Johnson v. State Mut. Life Assur. Co. of America, 90-1971

Citation942 F.2d 1260
Decision Date21 August 1991
Docket NumberNo. 90-1971,90-1971
Parties14 Employee Benefits Cas. 1305 Jo Ann JOHNSON, Appellant, v. STATE MUTUAL LIFE ASSURANCE CO. OF AMERICA, Appellee.
CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)

Alan Cohen, St. Louis, Mo., for appellant.

Wilbur L. Tomlinson, argued (John Emde on brief), St. Louis, Mo., for appellee.

Before LAY, Chief Judge, and McMILLIAN, ARNOLD, JOHN R. GIBSON, FAGG, BOWMAN, WOLLMAN, MAGILL, BEAM and LOKEN, Circuit Judges, En Banc.

LOKEN, Circuit Judge, joined by LAY, Chief Judge, and ARNOLD, BOWMAN, WOLLMAN and MAGILL, Circuit Judges.

Plaintiff Jo Ann Johnson appeals from a district court order dismissing her Complaint for group life insurance benefits. 735 F.Supp. 331. Having concluded that Johnson's Complaint is governed by Missouri's ten-year contract statute of limitations, Mo.Ann.Stat. § 516.110(1), instead of the five-year contract statute of limitations applied by the district court, Mo.Ann.Stat. § 516.120(1), we reverse.

In October 1979, Cleveland Johnson died of a gunshot wound. At the time of his death, Mr. Johnson was a policyholder under a group policy issued by defendant State Mutual Life Assurance Co. of America to his employer, Terminal Railroad Association of St. Louis. Plaintiff, Johnson's wife, was the policy beneficiary. The employer promptly gave defendant proof of death and demanded payment to plaintiff as beneficiary of the amount owing in the case of accidental death. Thereafter, defendant paid plaintiff the death benefits under a second policy but refused to pay the $44,000 owing in the case of an accidental death under this policy on the ground that Mr. Johnson's death resulted from an altercation in which he was the aggressor and which he should have foreseen would put his life in danger.

In May 1989, plaintiff commenced this action in Missouri state court to recover the unpaid $44,000. 1 Defendant removed the action to federal court, alleging exclusive federal jurisdiction under 29 U.S.C. § 1132 because its group policy was part of the employer's "plan" regulated by the Employee Retirement Income Security Act ("ERISA"). Rather than contest Federal jurisdiction, plaintiff filed an Amended Complaint in the district court recasting her cause of action as one under ERISA. A jury trial was scheduled for late 1989 but was postponed to permit consideration of defendant's statute of limitations motion, which the district court granted. Plaintiff then appealed. After this case was argued to a panel of the court, we issued an order, sua sponte, resubmitting it to the court en banc because of a perceived need to consider whether our prior decision in Fogerty v. Metropolitan Life Ins. Co., 850 F.2d 430 (8th Cir.1988), should be overruled.

I.

ERISA contains no statute of limitations for actions to recover benefits under a regulated plan. The district court correctly held that it must therefore look to Missouri law for the most analogous statute of limitations, but that the characterization of plaintiff's claim for statute of limitations purposes is a question of federal law. See Wilson v. Garcia, 471 U.S. 261, 105 S.Ct. 1938, 85 L.Ed.2d 254 (1985); United Auto Workers v. Hoosier Cardinal Corp., 383 U.S. 696, 86 S.Ct. 1107, 16 L.Ed.2d 192 (1966).

Judge Beam in dissent urges a result not considered by the parties or the district court, namely, that this action should be characterized as a suit against a trustee for breach of trust for statute of limitations purposes, and that the five year limitations period in Mo.Ann.Stat. § 456.220 is therefore applicable. We disagree. In the first place, this action is not for breach of trust. It involves the interpretation of an insurance policy, an asset of the employer's plan that is excepted from the trust requirements of ERISA. See 29 U.S.C. § 1103(b); Brown v. Blue Cross & Blue Shield of Alabama, Inc., 898 F.2d 1556, 1561 (11th Cir.1990), cert. denied, --- U.S. ----, 111 S.Ct. 712, 112 L.Ed.2d 701 (1991). Thus, this action is not the least bit analogous to the actions under Missouri law that are governed by Mo.Ann.Stat. § 456.220. If our search is properly for the most analogous state statute, § 456.220 is not a rational choice.

Second, it is important to note that ERISA contains an express federal statute of limitations for suits claiming breach of an ERISA trust, 29 U.S.C. § 1113. If it is appropriate as a matter of federal law to borrow a breach-of-trust statute of limitations, we should borrow the federal statute. However, Congress expressly limited § 1113 to suits claiming breach of an ERISA trustee's fiduciary duties "under this part," which does not include beneficiary suits under § 1132(a)(1)(B). 2 It cannot be consistent with congressional intent to borrow a state breach-of-trust statute of limitations to govern suits by ERISA beneficiaries, when that state statute was itself preempted by an ERISA limitations provision that is expressly not applicable to such suits.

Third, we think the dissent's quest for statute of limitations uniformity does not warrant creating judicially what Congress intentionally did not provide in the statute. The Supreme Court's decision in Wilson v. Garcia, 471 U.S. 261, 105 S.Ct. 1938, 85 L.Ed.2d 254 (1985), was based upon factors unique to the federal Civil Rights Act of 1871. The Supreme Court has rejected a uniform statute of limitations for actions under § 301 of the Labor Management Relations Act, stating, "Lack of uniformity in this area is ... unlikely to frustrate in any important way the achievement of any significant goal of labor policy." UAW v. Hoosier Cardinal Corp., 383 U.S. at 702, 86 S.Ct. at 1111. True, the Court subsequently borrowed a uniform federal limitations period for union breach of duty suits, but only after stating that "resort to state law remains the norm for borrowing of limitations periods" unless federal law "clearly provides a closer analogy [that is] significantly more appropriate." DelCostello v. International Bhd. of Teamsters, 462 U.S. 151, 171-72, 103 S.Ct. 2281, 2294, 76 L.Ed.2d 476 (1983). We conclude, and the dissent apparently agrees, that suits to recover ERISA benefits should be governed by the norm, the most analogous state statute of limitations.

Finally, we question whether adoption of state breach-of-trust limitations law would achieve the dissent's objective of ending confusion and inconsistency. In Missouri, for example, it is unlikely that § 456.220, a rather new statute, has abrogated the traditional doctrine that, "The statute of limitations [for breach of a trustee's duty] does not begin to run until the trust is repudiated." Senn v. Manchester Bank of St. Louis, 583 S.W.2d 119, 134 (Mo.1979). See Bogert, The Law of Trusts & Trustees § 951 (2d ed. 1982). Although that doctrine can be avoided here by treating the denial of plaintiff's death claim as a "final account," determining when the cause of action accrued on claims for ongoing benefits from a continuing ERISA plan might prove more troublesome under traditional trust limitations law.

For the above reasons, we agree with those federal courts that have held, without exception to our knowledge, that a suit for ERISA benefits under § 1132(a)(1)(B) should be characterized as a contract action for statute of limitations purposes, unless a breach of the ERISA trustee's fiduciary duties is alleged. Compare Jenkins v. Local 705, 713 F.2d 247, 253 (7th Cir.1983), and Dameron v. Sinai Hosp. of Baltimore, Inc., 595 F.Supp. 1404, 1413 (D.Md.1984), with Edwards v. Wilkes-Barre Pub. Co., 757 F.2d 52 (3d Cir.), cert. denied, 474 U.S. 843, 106 S.Ct. 130, 88 L.Ed.2d 107 (1985). We see no reason to reject for statute of limitations purposes the characterization that Missouri law would place on plaintiff's claim for accidental death insurance benefits. See UAW v. Hoosier Cardinal Corp., 383 U.S. at 706, 86 S.Ct. at 1113. Therefore, we conclude that the district court properly framed the issue in this case as requiring us to decide which of Missouri's two contract statutes of limitations is "most analogous" to plaintiff's ERISA claim.

II.

For more than a century, Missouri has had two contract statutes of limitations. Section 516.120(1) provides that, "All actions upon contracts, obligations or liabilities, express or implied, except those mentioned in section 516.110," must be brought within five years; Section 516.110(1) provides that, "An action upon any writing, whether sealed or unsealed, for the payment of money or property" may be brought within ten years. The district court held that the five-year statute applies because plaintiff's action to recover benefits under an ERISA-regulated plan is not an action upon a written promise for the payment of money within the meaning of the ten-year statute.

There are numerous Missouri cases deciding which of these two statutes of limitations applies to a particular contract claim. Many decisions applying the five-year statute contain dictum that, in our view, is inconsistent with the holdings in many other cases applying the ten-year statute. Therefore, our task is to decide which of two parallel inconsistent lines of cases the Supreme Court of Missouri would apply to the facts of this case.

The key statutory language is that limiting the ten-year statute of limitations to "an action upon any writing ... for the payment of money." Early on, the Supreme Court of Missouri rejected a narrow interpretation of this phrase:

Defendants claim that an instrument for the payment of money or property, such as is meant by the 10 years' statute of limitations, should acknowledge an obligation to pay which is neither conditional nor contingent.... If this position be correct, then all instruments other than notes, bonds, bills of exchange, and other written promises or obligations to pay, unconditionally, specified sums of money would be embraced by the 5 years' statute of limitations. To this we are...

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