Denart Coal Co.

National Labor Relations Board - Board Decisions

Dec 16, 1994

315 N.L.R.B. 850 (N.L.R.B. 1994)

850
315 NLRB No. 125
DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
1 Not reported in Board volumes.
2 The brief was submitted on behalf of Respondents Laing Enter-
prises, Vance Trucking, Delores Vance d/b/a D & J Trucking, Don
Vance, Don E. Vance, and Michael Vance.
3 Not reported in Board volumes.
4 No. 90-1004 (unpublished).
5 Contrary to the General Counsel’s exceptions, there is insuffi-
cient record evidence to establish that Laing or Vance Trucking,
which have been dissolved, are single employers with Denart/V Coal
or that Michael Vance or Don E. Vance are individually liable for
remedying the unfair labor practices. Accordingly, we dismiss the al-
legations in the compliance specification as to those Respondents.
Denart Coal Co., Inc. and its alter ego, V Coal Co.,
Inc., Laing Enterprises; Vance Trucking;
Delores Vance d/b/a D & J Trucking, a sole
proprietorship; Don Vance; Don E. Vance; and
Michael Vance and United Mine Workers of
America, District 17. Case 9–CA–25650
December 16, 1994
SUPPLEMENTAL DECISION AND ORDER
BY MEMBERS STEPHENS, DEVANEY, AND
BROWNING
On October 14, 1992, Administrative Law Judge
Hubert E. Lott issued the attached supplemental deci-
sion. The General Counsel filed exceptions and a sup-
porting brief. On March 26, 1993, the Board issued an
Order remanding the proceeding to the judge.1 On
March 25, 1994, the judge issued the attached second
supplemental decision. The General Counsel filed ex-
ceptions and a supporting brief and the Respondents
filed an answering brief, which was styled as a reply
memorandum.2
The National Labor Relations Board has delegated
its authority in this proceeding to a three-member
panel.
The Board has considered the supplemental decision
and second supplemental decision and the record in
light of the exceptions and briefs and has decided to
affirm the judge’s rulings, findings, and conclusions
only to the extent consistent with this Supplemental
Decision and Order.
In his supplemental and second supplemental deci-
sions, Judge Lott found that none of the Respondents
involved in the proceeding before him were liable for
the backpay remedy the Board ordered in the unfair
labor practice proceeding, and he recommended that
the compliance specification be dismissed in its en-
tirety. For the reasons set forth below, we find, con-
trary to the judge, that certain of the Respondents are
liable for the backpay amounts due under the Board’s
Order in the unfair labor practice case.
I. PROCEDURAL HISTORY
On August 14, 1989, the Board issued an Order in
this proceeding, adopting, in the absence of exceptions,
the findings, conclusions, and recommendations of Ad-
ministrative Law Judge Wallace Nations.3 Judge Na-
tions found that Respondents Denart Coal Co., Inc.
(Denart) and V Coal Co., Inc. (V Coal) violated Sec-
tion 8(a)(5) and (1) of the Act by refusing to comply
with the terms of their applicable collective-bargaining
agreement with the Union and failing to supply infor-
mation to the Union. The judge further found that
Denart, majority-owned and controlled by Don Vance,
and V Coal, owned by Don Vance’s sons and operated
by Don Vance, are alter ego coal mining corporations
commonly owned and managed by Vance family
members. The Board adopted the judge’s rec-
ommended Order that Denart/V Coal, inter alia, make
employees whole for losses resulting from the unfair
labor practices. On March 1, 1990, the United States
Court of Appeals for the Fourth Circuit enforced the
Board’s Order in full.4
On June 4, 1990, the Regional Director issued a
compliance specification, alleging, inter alia, that in
addition to Denart/V Coal, the following entities (col-
lectively the additional Respondents) are responsible
for the backpay due under the terms of the Board’s
Order: Laing Enterprises (Laing); Vance Trucking;
Delores Vance d/b/a D & J Trucking, a sole propri-
etorship (D & J); Don Vance, an individual; Don E.
Vance, an individual; and Michael Vance, an individ-
ual.
On January 28, 1991, the Board granted the General
Counsel’s Motion for Partial Summary Judgment
against Denart/V Coal for failure to file an answer to
the compliance specification, and found that all allega-
tions in the compliance specification were admitted as
true against them. The Board, however, remanded for
a hearing as to the liability of the additional Respond-
ents. 301 NLRB 391.
In his supplemental decision, Judge Lott found that
there was insufficient evidence to establish a single-
employer relationship between Denart/V Coal and any
of the additional Respondents, and dismissed the com-
pliance specification allegations against all the Re-
spondents. In its remand, the Board directed the judge
to explain his finding that Delores Vance’s testimony
regarding the ownership and operations of D & J was
uncontradicted by the documentary evidence.
In the second supplemental decision, Judge Lott re-
affirmed his finding that none of the additional Re-
spondents are a single employer with Denart/V Coal.
For the reasons below, we reverse the judge and
find that D & J is a single employer with Denart/V
Coal.5 As such, D & J is liable with Denart/V Coal
for remedying the unfair labor practices as set forth in
the compliance specification. Finally, because D & J is
a proprietorship, not a corporation, its principals (Don
851DENART COAL CO.
6 Therefore, the judge erred in stating that the test includes the fac-
tors of ‘‘employee interchange, business purpose, plant and equip-
ment and anti-union motive.’’
and Delores Vance) are personally liable for the obli-
gations incurred by D & J.
II. ANALYSIS
It is well settled that the Board examines the follow-
ing factors in determining whether two or more em-
ploying entities constitute a single employer: (1) com-
mon ownership; (2) interrelation of operations; (3)
common management; and (4) centralized control of
labor relations. Radio Technicians Local 1264 v.
Broadcast Service of Mobile, 380 U.S. 255 (1965).6
Not all of these criteria need be present to establish
single-employer status and a significant factor is the
absence of an ‘‘arm’s length relationship found among
unintegrated companies.’’ Operating Engineers Local
627 v. NLRB, 518 F.2d 1040, 1046 (D.C. Cir. 1975),
affd. in pertinent part sub nom. South Prairie Con-
struction Co. v. Operating Engineers Local 627, 425
U.S. 800 (1976). We shall examine each of these fac-
tors in turn.
A. Common Ownership
The judge in his first decision found Delores
Vance’s testimony that she was D & J’s sole owner to
be ‘‘uncontradicted.’’ In his exceptions, the General
Counsel referred to a number of documents that on
their face contradicted Delores Vance’s testimony that
she is the sole owner of D & J and that Don Vance
is uninvolved with its operations. In our Order remand-
ing the case to the judge, we stated in pertinent part
as follows:
We cannot reconcile the judge’s apparent cred-
iting of Delores Vance with the documentary evi-
dence. We shall therefore remand this proceeding
for the judge to explain or reconsider his credibil-
ity findings in light of the documentary evidence,
which he did not discuss in his supplemental deci-
sion.
In his second decision, the judge stated that because
the compliance specification did not allege Don Vance
to be an owner of D & J, ‘‘whether or not Delores
Vance is the sole proprietor as she testified, is not rel-
evant to this proceeding.’’ At the same time, the judge
observed that the documentary evidence concerning
ownership to which we referred in our remand was in-
conclusive. He offered little explanation for this asser-
tion.
The judge’s second decision is seriously flawed.
First, the judge did not perform the task we specifi-
cally assigned him and instead termed ‘‘irrelevant’’ the
issue that was the focus of our Order remanding. This
was plain error on his part because ‘‘it is not for [an
administrative law judge] to speculate as to what
course the Board should follow . . . . On the contrary,
it remains the [judge’s] duty to apply established
Board precedent.’’ Insurance Agents, 119 NLRB 768,
773 (1957), revd. on other grounds 361 U.S. 477
(1960). We would not have remanded the case to the
judge if we shared his view that the ownership issue
was ‘‘irrelevant.’’ The judge should have recognized
the legal authority of the Board’s Order and complied
with its instructions.
Second, the fact that the compliance specification
did not contain a specific allegation that Don Vance
owned D & J is immaterial. The specification did al-
lege, inter alia, that there was ‘‘common ownership’’
of D & J Trucking and Denart/V Coal, that D & J is
a single employer with Denart/V Coal, that Don and
Delores Vance ‘‘have held common stock in, have
commingled assets with . . . and have operated’’ the
single employer, and that Don and Delores Vance are
‘‘personally, jointly and severally, liable’’ with
Denart/V Coal for the amounts due under the Board’s
Order. Further, the issue of whether Don Vance was
a principal of D & J Trucking was fully litigated at the
hearing. Finally, the very fact that Denart/V Coal and
D & J are alleged as single employers places the ques-
tion of ‘‘common ownership’’ in issue, because that is
one of the criteria for determining single-employer sta-
tus, a fact that the judge could not have taken into ac-
count because of his mischaracterization of those cri-
teria (see fn. 6 above). Under these circumstances, we
find, contrary to the judge, that there is no due-process
barrier to deciding the ownership question that was the
subject of our remand. Cf. Jerry’s United Super, 289
NLRB 125 fn. 2 (1988).
Because the judge failed to fulfill his role as fact
finder on two occasions, we shall proceed to examine
the documentary evidence in the record de novo. See,
e.g., Williamson Memorial Hospital, 284 NLRB 37
(1987). We recognize that in our Order remanding we
stated that the judge ‘‘apparent[ly] credit[ed]’’ Delores
Vance’s testimony on the ownership issue, but after
carefully reexamining the record and the judge’s first
decision in light of his second decision, we now real-
ize that the judge did not, in fact, make a credibility
resolution respecting Delores Vance’s testimony. We
rest this conclusion on several considerations.
In neither of his decisions did the judge refer even
generally to the testimonial demeanor of the witnesses
who testified. Nor did the judge make an explicit
credibility finding regarding Delores Vance’s testi-
mony. Rather, in his first decision, he stated that her
testimony was ‘‘uncontradicted,’’ an error that we
brought to the judge’s attention in our Order remand-
ing and that he failed to correct in his second decision.
Furthermore, in his second decision, the judge stated
that the issue on which Delores Vance testified was
852 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
7 We have been administratively advised that Judge Lott has re-
tired from the NLRB. Therefore, a second remand is not, in any
event, a viable alternative.
8 Indeed, counsel for the additional Respondents concedes in his
brief to the Board that common ownership exists among all the Re-
spondents.
9 We also reject the judge’s finding that documentary evidence
dated after Denart and V Coal ceased doing business is irrelevant.
Denart/V Coal continued to exist after their operations ended, and
D & J settled V Coal’s accounts with various suppliers after V Coal
ceased operations. Thus, events after Denart/V Coal ceased oper-
ations have a direct bearing on the single-employer issue. See
Emsing’s Supermarket, 284 NLRB 302, 303 (1987), enfd. 872 F.2d
1279 (7th Cir. 1989).
10 Indeed, the initial funding from a joint husband-wife account
and the continuing involvement of one spouse in both enterprises
would be a sufficient basis for finding common ownership. See
H. A. Green Decorating Co., 299 NLRB 157, 163 (1990).
11 The judge suggests that Don Vance’s cosigning of loans to D
& J is without significance because marital property was used as
collateral. We find this suggestion to be factually erroneous as to the
collateral used in most of the loans in question and also find that
Don Vance’s guarantee of loans to D & J without compensation is
relevant to the issue of whether he had a financial interest in D &
J.
12 Denart’s interrelation of operations with D & J is further evi-
denced by the following: Don Vance agreed with the Union that
Denart would pay union dues on behalf of D & J employees (see
below); all the Respondents share the same accountant (Don Vance’s
cousin); D & J’s facility is located on property leased by Denart;
and D & J’s office is located at the home of Don and Delores
Vance.
‘‘not relevant to this proceeding.’’ Therefore, instead
of crediting and relying on Delores Vance’s testimony,
it appears that the judge viewed the testimony as hav-
ing no bearing on the outcome of this case. Accord-
ingly, in the absence of a credibility finding by the
judge concerning Delores Vance’s testimony, we shall
‘‘exercis[e] [our] responsibility to assess the testimony
in the light of the record as a whole.’’ Royal Type-
writer Co. v. NLRB, 533 F.2d 1030, 1042–1043 fn. 12
(8th Cir. 1976).7
We find that the preponderance of the evidence es-
tablishes D & J is commonly owned by Don Vance,
majority owner of Denart, and his wife Delores Vance,
an admitted owner of D & J.8 Thus, on a credit appli-
cation with a bank for a personal $10,000 loan, Don
Vance identified himself as ‘‘owner’’ of D & J and
listed D & J’s bank account as his own. On several
checks made payable to D & J, Don Vance endorsed
them by signing, ‘‘D & J Trucking/Don Vance/-
Owner.’’ These checks were for no small amount, to-
taling approximately $135,000. Contrary to the judge,
we find that there is no ‘‘multitude of other documents
. . . listing Delores Vance as sole owner of D & J
Trucking’’ and that the documents in the record do not
‘‘cancel each other out.’’9
D & J was started with money from the joint ac-
count of Don and Delores Vance,10 their joint money
was used to fund D & J thereafter, and Don Vance
personally guaranteed loans to D & J without any evi-
dence of consideration.11
B. Interrelation of Operations
Denart and V Coal were engaged in the business of
mining coal. D & J hauled coal for Denart and V Coal
as well as other coal mines. D & J also leased equip-
ment to Denart and V Coal.
In addition, the record is replete with evidence es-
tablishing a substantial operational and financial inter-
relationship between D & J and Denart/V Coal and a
lack of arm’s-length dealings between the entities. For
example, D & J paid V Coal’s payroll of $20,000,
with money Don and Delores Vance borrowed (with
interest) from a bank. See Emsing’s Supermarket,
supra, 303–304. There was no provision for interest re-
payments by V Coal to D & J or to Don or Delores
Vance. Further, Delores Vance made a no-interest loan
of $40,000 to Denart, a loan for which there is no
written note or agreement. D & J/Delores Vance made
other loans to V Coal for which there is no documen-
tary evidence that interest payments were required or
evidence that D & J has demanded full repayment of
the loans from V Coal. See Il Progresso Italo
Americano Publishing Co., 299 NLRB 270, 288
(1990); MIS, Inc., 289 NLRB 491, 492 (1988). Addi-
tionally, when D & J leased equipment to V Coal, it
did not require any insurance or security deposit from
V Coal. Finally, D & J paid V Coal’s creditors with
money transferred from V Coal to D & J after V Coal
ceased operations, to enable V Coal to avoid attach-
ment of its assets by various creditors.12 In the words
of the Board in Emsing’s Supermarket, supra at 304:
These facts, taken as a whole, clearly reveal not
only a financial interdependency between
[Denart/V Coal] and [D & J], but also a propen-
sity on the part of [Don and Delores Vance] to
operate [the companies] in such a manner that the
exigencies of one would be met by the other.
This method of operating shows less than an
‘‘arm’s length relationship’’ between [Denart/V
Coal] and [D & J].
C. Common Management
It is undisputed that Don Vance managed Denart.
There is substantial documentary evidence in the
record controverting Delores Vance’s testimony that
Don Vance was not involved in the management of D
& J. The record shows that Don Vance filed a finan-
cial statement with a bank in which he stated that D
& J is his ‘‘business or occupation.’’ Also in the
record is a credit application in which the Vances held
themselves out as jointly doing business as D & J. In
another application, Don Vance applied for credit on
behalf of D & J. Even the judge found that Don Vance
853DENART COAL CO.
13 We do not require extensive evidence that all four criteria have
been satisfied before making a finding of single-employer status. See
Imco/International Measurement Co., 304 NLRB 738, 740 (1991)
(single-employer finding warranted where three of four criteria met
and no arm’s-length relationship existed among the entities), enfd.
978 F.2d 334 (7th Cir. 1992).
contracted for goods on behalf of D & J by purchasing
a truck, an act hardly in keeping with one who is not
involved in the Company’s operations.
Don Vance, Delores Vance, and their son, Don E.
Vance discussed the businesses of all the entities at
weekly informal meetings. Denart/V Coal had no for-
mal board of directors meetings and corporate minutes
are not in evidence. The family meetings, the absence
of any formal meetings by each entity, and the dis-
regard of the separation between the various entities at-
test to their common management.
D. Centralized Control of Labor Relations
Evidence of Don Vance’s involvement in D & J’s
labor relations is limited but significant. Delores Vance
denied that Don Vance was involved in certain aspects
of labor relations for D & J—hiring and dealing with
employees regarding their wages and terms and condi-
tions of employment. The record shows, however, that
Don Vance met with union representatives of United
Mine Workers District 17 regarding D & J employees
and agreed that Denart would pay the dues of D & J
employees. The record also shows that Don Vance rep-
resented D & J in a proceeding before the State of
West Virginia Department of Energy regarding an em-
ployee of D & J who was injured at work. Although
not overwhelming, this evidence of Don Vance’s in-
volvement in D & J’s labor relations, in combination
with the ample evidence relating to the other factors
discussed above, provides additional support for a find-
ing that D & J and Denart/V Coal are a single em-
ployer.13
E. Conclusion
Under all the circumstances—including common
ownership of Denart/V Coal and D & J, the marital re-
lationship between Don and Delores Vance, the finan-
cial and operational interrelationship between Denart/
V Coal and D & J, Don Vance’s involvement in the
labor relations of D & J, and common management—
we find that the record establishes an absence of an
arm’s-length relationship between Denart/V Coal and
D & J and that they therefore constitute a single em-
ployer.
III. REMEDY
The Respondents’ brief concedes, as it must, that
Delores Vance is personally liable if D & J is a single
employer with Denart/V Coal, because D & J is a pro-
prietorship, not a corporation. There is no contention
that D & J as an entity has limited liability. Given our
findings that Denart/V Coal and D & J are a single
employer and that Don Vance and Delores Vance
jointly own D & J, we conclude that they are both per-
sonally liable with Denart/V Coal/D & J for remedying
the unfair labor practices.
No issue is presented with respect to the amount of
backpay that is due. In its 1991 Decision and Order in
this case, the Board granted the General Counsel’s
Motion for Summary Judgment against Denart/V Coal
for failure to file an answer to the compliance speci-
fication. The Board stated that it ‘‘deem[ed] all the al-
legations in the compliance specification to be admit-
ted as true against the Respondents, Denart Coal Co.,
Inc. and its alter ego V. Coal Co., Inc.’’ 301 NLRB
at 392. In addition, the Board stated:
If all the Respondents are a single employer,
then they are all responsible for, and bound by,
the actions of the single employer in this proceed-
ing. That includes the failure of the original,
named Respondents to provide an adequate an-
swer here. [Id.]
Accordingly, additional Respondents D & J, Don
Vance, and Delores Vance, bound as they are by the
actions of the original Respondents, are also liable for
payment of the amounts set forth in the compliance
specification.
ORDER
The National Labor Relations Board orders that the
Respondents, Denart Coal Co., Inc. and its alter ego,
V Coal Co., Inc.; D & J Trucking; and Don Vance and
Delores Vance, as individuals, Chapmanville, West
Virginia, their officers, agents, successors, and assigns,
jointly and severally, shall make whole each of the
employees named below by paying each of them the
amount specified as net backpay, as well as payment
to each of them for losses suffered by virtue of the Re-
spondents’ failure to provide medical insurance as re-
quired by the collective-bargaining agreement, with in-
terest computed in accordance with New Horizons for
the Retarded, 283 NLRB 1173 (1987), until payment
of all amounts due is made, less tax withholdings re-
quired by Federal and state laws:
Discriminatees Backpay Medical Expense
Adams, Arthur $383
Bailey, Chester $17,000 92
Brown, Harold 17,575 411
Brumfield, Robert 1,787
Bryant, James 1,664
Buzzard, Bruce 16,350 0
Carter, Troy 129
Dickerson, L. 9,825 0
Ellis, Buell Jr. 6,421
Farley, H. 16,225 379
854 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
Discriminatees Backpay Medical Expense
Harless, Aley 15,725 1,563
Harris, John 1,250 519
Lambert, G. 15,575 703
Lance, Larry 10,800 0
Martin, Thomas 18,825 302
Russell, R. 350 0
Vance, Sherman 803
IT IS FURTHER ORDERED that the above-named par-
ties jointly and severally shall pay the 1950 Pension
Trust, 1950 Benefit Trust, and 1974 Pension Trust, the
amounts specified below pursuant to the terms and
conditions of the 1984–1988 Bituminous Coal Wage
Agreement, with any additional amounts due the funds
computed according to Merryweather Optical Co., 240
NLRB 1213, 1216 fn. 7 (1979), until payment is made
of all such amounts due:
1950 Pension Trust $78,864
1950 Benefit Trust 45,471
1974 Pension Trust 15,071
Gary E. Lindsay, Esq., for the General Counsel.
Daniel McCarthy, Esq., for the Respondent.
Charles Donnelly, Esq., for the Charging Party.
SUPPLEMENTAL DECISION
STATEMENT OF THE CASE
HUBERT E. LOTT, Administrative Law Judge. This case
was tried in Charleston, West Virginia, on December 16 and
17, 1991.
FINDINGS OF FACT
A. Background
On July 5, 1989, Judge Wallace Nations found that
V Coal Co., Inc. was the alter ego of Denart Coal Co., Inc.,
and that they were in violation of Section 8(a)(5) and (1) of
the Act for refusing to comply with the Bituminous Coal
Wage Agreement (JD–147–89). Exceptions were not filed by
the Respondent and the Board adopted Judge Nations’ deci-
sion on August 14, 1989. On March 1, 1990, the United
States Court of Appeals for the Fourth Circuit enforced the
Board’s Order in full.
On June 4, 1990, the Regional Director for Region 9
issued a compliance specification alleging that Laing Enter-
prises, Vance Trucking, and D & J Trucking, a sole propri-
etorship, constitute a single employer with Respondent’s
Denart Coal Co., Inc. and V Coal Co., Inc. The specification
further alleges that Delores Vance, Don Vance, Don E.
Vance, and Michael Vance are individually liable with
Denart Coal and V Coal for any payments owned under the
BCWA because they ‘‘held common stock in, have commin-
gled assets with and have been agents of’’ the single em-
ployer alleged above.
On October 9, 1990, counsel for the General Counsel filed
with the Board a Motion for Partial Summary Judgment and
Motion to preclude Respondents from controverting certain
allegations of the compliance specification, because Respond-
ent Denart Coal and its alter ego did not file an answer. On
January 28, 1991, the Board, in its decision at 301 NLRB
391, granted the Motion for Partial Summary Judgment
against Respondent’s Denart Coal and its alter ego V Coal
and denied the motion with respect to issues raised by the
other Respondents and individuals. However, the Board
made the following statement in its decision:
If all the Respondents are a single employer, then they
are all responsible for and bound by the actions of the
single employer in this proceeding. That includes the
failure of the original named Respondents to provide an
adequate answer here and against whom we have grant-
ed partial summary judgment. If they are not a single
employer, then there is no basis on this motion for im-
posing liability on the additional Respondents. In that
circumstance, their access to any records necessary to
answer the backpay specification is irrelevant; it does
not run against them.
B. Status of Denart Coal Co, Inc. and V Coal Co., Inc.
It was found in a previous case that V Coal Co., Inc. is
the alter ego of Denart. Don Vance (father) owns 75 percent
of Denart and was a consultant to V Coal, Inc., whose stock
holders are Don E. and Michael Vance (sons). Both compa-
nies were engaged in the business of mining coal. However,
Denart ceased operations in November 1987 and V Coal
ceased operating in September 1988.
In December 1988, Don Vance borrowed $30,000 from
the bank to buy Denart stock. The money was deposited into
Denart’s account and was carried on Denart’s books as a li-
ability. Payments were made on the loan. On January 6,
1988, Delores Vance (wife of Don) paid $40,000 to Denart
which was repayment for a no-interest loan.
On March 31, 1988, Denart paid $138,500 to D & J
Trucking (owned by Delores Vance) which were the pro-
ceeds from and insurance claim on a miner leased from
D & J and buried in a mine fire. Lease agreements required
the lessee to carry insurance.
There were in evidence canceled checks to Vance Coal for
hauling coal from the mine. Also in evidence was a receipt
for tools purchased by Denart for $445 on the D & J ac-
count. When this occurred, Denart reimbursed D & J, who
had an account with Tools Unlimited. There is also a check
for $1320 paid by Denart to Shamblin Stone for invoices
made out to Vance. These invoices were for crushed stone
placed on Denart’s road. The invoices were incorrectly ad-
dressed to Vance Trucking because Vance hauled the stone.
V Coal Co., Inc. was formed on January 2, 1988, by Don
E. and Michael Vance with their own money and later
money borrowed from Delores (D & J). These loans were
covered by loan agreements and carried on the financial
statement of both companies. D & J had lease agreements
with V Coal covering the mine equipment. Regular pay-
ments were made to D & J for this equipment which was
also listed on the financial statements. V Coal had a coal
haulage agreement with Vance Trucking and payments were
made to Vance for hauling coal from the mine. V Coal
ceased operations in September 1988. Thereafter, on June 2,
1989, it made payments of $51,000 to Delores Vance in re-
payment of loans, $1000 to Baron & Curtis, and $12,000 to
M.R. Ellis for services rendered. V Coal also paid Don E.
855DENART COAL CO.
1 The evidence does not support a finding that either Denart or
V Coal owned the property on which they were mining coal.
Vance $24,000 on June 2, 1989, in repayment of a loan. He
in turn paid the money to Delores Vance in repayment for
a loan. The repayments to Delores Vance are reflected in her
draw account. All the money received by D & J and
Delores Vance from V Coal was used to pay V Coal credi-
tors.
On June 9, 1989, M.R. Ellis, the accountant for all the
companies and a CPA, negotiated settlement agreements be-
tween V Coal and its creditors because V Coal was insol-
vent. According to M.R. Ellis, after the agreements were
reached, V Coal, in August 1989, received $11,000 from
Appalachian Power Co. as a return of deposit which was in
turn paid to Delores Vance who paid the money to V Coal’s
creditors. V Coal also had an account receivable in excess
of $150,000 from Paulownia Coal, which has been in litiga-
tion for years with very little prospect of collecting. There
was a $27,000 transfer from V Coal to D & J account on
June 2, 1989. This money was paid to D & J for the pur-
pose of paying V Coal’s creditors and the canceled checks
so indicate.
C. Laing Enterprises
The shareholder’s were Don Vance and Don Toppings.
This company was dissolved in 1990 and its equipment (road
grader and two end loaders) were sold to D & J Co.
D. Vance Trucking
Vance was in the business of hauling coal and it was dis-
solved in September 1991. Don Vance was the president and
only shareholder. The articles of incorporation, dated July 1,
1984, list Don and Delores Vance as incorporators. Delores
was secretary of the corporation at that time; however, she
was removed from that office on July 1, 1987, because she
was too busy with her own company. The bank deposit
agreement gives both Don and Delores Vance power to sign
checks, notes, and borrow money on behalf of the corpora-
tion. All the trucks leased from D & J are listed as assets
on Vance’s financial statements.
E. D & J Trucking
D & J is a sole proprietorship owned by Delores Vance.
She had a draw account which is listed on D & J’s financial
statements as her equity interest. She used this account for
personal as well as business transactions. Her office is in a
portion of her home which is owned jointly by her and her
husband Don Vance.
D & J hauled coal for Denart and V Coal as well as
other coal mines. All coal hauling was billed and paid for.
D & J leased equipment to Denart and V Coal which are
covered by lease agreements. Rental payments were made
and credited to D & J’s account. After Denart and V Coal
cease doing business, D & J leased equipment to other mine
operators such as Rose Eagle Mine and B & F Enterprise.
Delores Vance testified that Don Vance was not involved
in the operations of D & J. He was not the owner, had noth-
ing to do with her drivers or their wages. However, he did
buy a truck for D & J in 1987 when she was on vacation.
Delores Vance paid the D & J bills. One $50,000 loan to
V Coal was listed as uncollectible and carried as a debit on
D & J’s financial statements.
When V Coal ceased operations, Don E. and Michael
Vance returned to D & J. Don E. worked as a contract hauler
and Michael worked as an employee for a while.
The bank made two loans of $150,000 and $50,000 to
D & J trucking. Both Don and Delores Vance signed a loan
agreement because they put up their home and other property
which they jointly owned as collateral. Regular payments
were made to the bank by D & J on these loans.
D & J loaned money to V Coal to cover startup costs and
payroll. These loans were covered by promissory notes from
Don E. and Michael Vance and carried on D & J’s financial
statements as loans.
Richard Glover, United Mine Workers International rep-
resentative, testified that he dealt with Don Vance concerning
D & J employees because the D & J Garage was on Denart
property.1 Although Don Vance signed a contract with the
Union covering Denart employees, he would not sign a con-
tract covering D & J employees. According to Glover, Don
Vance didn’t want to be responsible for D & J employees
but he would see that owner-operators paid their dues. On
December 18, 1985, Clifford Crum, a United Mine Workers
executive board member, agreed in writing that the owner-
operators hauling coal for Denart were not Denart employ-
ees. The Union’s dues-checkoff list, dated November 20,
1987, has D & J drivers separately designated from those of
Denart Coal Co.
Analysis and Conclusions
Single-Employer, Alter Ego Status of
Other Respondents
In determining whether or not entities constitute a single
employer, the Board generally considers common ownership,
common management and control, employee interchange,
business purpose, plant and equipment, and antiunion motive.
The compliance specification alleges that Laing Enter-
prises, Vance Trucking, and D & J Trucking constitute a
single employer with Respondents Denart Coal Co., Inc. and
its alter ego V Coal Co., Inc. having common ownership,
management, supervision, facilities, and centralized control
of labor relations. After reviewing the evidence, it seems evi-
dent that counsel for the General Counsel did not prove, by
a preponderance of the evidence, that single-employer status
exists. I cannot find common ownership between
Denart/V Coal and the other Respondents based on the evi-
dence presented. Moreover, there is virtually nothing in the
record to support a finding of common management and con-
trol, employee interchange, business purpose, plant and
equipment interchange, or antiunion motivation.
There was evidence of one no-interest loan made to
D & J by Denart which was repaid but it is unclear whether
other no-interest loans were made. In any event, the loans
themselves were bona fide.
There also was testimony that Don Vance would see that
D & J contract drivers would pay union dues but this was
offset by him also saying that he didn’t want to be respon-
sible for those drivers. It is further offset by Delores Vance’s
uncontradicted testimony that she was the sole owner of
D & J and that she hired the drivers and determined and
856 DECISIONS OF THE NATIONAL LABOR RELATIONS BOARD
2 If no exceptions are filed as provided by Sec. 102.46 of the
Board’s Rules and Regulations, the findings, conclusions, and rec-
ommended Order shall, as provided in Sec. 102.48 of the Rules, be
adopted by the Board and all objections to them shall be deemed
waived for all purposes.
paid their wages, and that Don Vance had nothing to do with
D & J operators. There is virtually no evidence with respect
to the other Respondents.
The business purpose of Denart Coal and V Coal was coal
mining. The other Respondents were engaged in trucking and
equipment rental. Other than that, the record is devoid of em-
ployee interchange, plant and equipment interchange, other
than lease arrangements and antiunion motivation.
Accordingly, I find that Laing Enterprises, Vance Truck-
ing, and D & J Trucking are not a single employer with
Denart Coal Co., Inc. and its alter ego V Coal Co., Inc.
Individual Liability of Delores Vance, Don Vance, Don
E. Vance, and Michael Vance
In the compliance specification, counsel for the General
Counsel alleges that the Vances are individually liable be-
cause they held common stock in, commingled assets with,
have been agents of, and have operated the single-integrated
enterprise.
The evidence does not support a finding of a single-inte-
grated enterprise composed of all Respondents. It should be
further stated that stock ownership in a corporation does not
create individual liability. Moreover, the evidence does not
support a finding that assets of any of the entities were com-
mingled. To the contrary, the evidence supports a finding
that Millard Ellis, the certified public accountant who kept
the records and accounts of all the entities, gave
uncontradicted testimony on the hundreds of transactions of-
fered into evidence, explaining each transaction. He kept sep-
arate financial statements and records for each entity. Loan
payments, rental payments, and other financial transactions
were kept separately, which was not disputed. Although
loans and payments were made between various Respond-
ents, the evidence does not support a finding of commin-
gling.
Although it was not alleged and therefore not an issue be-
fore me, I cannot find evidence of fraud, concealment, or any
attempt to defeat a backpay obligation. Riley Aeronautics
Corp., 178 NLRB 495 (1969).
Accordingly, the evidence does not support a finding of
individual liability.
CONCLUSIONS OF LAW
1. The Respondents, Laing Enterprises, Vance Trucking,
and D & J Trucking are not a single employer with Denart
Coal Co., Inc. and its alter ego V Coal Co, Inc.
2. There is no individual liability.
On these findings of fact and conclusions of law and on
the entire record, I issue the following recommended2
ORDER
The compliance specification allegations are dismissed.
Gary E. Lindsay, Esq., for the General Counsel.
Daniel McCarthy, Esq., for the Respondent.
Charles Donnelly, Esq., for the Charging Party.
SECOND SUPPLEMENTAL DECISION
My supplemental decision issued October 14, 1992, in
which it was found that Laing Enterprises, Vance Trucking,
and D & J Trucking are not a single employer with Denart
Coal Co., Inc. and its alter ego V Coal Co., Inc. It was fur-
ther found that there was insufficient evidence to find indi-
vidual liability.
On March 26, 1993, the Board remanded the case ques-
tioning whether or not Delores Vance was the sole owner of
D & J Trucking. The Board further questioned the liability
of corporate shareowners stating that should I find a single-
employer relationship between D & J and Denart/V Coal,
then the D & J owner is individually liable for the obliga-
tions incurred by D & J.
In the compliance specification, the General Counsel al-
leges that D & J Trucking is a sole proprietorship. Later in
the specification, the General Counsel alleges that Delores
Vance is the sole proprietor of D & J Trucking.
Nowhere in the specification is Don Vance alleged as the
sole proprietor of D & J Trucking or that it is actually a
partnership. Therefore, whether Delores Vance is the sole
proprietor, as she testified, is not relevant to this proceeding.
The allegation is that Delores Vance d/b/a a sole proprietor-
ship is a single employer with Denart Coal Co., Inc. and V
Coal Co., Inc.
An examination of the documents indicates that there is no
evidence of common ownership between D & J Trucking
and Denart/V Coal. The few documents listing Don Vance
as owner of D & J cannot be used to find that he was. Nev-
ertheless, these documents are rebutted by a multitude of
other documents dated from 1987 to 1991 listing Delores
Vance as sole owner of D & J Trucking and Don Vance as
guarantor, as an individual. Had he been anything else, the
documents required him to so state. It is therefore my finding
that these documents do not prove a single-employer rela-
tionship between D & J Trucking and Denart/V Coal. If
anything, they cancel each other out.
It is alleged among other things that common ownership
exists between D & J Trucking and Denart/V Coal. Denart
ceased doing business in November 1987 and V Coal closed
down in September 1988. Therefore, there can be no nexus
between these companies and D & J after these dates. Be-
fore these dates Don Vance listed himself as owner of
D & J. While this cannot be used to prove ownership, it
may show that he had some relationship as an individual, or
husband to Delores, with D & J in order to obtain loans.
What transpires between husband and wife financially is
hardly the stuff that would implicate their respective busi-
nesses. In most cases, the other spouse must cosign loans
when personal joint property is used as collateral. These fac-
tors alone do not support a finding that Denart Coal/V Coal
and D & J Trucking were a single employer as alleged in
the specification. Finally, these documents shed no light on
the allegations of common management, supervision, facili-
ties, and centralized control of labor relations; moreover, the
record is devoid of other evidence of single-employer status.
857DENART COAL CO.
Accordingly, I find that Laing Enterprises, Vance Truck-
ing, and D & J Trucking are not a single employer with
Denart Coal Co., Inc. and its alter ego V Coal Co., Inc.
Addressing individual liability, one of the allegations in
the specification is that the Vances are individually liable be-
cause they held common stock in Denart Coal Co., Inc. and
V Coal Co., Inc. The reply in my decision stands and my
findings and decision on individual liability remain the same.