICH and
FRANCIS KEENAN, all as Trustees
ad Litem of the WESTERN PENNSYL-
VANIA HOTEL, CLUB, MOTEL AND
RESTAURANT EMPLOYEES WELFARE FUND,
and/or SUCCESSOR TO TRUSTEES OF
THE HOTEL AND RESTAURANT EMPLOYEES
ALLIANCE LOCAL UNION 237 INSURANCE
AND WELFARE TRUST FUND AND TRUSTEES
OF THE HOTEL AND RESTAURANT EMPLOYEES
ALLIANCE LOCAL UNION 237 PENSION
TRUST FUND,
and
HOTEL AND RESTAURANT EMPLOYEES AND
BART’ NDERS INTERNATIONAL UNION
„ ARE FUND,
and
INTERNATIONAL UNION PENSION FUND,
Defendants.
— i i i ie —— — — — —ũͤ—ũ— tO ttl tl — tl tl el
The above entitled action, tried to this court
without a jury, was commenced by the plaintiff,
John J. Kenny, in the court of Common Pleas of
Allegheny County, Pennsylvania, Civil Division,
to recover damages for the wrongful termination
by the defendants of his imployment as Chairman
of the Board of Trustees and Director of the
34
Appendix
Hotel and Restaurant Employees Alliance Local
Union 237 Pension Trust Fund and Welfare Trust
Fund (Local 237 Trust Funds), which funds were
accumulated largely through the efforts of
Mr. Kenny as President of Local 237.
The defendants, trustees of the Western
Pennsylvania Hotel, Club, Motel and Restaurant
Employees Pension Fund and Welfare Fund (Western
Pennsylvania Trust Funds) and the Hotel and
Restaurant Employees and Bartenders International
Union Pension Fund and Welfare Fund (Interna-
tional Trust Funds), removed the action to this
court pursuant to 28 U.S.C.A. #1441 (a)!
128 U. S. C. A. #1441 (a) provides:
„. . any civil action brought in a State
Court of which the district courts of the
United States have original jurisdiction,
may be removed by the defendant or the de-
fendants, to the district court of the
United States for the district and division
embracing the place where such action is
pending."
35
Appendix
. Pursuant to the declaration of trust,
Appendix
on October 21, 1971, the trustees of the Local
and 29 U.S.C.A. #1001 et seg. applicable to 237 Trust Funds signed a formal contract of
employee welfare and pension benefit plans, and employment which named John J. Kenny as Chair-
asserted a counterclaim for compensation man of the Board of Trustees and Director of
paid to the plaintiff between May 1, 1973 and the Local 237 Trust Funds. On May 1, 1973,
August 31, 1974. Mr. Kenny accepted the terms of the contract
as amended June 14, 1972, agreeing to devote
whatever time he felt was necessary in the per-
formance of his duties and accepting compen-
sation of $18,000.00 per year, subject to
a yearly increase of ten percent during the
term of the contract or any renewal thereof.
The trustees agreed to reimburse Mr. Kenny for
FINDINGS OF FACT
From the inception of the Local 237
Trust Funds, two funds administered by boards
of trustees of identical composition, John J.
Kenny acted as unsalaried chairman of both
boards of trustees in addition to performing
his duties as President of Local 237, an ,
tented üer expenses incurred in supervis ing the Funds
r Vv —
— * ‘ * and in operating the automobile with which
* he was to be provided.
229 U. S. C. A. #1132(e)(1) provides: 3
The Agreement and Declaration of Trust of the
„ the district courts of the United Local 237 Trust Funds, as amended, provided:
States shall have exclusive jurisdiction
of civil actions under this sub-chapter Section 5. -- Compensation --
brought by the Secretary or by a partici- No Trustee shall receive any compensation for
pant, beneficiary, or fiduciary. the services rendered by him as Trustee.
However, in those instances wherein the
Trustee is also designated to act in a dual
i capacity as Director of the Fund, compens a-
tion shall be permitted to be paid to sa id
Trustee in the capacity as Director.
36 ; 37
Appendix
Under the terms of the contract, Mr.
Kenny was not subject to discharge and, upon
termination of his employment, was entitled
to severance pay in the amount of $16,500.00.
The contract could be renewed at his option
for an additional five years under the same
terms and conditions.
After May 1, 1973, Mr. Kenny did not
receive compensation as President of Local
237 and, on September 7, 1973, he resigned
that position.
In September, 1973, William L. Meyers
Co., with the approval of the trustees, con-
ducted a study of the administration of the
Local 237 Trust Funds and submitted a report,
dated October 5, 1973. which contained sugges-
tions for the Funds' improved efficiency. Mr.
Meyers found no improprieties in the admin-
istration of the Trust Funds.
In March, 1974, Local 237 merged with
the Bartenders Local Union 188 to form Local
57 Western Pennsylvania Hotel, Club, Motel
and Restaurant Employees and Bartend-rs Union,
38
Appendix
and direction and control of the assets of the
Local 237 Trust Funds were transferred to the
trustees of the Western Pennsylvania Trust
Funds. On March 7, 1974, the trustees voted
to remove Mr. Kenny from the board of
trustees and to hire William L. Meyers Co.
as administrator of the Trust Funds. Mr.
Kenny continued to receive his salary as
Director of the newly-named Trust Funds until
August 19, 1974, when the trustees voted to
discontinue his salary. During his employment,
Mr. Kenny received $24,600.00 under the terms
of the contract and continues to have
possession and use of an automobile owned by
the Trust Funds.
On April 1, 1975, the Western Pennsyl-
vania Trust Funds were merged with the Inter-
national Trust Funds. There is no evidence
that the transfer of the funds was made for
any purpose other than to discharge the
fiduciary duty of the trustees to administer
the Trust Funds in the interest of the
39
Appendix
participants and beneficiaries and with the
care, skill, prudence, and diligence required
by statute.”
Although the defendants content that Mr.
Kenny was unwilling or unable to perform his
duties as Director of the Trust Funds and that
he was therefore terminated for just cause,
the report of the study conducted by the
William L. Meyers Co. does not establish that
Mr. Kenny's performance was unsatisfactory.
Mr. Meyers further dispelled any such in-
ference by his testimony that the recommended
improvements could have been implemented under
Mr. Kenny's administration.
The court finds no evidence of support
the contention that Mr. Kenny used improper
means to secure the contract or that the
compensation provided in exchange for his
services was not reasonable.
4 29 b. S. C. A. #1104
40
Appendix
CONCLUSIONS OF LAW
The court has jurisdiction over the per-
and subject matter of this action pursuant
to 28 U.S.C.A. #1441(a).
The contract of employment providing
compensation to Mr. Kenny for his services
as Director of the Funds violated neither the
terms of the trust agreement nor the pro-
visions of 29 U. S. C. A. #1001 et seq. Nor
does the evidence disclose just cause for
the discontinuance of Mr. Kenny's salary or
for the unilateral rescission of his employ-
ment contract. The subsequent transfer of
the Trust Funds does not cure the breach.
The measure of damages recoverable by
an employee for the breach of an employment
contract for a specific term is:
„.. the amount of his salary for the
unexpired term less any sums which he
has earned following his discharge and
which he may thereafter earn during the
unexpired term of the contract."
4]
Appendix
Russell v. Barnes Foundation, 52 F. Supp. 827,
830 (E. D. Pa. 1943), aff'd 143 F.2d 871
(3d Cir.), cert. denied 323 U.S. 771 (1944).
citing Pierce v. Tennessee Cola, Iron and
Railroad Company, 173 U.S. 1 (1899).
In view of Mr. Kenny's limited formal
education (four years of elementary school),
his 73 years of age, and the fact that he
has sustained two severe heart attacks in recent
years, (Tr. 97-100), it is not likely that
he would find employment elsewhere. It is
therefore concluded that, as to the first five-
year period of the contract, Mr. Kenny may
recover $128,290.30, the sum of the following:
$67,468.00, the compensation which he would
have received to date, and $16,500.00,
severance pay under the terms of the contract,
plus $44,322,30, compensation for the re-
maining twenty-one months of the five-year
term. Future losses are not reduced to present
worth because it is believed that the differ-
ential is off-set by non-inclusion of interest
on plaintiff's losses to date,
42
Appendix
The above considerations, in addition to
those contained in Mr. Kenny's motion for
advancement of the trial date,” lead this court
to conclude that it is not probably that Mr.
Kenny would have exercised his option to renew
the contract for an additional five-year term.
The defendants' counterclaim for salary
paid under the terms of the contract until May,
1973, will be denied.
An appropriate Order will be entered.
C. D. d.
Herbert P. Sorg
Dated: Aug. 2, 1976
>The plaintiff's Motion to Advance Trial, grant-
ed on January 1, 1976, set forth the follow-
ing:
7. Plaintiff is 74 years of age, is
suffering from hypertension and
heart ailment necessitating constant
cardiological care and requiring that
he avoid stress. Delay in the with-
in trial aggravate his ailments, as
counsel for plaintiff is advised by
Dr. Julian Levinson, plaintiff's
physician.
43
Appendix Appendix
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA THE PRE-TRIAL STIPULATION ADMITTED FACTS
(Vol II jt. App.p.117a)
JOHN J. KENNY, Plaintiff, Civil Action Among the stipulations of fact agreed upon
v. are:
LOUIS SANFILIPPO, et al., No. 75-40 "10. The employment contract, and amend-
Defendants. ) ments thereto, which are the basis of the
plaintiff's complaint, and are attached as
Exhibits "A" and "B" thereto, were entered
ORDER into during the separate existence of Local
237 and the Local 237 welfare and pension
AND NOW, this 2nd day of Aug. „ 1976, trusts."
IT IS HEREBY ORDERED that judgment be ; "20. In the July, 1971 meeting of the
3 j trustees of Local 237 Pension and Welfare
entered in favor of the Plaintiff and against Trusts, a resolution was adopted offering
the Defendants in the amount of $128,290.30, to plaintiff directorship of both Local
237 trusts under written contract. Plain-
together with costs. tiff did not accept the offer, but was
IT IF FURTHER ORDERED that the automobile granted time to do so."
assigned to John J. Kenny be returned to the „21. At the October, 1971 Local 237
International Trust Funds. trustee m-etings of the pension and welfare
trusts a formal contract of employemnt of
C. D. J. plaintiff as director of the trusts was
Herbert P. Sorg presented for re of the trustees
and was signed by all of the trustees.
ce ae 9 Plaintiff did not, however, enter into the
＋ . V 5.5% 15219 employment as director at that time. He
Tetsburgn, ra. continued as the present of Local 237 and
Gerald Schilian Esq. as chairman of both local 237 trusts."
540 Madison Avenue 8
New York, N. Y. 10022
44 45
Appendix
"22. At the June, 1972 meetings of
the local 237 trusts, a formal amendment to
the July, 1971 contract (Exhibit 2) was
presented for adoption and signature of the
trustees, all of whom signed same. Plain-
tiff still did not accept the position
as director of the trusts."
"23. Following intervening correspon-
dence with International Union President
Ed. S. Miller concerning same, on April
26, 1973 the plaintiff elected to comply
with the provisions of the profferred employ-
ment contract as amended, accepting the
Salary provisions therunder, and simultan-
eously foregoing any salary as president
of Local 237."
"24. Following the merger of Local 237
and Local 188 into Local 57, as of Marhc 1,
1974 and the establishment of the Western
Pennsylvania trusts, plaintiff continued
receiving his salary as director of the
newly named trusts until the end of
August, 1974, since which time he has not
been paid.”
"25. Direction and control of the trust
assets of Local 237 pension and welfare
trusts were transferred to the trustees of
the Western Pennsylvania Hotel, Club, Motel
and Restaurant Employees Pension and Wel-
fare Funds in March, 1974."
46
Appendix
"26. Plaintiff's employment contract
as amended was in effect as of the date
of transfer referred in to 25."
47
CONTRACT OF EMPLOYMENT
This agreement made and entered into this
2lst day of October, 1971, by and between
the undersigned trustees of the Hotel and
Restaurant Employees Alliance Local Union
Insurance and Welfare Trust Fund and Trus-
tees of the Hotel and Restaurant Employ-
ees Alliance Local Union 237 Pension Trust
Fund hereinafter referred to as the ‘Trust-
ees" and John J. Kenny,
WHEREAS, under and by virtue of resoluti-
ons by the Trustees, adopted as a result
of motions passed on the 13th day of July
1971 at meetings of the Trustees wherein
they indicated that the said John J. Ken-
ny may at his option take the job as
Chairman of the Board of Trustees and
Director of the Funds,
NOW THEREFORE, In consideration of the
mutual promises herein contained, and fa
other good and valuable consideration,
the receipt of which is hereby acknowled-
ged, it is herewith and hereby agreed as
follows:
1. That John J. Kenny is the Chair-
man of the Board of Trustees for the
term herein stated and is hereby appoint-
ed and employed as Director of the Hotel
and Restaurant Employees Alliance Local
48
Contract of Employment
237 Insurance and Welfare Trust Fund and
for the Hotel and Restaurant Employees A.
liance Local 237 Pension Trust Fund for a
period of five (5) years effective with
the date of commencement of duties as Dir-
ector of the Funds. He shall not be sub-
ject to discharge or removal for said per-
iod of time unless by mutual agreement of
the said John J. Kenny and the majority
of the Trustees,
2. The said John J. Kenny shall have
full authority to direct the administra-
tion of the Trust Funds, subject only to
the paramount authority of the Trustees
as set forth under the terms of the Trust
Agreements, to be operated in accordance
with past operating practices,
3. That pursuant to the amendments to
the Trust Agreements the said John J. Ken-
ny is herewith and hereby authoriged to
continue to act as Chairman of the Board
of Trustees of both Funds as well as Dir-
ector thereof,
4. AS compensation for his services,
49
Contract of Employment
the said John J. Kenny shall be paid by the
Trustees out of the Trust Funds the sum of
$18,000.00 per year payable weekly. Each
year thereafter he shall receive a ten (10%)
per cent increase during the term of this
contract or any renewal thereof. In additi-
on thereto the Director shall be furnished
with an automobile and reimbursed all ex-
penses incurred by him in the maintenance
and operation of that autom?bile. He shall
also receive and be reimbursed for any and
all expenses incurred by him in connection
with the operation of the aforesaid funds.
>. The said John J. Kenny herewith and
hereby agrees to devote full time and eff-
orts to the performance of his duties as
Director of the said Funds and shall have
the right to retire at any time within his
discretion.
6. Payment for the salary and all exp-
enses for the said John J. Kenny shall be
divided equally by and between the two
Funds specified as hereinabove,
7. As part of his compensation as Dir-
ector of the Funds, the said John J. Kenny
50
Contract of Employment
Shall be entitled to severance pay upon ter-
mination of employment in accordance with
the following terms and conditions:
(a)
The amount of severance pay shall be
516, 500. 00.
(b) The severance pay shall be paid in
(E)
)
three equal yearly installments of
$5,500.00, the first installment
to be due and payable thirty-one days
after the termination of John J. Ken-
ny's employment as Director of the
Funds and the second and third inst-
allment payments shall be due and
payable on the yearly anniversary
dates of the first payment,
In the event that John J. Kenny pre-
decease the receipt of the entire
$16,500.00 and be survived by Rosa
Kenny, his wife, then such install-
ment payment or payments shall be
paid to Rosa Kenny in the place of
John J. Kenny as they become due,
In the event that both John J. Kenny
and Rosa Kenny predecease receipt of
51
Contract of Employment
all or any of such installment payments,
the obligation of the Health and Pension
and Welfare Trust Funds to make such in-
Stallment payments shall cease and termi-
nate in such manner and fashion that in no
event shall such installment payments be
due to the estate or heirs of either John
J. Kenny or Rosa Kenny,
() In the event that John J. Kenny
7.
should be deceased prior to receipt
of any amount of severance pay,
payment in the sum of $16,500.00
should be made to Rosa Kenny in
three equal annual installments.
Said John J. Kenny shall have the
option to renew and extend the
terms of this contract for an addi-
tional five years subsequent to the
termination thereof under the same
terms and conditions as hereinabove
specified except as may be modified
by agreement between the parties.
52
Contract of Employment
Hotel and Restaurant
Employees Alliance
Local 237 Pension
Trust Fund
{/s/ Frank Blandi
s/ W,B,Settle
s/ White
/s/ Henry J. Huemrich
/s/ Daniel Dubaniewicz
/s/ Frank E. Prince
s/ Louis Sanfili
7s/ Robert V. Kern
/s/ Aug. Z. Sommers
2s/ Banald S. Rossa
get Gurdon F, Flagg
s/
CONSENTED TO:
John J. Kenny
53
Hotel and Restau-
rant Employees
Alliance Local
237 Insurance and
Welfare Trust
Fund
/s/_ Frank Blandi
s/ W,B,Settle
s/ Leo White
/s/ 122122 Duban-
Js R RNA · Jac-
/s/ Frank E,.Prince
/s/ s Sanfil-
7s/Robert.V.Kern
s /Aug .Z.Sommers
/s/Ranald S,Rossa
/s/ Gurdon F.Flagg
Contract of Employment
HOTEL AND RESTAURANT EMPLOYEES ALLIANCE LO-
CAL #237 PENSION TRUST FUND
RESOLUTION
AMEND ING CONTRACT OF EMPLOYMENT OF
JOHN J. KENNY AS DIRSCTOR OF FUNDS
WHEREAS, on the l4th day of June, 1972 at
a duly called, convened and conducted meet-
ing of the Board of Trustees of the Hotel
and Restaurant Employees Alliance Local 237
Pension Trust Fund a motion was made and car-
to the effect that the contract of employ-
ment concerning the employment of Mr. John
J. Kenny as Director of the Fund should be
amended, and
WHEREAS, the original contract of en-
ployment contained a provision which set
forth that Mr. Kenny shall devote full tim
to his job as Director of the Fund, and
WHEREAS, The Board of Trustees desire to
amend the contract of employment to state
that with respect to the time required to
do the job as Director of the Fund, Mx.
John J. Kenny shall devote whatever time
he feels is necessary to perform his duties
54
Contract of Employment
as Director, and
NOW THEREFORE, be it resolved that the
contract of employment employing John J.
Kenny as the Director of the Hotel and Res-
taurant Employees Alliance Local #237 Pen-
Sion Trust Fund is hereby amended to state
that Mr. John J. Kenny as Director of the
Fund shall devote as much time as he deems
necessary to perform his duties as Direc-
tor of the Fund.
HOTEL and RESTAURANT EMPLOYEES
ALLIANCE LOCAL 237 PENSION
TRUST FUND
(SL Daniel Dubaniewicz
Renald Rossa
{/s/ Robert . Kern
/s/_ Louis Sanfilippo
/s/ Umberto Guidotti
55
This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.