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Employing Plasterers' Association of Chicago v. Journeymen Plasterers' Protective and Benevolent Society of Chicago

May 6, 1960


Before Schnackenberg and Knoch, Circuit Judges and Grubb, District Judge.

Author: Grubb

GRUBB, D. J.: This is an appeal from an order for judgment for the defendants dismissing an action for injunction and ancillary relief under Section 302(e) of the Labor Management Relations Act of 1947, 29 U.S.C.A. ยง 186(e).

Plaintiff-appellant, Employing Plasterers' Association of Chicago (hereinafter referred to as the "Association"), is a nonprofit trade corporation. At the commencement of this action, its members were about 45 out of an approximate total of 200 Chicago plastering contractors. A function of the Association is the negotiation and execution on behalf of its members of collective bargaining agreements covering wages, hours, and conditions of employment for plastering work performed in and about Chicago.

Defendant-appellee, Journeymen Plasterers' Protective and Benevolent Society of Chicago, Local No. 5 (hereinafter called "Local No. 5"), is an unincorporated trade union composed of journeymen and apprentice plasterers who are employed by Chicago plastering contractors, including contractor members of the Association. It is a chartered local of the Operative Plasterers and Cement Masons International Association. Local No. 5 has negotiated and executed the pertinent collective bargaining agreements of June 1, 1945 and June 1, 1955, with the Association.

Defendant-appellee, Chicago Plastering Institute, Inc. (hereinafter called the "Institute"), is a nonprofit Illinois corporation. It was incorporated in December of 1944 on application of Byron W. Dalton and Herman J. Mutter, members of Local No. 5, and Stephen Luczak, a plastering contractor and member of the Association. The purposes for which the Institute was originally organized were as follows:

"The advancement of plaster construction over inferior substitutes, by (1) education of the public, and (2) by sponsoring legislation calculated to preserve the health and safety of the public by the use of plaster construction, and (3) discourage attempts to pass legislation derogatory to plaster construction, and (4) to do those things which are necessary and proper to promote and enhance the plastering industry."

An amendment on December 7, 1945, added the following:

"5. Benevolent and charitable, and in furtherance of same, but in limitation thereof, and obtaining, through others, of hospital, death and other benefits for members of the corporation employed by contractors engaged in the business of plastering construction.

"The above shall not include the payment of any direct sick or death benefits by the corporation, nor shall it be deemed to authorize the corporation to perform any of the functions of an insurance company."

The collective bargaining agreement between Local No. 5 and the Association provides for financial contributions to the Institute as follows: The Association agrees to assess and collect from its members and to contribute a certain number of cents per hour per man employed. Local No. 5 agrees to contribute a sum not to exceed a fraction of a cent per hour for each hour each of its members is employed by contractor members of the Association.*fn1

The organic structure of the Institute provides for two classes of membership: (1) Institute members consisting of Local No. 5 and contributing contractors, and (2) beneficial members composed of members in good standing of Local No. 5 employed by an Institute member. In addition, proprietors, executives, and employees of all Institute members are eligible for the benefits provided under the By-Laws on payment of certain dues.

Pursuant to the By-Laws which serve as its constitution, the management of the Institute affairs is vested in an eight member Board of Directors which also elects its officers. Four of the directors represent employer groups including the Association; the remaining four represent Local No. 5. In voting at Institute meetings, the number of Local No. 5 votes shall equal the number of votes of employers present. The President of the Institute, an ex-officio member of the Board of Directors, may cast the deciding vote in case of deadlock.

The Institute administers three funds: (1) a General Fund, (2) a Benevolent Fund, and (3) a Pension Trust. The directors in their discretion may variably distribute Institute income between the General Fund and the Benevolent Fund, subject to the limitation that 40 per cent of the gross proceeds must go to the General Fund.

Regular members of the Association are contributing members of the Institute and have supplied approximately 40 per cent of the Institute income. Members of the Association have also served on the Board of ...

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