International Union of Operating Engineers, Local Union No. 132 Health & Welfare Fund v. L.A. Pipeline Construction Co.

IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA
January 2016 Term FILED
_______________ May 18, 2016
released at 3:00 p.m.
RORY L. PERRY II, CLERK
No. 15-0898 SUPREME COURT OF APPEALS
_______________ OF WEST VIRGINIA
INTERNATIONAL UNION OF OPERATING ENGINEERS, LOCAL UNION NO.
132 HEALTH AND WELFARE FUND, et al.,
Plaintiffs Below, Petitioners
v.
L.A. PIPELINE CONSTRUCTION COMPANY, INC.,
Defendant Below; and
UNITED BANK, INC., Intervenor Below
Respondents
____________________________________________________________
Certified Question from the United States District Court
for the Southern District of West Virginia
The Honorable Robert C. Chambers, United States District Judge
Civil Action No. 3:13-cv-00537
CERTIFIED QUESTION ANSWERED
____________________________________________________________
Submitted: April 27, 2016
Filed: May 18, 2016
Lawrence B. Lowry, Esq. James S. Huggins, Esq.
Barrett, Chafin, Lowry & Amos Daniel P. Corcoran, Esq.
Huntington, West Virginia Theisen Brock
Counsel for the Petitioners Marietta, Ohio
Counsel for the Respondent,
Patrick Morrisey, Esq. L.A. Pipeline Construction Company
Attorney General
Elizabeth G. Farber, Esq. Floyd E. Boone Jr., Esq.
Assistant Attorney General Bowles Rice LLP
Charleston, West Virginia Charleston, West Virginia
Counsel for Amicus Curiae Counsel for Intervenor
West Virginia Division of Labor United Bank, Inc.
Thomas A. Heywood, Esq.
Sandra M. Murphy, Esq.
Julia A. Chincheck, Esq.
Daniel J. Cohn, Esq.
Bowles Rice LLP
Charleston, West Virginia
Counsel for Amicus Curiae
West Virginia Bankers Association, Inc.,
and Community Bankers of West
Virginia.
CHIEF JUSTICE KETCHUM delivered the Opinion of the Court.
SYLLABUS BY THE COURT
1. Under West Virginia Code Section 21-5-14(g) [2012], a wage bond
obtained pursuant to the West Virginia Wage Payment Collection Act may be terminated,
ended, or concluded only with the approval of the Commissioner of the Division of
Labor. The Commissioner of the Division of Labor may approve termination of the wage
bond only after he/she has determined that the wages and fringe benefits due and owing
to all employees protected by the wage bond have been paid or that the employer who
obtained the wage bond is of sufficient financial responsibility to pay wages and fringe
benefits. This statute applies equally to a letter of credit serving as a wage bond obtained
pursuant to the Wage Payment Collection Act.
2. “To the extent that W.Va. Code § 46-5-106 (1963) conflicts with
W.Va. Code § 21-5-14 (1989), the provisions of the latter are controlling with regard to
the termination of an irrevocable letter of credit serving as a wage bond. In other words,
an irrevocable letter of credit serving as a wage bond pursuant to W.Va. Code § 21-5-14
(1989) can only be terminated with the approval of the Commissioner of the Division of
Labor.” Syl. Pt. 6, Leary v. McDowell Cnty. Nat’l Bank, 210 W.Va. 44, 552 S.E.2d 420
(2001).
3. To the extent West Virginia Code Section 46-5-106 [1996] conflicts
with West Virginia Code Section 21-5-14 [1991], the provisions of the latter are
controlling with regard to the termination of a perpetual irrevocable letter of credit
serving as a wage bond. In other words, a perpetual irrevocable letter of credit serving as
i
a wage bond pursuant to West Virginia Code Section 21-5-14 [1991] can only be
terminated with the approval of the Commissioner of the Division of Labor.
ii
Chief Justice Ketchum:
The United States District Court for the Southern District of West Virginia
presents this Court with one certified question regarding a “Perpetual Irrevocable Letter
of Credit/Wage Bond.” This letter of credit/wage bond was obtained pursuant to the
West Virginia Wage Payment Collection Act (“WPCA”) by an out-of-state corporation.1
The letter of credit/wage bond’s duration is governed by two competing
bodies of law: (1) the WPCA, which pertains to wage bonds; and (2) the Uniform
Commercial Code, which pertains to letters of credit. Consequently, the district court
presented us with the following question, which has been reformulated by this Court:2
Does a “Perpetual Irrevocable Letter of Credit/Wage
Bond” obtained pursuant to the Wage Payment Collection
Act remain in effect until terminated with the approval of the
Commissioner of the Division of Labor, as provided by the
Wage Payment Collection Act, or does it automatically expire
five years from its stated date of issuance, regardless of
whether it has been terminated with the Labor
Commissioner’s approval, as provided by the Uniform
Commercial Code?
1
The WPCA is codified in West Virginia Code Section 21-5-1, et seq. In
West Virginia Code Section 21-5-14 [2012], it “provide[s] that any employer engaged in
the construction industry or in the mining industry who has been doing business in the
State for less than five years shall obtain a bond payable to the State to secure payment of
wages and fringe benefits to employees.” Perry v. Barker, 169 W.Va. 531, 533, 289
S.E.2d 423, 425 (1982).
2
“[T]his Court retains the power to reformulate questions certified to it
under . . . the Uniform Certification of Questions of Law Act found in W.Va.Code, 51–
1A–1, et seq.” Syl. Pt. 3, in part, Kincaid v. Mangum, 189 W.Va. 404, 432 S.E.2d 74
(1992).
1
We answer: To the extent they conflict, the WPCA prevails over the
Uniform Commercial Code on the duration of a letter of credit/wage bond obtained
pursuant to the WPCA. Thus, under West Virginia law, the letter of credit/wage bond at
issue in this case remains in effect until terminated with the approval of the Labor
Commissioner.
I.
FACTUAL AND PROCEDURAL BACKGROUND
This dispute arises from a corporation’s failure to fully pay its employees.
The employer is L.A. Pipeline Construction Company, an Ohio corporation. The
aggrieved employees are a group of engineers who worked on a pipeline job in West
Virginia.3 L.A. Pipeline admitted liability for failing to pay the engineers’ fringe benefits
and administrative union dues. Now, it seeks to avoid paying on that liability by
claiming a wage bond ensuring employee access to wages has expired.
Before these facts occurred, L.A. Pipeline had not conducted much work in
West Virginia. Therefore, the WPCA required it to obtain a wage bond securing its
employees’ wages. A wage bond obtained pursuant to the WPCA may take various
3
The employee engineers’ interests are represented by the International
Union of Operating Engineers, Local No. 132 Health and Welfare Fund; International
Union of Operating Engineers, Local No. 132 Pension Fund; International Union of
Operating Engineers, Local No. 132 Apprenticeship and Skill Improvement Fund;
International Union of Operating Engineers, Local 132 Annuity and Savings Fund; and
International Union of Operating Engineers, Local No. 132 AFL-CIO. We refer to the
Plaintiffs as the “engineers” throughout this opinion.
2
forms, including a letter of credit.4 Under the WPCA, it may be terminated with the
Labor Commissioner’s approval only after the Commissioner has determined that all
wages and fringe benefits have been paid.5
Pursuant to the WPCA’s wage bond requirement, L.A. Pipeline obtained a
“Perpetual Irrevocable Letter of Credit/Wage Bond” in January 2009. The letter of
credit/wage bond provided in part:
This perpetual irrevocable letter of credit is posted as a
wage bond pursuant to [the WPCA], and is subject to the
provisions thereof, and the laws of the State of West Virginia.
. . . This perpetual irrevocable letter of credit/wage bond may
only be terminated with the approval of the Commissioner of
the West Virginia Division of Labor pursuant to the terms and
conditions of [the WPCA]. . . . The Issuing bank further
agrees to notify the Commissioner . . . prior to the five (5)
year anniversary of the Issuing date so that the Commissioner
can determine if the wage bond may be terminated pursuant
to [the WPCA].
The letter of credit/wage bond was issued by United Bank, Inc. and listed the Labor
Commissioner as the beneficiary. Under the letter of credit/wage bond, the Labor
Commissioner would draw funds from United Bank if L.A. Pipeline failed to fully pay its
employees. In this event, L.A. Pipeline would owe United Bank the amount withdrawn
by the Labor Commissioner.
In April 2011, L.A. Pipeline failed to pay the engineers’ fringe benefits and
administrative union dues. When the engineers notified the Labor Commissioner about
4
W.VA. CODE § 21-5-14(c).
5
W.VA. CODE § 21-5-14(g).
3
L.A. Pipeline’s failure to pay, they were advised to obtain a court order to collect
payment through the letter of credit/wage bond.6
In January 2013, the engineers relied on the Labor Commissioner’s advice
and sued L.A. Pipeline for unpaid wages in the United States District Court for the
Southern District of West Virginia.7 In April 2014, the parties entered into an agreed
judgment order in which L.A. Pipeline admitted it owed the engineers $129,273.90 in
unpaid employee benefit contributions. L.A. Pipeline did not pay the engineers the
amount owed under the judgment order.
In March 2015, the engineers filed a writ of suggestion calling on the Labor
Commissioner to draw from the letter of credit/wage bond to satisfy the agreed judgment
order. In response, L.A. Pipeline threatened to sue United Bank if it paid the Labor
Commissioner under the letter of credit/wage bond.
In April 2015, L.A. Pipeline responded to the engineers’ writ of suggestion,
asserting the letter of credit/wage bond is no longer in effect. Citing provisions of the
Uniform Commercial Code, L.A. Pipeline argued that the letter of credit/wage bond
6
It was incumbent on the Labor Commissioner, not the engineers, to collect
payment through the letter of credit/wage bond. The WPCA states “If the commissioner .
. . finds that such wages and fringe benefits or a portion thereof are unpaid, he shall make
demand of such employer for the payment of such wages and fringe benefits.” W.VA.
CODE § 21-5-14(e) (emphasis added). Indeed, “The . . . Commissioner of Labor has a
clear legal duty to enforce the bonding . . . provisions of the [WPCA].” Perry, 169
W.Va. at 539, 289 S.E.2d at 428.
7
The engineers’ complaint alleged L.A. Pipeline violated the federal
Employee Retirement Income Security Act of 1974 and the federal Labor Management
Relations Act of 1974.
4
automatically expired in January 2014, five years after its issuance date in January 2009.
United Bank intervened in this dispute and adopted L.A. Pipeline’s position.
Essentially, this dispute is whether the letter of credit/wage bond is still in
effect. The engineers argue that, under the WPCA, the letter of credit/wage bond is still
in effect because it has not been terminated with the Labor Commissioner’s approval and
L.A. Pipeline has not paid them. L.A. Pipeline and United Bank assert it automatically
expired in January 2014 under the Uniform Commercial Code. The district court found
this issue has not been directly addressed by this Court. Therefore, on September 17,
2015, it certified a question on the letter of credit/wage bond’s duration to this Court.
II.
STANDARD OF REVIEW
In regard to a federal court’s certified question, “A de novo standard is
applied by this Court in addressing the legal issues presented by a certified question from
a federal district or appellate court.”8
III.
ANALYSIS
The federal court asks us to resolve the duration of a letter of credit/wage
bond obtained pursuant to the WPCA. Two bodies of law govern this subject-matter: (1)
the WPCA, which pertains to wage bonds; and (2) the Uniform Commercial Code, which
pertains to letters of credit.
8
Syl. Pt. 1, Light v. Allstate Ins. Co., 203 W.Va. 27, 506 S.E.2d 64 (1998).
5
To answer this question, the parties dispute two issues: (1) whether the
WPCA is clear and unambiguous that the letter of credit/wage bond remains in effect;
and, if so, (2) whether the WPCA prevails over the Uniform Commercial Code to the
extent they conflict on the letter of credit/wage bond’s duration. We discuss both issues
in turn.
A. The West Virginia Wage Payment Collection Act
In West Virginia Code Section 21-5-14(g), the WPCA provides that a wage
bond may terminate only with the approval of the Labor Commissioner:
The bond may be terminated, with the approval of the
commissioner, after an employer submits a statement, . . . that
the following has occurred: The employer has ceased doing
business and all wages and fringe benefits have been paid, or
the employer has been doing business in this State for at least
five consecutive years and has paid all wages and fringe
benefits. The approval of the commissioner will be granted
only after the commissioner has determined that the wages
and fringe benefits have been paid. The bond may also be
terminated upon a determination by the commissioner that an
employer is of sufficient financial responsibility to pay wages
and fringe benefits.9
The engineers argue that, under West Virginia Code Section 21-5-14(g)’s
clear and unambiguous terms, payment, or the ability to pay, wages and fringe benefits
are a pre-requisite to terminating a letter of credit serving as a wage bond. Thus, the
9
W.VA. CODE § 21-5-14(g) (emphasis added).
6
letter of credit/wage bond remains in effect because L.A. Pipeline has not paid their
wages and fringe benefits.
However, L.A. Pipeline and United Bank assert West Virginia Code
Section 21-5-14(g) is not as clear as it seems. They cite a provision in the Uniform
Commercial Code which states: “A letter of credit that states that it is perpetual expires
five years after its stated date of issuance[.]”10 They contend that, reading the two
statutes together, the Uniform Commercial Code creates an ambiguity in West Virginia
Code Section 21-5-14(g) despite its seemingly clear language.
We decline to find ambiguity in West Virginia Code Section 21-5-14(g)’s
language merely because another statute may seemingly conflict with it. As we have
held: “The rule that statutes should be read and construed together . . . may not be
invoked when the language of the statute is clear and unambiguous.”11 Indeed, “a related
statute cannot be utilized to create doubt in an otherwise clear statute.”12
If West Virginia Code Section 21-5-14(g) is clear and does not lend itself to
multiple constructions, its language must be accepted as it is written. As is well-
established, “[w]here the language of a statute is clear and without ambiguity the plain
10
W.VA. CODE § 46-5-106(d) [2012].
11
State v. Epperly, 135 W.Va. 877, 881-82, 65 S.E.2d 488, 491 (1951).
12
Berkeley Cnty. Pub. Serv. Sewer Dist. v. W.Va. Pub. Serv. Comm’n, 204
W.Va. 279, 287, 512 S.E.2d 201, 209 (1998) (quotations and citations omitted).
7
meaning is to be accepted without resorting to the rules of interpretation.”13 Likewise,
we “presume that a legislature says in a statute what it means and means in a statute what
it says[.]”14 “Plain statutory language does not need to be construed.”15
West Virginia Code Section 21-5-14(g) is clear on its face. It plainly sets
out when a wage bond may be “terminated.” Giving the word “terminate” its common,
ordinary, and generally accepted meaning, West Virginia Code Section 21-5-14(g)
applies to when a wage bond “ends” or “concludes.”16 Thus, a wage bond obtained
pursuant to the WPCA may be terminated, ended, or concluded with the Labor
Commissioner’s approval “only after [he/she] has determined that the wages and fringe
benefits of all employees have been paid” or “upon a determination by [him/her] that an
employer is of sufficient financial responsibility to pay wages and fringe benefits.”17
The Legislature did not make an exception to these statutory requirements
for a letter of credit serving as a wage bond under the WPCA. As we have held: “It is not
for this Court arbitrarily to read into [a statute] that which it does not say. Just as courts
13
Syl. Pt. 2, State v. Elder, 152 W.Va. 571, 165 S.E.2d 109 (1968).
14
Mart. v. Randolph Cnty. Bd. of Educ., 195 W.Va. 297, 312, 465 S.E.2d
399, 414 (1995) (quotations and citations omitted).
15
Tribeca Lending Corp. v. McCormick, 231 W.Va. 455, 460, 745 S.E.2d
493, 498 (2013).
16
Terminate, BLACK’S LAW DICTIONARY (9th ed. 2009) (“Terminate”
means “to end” or “to conclude” generally).
17
W.VA. CODE § 21-5-14(g).
8
are not to eliminate through judicial interpretation words that were purposely included,
we are obliged not to add to statutes something the Legislature purposefully omitted.”18
Thus, we will not create an exception to the WPCA where the legislature declined to do
so.
Therefore, we hold that, under West Virginia Code Section 21-5-14(g)
[2012], a wage bond obtained pursuant to the West Virginia Wage Payment Collection
Act may be terminated, ended, or concluded only with the approval of the Commissioner
of the Division of Labor. The Commissioner of the Division of Labor may approve
termination of the wage bond only after he/she has determined that the wages and fringe
benefits due and owing to all employees protected by the wage bond have been paid or
that the employer who obtained the wage bond is of sufficient financial responsibility to
pay wages and fringe benefits. This statute applies equally to a letter of credit serving as
a wage bond obtained pursuant to the Wage Payment Collection Act.
Our holding accords with the WPCA’s plain intent, which is to ensure
working people in this state have access to their agreed-upon wages and to provide them
a remedy for recovering those wages when they are wrongly withheld.19 “It is always
presumed that the Legislature will not enact a meaningless or useless statute.”20 Here, the
18
Phillips v. Larry’s Drive-In Pharm., Inc., 220 W.Va. 484, 491, 647
S.E.2d 920, 927 (2007) (quotations and citations omitted).
19
Grim v. E. Elec. LLC., 234 W.Va. 557, 571, 767 S.E.2d 267, 281 (2014).
20
Syl. Pt. 4, State ex rel. Hardesty v. Aracoma, 147 W.Va. 645, 129 S.E.2d
921 (1963).
9
WPCA’s wage bond requirement would be rendered “meaningless” if wage bonds were
allowed to automatically expire before all wages and fringe benefits have been paid.21
Accordingly, we find the WPCA clearly and unambiguously provides this letter of
credit/wage bond remains in effect.
B. Conflict between the Wage Payment Collection Act and the Uniform Commercial Code
Even though the letter of credit/wage bond remains in effect under the
WPCA, our inquiry does not end. A provision in the Uniform Commercial Code, West
Virginia Code Section 46-5-106(d) provides, “A letter of credit that states that it is
perpetual expires five years after its stated date of issuance[.]” In this case, the letter of
credit/wage bond states it is perpetual, and it was issued more than five years ago. Thus,
we are faced with two seemingly conflicting laws that apply to the letter of credit/wage
bond: (1) the WPCA, under which the letter of credit/wage bond remains in effect; and
(2) the Uniform Commercial Code, under which the letter of credit/wage bond is no
longer in effect.
Ordinarily, where two statutes apply to the same subject matter, the more
specific statute prevails over the general statute. “When faced with a choice between two
statutes, one of which is couched in general terms and the other of which specifically
speaks to the matter at hand, preference generally is accorded to the specific statute.”22
21
Perry, 169 W.Va. at 539, 289 S.E.2d at 428.
22
Newark Ins. Co. v. Brown, 218 W.Va. 346, 351, 364 S.E.2d 783, 788
(2005).
10
As we have held: “The general rule of statutory construction requires that a specific
statute be given precedence over a general statute relating to the same subject matter
where the two cannot be reconciled.”23
In West Virginia Code Section 21-5-14(g), the WPCA specifically speaks
to the matter at hand while the Uniform Commercial Code is couched in general terms.
The WPCA’s application is limited to letters of credit serving as wage bonds pursuant to
its wage bond requirement. By contrast, the Uniform Commercial Code applies to letters
of credit generally, with no special provision regarding letters of credit serving as wage
bonds. Thus, under our rule in which a specific statute prevails over a general statute, the
WPCA must prevail over the Uniform Commercial Code as to the letter of credit/wage
bond’s duration.
In a similar case, Leary v. McDowell County National Bank, 210 W.Va. 44,
552 S.E.2d 420 (2001), we found the WPCA prevailed over the earlier 1963 version of
the Uniform Commercial Code regarding termination of an irrevocable letter of credit
serving as a wage bond. In Syllabus Point 6 of Leary, we held:
To the extent that W.Va. Code § 46-5-106 (1963)
conflicts with W.Va. Code § 21-5-14 (1989), the provisions
of the latter are controlling with regard to the termination of
an irrevocable letter of credit serving as a wage bond. In
other words, an irrevocable letter of credit serving as a wage
bond pursuant to W.Va. Code § 21-5-14 (1989) can only be
23
Syl. Pt. 1, UMWA v. Kingdon, 174 W.Va. 330, 325 S.E.2d 120 (1984).
11
terminated with the approval of the Commissioner of the
Division of Labor.24
The following two rationales supported this holding: (1) the Uniform Commercial Code
states it may be supplemented by other statutes; and (2) the WPCA’s remedial purpose
requires that the letter of credit/wage bond be available to compensate unpaid
employees.25
Both of these rationales apply to the 1996 version of the Uniform
Commercial Code. Importantly, the Uniform Commercial Code recognizes that when it
conflicts with another statute:
[I]nterpretive principles addressing the [relationship]
between statutes may lead the court to conclude that the other
statute is controlling, even though it conflicts with the
Uniform Commercial Code. This, for example, would be the
result in a situation where the other statute was specifically
intended to provide additional protection to a class of
individuals engaging in transactions covered by the Uniform
Commercial Code.26
This statement in the Uniform Commercial Code naturally leads us to
Leary’s next rationale: the WPCA is remedial legislation intended to protect West
Virginia workers. Likewise, the WPCA’s remedial purpose is only accomplished when
24
Syl. Pt. 6, Leary, 210 W.Va. at 51, 552 S.E.2d at 427. This holding is
limited to the 1963 version of the Uniform Commercial Code. Id., at 51 n.9, 522 S.E.2d
at 427 n.9.
25
Id. at 51, 552 S.E.2d at 427. We caution that even though the Uniform
Commercial Code may be supplemented by other statutes, some of its provisions may not
be varied by agreement between the parties. See W.VA. CODE § 46-5-103(c) [2012].
26
W.VA. CODE § 46-1-103, cmt. 3 (emphasis added).
12
the wage bond is available to compensate unpaid employees. As we have held: “Because
it is remedial legislation, the WPCA must be construed liberally in order to accomplish
the purposes for which it was intended.”27
Therefore, we extend our reasoning in Syllabus Point 6 of Leary to the
current 1996 version of West Virginia Code Section 46-5-106(d). To the extent West
Virginia Code Section 46-5-106 [1996] conflicts with West Virginia Code Section 21-5­
14 [1991], the provisions of the latter are controlling with regard to the termination of a
perpetual irrevocable letter of credit serving as a wage bond. In other words, a perpetual
irrevocable letter of credit serving as a wage bond pursuant to West Virginia Code
Section 21-5-14 [1991] can only be terminated with the approval of the Commissioner of
the Division of Labor.28
Under the WPCA’s clear and unambiguous terms, the Labor
Commissioner’s approval, which may be granted only upon the payment, or the ability to
pay, wages and fringe benefits, is a pre-requisite to the termination of a wage bond.
Because the WPCA’s provisions are controlling with regard to termination of the letter of
credit/wage bond, it remains in effect.
27
Citynet LLC. v. Toney, 235 W.Va. 79, 92, 772 S.E.2d 36, 49 (2015).
28
We stress our holding is limited to letters of credit serving as wage bonds
pursuant to the WPCA. Letters of credit that do not serve as wage bonds obtained
pursuant to the WPCA are unaffected by our holding in this case.
13
IV.
CONCLUSION
To the extent they conflict, the WPCA prevails over the Uniform
Commercial Code on the duration of a letter of credit/wage bond obtained pursuant to the
WPCA. Thus, under West Virginia law, the letter of credit/wage bond at issue in this
case remains in effect until terminated with the approval of the Labor Commissioner.
Certified Question Answered.
14