[1999] OLRB REP. MARCH/APRIL 247

1429-97-U; 1434-97-G United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, Ontario Pipe Trades Council and United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, Local 552, Applicants v. Mechanical Contractors Association of Ontario, Mechanical Contractors Association of Windsor, State Group Ltd. - Mario Cossarini, Vollmer & Associates Contractors Limited - John Vollmer, Southern Mechanical Contractors Ltd. - Louis Panontin, Lekter Industrial Services Inc. - David Holek, Fahrhall Mechanical Contractors Ltd. - John Fahringer, Mid-South Contracting Limited - Robert Nantais and Haller Mechanical Contractors Inc. - Richard Haller, Responding Parties; Ontario Pipe Trades Council, United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada, Local 552, Applicants v. Mechanical Contractors Association of Ontario Employers listed on Schedule "A" attached, Responding Parties

BEFORE: Harry Freedman, Vice Chair.

APPEARANCES: S. B. D. Wahl, R. Pearn and J. Boyle for the applicant; Richard J. Charney, J. Timothy Lawson and Stephen Coleman for Mechanical Contractors Association of Ontario; L. P. Kavanaugh, Q. C., Mario Cossarini and Richard Haller for Mechanical Contractors Association of Windsor; no one appearing for the remaining responding parties.

DECISION OF THE BOARD; March 5, 1999

1. These were two matters scheduled for hearing before me; an application under section 96 of the Labour Relations Act, 1995, S.0. 1995, c. 1 as amended ("the Act") alleging, in essence, that the failure or refusal of the Mechanical Contractors Association of Windsor ("the MCAW") to execute amendments to two trust agreements to give effect to the understanding and agreement reached during the 1995 round of bargaining between the Mechanical Contractors Association of Ontario ("the MCAO") and the applicants' designated employee bargaining agency in respect of the transformation of trust funds from jointly trusteed trust funds to trust funds administered by only union appointed trustees violated several sections of the Act, including sections 17 and 162(2) (Board File No. 1429-97-U) and a referral of a grievance to the Board for determination pursuant to section 133 of the Act (Board File No. 1434-97-G). The Altemate Chair of the Board authorized me to sit alone to hear and determine these matters pursuant to section 110( 14)(a) of the Act.

2. At the opening of the hearing in these matters, the parties agreed to the matter in Board File No. 1434-97-G being adjoumed sine die. Therefore, having regard to the agreement of the parties, the Board hereby adjourns the grievance referral in Board File No. 1434-97-G sine die. Unless a party requests the Board proceed with that grievance referral within one year from the date of this decision, it will be deemed terminated without further notice to the parties.

3. The hearing in Board File No. 1429-97-U proceeded before me without the parties calling any evidence. Rather, the parties agreed to the material facts and made representations with respect to the issues raised by the application. At the conclusion of the argument, I advised the parties that I thought it necessary to have a further factual context in respect of the structure of the MCAO and its relationship with the MCAW in order to determine the issues the parties placed before me. To that end, I prepared and delivered to the parties a memorandum to file outlining the issues that I was to deal with and invited their comments upon my description of those issues. The parties did not make any comment with respect to the description of the issues that I would be addressing in this decision. The parties subsequently filed the material contemplated by the memorandum in accordance with the timetable set out therein. That memorandum to file stated:

"At the hearing on Monday, October 19 and Tuesday, October 20, the parties agreed that the issues that they would be addressing before me were as follows:

(i) does the agreement of May 18, 1995 require the MCAW as a constituent member of the MCAO to cause the execution of amendments to the MCAW/Local 552 trust agreements to create the "transformation" of the trusts?

(ii) if the answer to issue (i) is yes, does the MCAO have the authority to enter into a provincial agreement that makes that [execution of amendments to trust agreements to create the transformation of the trusts] a requirement of the MCAW and the employers for whom the MCAO holds bargaining rights?

At the conclusion of the argument, I determined that it was necessary for me to have some factual context in order to understand the structure of the MCAO and its relationship with the MCAW before I could properly deal with the issues.

In order to provide the factual context, the parties agreed that the MCAO will deliver its constitution and any other relevant "public" documents to the other parties and to the Board, and that the MCAW, if it wished to rely on its constituting documents or any other relevant "public" documents, would deliver those documents to the Board and to the other parties. Following delivery of those documents, the parties agreed that they would make representations in relation to the structure of MCAO and the relationship between it and MCAW based on those documents and the necessary inferences and conclusions I should draw from those documents that would be relevant to the issues before me.

If any of the parties make factual representations that another party disputes, I would determine first if that dispute related to a material fact, and if so, I would convene a hearing to resolve that factual dispute. I indicated to the parties that I would endeavour to reach a decision in a way that would not require me to rely on any facts that are disputed. I note in that regard that the oral argument proceeded before me on the basis of no material facts being disputed.

The parties agreed to the following timetable for the delivery of all documents and representations to the Board and to the offices of counsel who appeared before me (Stephen Wahl, Leonard Kavanaugh and Richard Chamey). That material is to be delivered by the close of business on the following dates:

(i) constituting and other relevant "public" documents no later than October 30,

(ii) initial representations from all parties no later than November 16,

(iii) reply representations, if any, no later than November 25.

The parties also agreed that if any of the representations were delivered late, those late representa­tions would not be considered by me in my deliberations."

4. In the 1995 round of provincial bargaining between the MCAO (the designated employer bargaining agency) and the United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada and the Ontario Pipe Trades Council (the "OPTC") (the designated employee bargaining agency) the governance structure of the pension and welfare trust funds that were jointly administered at the local level was an issue. The OPTC sought to have the trust funds that had been jointly administered (an equal number of trustees appointed by each of the employer association and the union) transformed into trust funds administered by trustees appointed only by the union.

5. The MCAW and Local 552 of the United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada ("Local 552") together with six individuals acting as a distinct party (three of whom were appointed by the MCAW and three of whom were appointed by Local 552) had entered into a three party agreement and declaration of trust effective June 1, 1978, to establish a pension trust fund for the purpose of providing pension and related benefits to eligible beneficiaries. A similar three party agreement among the MCAW, Local 552 and the six individuals had been entered into on the same date to establish a trust fund for the purpose of providing benefits under a benefit plan for eligible beneficiaries. Those six individuals were appointed trustees of those two funds under those two tripartite agreements (the "Trust Agreements"). Those Trust Agreements appear to have been restatements and successors to a pension benefits agreement declara­tion of trust that was entered into in July 1964 and a welfare benefits agreement declaration of trust that was entered into in March, 1965.

6. The parties agreed before me that nothing turned on the earlier trust agreements as they existed prior to June 1, 1978 and for purposes of this determination, the parties agreed that the rights, duties and obligations of the parties to and under the agreements are based on the June, 1978 agreements, that is the Trust Agreements, and not the predecessors to the Trust Agreements.

7. The relevant factual context for the determination of the issues before me was relatively straightforward. For approximately 30 years, Local 552 and the MCAW appointed an equal number of trustees to administer the pension plan trust fund (the "Pension Trust") and the welfare benefit plan trust fund (the "Welfare Trust"). In bargaining in 1995, the OPTC as the designated employee bargaining agency acting on behalf of all of its affiliated bargaining agents, including Local 552, sought to change the administration of the Pension Trust and the Welfare Trust from joint trustees appointed in equal numbers by the MCAW and Local 552 to trustees appointed only by Local 552. The MCAW opposed this change to the administration of the Pension Trust and Welfare Trust (collectively, the "Benefit Trusts"). The MCAW notified the MCAO that not only did it object to the MCAO bargaining with respect to the governance structure of the Benefit Trusts, it specifically advised the MCAO that the MCAO did not have authority to enter into any agreement with the OPTC which affected the Trust Agreements establishing the Benefit Trusts administered by the trustees appointed by both the MCAW and Local 552.

8. Despite the MCAW putting the MCAO on notice with respect to bargaining in relation to the Trust Agreements, the MCAO and the OPTC entered into the following trustee structure agreement dated May 18, 1995, (the "May 18 Agreement") as part of the collective agreement between the OPTC and MCAO in respect of the ICI sector of the construction industry which became effective in May, 1995 ("the Collective Agreement"). The May 18 Agreement provided:

"Notwithstanding the provisions of the various Local Union appendices which reference the composition of Union and Management representation on Boards of Trustees for the Pension, Health and Welfare, SUB. and vacation Pay Trust Funds, the following procedure will be accepted by the parties to this Agreement:

1. All Boards of Trustees of Pension, Health and Welfare, S.U.B. and vacation Pay Trust Funds which currently include management representatives may, in accordance with paragraph 2 below, be restructured such that management representatives no longer sit on any such Board. All costs related to this restructuring, legal or otherwise, shall be the sole responsibility of the initiat­ing party.

2. Management representatives on such Boards of Trustees as noted in paragraph 1 above can be permanently removed so that any such Board consists solely of employee representatives, following a secret ballot vote requested by either party and jointly overseen provided that 70% of the plan participants attending the vote approve such an amendment.

3. The initiating party may request a vote during the term of the agreement by serving such request in writing on its counterpart, with copies to the employee and employer bargaining agencies.

4. Following the request of a vote pursuant to paragraph 3 above, the Trustees of the affected Board(s) shall jointly and in good faith make arrangements for a secret ballot vote which must occur no earlier than January 31, 1996.

5. Only members of the local Union who are participants in the plan will be eligible to vote.

6. Upon a determination that 70% or more of the plan participants have approved of such a restructuring in accordance with paragraph 2 above, then effective within the necessary time required from the date of the vote:

(a) all parties to the applicable trust agreement will be obligated to make the necessary amendments to remove the management repre­sentatives; and

(b) the applicable Zone Appendix of the collective agreement is to be amended to reflect same.

Counsel for the MCAW, although acknowledging that the May 18 Agreement was entered into by the MCAO and the OPTC, takes the position that a proper reading of the May 18 Agreement reveals that it was not intended to amend the Trust Agreements and more importantly, also submitted that the MCAO did not have the legal authority to require the MCAW to amend the Trust Agreements to which it and Local 552 were parties.

9. Both the MCAO and MCAW point out that the MCAO and the OPTC entered into an agreement to amend Schedule K of Appendix 4 (the Zone Appendix applicable to the MCAW and Local 552) of the Collective Agreement effective October 3, 1996 with respect to the Benefit Trusts. Schedule K of Appendix 4 of the Collective Agreement prior to the October 3, 1996 amendment provided in paragraph 3:

"The Welfare, Pension and vacation Pay Plans shall be administered by the Board of Trustees, in accordance with the terms of the Trust Agreement [sic] covering these plans. The Board shall be made up of representatives from the Employers and the Union, with three persons being designated by the Employers and three persons being designated by the Union. Refer to Letter of Understanding in Appendix A for further information."

The October 3, 1996 amendment provided, in part:

"All Welfare, Pension and Vacation Pay Plan contributions made up to and including June 24, 1996, shall be administered by the Board of Trustees, (made up of representatives from the Employers and the Union; with three persons being designated by the Employers and three persons being designated by the Union) in accordance with the terms of the Trust Agreement [sic] covering these plans in effect prior to the newly established Trust Document referenced in 3(b) below."

[emphasis added]

10. It is clear that the October 3, 1996 amendment to Schedule K of Appendix 4 of the Collective Agreement called for the establishment of a new pension plan trust fund and a new benefit plan trust fund to be administered by a new board of trustees comprised solely of individuals appointed by Local 552.

11. The issue between the parties relates to the custody and administration of the assets and funds held by the Benefit Trusts that were the responsibility of the boards of trustees of the Pension Trust and Welfare Trust up to and including June 24, 1996. (As I indicated earlier, those boards of trustees were comprised of an equal number of trustees appointed by the MCAW and Local 552.) The parties agreed before me that the necessary steps were taken to establish new trust funds and plans administered by trustees appointed only by Local 552 as contemplated by the October 3, 1996 amendment to the Collective Agreement.

12. As stated in the memorandum to file that was delivered to the parties, the first issue for me to determine in this proceeding is whether the May 18 Agreement requires the MCAO to cause the MCAW as a constituent member of the MCAO to execute amendments to the Trust Agreements to create the transformation of the Benefit Trusts sought by the applicants.

13. Counsel for the applicants submits that the May 18 Agreement required a change in the structure of the Benefit Trusts to benefit and pension plan trust funds and plans with only trustees appointed by Local 552. In order to accomplish that transformation, the parties to the Trust Agreements were required to execute amendments to those Trust Agreements. I was not asked to determine nor did I review the Trust Agreements for the purpose of considering what amending powers, if any, they contained. The parties appear to have assumed the Trust Agreements could be lawfully amended in the way envisaged by the applicants if the MCAW had been prepared to execute the requisite amendments. Counsel submitted that it was clear that the parties in bargaining were focusing on the Benefit Trusts that existed at that time (May, 1995) and that the intent of the two principals in bargaining, the MCAO and the OPTC, was to ensure that those existing Benefit Trusts would come under the control of a board of trustees appointed only by Local 552 following the necessary steps contemplated by the process set out in the May 18 Agreement.

14. Counsel for the MCAW takes the position that the MCAO had no authority to bargain governance of the Benefit Trusts and submitted, in any event, that even if it did have the authority, the May 18 Agreement did not compel the trustees of the Benefit Trusts to give up control of the assets and funds in the Benefit Trusts, but rather dealt with the governance structure issue prospectively which was, in fact, carried out pursuant to the October 3, 1996 amendment to the Collective Agreement.

15. Counsel for the applicants relied on section 150(1) of the Act to argue that the transformation contemplated by the May 18 Agreement was expressly required by the Act. Counsel submitted that section 150(1) mandated the transformation of the governance structure of the Benefit Trusts. Counsel argued that section 150(1) of the Act entitled Local 552 to appoint a majority of trustees to administer the Benefit Trusts.

16. Section 150(1) of the Act provides:

"If benefits are provided under an employment benefit plan primarily to members of one local trade union or to their dependants or beneficiaries, the local trade union is entitled to appoint at least a majority of the trustees who administer the plan, excluding the trustees who are appointed by employers."

Section 150(1) excludes from the calculation of the majority the trustees "who are appointed by employers". In this case, counsel for the applicants submits that the trustees of the Benefit Trusts were appointed by the MCAW, an employers' organization, and not by employers. Therefore, counsel argues that Local 552 must, by reason of section 150(1), appoint a majority of the trustees to administer the Benefit Trusts.

17. Counsel for the applicants is correct when he points out that the Trust Agreements contem­plated trustees being appointed by the MCAW, an employers' association, which is treated differently under the Act from employers. Counsel relied on Grand Valley Construction Association, [1988] OLRB Rep. June 593; Jaddco Anderson Limited. [1990] OLRB Rep. May 570; Paul D'Auost Construction, [1976] OLRB Rep. Sept. 529; MacGregor Crane, [1979] OLRB Rep. Aug. 777; and David Yan Construction Limited, [1984] OLRB Rep. May 715. Those decisions hold that when the Act refers to employers and not employers' organizations, the provisions apply only to employers and not to employers' organizations. It is, therefore, curious that section 150(1) excludes from the majority calculation those trustees who are appointed by employers without excluding those trustees who are appointed by employers' organizations.

18. Although the absence of "employers organizations" in the calculation of the majority under section 150 may appear anomalous, I need not deal with that anomaly in this decision. While the Trust Agreements make reference to trustees appointed by the MCAW, the Collective Agreement and in particular, section 3 of Schedule K of Appendix 4 (which, in my view, was the ultimate authority for the establishment of the composition of the board of trustees at the times material to this proceeding) provided that the various benefit plans would be

“…..administered by the Board of Trustees, in accordance with the terms of that Trust Agreement covering these Plans. The Board shall be made up of representatives from the employers and the union, with three persons designated by the employers and three persons being designated by the union.

[emphasis added]

While the Trust Agreements contemplated that the trustees would be appointed by the MCAW and not individual employers, the Collective Agreement which, in my view, governs the structure of the Benefit Trusts expressly provided that the Benefit Trusts would be administered by representatives from the employers and the union with three of the trustees being persons being "designated by the employers". (Where there is a conflict between the provisions of the Trust Agreements and the Collective Agreement in relation to matters covered by the Collective Agreement then, in my view, the Collective Agreement must prevail.) I therefore need not determine whether section 150(1) excludes from consideration trustees appointed by an employers' association. It is clear to me that the Collective Agreement, which establishes the composition of the trustees of the Benefit Trusts, stipulated that the trustees are appointed by and are representative of employers and not an employers' association. Thus, I am of the view that section 150(1) does not assist the applicants in their argument that the interpretation of the May 18 Agreement they propose is mandated by section 150 of the Act in the circumstances of the relationship between the MCAW and Local 552.

19. Counsel for the MCAW submits that the interpretation of the May 18 Agreement must be made in light of the limited scope of authority of the MCAO to bargain in respect of the governance structure of the Benefit Trusts and in the face of the Trust Agreements to which the MCAO was not a party and therefore could not bargain over changes to those agreements. Counsel for the applicants submits that there was no limitation on the authority of the MCAO to bargain with respect to the Pension Trust and the Welfare Trust. The OPTC relied on the warrant of authority of the MCAO, that is, the MCAO had the apparent authority to negotiate with the OPTC about the governance structure of the Benefit Trusts when it bargained the May 18 Agreement. If the MCAO did not have actual authority to bargain changes to the governance structure of the Benefit Trusts, then that was a matter as between the MCAW and the MCAO and should not affect the ability of the OPTC to secure changes to the Trust Agreements that resulted from the May 18 Agreement as the OPTC relied on the apparent or ostensible authority of the MCAO as the designated employer bargaining agency with the statutory authority to bargain a collective agreement with the OPTC.

20. Counsel for the applicants argued that the October 3, 1996 amendment to the Collective Agreement established that the pension plan trust fund and the benefit plan trust fund going forward were to be administered by trustees appointed only by Local 552, but that did not take away from the obligation of the MCAW to implement the changes to the Trust Agreements that had been agreed to in respect of the Benefit Trusts prior to that date.

21. I am satisfied that the governance structure of pension, welfare and benefit plans funded through the creation of trusts to hold the assets ultimately used to fund those plans is a matter that may be an integral part of collective bargaining. See Trent University Faculty Association v. Trent University, 1997 CanLII 1067 (ON CA), 35 O.R. (3d) 375 (C.A.); N.L.R.B. v. Amax Coal Co., (1981), 453 U.S. 322; 2 EBC 1489; Professional Administrators Ltd. v. Kopper-Glo Fuel, Inc., (1987), 8 EBC 1769. I note that parties in collective bargaining may not, however, dictate to the trustees of those plans how they are to discharge their fiduciary responsibilities and obligations owed ultimately to the beneficiaries of those plan trusts. See N.L.R.B. v. Amax Coal Co., supra.

22. The parties to collective bargaining at the local level i.e., Local 552 and the MCAW, included in their prior collective agreements a structure for the governance of their Benefit Trusts. Once the trustee structure of the Benefit Trusts was in their collective agreement, it is clear to me that the parties to the collective agreement can bargain over changes to that governance structure. With the advent of province wide bargaining in the ICI sector of the construction industry in 1978, the rights to bargain changes to the local agreement that had been held by Local 522 and the MCAW became vested rights of the designated employee and employer bargaining agencies, that is the OPTC on the one hand and the MCAO on the other. (See sections 156 and 157 of the Act.) I am of the view that the MCAO and the OPTC had the authority to agree in bargaining to change the governance structure i.e., the composition of the board of trustees, of the Benefit Trusts through their collective bargaining, and indeed, there is no argument from the MCAW that the agreement to amend the Collective Agreement reached in October 1996 was not well within the authority of the MCAO and the OPTC. That change in the governance structure could not however, in my opinion, adversely affect the existing benefits under the Benefit Trusts that had vested in the beneficiaries of those trusts as of the date of the change. See Dayco Canada Ltd. v. CAW-Canada, [1993] S.C.R. 230; 1993 CanLII 144 (SCC), 102 D.L.R. (4th) 609.

23. The ultimate issue before me is more narrowly focused; that is, whether the MCAO had the authority to enter into an agreement with the OPTC that would affect the administration of the assets and funds that had been deposited with the trustees of the Benefit Trusts under the existing structure. Before determining that issue, I must determine whether the May 18 Agreement requires the parties to execute amendments to the Trust Agreements so as to change the trustee structure of the Benefit Trusts, thereby affecting the administration of those trusts. In order to do so, it is necessary to examine both the May 18 Agreement and the other documents executed by the parties both at that time and subsequently.

24. The May 18 Agreement provided that the boards of trustees of the Benefit Trusts were to be restructured with the result that management representatives no longer sat on those boards, provided the process contemplated in the May 18 Agreement was followed. The parties agreed before me that the process contemplated within the May 18 Agreement occurred with a vote taking place on June 24, 1996. Subsequent to the vote, there were no amendments executed to the Trust Agreements. Rather, the MCAO and OPTC entered into the October 3, 1996 agreement to amend the Collective Agreement.

25. Counsel for the applicants submitted that the May 18 Agreement applied to the existing Benefit Trusts and that the May 18 Agreement simply required amendments to the Trust Agreements so that the Benefit Trusts would be transformed into trusts administered by trustees appointed by only Local 552. Counsel for the applicants also argued that the October 3, 1996 amendment to the Collective Agreement has no relationship whatever to the May 18 Agreement because it does not make any reference to that agreement. Counsel submits that the October 1996 amendments were not meant to affect the obligations of the parties under the May 18 Agreement.

26. Counsel for the MCAO and counsel for the MCAW submitted that the May 18 Agreement established a process for creating pension and benefit trust plans administered by trustees appointed only by the OPTC or its affiliated bargaining agents. Counsel submits the May 18 Agreement was not intended to affect the existing rights and obligations of the trustees of the Benefit Trusts and the property vested in those trustees. Counsel also argued that the MCAO, in particular, could not have intended to enter into an agreement to affect existing rights when it knew it did not have the authority to do so.

27. I am satisfied that the two parties to the collective bargaining negotiations, that is the OPTC and MCAO, entered into the May 18 Agreement in order to facilitate a change from a jointly trusteed benefit plan and pension plan structure to a union trusteed benefit plan and pension plan structure provided the process contemplated in the May 18 Agreement was followed. Furthermore, subsequent to the taking of the vote required by the May 18 Agreement, the MCAO and OPTC entered into the October 3, 1996 agreement which amended paragraph 3 of Schedule K of Appendix 4 of the Collective Agreement. That October 3, 1996 amendment to the Collective Agreement provided:

"(a) All Welfare, Pension and Vacation Pay Plan contributions made up to and including June 24, 1996, shall be administered by the Board of Trustees (made up of representatives from the Employers and the Union; with three persons being designated by the Employers and three persons being designated by the Union) in accordance with the terms of the Trust Agreement covering these plans in effect prior to the newly established Trust Document referenced in 3(b) below.

(b) Effective June 25, 1996, the Welfare, Pension and Vacation Pay Plans and all contribu­tions made to such plans as of June 25, 1996, shall be administered by a newly established Board of Trustees (made up of persons designated by the Union only) and in accordance to [sic] a newly established Trust Document to take effect June 25, 1996.

(c) Refer to Letter of Understanding in Appendix A for further information."

The Letter of Understanding referred to in paragraph 3(c) above provided:

“A number of local appendices reference the composition of local trust funds for Pension, Health and Welfare, S.U.B. and Vacation Pay. It is agreed that in the event of a restructuring of said trust funds, the procedure as outlined in the document of May 18, 1995 shall be applied."

28. As is clear, the Letter of Understanding referred to in Section 3(c) of the October 1996 amendment explicitly mentioned the May 18 Agreement.

29. Section 3 of Schedule K to Appendix 4 of the Collective Agreement provided, prior to the October 1996 amendment, that the board of trustees charged with administering the Benefit Trusts were comprised of trustees appointed by the employers and trustees appointed by Local 552. That changed as a result of the vote taking place in June, 1996 and culminated with the amendment to the Collective Agreement in October, 1996. Section 3(a) of the October, 1996 amendment expressly provided that the assets of the Benefit Trusts will remain subject to administration by a "Board of Trustees made up of representatives from the employers and the union" in accordance with the terms of the Trust Agreements covering the Benefit Trusts in effect prior to "... the newly established trust document referenced in 3(b) below". Section 3(b) of the October, 1996 amendment expressly contemplated that a new board of trustees made up of persons designated only by Local 552 would administer contributions to those newly created benefit trust plans on and after June 25, 1996. While the May 18 Agreement speaks of changes to Trust Agreements and governance of the Benefit Trusts, there was nothing in that May 18 Agreement that expressly provided that the assets and funds of the Benefit Trusts that had been jointly administered by a joint board of trustees were to be transferred to a trust fund or funds administered by trustees appointed only by Local 552. 30. Assuming without deciding that parties to a collective agreement can lawfully direct trustees of a pension or benefit trust fund who they have appointed to dispose of or transfer assets in a particular way or to a specific fund (a proposition with which I have considerable doubt) then there must be very clear language containing that direction. Trustees of those pension or benefit trust funds owe fiduciary obligations to the beneficiaries of the funds and, as trustees, must act in the interests of those beneficiaries and not simply at the behest of the parties who appointed them to hold office as trustees. The May 18 Agreement does not contain the kind of clear language that dictates the result claimed by counsel for the applicants.

30. In my view, the May 18 Agreement set out a process whereby a new trust plan structure was to be established to begin receiving contributions to fund those new benefit and pension plans. That agreement does not, in my opinion, require the trustees of the Benefit Trusts to transfer the assets and funds for which they are responsible to the newly created trust plans administered by trustees appointed only by Local 552. In my opinion, the necessary amendments required to be made to plan and contribution documents by reason of section 6 of the May 18 Agreement was to ensure that any assets designated as contributions to those newly created trust plans would, after June 25, 1996, be allocated to the custody of the trustees of those new plans only. It does not follow that the trustees of the Benefit Trusts who had been appointed by the MCAW were obliged to resign from their office as trustees of the Benefit Trusts and thereby have the assets for which they are responsible be administered by the trustees appointed only by Local 552.

31. This view is reinforced by the express language of the October 3, 1996 amendment to the Collective Agreement. It is clear that the parties in that amendment established new plans following the completion of the process contemplated by the May 18 Agreement. They also agreed that the Benefit Trusts would remain in place with assets and funds held under the Benefit Trusts continuing to be administered by the trustees appointed by the employers and trustees appointed by Local 552.

32. Therefore, in answer to the first issue I described in my memorandum to file of October 22,

1998, that is,:

"Does the Agreement of May 18, 1995 require the MCAW as a constituent member of the MCAO to cause the execution of amendments to the MCAW/Local 552 Trust Agreements to create the "transformation" of the Trusts?",

the answer is no. In view of that answer, I need not address the second issue raised in this application.

34. It appears that this application was based entirely upon the allegation that the May 18 Agreement required the MCAW to execute amendments to the Trust Agreements to change the governance structure of the Benefit Trusts. As I have found that the May 18 Agreement does not impose that obligation on the MCAW, it appears to me that this application ought to be dismissed. Nevertheless, since the ultimate consequence of my determination of this issue has not been addressed by the parties, I hereby direct the parties to deliver to the Board and to the other parties in this proceeding, within 10 days of the date of this decision their submissions as to whether this matter needs to continue. If no submissions are filed within the time stipulated, this application will be dismissed. If the parties wish the matter to continue, their submissions will be reviewed and the Board will determine whether the matter proceeds.

35. I continue to remain seized of this matter.