Brown v. Seitz Foods, Inc. Disability Ben. Plan

• Citation: 140 F.3d 1198
• Decision Date: 14 April 1998
• Docket Number: No. 97-2980.,97-2980.
• Parties: Michael E. BROWN, Appellee, v. SEITZ FOODS, INC. DISABILITY BENEFIT PLAN; Continental Casualty Company, Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

140 F.3d 1198

Michael E. BROWN, Appellee, v. SEITZ FOODS, INC. DISABILITY BENEFIT PLAN; Continental Casualty Company, Appellants.

No. 97-2980.

United States Court of Appeals, Eighth Circuit.

Submitted March 12, 1998.

Decided April 14, 1998.

Rehearing and Suggestion for Rehearing En Banc Denied May 20, 1998.

Todd A. Brenner, Columbus, OH, argued (Philip F. Brown, on the brief), for Appellants.

Cynthia B. McGinnis, Springfield, MO, argued (Frank M. Evans, III, on the brief), for Appellee.

Before FAGG, ROSS, and BOWMAN, Circuit Judges.

FAGG, Circuit Judge.

The Seitz Foods, Inc. Disability Benefit Plan (the Plan) and the Plan's administrator, Continental Casualty Company (Continental), appeal the district court's order granting Michael E. Brown benefits under the Plan, which is governed by the Employee Retirement Income Security Act, 29 U.S.C. §§ 1001-1461 (1994) (ERISA). We reverse.

Brown was a full-time sales representative with Seitz Foods. To cover his sales territory, Brown had to drive as many as 1000 miles a week. On May 19, 1992 Brown suffered a whiplash-type injury in an auto accident. He worked at his sales job on and off in the months that followed, then returned to full-time status in late November and continued working (except for three weeks in January) until he was fired on March 4, 1993 for attempting to cheat the company. Toward the end of his employment with Seitz Foods, Brown was no longer working his territory, but he continued doing sales work to the end. Just before he was fired, Brown applied for total disability benefits under the Plan. As defined in the summary plan description (SPD), and leaving aside parts of the definition not relevant here, "total disability" means the employee is "continuously unable to perform the substantial and material duties of [his or her] regular occupation." Although Brown's coverage ended when he was fired, the Plan provided "[t]ermination will not affect a covered loss [that] began before the date of termination." Thus, to receive benefits, Brown had to show he had become continuously unable to perform the duties of his occupation before he was fired.

Unsurprisingly, Continental denied Brown's claim. In a letter dated October 4, 1993, Continental informed Brown of its decision and of Brown's right to supplement the administrative record and appeal. Brown did appeal, unsuccessfully. In its March 9, 1994 letter to Brown's attorney, the Appeals Committee pointed out the obvious: Brown was able to do sales work right up to the date he was fired. The Committee also noted that Brown's own physician, Dr. Mohsen, believed him capable of working at his regular occupation. Dr. Mohsen recommended Brown be allowed to break up long drives with periods of stretching and rest, but added "that doesn't mean that [Brown] cannot be engaged in sales and driving." Another examining physician, Dr. Lin, could find no objective evidence of disability. The administrative record also included the statements of three other physicians, Drs. Pazell, Paff, and Briggs. Dr. Paff evaluated Brown's condition at the request of Brown's attorney three days before Brown was fired. In Dr. Paff's opinion, Brown was able to work eight hours a day, as Brown's job required. Dr. Pazell reported Brown would be able to work only six hours a day. Continental discounted Dr. Pazell's report, however, because it was dated January 12, 1994, more than ten months after Brown's coverage had ceased. Dr. Briggs's report states he never authorized Brown to stop working, and concludes with the terse remark: "Patient not disabled by me."

After Continental denied his claim, Brown filed this lawsuit under 29 U.S.C. § 1132(a)(1)(B) (1994). The district court decided to admit evidence outside the record on which Continental had based its decision. This evidence included the statement of Wilbur Swearingin, a rehabilitation consultant, that Brown had been unable to perform his job duties from the date of the accident. Swearingin's reports in the district court record are dated March 1995 and August 1996. Swearingin first evaluated Brown on October 5, 1993, the day after Continental first rejected Brown's claim and months before Continental's Appeals Committee affirmed that decision, yet nothing from Swearingin appears in the administrative record. The district court also admitted the statement of Dr. Terry Winkler, who seconded Swearingin's assessment based on a physical examination performed in February 1995. The district court then reviewed Continental's decision de novo, concluded Brown "has remained totally disabled from May 19, 1992 through the present," and awarded Brown past and future disability benefits together with attorney's fees and expenses. This appeal followed.

Continental first contends the district court should have reviewed Continental's denial of benefits for abuse of discretion. Brown defends de novo review in this case because the Plan did not give Continental "discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956-57, 103 L.Ed.2d 80 (1989). To support its contention that the Plan did grant Continental the discretionary authority necessary to secure deferential review of its benefit decisions, Continental quotes as follows from the SPD:

To be considered disabled, you must be under a doctor's care. Normally, your own physician determines the degree of physical impairment caused by the disabling condition. Temporary disabilities are covered as long as the definition of total disability is satisfied. Written proof of loss must be furnished to us within 90 days after the end of a period for which We are liable.... Benefits will be paid monthly immediately after We receive due written proof of loss.

According to Continental, phrases and words like "[t]o be considered disabled," "[n]ormally," "as long as the definition of total disability is satisfied," and "due ... proof of loss" necessarily imply Continental's discretionary authority to decide claims. We disagree. The provisions Continental quotes "read like a typical insurance policy" and "do not trigger the deferential ERISA standard of review." Ravenscraft v. Hy-Vee Employee Benefit Plan & Trust, 85 F.3d 398, 402 n. 2 (8th Cir.1996); see...