## Facts

- A multiemployer musicians’ pension plan sought to enforce contribution-related rights against a signatory employer under ERISA and LMRA § 301.
- The employer hired musicians for single engagements and, under collective bargaining agreements with the musicians’ local, owed pension contributions at specified rates for covered work.
- A union president who also served as a plan trustee negotiated and signed fifteen written settlement agreements with the employer addressing disputed contributions for specified periods and employees.
- Each settlement fixed a contribution amount and stated it was a full and final settlement of all claims for the covered periods; the agreements contemplated ratification by the plan’s acceptance of payment.
- The plan’s internal governance limited authority to compromise plan claims to the board of trustees collectively; the signatory lacked actual authority to bind the plan unilaterally.
- The employer tendered checks in the settlement amounts, and the plan cashed all fifteen checks.
- The plan later demanded an audit of the employer’s payroll records for 1992–1994 to determine whether additional contributions were owed.
- The employer refused, contending the settlements barred further audits or monetary claims for the same periods.

## Issues

1. Whether the plan trustees were bound by settlement agreements signed by a union officer/plan trustee who lacked actual authority to settle plan claims.
2. Whether the plan’s acceptance and retention of settlement payments barred it, under equitable estoppel or ratification principles, from repudiating the settlements and demanding an audit for the same periods.
3. Whether the signatory had apparent authority, as reasonably perceived by the employer, sufficient to bind the plan despite undisclosed internal limits on authority.

## Decision

- The court treated the employer’s motion as one for summary judgment and granted it, dismissing the complaint.
- The court held the plan was bound by the fifteen settlement agreements and could not demand an audit or pursue additional claims for the covered time periods.
- The court concluded the employer reasonably relied on the signatory’s apparent authority, and the plan’s cashing of the settlement checks constituted ratification and supported equitable estoppel.

## Legal Principles

- Apparent authority may bind a principal when the principal’s manifestations and course of dealing cause a third party reasonably to believe an agent is authorized, even if internal rules restrict actual authority and the third party lacks notice of those limits.
- A principal may ratify an unauthorized act by knowingly accepting and retaining the benefits of the transaction, making the act binding as if originally authorized.
- Equitable estoppel may preclude a party from disavowing an agreement where the other party reasonably relied on the party’s conduct and repudiation would be inequitable.
- ERISA does not categorically displace common-law doctrines of apparent authority, ratification, and estoppel in disputes between benefit funds and contributing employers, particularly where the fund accepted payment under purported settlements resolving past contribution disputes.

## Conclusion

The court enforced fifteen contribution settlements against an ERISA pension fund because the employer reasonably believed the union president/trustee had authority to settle, and the fund ratified and was estopped from repudiating the agreements by accepting and retaining the settlement payments, thereby barring a later audit demand for the same periods.


Trs. of the Am. Fed’n of Musicians & Emps.’ Pension Fund v. Steven Scott Enters., Inc., 40 F. Supp. 2d 503 (S.D.N.Y. 1999)