(dissenting).
The District Court’s action was sound and its judgment should not be disturbed.
Remand to the District Court is worse than useless since it is for the purpose of establishing a legal irrelevancy. This course is not justified because the only possible result of a trial on the issue of “sham contract” would be to ascertain facts which could constitute no defense.
Lowry became a party to the industry-wide collective bargaining agreement which obligated him to make royalty payments to the Trustees of the Welfare and Retirement Fund at the rate of $0.40 per ton. He regularly paid the fixed amount upon the number of tons he reported to the Trustees, reducing the total payments by the simple expedient of understating the tonnage in each of twenty-five payments made during the period in question. When the Trustees discovered from his reports to other agencies that his production was much greater than he had accounted for to the Trustees, they demanded payment of the difference due. Lowry did not interpose the present defense of “sham agreement,” but sought to defend the correctness of the remittances made by him. He would not, however, agree to an inspection of his production records, either by a certified public accountant of his own choice or by accountants from the Trustees’ office. It happens that each of his seven employees whose names Lowry remembered in his deposition had been certified by him from time to time to collect, and did collect, benefits from the Trust Fund.
However, my dissent is based not upon the defendant’s lack of equity, but upon broader grounds, for this is not just a small case involving a few coal miners. If the present employer is permitted to circumvent his written collective bargaining agreement, the effects will be industry wide.1
There are three reasons why the defendant’s allegations fail to constitute a defense to the suit by the Trustees. First, the statute authorizing agreements to establish industrial trust funds, properly interpreted, requires that such agreements shall be in writing. Second, broadly as a matter of federal labor law, the so-called “sham” exception to the parol evidence rule should not be allowed in suits under collective bargaining agreements. Third, even if a private oral agreement, said to be the “real contract,” could be relied upon by Lowry in a suit by the union, it cannot be asserted as against the Trustees.
*201I.
In section 302 of the Labor Management Relations Act,2 Congress shows a concern for the abuses accompanying the growth of the industrial trust funds. Primarily, it was feared that if the management of the funds was left entirely in the discretion of union officials, the money contributed by employers and by employees might not be used for welfare purposes. As Senator Taft said, “Unless we impose some restrictions, we shall find that the welfare fund will become merely a war chest for the particular union * * 3 One of the safeguards imposed by the act is that “the detailed basis on which such payments are to be made is specified in a written agreement with the employer.” 4 According to the law’s framers, the primary purpose of this provision was to enable employees to know what they were entitled to receive in welfare benefits and to be able to bring suit against the Trustees if necessary.
Literally read, section 302(c) (5) (B) may be thought to require that only the terms of the payments to the employees be in writing. Nevertheless, the protection of the employees is not complete unless the statute is read to require as well that the terms on which payments are to be made into the Trust Fund be similarly stated in writing. Congress could not have intended to safeguard against the improper use of money once it has been contributed to the fund, but not against evasion of the primary obligation to contribute.5
Further, it would be inconsistent to read the statute to require that the agreement as to terms of payment to the fund be in writing and yet to permit an employer to claim the “sham” exception to the parol evidence rule. The royalty payments are an indirect method of compensating the employees,6 and they have a right to know exactly what they are receiving for their services. They also have a right to know how well their union negotiators represented their interests. They are being deceived if the publicly declared, written agreement may be sapped by a secret compact. In addition, the establishment of this type of trust fund is generally made on an industry-wide basis. If some employers secretly contribute less than their shares, other employers may be forced to contribute more to enable the fund to meet its obligations.’7' Assuming that different royalties may be charged different employers, the other employers are at least entitled to know when someone is paying less per ton than they are. If then Congress has required that the agreement be reduced to writing, it cannot be supposed to have contemplated that a party may come into court with the defense, “Yes, we have obediently put it in writing, but we did not mean it.” The salutary scheme to cushion the financial impact on employees and their families of unemployment, illness, old age and death could be reduced to chaos by a succession of such defenses as that attempted here, bringing in its train a host of social evils.
II.
In respect to ordinary commercial contracts the high position accorded to written agreements, as witnessed by the parol evidence rule itself, may under some circumstances yield to the “sham” exception.8 Nevertheless, as a matter of sub*202stantive labor law, courts' should not permit the exception.
A collective bargaining agreement has been called a “generalized code” 9 for the industry to which it applies, and has been likened to a “charter instrument of a system of industrial self-government, like words in a statute.” 10 If these are valid concepts, a union and an employer can no more make covert exceptions to the contract than a legislative body could to a statute which it adopts. Both are frauds upon the constituencies concerned. This is not to say that a collective bargaining agreement may never be oral, but where the parties have put it into writing, as in the usual case, it may not be varied by a contradictory oral agreement.
The union is not bargaining for itself alone, but as a representative of employees, and sometimes of others such as the Trustees in the instant case. It is imperative that the employees and other direct beneficiaries have a written embodiment of their rights and duties which can be ascertained by all. The public also has a right to know precisely what was agreed upon. If this “sham” exception is recognized, none of these interests will have any idea what the terms of the “real” collective bargaining contract are.
We must have regard for the spirit of the legislation. Section 8(d) of the Labor Management Relations Act11 has recognized the importance of having a collective bargaining contract in writing by providing that bargaining in good faith includes a willingness to embody the agreement in writing at the request of the other party. See H. J. Heinz Co. V. N. L. R. B„ 1941, 311 U.S. 514, 523-526, 61 S.Ct. 320, 85 L.Ed. 309. A written labor agreement settles questions that if left unsettled could lead to industrial strife. Its purpose is to avoid strikes, walkouts, workstoppages and the like. If such written contracts can be nullified whenever the employer and union come to some other secret oral agreement, the purpose of the contract as an instrument of industrial peace may be frustrated.12
III.
Even if it be assumed that in a suit by the union rather than the Trustees a sub-rosa understanding could be asserted by the employer, to allow the defense as against the Trustees would tend to undermine the statutory scheme for the creation of an irrevocable trust for the employees. The plan is one sponsored jointly by industry and labor and approved by Congress. The fund is jointly administered by representatives of employers and labor along with a neutral third party. It would be an unbearable incongruity, at war with the law’s underlying policy, to allow the trust fund to be eroded in the manner proposed, for what kind of trust is it that leaves the door open to impairment by secret agreements, even those participated in by a donor?
The Supreme Court in Lewis v. Benedict Coal Corp., 1960, 361 U.S. 459, 465, *20380 S.Ct. 489, 493, 4 L.Ed.2d 442, pointed out that a trust fund is in “no way an asset or property of the union.” See 93 Cong.Rec. 4678 (1947) (remarks of Senator Ball). In that case the trust fund was considered so far independent of the union that although a money judgment had been rendered in favor of the employer against the union, the employer was not permitted to use it as a set-off to a judgment against the employer in favor of the trustees. The considerations bearing on the protection of the interests of beneficiaries, which were stressed in Benedict, apply in logic and common sense with no less force here. Royalty payments to the Trustees may not be curtailed by private oral agreements between an employer and a union, any more than they were permitted to be reduced by damage claims of the employer against the union. The Trust Fund’s obligation to pay benefits to Lowry’s employees could not be affected by secret understandings between the coal company and the union; neither may the employer’s obligation to pay royalties to the Trustees be diminished by clandestine arrangements between the employer and the union.
IV.
The court’s opinion treats the defense of coercion as frivolous, and with this I fully agree. No threats are claimed. The mere fear that if one will not sign the agreement there will be a strike or walk-out is not the kind of coercion that a court will recognize as sufficient to invalidate an agreement. This is elementary.13 Certainly no remand is warranted to take testimony in support of this “defense.”
For the above reasons, I think that the order of the District Court should be affirmed. Remand erroneously implies that if the facts that have been asserted could be established, they would constitute a valid defense. With this I do not agree.
. The present case involves no “April Fools’ Day” joke, but is one of a series of attempts by coal operators over the nation to renege on their agreed-upon obligations with respect to the Union Welfare and Retirement Fund. For other cases where coal operators have attempted, unsuccessfully, to escape the payment of royalties to the Welfare Fund, some of them involving the same contentions as in the instant case and some involving different ones, see: Lewis v. Fentress Coal and Coke Company, D.C.M. D.Tenn.1958, 160 F.Supp. 221, affirmed 6 Cir., 1959, 264 F.2d 134; Lewis v. Mearns, D.C.N.D.W.Va.1958, 168 F.Supp. 134, affirmed 4 Cir., 1959, 268 F.2d 427; Lewis v. Quality Coal Corporation, 7 Cir., 1959, 270 F.2d 140, certiorari denied 1960, 361 U.S. 929, 80 S.Ct. 369, 4 L.Ed.2d 353; Lewis v. Cable, D.C.W.D. Pa.1952, 107 F.Supp. 196; Lewis v. Hixson, D.O.W.D.Ark.1959, 174 F.Supp. 241; Lewis v. Kerns, D.C.S.D.Ind.1959, 175 F. Supp. 115; Lewis v. Mill Ridge Coals, Inc., D.C.E.D.Ky.1960, 188 F.Supp. 4; Lewis v. Young & Perkins Coal Company, D.C.W.D.Ky.1960, 190 F.Supp. 838; Lewis v. Gilchrist, D.C.N.D.Ala.1961, 198 F.Supp. 239. For one case upholding a contention similar to that of the defendant in the present case, see Lewis v. Hears, D.C.W.D.Pa.1960, 189 F.Supp. 503 affirmed 297 F.2d 101.
. 61 Stat. 157 (1947), as amended, 29 U. S.O.A. § 186 (Supp.1960).
. 93 Cong.Rec. 4747 (1947).
. Labor Management Relations Act § 302 (c) (5) (B), 61 Stat. 157-58 (1947), as amended, 29 U.S.C.A. § 186(c) (5) (B) (Supp.1960).
. See William Dunbar Co. v. Painters & Glaziers Dist. Council, D.C.D.C.1955, 129 E.Supp. 417, 423.
. Lewis v. Benedict Coal Corp., 1960, 361 U.S. 459, 469, 80 S.Ct. 489, 4 L.Ed.2d 442.
. See Lewis v. Benedict Coal Corp., supra, 1960, 361 U.S. at page 469, 80 S.Ct. 489.
. The parties are in disagreement as to whether under Kentucky law, if applicable, the “sham” exception to the parol evidence rule is recognized. I find it unnecessary to decide this.
. United Steelworkers v. Warrior & Gulf Nav. Co., 1960, 363 U.S. 574, 578, 80 S.Ct. 1347, 4 L.Ed.2d 1409 (Douglas, J.).
. United Steelworkers v. American Mfg. Co., 1960, 363 U.S. 564, 570, 80 S.Ct. 1363, 1364, 4 L.Ed.2d 1432 (Brennan, J., concurring). See Cox, The Legal Nature of Collective Bargaining Agreements, 57 Mich.L.Rev. 1, 22-36 (1958).
. 61 Stat. 142 (1947), 29 U.S.C.A. § 158 (d) (1956).
. The majority opinion suggests in footnote 5 that an employer might be es-topped from asserting an oral understanding with the union contradicting their written agreement if it were shown that the Trustees or employees acted to their detriment. The simple answer is that specific detriment to these third parties is not required to be shown to invoke the rule against secret evasion of the written agreement because detriment is inherent in the frustration of Trustees’ and employees’ rights which has been fully pointed out above in the text.
. See, e.g., Lewis v. Quality Coal Corporation, 7 Cir., 1959, 270 F.2d 140; Lewis v. Kerns, D.C.S.D.Ind.1959, 175 F.Supp. 115.