Hiysota Fuel Co., Inc. And Hiysota Fuel Co., Inc., And/Or J.R. Sales, Inc.

HIYSOTA FUEL CO 1 Hiysota Fuel Co., Inc ., and Hiysota Fuel Co., Inc., Debtor-in-Possession, and Mark Gregg, Trustee in Bankruptcy and/or J.R. Sales, Inc. and United Mine Workers of America and its Local 1023. Cases 6-CA-15852, 6-CA-15944, 6-CA- 16206 8 December 1987 ORDER GRANTING MOTION AND SUBSTITUTING SUPPLEMENTAL DECISION AND ORDER BY MEMBERS BABSON, STEPHENS, AND CRACRAFT On 31 July 1987 the Board issued a Supplemen- tal Decision and Order' in which it granted the General Counsel's motion to strike Respondent J.R. Sales' answer to paragraphs 1, 2, 3, 4, 6, 7, and 8 of the backpay specification, and granted the General Counsel's Motion for Summary Judgment. On 10 August 1987 J.R. Sales (the Respondent) filed a motion to reconsider the Supplemental De- cision and Order. The General Counsel filed an op- position to the Respondent's motion. The Respondent requests that the Board recon- sider its Supplemental Decision and Order because its amended answer, which the Respondent sent to the Office of the Chief Administrative Law Judge, 2 was not considered by the Board. In addi- tion, the Respondent states, inter alia , that the Board never provided it with specific direction for filing an answer to a backpay specification, and that the calculations of the hours worked by Hiy- sota Fuel employees in the General Counsel's back- pay specification are grossly inaccurate. The Board did not have the Respondent's amended answer before it at the time of the Board's consideration of its Supplemental Decision and Order in this case. Because the Board did not consider the Respondent's amended answer in its original determination of this case, it has therefore decided to grant the Respondent's motion for re- consideration. The Board having duly considered the matter, IT IS ORDERED that Respondent J.R. Sales' motion is granted. IT IS FURTHER ORDERED that the attached Sup- plemental Decision and Order be substituted for the Supplemental Decision and Order that issued on 31 July 1987. ' 285 NLRB No 17 (unpublished) 2 The Respondent asserts that it was instructed to forward its amended answer to the Office of the Chief Administrative Law Judge by Deputy Chief Administrative Law Judge Davidson We do not pass on the verac- ity of this assertion SUPPLEMENTAL DECISION AND ORDER' On 24 June 1986 the National Labor Relations Board issued a Decision and Order2 directing Hiy- sota Fuel Co., Inc., and Hiysota Fuel Co., Inc., Debtor-in-Possession, and Mark Gregg, Trustee in Bankruptcy and/or J.R. Sales, Inc. (the Respond- ents), inter alia, to make whole the Respondents' employees by paying to the United Mine Workers of America and its Local 1023 benefit trust fund contributions which were withheld between 2 June and 8 September 1982 as required by the National Bituminous Coal Wage Agreement of 1981. On 30 October 1986 the United States Court of Appeals for the Third Circuit entered its judgment enforc- ing in full the backpay provisions of the Board's Order. Because controversies arose over the amounts due the Union's benefit trust funds under the terms of the Board's Order, on 2 February 1987 the Regional Director for Region 6 issued and caused to be served on the parties a backpay speci- fication and notice of hearing alleging the amount of backpay due under the Board's Order and noti- fying the Respondents that they must file a timely answer complying with the Board's Rules and Reg- ulations. On 24 February 1987 Respondent J.R. Sales filed its answer. Respondents Hiysota Fuel Co., Inc., and Hiysota Fuel Co., Inc., Debtor-in-Possession, and Mark Gregg, Trustee in Bankruptcy, failed to file an answer. By letter dated 18 February 1987, Mark Gregg, Trustee in Bankruptcy, acknowl- edged receipt of the backpay specification and, inter alia, asserted that the scheduling of additional hearings to determine the extent of backpay due was in violation of the automatic stay provisions of the Bankruptcy Code. By letter dated 6 March 1987, Mark Gregg, Trustee in Bankruptcy, for- warded to the General Counsel a copy of the Trustee's proposed order of distribution of the estate of debtor Hiysota Fuel Co., Inc. On 4 March 1987, by telephone, and on 27 March 1987, by letter, the General Counsel advised the Trustee in Bankruptcy of her position that the instant pro- ceeding was excepted from the automatic stay pro- visions of the Bankruptcy Code. By letter dated 27 March 1987 the General Counsel again notified the Trustee in Bankruptcy of the obligation to file an ' On 31 July 1987 the Board issued a Supplemental Decision and Order in this case. On 10 August 1987 Respondent J R Sales filed a motion to reconsider the Board's decision and attached a copy of an amended answer it had previously mailed to the Office of the Chief Ad- ministrative Law Judge on 14 April 1987 On 24 August 1987 counsel for the General Counsel filed an opposition to Respondent J R Sales' motion The Board has this day granted Respondent J R Sales' motion to reconsider this case 2 280 NLRB 763 287 NLRB No. 1 2 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD answer to the backpay specification under the Board's Rules and Regulations and of the effects of the failure to file an answer, i.e., that the allega- tions in the specification could be found to be true and thus the Board could enter an appropriate order. The General Counsel further advised that unless a contrary indication was received from the Trustee in Bankruptcy by 1 April 1987, it would be assumed that the Trustee in Bankruptcy did not intend to file an answer in this matter, and the General Counsel would expeditiously proceed to liquidate the total amount due from the Respond- ents. On 30 March 1987 the General Counsel filed with the Board a "Motion to Strike Portions of Answer of Respondent JR. Sales, Inc. to the Back- pay Specification and to Deem Admitted Portions of Backpay Specification and Motion for Judgment on the Pleadings." On 1 April 1987 the Board issued an order transferring the proceeding to the Board and a Notice to Show Cause why the Gen- eral Counsel's motion should not be granted. Re- spondent J.R. Sales filed an amended answer dated 14 April 1987 with the Office of the Chief Admin- istrative Law Judge in Washington, D.C., and it was received by that office on 17 April 1987. Re- spondent J.R. Sales' amended answer was received by the Board along with its motion to reconsider on 10 August 1987. The General Counsel filed an opposition to Respondent J.R. Sales' motion to re- consider. On 10 April 1987 the General Counsel filed with the Board a "Motion for Summary Judgment upon Backpay Specification and Notice of Hearing." On 14 April 1987 the Board issued a Notice to Show Cause why the General Counsel's motion should not be granted. Respondents Hiysota Fuel Co., Inc., and Hiysota Fuel Co., Inc., Debtor-in-Posses- sion, and Mark Gregg, Trustee in Bankruptcy, have failed to file a response to either Notice to Show Cause. The National Labor Relations Board has delegat- ed its authority in this proceeding to a three- member panel. On the entire record, the Board makes the fol- lowing Ruling on Motion to Strike and Motion for Summary Judgment Section 102.54 of the Board's Rules and Regula- tions provides that the allegations in the specifica- tion may be deemed admitted if an answer is not filed within 21 days from service of the specifica- tion. This section also provides that the respondent "shall specifically admit, deny, or explain each and every allegation of the specification, unless the re- spondent is without knowledge, in which case the respondent shall so state." The specification states that "[t]o the extent that such answer fails to deny allegations of the specification in the manner re- quired under the Board's Rules and Regulations and the failure to do so is not adequately explained, such allegations shall be deemed to be admitted to be true and the Respondent shall be precluded from introducing any evidence controverting them." In its amended answer, Respondent J.R. Sales admits that UMWA and its Local 1023 were par- ties to the National Bituminous Coal Wage Agree- ment of 1981 (NBCWA), but denies that Respond- ent J.R. Sales was a party to the agreement and, further, asserts that it "believes that the effective dates of the NBCWA as set forth by the Regional Counsel are not correct." Respondent J.R. Sales maintains that the Board should rely on the lan- guage of the NBCWA and not the allegations of the Regional Director in paragraphs 2 and 3 of the backpay specification because "there seems to be some discrepancy in the two." Respondent J.R. Sales denies the allegations in paragraph 4 of the backpay specification, and that it employed any bargaining unit employees at any time material to these cases. Respondent J.R. Sales states that it believes that the listing of hours worked is for Hiysota Fuel Co. employees and that the listing is incorrect. Respondent J.R. Sales as- serts that it reviewed the payroll records of Hiy- sota Fuel and sets forth the number of hours that it believes the Hiysota Fuel employees worked during the backpay period.3 Respondent J.R. Sales denies the allegations of paragraph 5 of the backpay specification, and states that the production figures listed by the Regional Director represent coal produced by Hiysota Fuel, but that the "Respondent [J.R. Sales] has not exam- ined the production records of Hiysota Fuel and offers no opinion or belief with regard to the accu- racy of the figures." Respondent J.R. Sales further denies the allegations of paragraphs 6 and 7 of the backpay specification and states that it "believes that the Board Decision calls for the payment of approximately $5500.00 to the 1974 Pension Trust and nothing to trusts for employees who were re- 3 Respondent J R Sales believes that the Hiysota Fuel employees worked the following number of hours during the backpay period Period Hours Worked 6/2-6/30 668 00 7/1-7/31 1957 25 8/1-8/31 2044 50 9/1-9/7 37600 HIYSOTA FUEL CO. tired prior to the time that the Hiysota Fuel mine was opened." The General Counsel submits in the opposition to the motion of Respondent J.R. Sales to reconsid- er the Board's previous Supplemental Decision and Order that the amended answer filed by Respond- ent J.R. Sales fails to cure the defects of Respond- ent J.R. Sales' original answer, and that the Board should reaffirm its Supplemental Decision and Order in this matter. The General Counsel submits that Respondent J.R. Sales in its amended answer has failed to comply with the specificity require- ments of Section 102.54(b) and (c) of the Board's Rules and Regulations, and is attempting to reliti- gate matters relating to the single employer status of the Respondents, which matters are res judicata in this proceeding. We agree with the General Counsel with respect to paragraphs 1, 2, 4, 6, and 74 of Respondent J.R. Sales' amended answer. It is clear that Respondent J.R. Sales is attempting to relitigate matters relat- ing to the single employer status of the Respond- ents which have already been decided by the Board . As the issue of single employer status has been determined by the Board, clearly it cannot be relitigated now in the context of a backpay specifi- cation hearing. With respect to paragraph 4 of Re- spondent J.R. Sales' amended answer, because Re- spondent J.R. Sales has access to the production records of Hiysota Fuel, its answer to the allega- tions in paragraph 5 of the backpay specification is deficient. Furthermore, paragraphs 6 and 7 of Re- spondent J.R. Sales' amended answer fail to meet the specificity requirements of Section 102.54(b) and (c) of the Board's Rules and Regulations.5 We therefore grant the General Counsel 's Motion for Summary Judgment with respect to paragraphs 1, 2, 3, 5, and 7 of the backpay specification, and find that Respondent J.R. Sales is liable for the backpay obligations set forth in paragraph 7 of the specifica- tion. However, we find that paragraph 3 of Respond- ent J.R. Sales' amended answer complies with the Board's Rules and Regulations, and, that this Re- spondent's answer raises an issue in controversy with respect to the number of hours worked by Hiysota Fuel employees during the backpay period. 4 There is no par. 5 in Respondent J.R. Sales' amended answer. ° Sec. 102.54 of the Board's Rules and Regulations provides: [Ilf the respondent disputes either the accuracy of the figures in the specification or the premises on which they are based , he shall specifically state the basis for his disagreement , setting forth in detail his position as to the applicable premises and furnishing the appropri- ate supporting figures. 3 We therefore deny the General Counsel's Motion for Summary Judgment with respect to paragraphs 4, 6, and 8 of the backpay specification. Furthermore, the undisputed allegations in the General Counsel's Motion for Summary Judgment disclose that Respondents Hiysota Fuel Co., Inc., and Hiysota Fuel Co., Inc., Debtor-in-Possession, and Mark Gregg, Trustee in Bankruptcy, were aware of their duty to file an answer and knowing- ly failed to do so. In the absence of good cause being shown for the failure of Respondents Hiysota Fuel Co., Inc., and Hiysota Fuel Co., Inc., Debtor- in-Possession, and Mark Gregg, Trustee in Bank- ruptcy, to file a timely answer,6 the allegations contained in paragraphs 1, 2, 3, 5, and 7 of the backpay specification are deemed to be admitted as true. Therefore, we grant the General Counsel's Motion for Summary Judgment with respect to those paragraphs of the specification. Accordingly, the Board concludes that the net backpay contributions due the United Mine Work- ers of America and its Local 1023 benefit trust funds under paragraphs 1, 3, 5, and 7 of the back- pay specification are as stated in paragraph 7 of the specification, and orders the payment of $18,715.16 by the Respondents to the benefit trust funds. The Board remands this case for a hearing on the net backpay contributions due under paragraphs 4, 6, and 8 of the specification. ORDER The National Labor Relations Board orders that the Respondents, Hiysota Fuel Co., Inc., and Hiy- sota Fuel Co., Inc., Debtor-in-Possession, and Mark Gregg, Trustee in Bankruptcy and/or J. R. Sales, Inc., Ralphton, Pennsylvania, their officers, agents, successors, and assigns, shall pay United Mine Workers of America and its Local 1023 benefit trust funds the amount of $18,715.16 plus any addi- tional amount computed in the manner prescribed in Merryweather Optical Co., 240 NLRB 1213 (1979), accrued to the date of payment. IT IS FURTHER ORDERED that this case be re- manded for a determination of the amount of back- pay due under paragraphs 4, 6, and 8 of the back- pay specification. ° We reject the Respondents' contention that the determination of backpay due in the instant proceeding is in violation of the automatic stay provisions of the Bankruptcy Code, because it is well settled that Board proceedings fall within the exception to the automatic stay provision for proceedings by a governmental unit to enforce its police or regulatory powers. P.J. Hamill Transfer Co., 277 NLRB 462, 463 (1985); Phoenix Co., 274 NLRB 995 (1985); NLRB Y. Evans Plumbing Co., 639 F.2d 291, 293 (5th Cir. 1981); In re Be! Air Chateau Hospital, 611 F 2d 1248, 1251 (9th Cir. 1979).