his own truck to make the deliveries. Levy did not withhold any
income or Social Security tax from Torrence, and he represented
himself as self-employed on his Social Security records from
1967-1972. Although he allegedly was repeatedly promised by
Levy that he would soon be receiving employee fringe benefits,
including employer contributions to the Plan, Torrence knew he
was not receiving them during the entire period. Last, although
he was a Union steward while working with Levy, Torrence was
not in charge of any Levy employees.
The Pension Administrative Board, after concluding its
investigation and a series of meetings with Torrence and upon
review of the foregoing factors, concluded that Torrence was
not an employee but was, rather, an independent contractor at
Levy from 1967-1972.
Torrence, in disputing the Board's conclusion, incorrectly
relies upon Lee v. Nesbitt, 453 F.2d 1309 (9th Cir. 1971),
which he asserts demonstrates that the Board's decision was
arbitrary or capricious. In Lee, the Ninth Circuit held that
a rule denying benefits to an employee solely because of an
involuntary interruption in employment after completion of the
minimum employment requirement and before reaching retirement
age was unreasonable on its face. 453 F.2d at 1312. In that
case, however, the court of appeals expressly limited its
holding to situations where, unlike the case at bar, the
minimum employment requirement had been fully attained prior to
the break-in service. Id. In Richardson v. Central States,
Southeast and Southwest Areas Pension Fund, 645 F.2d 660 (8th
Cir. 1981), also cited by Torrence, there were numerous factors
which buttressed the district court's decision to overturn the
Board's denial of Richardson's benefits which are not present
in Torrence's situation. Those additional factors include: (1)
although Richardson owned the vehicle used, he licensed it to
his company and it bore the company's colors; (2) the company
collected payments and maintained total authority over
Richardson's work under an "exclusive contract" agreement; (3)
the company had to authorize any substitute drivers; and (4)
Richardson could refuse to make a trip only in an emergency.
The absence of these and other factors from Torrence's business
relationship with Levy distinguish Richardson from Torrence's
Reviewing the record before the Board at the time Torrence's
pension application was denied, it is clear, as demonstrated
above, that Torrence's business relationship with Levy
implicated aspects of both employee and independent contractor
status. It is not the proper function of the Court to decide
between two reasonable, but conflicting, interpretations of the
facts presented. Judicial review of the Board's decision to
deny Torrence pension benefits is limited to a determination of
whether the Board's action was arbitrary or capricious in light
of the language of the Plan. Wardle, supra, 627 F.2d at
823-24; Reiherzer v. Shannon, 581 F.2d 1266, 1272 (7th Cir.
1978); Johnson v. Botica, 537 F.2d 930, 935 (7th Cir. 1976).
In light of Torrence's hybrid business relationship with Levy,
we cannot say the Board's determination that he was an
independent contractor during that period was arbitrary or
capricious. Wardle, supra, 627 F.2d at 826-27. Accordingly,
even though a contrary conclusion would not be irreconcilable
with the facts, the Board's decision cannot be overturned.
Id. at 827. Since we hold that there is no genuine dispute of
material fact regarding the Board's determination that Torrence
was an independent contractor and not an employee with Levy
during the 1965-1972 period, defendants' motion for summary
judgment must be granted on this issue.
Torrence alternatively argues that even if he were not an
employee with Levy, the Board is estopped to apply the break-in
service rule and deny him pension benefits because several
Union officials and Board members assured him prior to his 1965
job switch to Levy that the move would not detrimentally affect
his pension eligibility. Specifically, Torrence alleges that in
October, 1965, several Union officials and Board members: (1)
informed him that Levy was looking for drivers to deliver
low-volume outlets in troubled areas of Chicago (and did not
want to use its own drivers for such deliveries); (2) urged him
to take the job with Levy;*fn8 and (3) assured him that the
job switch would not impair his pension rights.
It is apparent that if Torrence can substantiate his
allegations, he may be able to satisfy the requirements of
equitable estoppel.*fn9 See, e.g., Packard Bell Electronics
Corp. v. Ets-Hokin, 509 F.2d 634, 637 (7th Cir. 1975).
However, the law regarding the propriety of invoking the
estoppel doctrine under these circumstances is currently in a
state of flux. While numerous cases have explicitly or
implicitly recognized that pension boards could be estopped to
deny benefits in certain situations,*fn10 other cases have
barred this attack on a pension board's decision, finding that
such use of the doctrine improperly infringes upon the rights
of qualified beneficiaries.*fn11
In the case at bar, neither side has adequately discussed the
application of estoppel principles in Torrence's situation. In
order to allow the Court to decide this issue of defendants'
summary judgment motion, defendants are hereby directed to file
a brief, affidavits, or other relevant matter as to this issue
on or before December 11, 1981. Torrence may file responsive
papers by December 18, 1981. Defendants may reply thereto by
December 28, 1981.
In summary, defendants' motion for summary judgment as to
Torrence's claim that the Board's decision denying him benefits
was arbitrary or capricious is granted. Our ruling as to
Torrence's estoppel argument against granting defendants'
summary judgment motion will be stayed pending the foregoing
briefing schedule.*fn12 Our order setting the status date of
December 4, 1981, will be vacated. A status hearing will be
held on January 29, 1982, at 10:00 A.M. It is so ordered.