Carpenters Pension Trust Fund v. Moxley, No. 11-16133 (9th Cir. 2013)
Annotate this CaseDebtor was required to make contributions to the Carpenters Pension Trust Fund pursuant to a multiemployer bargaining agreement (the Agreement). When the Agreement expired, debtor no longer was a signatory to a collective bargaining agreement and stopped making payments. The Fund subsequently filed suit because debtor was still doing work covered by the Agreement and was subject to withdrawal liability under 29 U.S.C. 1381. Debtor then filed for bankruptcy and sought a discharge of his debt to the Fund. The Fund filed a complaint under 11 U.S.C. 523(c) to prevent discharge, seeking to establish that the debt qualified as one created via defalcation by a fiduciary under section 523(a)(4). The court concluded that the Bankruptcy Court had jurisdiction to adjudicate the dischargeability of the Fund's claim against debtor; debtor was not a fiduciary of the Fund because the unpaid withdrawal liability was not an asset of the Fund; and debtor's failure to challenge the withdrawal liability amount in arbitration did not act as a waiver of his right to discharge the debt. Accordingly, the court affirmed the judgment.
Court Description: Bankruptcy. The panel affirmed the district court’s order affirming the judgment of the bankruptcy court in an adversary proceeding regarding the dischargeability in bankruptcy of a construction industry contractor’s “withdrawal liability” to a pension fund following the expiration of the collective bargaining agreement under which the fund was administered. Distinguishing Stern v. Marshall, 131 S. Ct. 2594 (2011), the panel held that the bankruptcy court had jurisdiction to adjudicate the dischargeability of the pension fund’s claim against the contractor because a dischargeability determination is central to federal bankruptcy proceedings and therefore constitutes a public rights dispute that a bankruptcy court may decide. The contractor was subject to withdrawal liability under the Employee Retirement Income Security Act because he continued doing work covered by the collective bargaining agreement after it expired. The panel held that this debt was dischargeable because it did not qualify as a debt created via defalcation by a fiduciary under 11 U.S.C. § 523(a)(4). The panel concluded that the contractor was not a fiduciary of the fund pursuant to ERISA because he had nothing to do with the fund’s administration or investment policy and did not exercise control respecting disposition of its assets. The panel held that the fund’s assets did not include the unpaid withdrawal liability. It reasoned that the withdrawal liability was a statutory obligation, and was different from unpaid contributions arising from contractual obligations under the collective bargaining agreement. The panel held that the contractor’s failure to challenge the withdrawal liability amount in arbitration did not act as a waiver of his right to discharge the debt.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.