The opinion of the court was delivered by: SHADUR
MILTON I. SHADUR, UNITED STATES DISTRICT JUDGE
Central States, Southeast and Southwest Areas Pension Fund and its Trustees ("Pension Fund," treated as a collective noun taking singular verbs) sued Minneapolis Van & Warehouse Company ("Minneapolis Van"), a now-dissolved Minnesota corporation, and its former sole stockholder Erwin Bruesehoff ("Bruesehoff") to collect past due interim withdrawal liability payments owed to Pension Fund pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001-1368 ("ERISA"), as amended by the Multiemployer Pension Plan Amendments Act of 1980, 29 U.S.C. §§ 1381-1461 ("MPPAA").
Pension Fund now moves for summary judgment under Fed. R. Civ. P. ("Rule") 56. For the reasons stated in this memorandum opinion and order, Pension Fund's motion is granted in part and denied in part -- but the partial grant is enough to provide Pension Fund with a total victory.
and Procedural History
Pension Fund is a multiemployer pension plan as defined in Section 1301(a)(3). Until the end of 1988 Minneapolis Van was subject to a collective bargaining agreement with Teamsters Local Union No. 544 under which Minneapolis Van was required to make specified contributions to Pension Fund on behalf of Minneapolis Van's covered employees.
On December 30, 1988 Minneapolis Van transferred the real estate that it owned at 106 First Avenue North, Minneapolis, Minnesota -- valued at $ 750,000 -- to Bruesehoff, then owner of 100% of its outstanding shares. Four days later Minneapolis Van dissolved and obtained a Certificate of Dissolution from the Minnesota Secretary of State. Either in connection with or before the time of its dissolution, Minneapolis Van transferred $ 54,000 in stocks, bonds and automobiles to Bruesehoff -- again wholly without consideration.
Neither Pension Fund nor other creditors received any value from the transfer of Minneapolis Van's assets (currently valued at $ 628,000) to Bruesehoff.
On September 5, 1989 Minneapolis Van received a Notice and Demand from Pension Fund seeking payment of $ 113,259.45, payable in a lump sum or in monthly installments of $ 4,753.02. On November 27, 1989 Minneapolis Van formally requested that Pension Fund review the assessment pursuant to Section 1399(b)(2)(A).
Pension Fund rejected Minneapolis Van's position in a letter received by Minneapolis Van on December 26, 1989.
Except for one payment in October 1989, Minneapolis Van did not make any payments in accordance with Pension Fund's Notice and Demand. Pension Fund's First Amended Complaint seeks:
1. recovery under MPPAA from Minneapolis Van and Bruesehoff for $ 71,295.30 in past due withdrawal liability payments plus $ 41,164.68 in interest, plus $ 14,259.06 in additional interest (pursuant to Section 1132(g)) (Count I);
2. imposition of a constructive trust on the value of Minneapolis Van's assets held by Bruesehoff (Count II); and
3. recovery of the value of those assets on the basis of Bruesehoff's violation of Section 5 of the Uniform Fraudulent Transfer Act ("UFTA"), Minn. Stat. §§ 513.41-513.51 (Count III).
This opinion addresses each claim in turn.
Minneapolis Van's Interim Withdrawal Liability
Congress enacted MPPAA in response to the advice of the Pension Benefit Guaranty Corporation ("PBGC"), a government entity created by Congress to administer the pension fund program. PBGC warned that ERISA's contingent liability provisions gave employers an incentive to withdraw from the program (see Board of Trustees of the Western Conference of Teamsters Pension Trust Fund v. Thompson Building Materials, Inc., 749 F.2d 1396, 1399 (9th Cir. 1984)). As the Secretary of Labor testified before Congress, PBGC proposed this means to address the problem (T.I.M.E. - DC, Inc. v. Management-Labor Welfare & Pension Funds, of Local 1730 International Longshoremen's Association, 756 F.2d 939, 944 (2d Cir. 1985), quoting Multiemployer Pension Plan Amendments Act of 1980: Hearings on H.R. 3904 Before Subcommittee on Labor-Management Relations of the House Committee on Education and Labor, 96th Cong., 1st Sess. 362 (1979)):
An employer that leaves the multiemployer pension plan would be required to pay its fair share of the plan's vested liabilities. The objective of this element is to discourage withdrawals and to provide a financial cushion for the plan which is not now provided by the present system because of ...