On February 16, 1999, the Complainant, U.S. Department of Labor, Pension and Welfare Benefits Administration (PWBA or "Department") filed a motion for sanctions and penalties for the failure of the Respondent to submit satisfactory Annual Report Forms 5500 C/R, and the failure to submit 1995 and 1996 Participant Account Statements and 1995 and 1996 Summary Annual Reports to the Plan participants by December 31, 1998, as provided in the terms of the settlement agreement. (JX 1) Complainant also contends that the Respondent failed to submit the agreed "compromised penalty payment of $15,000.00," on or before December 31, 1998, as provided therein. Respondent submits that its agent and accountant, Mr. Arneston, deposited into the mail box near it's offices the penalty check (JX 2) in the amount of $15,000.00 on December 31, 1998. The check was not postmarked until January 4, 1999 by the Post Office, and the certification of receipt of the check by the Department of Labor was dated January 7, 1999. (JX 14) Respondent also contends that drafts of Form 5500 C/Rs, participant account statements and summary Annual reports were timely submitted for review by the Department, but that errors were discovered that prevented submission of the finalized Plan reports.

   In addition to the above, the settlement agreement specifically states:

If the Administrative Law Judge finds that the documents have not been submitted on schedule, or resolves a dispute as to the acceptability of the forms in favor of the PWBA he may assess additional appropriate penalties based on all the facts and circumstances after providing the parties an opportunity to be heard . . . .

   It is my opinion that the above cited terms of the decision and order, which incorporated the settlement agreement, specifically reserved to the undersigned jurisdiction over the entire matter until its terms and conditions had been fulfilled. This necessarily implies the authority to make determinations regarding the sufficiency of the fulfillment of the terms of the settlement documents. It is also my opinion that the alleged failure to fulfill these terms and conditions returned the status of the legal proceedings to the status quo ante, as it existed prior to the signing of the settlement documents, and that I remain empowered under the provisions of 29 U.S.C. Sections 1132 and 1135, and the implementing regulations set forth at 29 C.F.R. § 2570.60 through 2570.71 to make determinations and to levy the necessary sanctions and penalties required by statute in this proceeding. The agreement also provides that I may assess appropriate penalties in the event of the failure of the Respondent to abide by the terms of the agreement. Likewise, I have the authority, and the discretion, to consider the facts as presented by both parties, and to make determinations regarding the appropriateness of mitigating circumstances in considering the amount of the said penalties, within the scope of the exercise of that discretion.

II. Procedural History:

   According to the documents, (See, e.g., JX 1, p 2 of the attached settlement agreement), the matter began in 1993 when the Chicago Regional Office ("ChiRO"), of the Department of Labor's Pension and Welfare Benefits Administration ("PWBA") , commenced an investigation in connection with an investment in and retention of the "Westmont Property," by the Plans. The property was a non-income producing piece of commercial real estate of 10 acres situated in Westmont, Illinois. It was purchased in October, 1986, and represented approximately 50% of the total assets of the two Plans. On July 26, 1996, ChiRO informed the trustees of the two Plans that its retention of the Westmont Property constituted a violation of § 404 (a) (1) (B) of ERISA.

   PWBA also informed the Administrator that there were violations for the Plans having failed to timely submit Annual Report Forms 5500 C/Rs for Plan years subsequent to 1991, in violation of § 104(a) (1). The letter was referred to the PWBA's Office of Chief Accountant for resolution, but stated that no legal action would be commenced on retention of the Westmont Property at that time. (JX 1, Attachment p. 2)

   Two notices of intent to assess a penalty were filed on May 30, 1996, for failure of the two Plans to file Form 5500 C/R's for the Plan Years 1992 - 1994. These were followed by statements of reasonable cause by the Respondent, and the agency responded with two notices of determination on statement of reasonable cause ("NODs"), which were not submitted to the two Plans until July 2, 1996. These assessed $198,000.00 in total penalties for failure to file the reports for the Plan years of 1992 - 1994. Respondent's answer of July 29, 1996 commenced the present action.

   In addition to the above, on or about September 23, 1996, ChiRO commenced a separate enforcement action by issuing subpoenas to Respondent regarding the failure of the Plans to issue participation benefit statements subsequent to the 1991 benefit plan year, and to provide the statements pursuant to requests or under ERISA § 105(a), or the documents establishing the plans.

   The matter was set for hearing by the undersigned, and pursuant to pre-hearing conferences between the parties and the undersigned, was postponed, and finally cancelled due to the above mentioned decision and order and the attached settlement agreement. That agreement provided for the Respondent to take the following actions:

   (a) By November 13, 1998, submit revised 1992-96 Annual Report Forms 5500 C/R for the Plans that are acceptable to the Department.

   (b) By December 1, 1998, submit draft participant account statements for all of the Plans' participants for plan years 1995 and 1996 to PWBA for review and comment.

   (c) By December 31, 1998, send finalized versions of the participant account statements to the Plans' participants.

   (d) By December 1, 1998, submit summary draft Annual Reports for plan years 1995 and 1996 to PWBA for review and comment.

   (e) By December 31, 1998, send finalized versions of the 1995 and 1995 summary draft Annual Reports for the Plan participants.

   (f) By December 31, 1998, pay a compromised penalty payment of $15,000.00 to the Department.

   On October 16, 1998, Respondent submitted the draft Form 5500 C/Rs for the Plan years 1992 - 1994 for review and comment. (JXs. 2, 3 &4) On December 1, 1998, it submitted drafts of the Summary Annual Reports for the Profit Sharing and Money Purchase Plans 001 and 002 for the plan years 1995 and 1996, along with individual participant account statements for the same Plans and plan years. (JXs 5 - 9) These submissions fulfilled the conditions of paragraphs 1 (b) and (d) of the settlement agreement, but not paragraph 1 (a), which required the revised 1992-1996 Annual Report Forms 5500 C/R, be submitted that are acceptable to the Department by November 13, 1998.

   On November 18, 1998, Respondent submitted finalized, signed and dated Form 5500 C/R reports for the Plan 001 and Plan 002 plan years 1992 - 1996. (JX 11 - 13) These finalized Form 5500 C/R's were due on November 13, 1998, and were, therefore five days late for the submission, and in technical non-compliance. No reasons were stated for the late submissions, and there was no evidence presented that an extension had been sought for the late submissions.

   The above cited letter of transmission for the compromised $15,000.00 penalty check was received by the Department of Labor on January 7, 1999, in an envelope postmarked January 4, 1999. The cover letter of transmission, signed by Accountant Ken Arneson, was dated December 31, 1998. (JX 14) Facially, the submission of the $15,000.00 compromised penalty was not in compliance with the settlement agreement to "pay" that amount, "By December 31, 1998. . . ."

IV. The Testimony:

   George Paul Klein:

   Mr. George Paul Klein, testified that he has been President of Current Development Corporation, since its inception in 1978, and Administrator of the two plans until the day of the hearing on August 11, 1999. (T 37 - 38) GreatBanc Trust Company of Aurora, Illinois, was to have taken over as Trustee of the Plans on that date. There has been no additional evidence submitted to the effect that it did not assume the position as administrator and/or fiduciary of the Plans, so I will assume that it did, with no effect on the final outcome of this proceeding.

   Mr. Klein testified that the law firm of Bell, Boyd and Lloyd (hereinafter, "BB&L") prepared the original Form 5500 C/Rs for the Plans, which arrived in his office on the evening of November 12, 1998, in care of Current Development Accountant, Ken Arneson, who had been working with the law firm on them. (T 39) They were presented to Mr. Klein by Mr. Arneson on November 13, 1999 for review and signature. When he reviewed them, he found several problems, which he communicated to the law firm, and assumed they had taken care of the filing date with the Department. He exdcuted them on November 17, 1998, and gave them to Mr. Arneson for mailing. He did not know until the Department's motion for sanctions that there was a problem with them as having been late filed. (T 41)

   Mr. Klein testified that he also knew that the finalized participant account statements were due on or before December 31, 1998, and that the preliminary statements had been sent out. He testified that he was concerned with their accuracy, and that they, æeducatedö themselves on their accuracy. (T 42 - 43) He had Mr. Arneson review the manual "work papers" (spread sheets) from the years in question, and compare them with the typewritten ledger entries. (T 43) None had been computerized, so when they compared the manual and typewritten sheets, they found several errors, with improper reconciliation of the years in question with the prior years. (T 43) He had Mr. Arneson review all of the bank statements and any statements in the archives that had a dollar figure related to the two Plans, checking the profit calculations, . the contributions to the Plans, and even the hours that every participant had worked, considering the annual 1,000 hour qualification requirement for participation in the Plans. They also had to compare the fiscal year working hours with the calendar years worked for each employee, and make necessary corrections. Their fiscal year begins on October 1st, so they had to remove the fourth calendar year quarter from one year and add it to the first three quarters of the following year to arrive at the 1,000 hour qualification in the correct fiscal year. ((T 44 - 45) This caused corrections to be made in all of the years involved in the recalculations, with different vesting results.

   Referring to Mr. Arneson as, "the most computer literate accountant that the company has ever had," he had him devise a set of programs to accommodate the changes and he ended up drafting an entire new set of reports for the years in question. The original draft statements had been drafted manually, and then typed. (T 46 - 47) In terms of years in which reports were submitted, and those in which there were none, they began with 1992. 1991 statements had gone out. They began with the 1992 fiscal year, which began in October of 1992, and extended through September of 1993. (T 52) He testified that, "it's not that they didn't go out because there were errors, the accountant we had at the time, I never took the time to manually take the information from the work papers, put it on statements and get it out. So we did find work papers in folders we just - but the statements had not been mailed." He did not know why it did not go out. (T 53)

   Mr. Klein testified that following the 1992 fiscal year, they had to recalculate each of the following fiscal years, for 1993, 1994, 1995 and 1996. Then they had to also do the 1997 statement, so that was also done and submitted. (T 54) With these calculations, Mr. Arneson was able to finalize the individual participant benefit statements, and they were all submitted under cover of the letter of April 1, 1999, which was postmarked on April 2, 1999. (T 54; OX 15 - 19)

   In December, 1998, between Christmas and New Year's, they realized that they were not going to make the December 31, 1998 deadline, and so notified BB&L. BB&L told them to just send out the inaccurate copies, which he felt that they could not do. He told BB&L to notify the DOL, but they were against doing so for an extension. (He was then talking to Ray Fay of BB&L's Washington office, for whom attorney Bonita Hatchett did some of the actual work on their account, but had since left the firm. (T 56 - 58) Ms. Hatchett's name is on the November 18, 1998 submissions. It was not clear who was handling the Current Development account at that time.) The reason that the rest took until April, 1999, was the amount of work that had to be done on the individual work papers which cover ten Plan years. (This was two Plans times five years.) They had to cancel vacations in order to get the work done. (T 59)

   The Plans were formed in 1979, with two amendments. (T 61) The first amendment is dated 1989, although he said 1987, and he testified that there was another in 1991. The record contains the 1989 First Amended Plans. (JX 20 and 21) Vesting requirements were changed, and had to be considered in the 1992 reports, which had an effect on when they were hired before 1992, which also had generated mistakes. Other mistakes involved allocation of expenses. (T 61 - 63)

   On cross-examination, Mr. Klein stated that he did not know of the sending of the preliminary drafts of the Form 5500 C/Rs on October 16, 1998, and was shown the cover letter by Mr. Ray Fay of BB&L to Mr. Durovic. (T 70; J X 2) He also testified that he had not seen the November drafts prior to their submission by BB&L to Mr. Anderson for Mr. Klein's signature. (T 71) He remembered discussions relative to not having seen the initial drafts, and telling Mr. Arneson that he needed to create statements that would show they were working on statements. (T 73)

   Mr. Klein acknowledged issuing participant benefit statements through 1991, but could not answer why they had ceased thereafter. (T 73) In response to questions as to why they did not begin issuing them in later years, he responded: "I guess we got too busy doing other things." He added that he found work papers from the intervening years, but couldn't explain why his accountants had not gotten the statements out. He did say that he, ''took full responsibility for not having gotten them out." (T 75)

   Mr. Klein acknowledged that he had received a written request for a participant statement from former employee, Ms. Palaro. (T 76)

   Mr. Klein testified that when he was hired in 1995, Mr. Areson was told that they were behind on participant statements, and they had to be gotten out as quickly as possible. However, work was not begun on them in 1995 due to other priorities. (T 81) Contributions to the money purchase plan are required at the rate of 10% of an eligible employee's reported wages in a particular year. He gave Mr. Arneson the Plans to read. That was all that was done at that point. (T 83 - 84)

   Mr. Klein stated that BB&L was responsible for not asking for an extension on the December 31, 1999 reporting requirements under the settlement agreement. He stated that.this court may not hold them responsible, but that he sure did so. (T 84)

   Kenneth Arneson:

   Accountant Kenneth Arneson testified that he was hired in March, 1995, and worked for about a year with a CPA who was hired to do work on an apartment complex of Current Development, but was put on the pension and profit sharing plans for about a year when the problems arose. (T 90 - 91) He (Mr. Arneson) became involved with the Plans when they signed the settlement agreement, and Mr. Klein asked whether they could meet the dates set forth in the settlement agreement. Mr. Arneson told him that, since he had not been involved with the Plans, he felt that it would be very difficult. (T 91) He acknowledged that he was the one that had received the completed 5500 C/Rs on November 12th, as set forth in the letter from BB&L of that date. (T 92: J X 1) . He did not recall discussing them with Mr. Klein dn the 12th~ but did so on the next day. He then had questions and discussions with BB&L, had certain questions answered, gave them to Mr. Klein for signature on November 17th, mailed them (by Mr. Arneson), (T 94) and they were received on the 18th.

   Mr. Arneson prepared the $15,000.00 compromised penalty check on December 31, 1999 because that was the date on which he was directed to prepare it. (T 95) He described the process for its preparation, initialed it, and used Mr. Klein's stamp on it. He placed it into the envelope, put a stamp on it, and took it to the mailbox at 4:30 p.m., addressed by him to the Department of Labor. (T 95) A picture of the mailbox is shown in Joint Exhibit 2. He testified that the time for last pick-up is shown to be "Five o'clock." (T 96) The mailbox clearly states on the front of it, "Last Collection, 5 p.m., Monday through Friday." (OX 2) [Mr. Arneson demonstrated during the entire course of his testimony that he was a forthright and credible person. Nothing in his actions or demeanor gave me any reason to doubt the veracity of his testimony on this point. I credit his statement on the matter, and conclude that he did deposit the check in the said mailbox on Thursday, December 31, 1999, at on or about 4:30 p.m.; that it was not picked-up on that date, and that, due to the intervening New Year' s holiday on Friday, January 1, 1999, and the weekend of January 2 and 3, 1999, the pick-up was not made until January 4, 1999, at which time the parcel was postmarked with that date, and subsequently delivered to the DOL on or about January 7, 1999. This is a separate question from the question of whether the Respondent was Obligated to have had the check delivered to the DOL, "By December 31, 1998.. ." which was the date set forth in the settlement agreement, as specifically stated therein, which will be hereinafter discussed as a matter of law. Note: Settlement agreements are contracts. This one obligated the Respondent to have the check delivered to the DOL "By December 31, 1998." That was not done, and constituted a breach of the settlement agreement, on the face of the transaction.

   It was a mistake on Mr. Klein's part to direct that a check that was due "By December 31, 1998," be mailed on that date. Such a mailing could not physically be received by that date. The failure to do so warrants the payment of an additional penalty, which I conclude should be that stated by the Department in the amount of $2,100.00, for a total amount due on the compromised penalty of $15,000.00 + 2,100.00 or $17, 100.00]

   Mr. Arneson acknowledged that it was he who prepared the participant statements, (T 96) and verified the course of action that was set forth by Mr. Klein in his testimony, in terms of the work sheets that he reviewed, and gave to the secretary for final typing. He did not know whether BB&L had received DOL approval of the draft statements. (T 97)

   To prepare the finals, he followed the procedure described by Mr. Klein, (T 98) He used an older version of a "Lotus" computer program to prepare them, but in the conversion from the old to the new version of "Lotus" there were too many errors, and he had to prepare them manually. (T 98) He did the Plan years 1992 - 1996, and had contact with Bonita Hatchett at BB&L to do so. He told her that he would not be able to get them done by December 31, 1998, prior to that date. (T 99) . He testified that he had two conversations with Mr. Durovic after December 31, 1998, and continued to load the information onto the Lotus spreadsheet. He was making continuous corrections after reviewing numerous documents as described by Mr. Klein, and entered them on spreadsheets as set forth in Respondent's Exhibits 3 and 4 for the two Plan years 1996, ending September 30, 1997. (T 100 - 101.) [Since no questions have been raised about the accuracy of the final documents, and the changes that needed to be made, including formula errors as they related to individual participant account errors, as set forth in Mr. Arneson's testimony, I will not review them in detail. (T 103 - 111) In so doing so, I find them to be accurate representations of the condition of the two Plans, as of September 30, 1997. In addition, I do not question the time that was necessary to devote to the documents from December through the submission of the documents in April, 1999. (T 113 - 114)

   With regard to the conversations with Mr. Durovic, he testified that he talked to him once in January, and then in February. He said that in the first, he had answered the questions about the 1992 and 1993 documents, and that he was not sure when they all would be completed. He testified that he told him that he was working as fast as he could, and hoped to be finished by the end of January or early February. In the beginning of February, he told Mr. Durovic that they were further along, but not finished with 1995, and did not know when they would be completed. (T 116 117) He then recounted all of the problems in finishing the documents, with specific reference to individual participants, including Ms. Palaoro, (T 117 - 121) and continued on with other individual accounts. (T 121 - 126).

   The documents were finally finished, and he mailed the individual participant account statements for all of the Plan years due, on April 1, 1999. (T 127) He mailed the individual participation benefit statements for Plan year 1997 about two weeks later, (T 127) which they were able to do as a result of the computerization work that had been done for the previous Plan years. (T 128) He did not receive any objections from any of the individual participant statements that were sent out. (T 128) However, Mrs. Palaoro did write a letter dated April 26, 1999, requesting various documents. (T 129 - 130) They responded to her letter on August 6, 1999. (T 131)

   Correcting his prior testimony on mailing the November documents, Mr. Arneson testified that he first mailed the documents to Ms. Hatchett at BB&L. (T 133) He verified again that he was authorized to mail the check for $15,000.00 on December 31, 1998. (T 133) The authorization he received to do so was the settlement agreement itself. (T 134) He also specifically identified the mailbox in Respondent' Exhibit 2 as the one that he used every day. (T 135)

   The name of the other accountant [the CPA] that Mr. Areson worked with was David Null. (T 139)

   Mr. Arneson verified that individual participant account statements were sent to all of the participants for the years 1992 - 1996, but that only the years 1995 and 1996 were sent to the DOL because that is all that the settlement agreement called for. (T 145)

   Mr. Arneson confirmed that he (they) did not respond immediately to Mrs. Palaoro's letter of April 26, 1999. (T 148) In August, 1999, [just before the hearing] they sent her the 1992 1996 participant account statements and the annual reports, which had been sent to participants in April, together with the worksheets, as well as some additional information on wages and expense information for the same years. (T 149)

   Joanne Palaoro:

   Ms. Palaoro testified that she began work for Current Deve1opment in January, 1986, and ceased work there on July 29, 1992. (T 152) She became a member of the Plans in 1987, for which she received an annual, individual participant statement through 1992, but they ceased after that. (T 152 - 153)

   Ms. Palaoro stated that she received the 1991 statement in 1993. Plan years 1990 had three revisions and 1991 had two after that. She left on July 29, 1992, and made her first request for the 1992 annual statements and Plan summaries regarding where her money was invested in August of 1992. (T 153) George Klein responded to the first, stating that they had discovered some errors in it, following which she made several requests for the information. (T 154) She sent letters periodically over a period through 1995, when she made her final request. (T 155) She did not receive any other responses. (T 156)

   Ms. Palaoro had served in several positions with both George and Elaine Klein, the latter being Mr. Klein's wife. She was assistant secretary to George and Elaine; executive secretary to George and to the personnel administrator who reported to George. She was the liason between George and the Arbor Club, and payroll clerk, throughout which she was an hourly paid employee. (T 157)

   Charles Olson was the accountant then, and was quite thorough. He would seek payroll information for the Plans, and had worksheets on them. (T 158) She would interview new hires and make recommendations on them, while providing them with necessary paperwork, such as social security cards. She maintained all of the personnel records, and kept those records herself. (T 159)

   With regard to the above requests, she was seeking the worksheets of the accountant to come up with the necessary figures for her own retirement. She also wanted to know the investments and their value. She stated that the April 26, 1999 responses and information basically contained all of the information that she already had. (T 160) She had questions on them, and felt that some were wrong. (T 160) Mr. Klein did not pay her wages until 1997, after a long court battle, and she questioned the wage base amounts that had served as the basis for her contributions. She does not know whether the figures were correct or not. (T 161)

   At times, Ms. Palaoro would go into the personnel files that she maintained to obtain the copies of the driver's licenses that she always made of new hires, to update or verify information that she was typing, including Workers' Compensation files and annual file information. (T 170 - 171) Her recent telephone complaints concerned the return on the investments of the Plans, and where the money was invested, and she complained that they never got any of that information. (T 172) she admitted that when she received the Form 5500 C/Rs in April, that they contained a section on the assets of the Plans, but claimed that she did not know how to read those sections. (T 173) Mrs. Palaoro did not review the accuracy of the materials brought to Mr. Klein that the accountant, Charles Olson had prepared, so she could not verify its accuracy. (T 169)

   Ms. Palaoro admitted that the Kleins were in the business of investing real estate, and that they would be interested in returns on such investments, but claimed that their interests were not the same as their own. (T 175) She also confirmed that the Plans were 100% contributory by the employer. (T 176) She stated that she had a general knowledge about the investment in the Westmont property by the Plans, and that to the point in time of the hearing that it had not generated any income. (T 178)

   Based upon the testimony and documents submitted for consideration in this case, I find the following facts to have been clearly established:

   1. The decision and order, and its attached settlement agreement were made contingent upon the fulfillment of all of their terms and conditions.

   2. Prior to the approval of the settlement agreement, as part of those negotiations, Respondent submitted draft 1992-1996 Annual Report Forms 5500 C/R for the two Plans for review.

   3. However, Respondent did not submit the finalized (signed), revised 1992-1996 Annual Report Forms 5500 C/R for the Plans that were acceptable to the Department on or before November 13, 1998, but instead submitted them on or November 18, 1998.

   4. Respondent did submit draft individual participant account statements for all of the Plans' participants for Plan years 1995 and 1996 for review and comment by December 1, 1998.

   5. However, Respondent did not send finalized participant account statements to the Plans' participants by December 31, 1998, but, instead submitted them to the Plan participants on or after April 1, 1999.

   6. Respondent did submit summary draft Annual Reports for plan years 1995 and 1996 to the Department for review and comment by December 1, 1998.

   7. Respondent did not send finalized versions of the 1995 and 1996 summary draft Annual Reports for the Plan participant by December 31, 1998.

   8. Respondent did not pay the compromised penalty payment of $15,000.00 to the Department by December 31, 1998. However it was paid on January 8, 1999.

   9. Respondent neither requested nor obtained extensions of time for the late submission of any of the said Annual Report Forms 5500 C/Rs, summary Annual Reports, or the individual participation account summaries, either before their original due dates in the respective years for which the reports and summaries were due, or in response to the due dates set forth in the settlement agreement.

   10. Respondent did not offer an explanation of reasonable cause for its failure to submit Annual Report Forms 5500 C/Rs when due for the Plan years 1992 - 1996, for both Plans 001 and 002.

   11. Respondent did not offer a reasonable explanation for its failure to submit the Summary Annual Reports, or participant beneficiary statements when due to individual Plan participants, for the Plan years 1995 - 1996, for both Plans 001 and 002.

   12. Respondent did not offer an explanation of reasonable cause for its failure to submit Annual Report Forms 5500 C/Rs when due under the terms of the settlement agreement, by November 13, 1998 for the Plan years 1992 - 1996, for both Plans 001 and 002.

   13. Respondent did not offer an explanation of reasonable cause for its failure to submit Summary Annual Reports, or participant beneficiary statements when due to individual Plan participants under the terms of the settlement agreement, for the Plan years 1995 - 1996, for both Plans 001 and 002.

   1. The undersigned has jurisdiction of this proceeding under the terms of Section 502(c) (2) of ERISA, 29 U.S.C. §§ 1132(c)(2), as implemented by the provisions of 29 C.F.R. §§ 1250.502c-2 and 1270.60 - 1270.71.

   2. This jurisdiction was preserved by the terms of the Respondent and its attached settlement agreement entered into by all the parties under the provisions of 29 C.F.R. § 2570.65, which provided that the undersigned would retain jurisdiction over the matter pending compliance with all of its terms and conditions. A settlement agreement constitutes a contract between the parties thereto, and is to be interpreted as a question of contract law. J.B. Steel v. United States, 810 Fed. Cir. (1987); Greco v. Department of the Army, 852 F.2d 558, 560, (Fed. Cir. 1988) . If the terms of the agreement are clear and unambiguous, those terms control the agreement, and the interpretation of its intent. Carson v. Department of Energy, 77 M.S.P.R. 453, 457 (1998) . Here, the question of the intent of the parties concerning the retention of jurisdiction by the undersigned pending fulfilment of the terms and conditions of the agreement, is clear and unambiguous.

   3. The penalties provided under the provisions of Section 502(c) (2) of the ERISA are civil penalties, as are any basic penalties that may be imposed by the undersigned for the failure of the parties to comply with the terms and conditions of the Respondent, and the attached settlement agreement. Due to the conditions of the settlement agreement, the motion for sanctions and penalties constituted appropriate notice to the Respondent that the Complainant was seeking penalties and sanctions. Complainant's characterization of the penalties and sanctions does not bind this administrative court.

   4. In addition to penalties that may be statutorily imposed by the undersigned for failure to fulfill the terms and conditions of the order and settlement agreement, the undersigned may impose sanctions for the extraordinary results of this failure, including the imposition of costs and attorneys' fees. See, Kokken v. Guardian Life Insurance, 511 U.S. 375, 380 (1994) . In addition to the reservation of jurisdiction in the agreement, it is my opinion that this Administrative Court has an "inherent power" to interpret and enforce its own settlement agreement orders. This, then, would be particularly so in those over which it has reserved its jurisdiction to insure compliance, and without which parties could unnecessarily delay the administrative proceedings contemplated by ERISA for the protection of individual plan participants.

This penalty is payable on the 31st day following the date of the issuance of this order.

   14.However, based upon the fact that the reports of the two Plans are now in compliance and the credible evidence that Respondent was diligently attempting to rectify the clear violations that it had caused, as is evidenced by the drafts that were timely submitted, in the event that the following are submitted on or before the day following the date of this order, the above penalty of $2,096,200.00 ($1048,100.00 X 2) be reduced to approximately 1% of that will total, for an amount of $20,962.00, and the amounts set will be paid as satisfaction for all obligations:

IT IS THEREFORE ORDERED that:

   1. In the event that the Respondent pays to the Complainant the 1% of the $2,096,200.00 penalty, the previously negotiated civil penalty the amount of $15,000.00, plus the late payment penalty of $2,100.00 and the penalty for late filing of the Annual Report Forms 5500 C/Rs of $15,000.00, for a total of $53,062.00, within 30 days of the date of this order, the Respondent's penalty obligations to the Complainant will be considered to be paid in full.

   2. In the event that the amount of $53,062.00 is not paid by the 30th day following the date of this order, on the 31st day following the date of this order, the full amount of the penalties and sanctions, in the amount of $2,311,300.00 must be paid in full.

      THOMAS F. PHALEN, JR.
      Administrative Law

   29 C.F.R. § 2570.118 provides that the decision of the administrative law judge shall become final agency action unless any dissatisfied party files an appeal with the Secretary within 20 days after issuance of the decision of the administrative law judge. 29 C.F.R. § 2570.119 provides that a notice of appeal to the Secretary shall state with specificity the issue(s) in the decision of the administrative law judge on which the party is seeking review. Such notice of appeal must be served on all parties of record. The final decision of the Secretary constitutes final action within the meaning of 5 U.S.C. 704.