Adkins v. Reliance Standard Life Ins. Co.

• Decision Date: 24 October 1990
• Docket Number: No. 89-1557,89-1557
• Citation: 917 F.2d 794
• Parties: Minnis ADKINS, Plaintiff-Appellant, v. RELIANCE STANDARD LIFE INSURANCE COMPANY, Defendant-Appellee.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 794

917 F.2d 794

59 USLW 2291

Minnis ADKINS, Plaintiff-Appellant, v. RELIANCE STANDARD LIFE INSURANCE COMPANY, Defendant-Appellee.

No. 89-1557.

United States Court of Appeals, Fourth Circuit.

Argued April 6, 1990.

Decided Oct. 24, 1990.

Ralph C. Young, Hamilton, Mooney, Burgess, Young & Tissue, Oak Hill, W.Va., for plaintiff-appellant.

James Michael Brown, File, Payne, Scherer & Brown, Beckley, W.Va., for defendant-appellee.

Before WIDENER and SPROUSE, Circuit Judges, and SMITH, United States District Judge for the Eastern District of Virginia, sitting by designation.

WIDENER, Circuit Judge:

Minnis Adkins appeals the district court's order granting summary judgment against him in his action to recover disability benefits under an insurance policy issued by Reliance Standard Life Insurance Company (Reliance). We vacate the district court's order granting summary judgment and remand for further proceedings.

In 1973 Minnis Adkins, while working as a coal miner, sustained an injury to his back that ultimately necessitated a spinal fusion in early 1974. In November 1974 Adkins resumed his previous duties at the mine. On March 1, 1977, Adkins became insured against permanent and total disability due to accident through an insurance policy that Reliance issued to Adkins' employer. Adkins suffered two additional accidental work-related injuries to his back, in January 1979 and in February 1982, but returned to work shortly after each incident. In May 1985 Adkins stepped into a hole inside a coal mine and injured his back for the final time. The parties agree that Adkins is now totally and permanently disabled.

Alleging that his May 1985 accident caused him to be permanently disabled, Adkins filed a claim for benefits with Reliance. The insurance policy in question provided coverage for losses "resulting directly and independently of all other causes from bodily injury caused by accident occurring while this Policy is in force." Reliance contended that the medical evidence it had received indicated that Adkins' disability was the result of several medical conditions, and denied benefits. Adkins then filed the present action in the district court, alleging that Reliance improperly denied his claim. Because the insurance policy in issue was covered by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. Secs. 1001 et seq., the district court correctly reviewed Reliance's decision under a de novo standard. See Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989). In deciding whether Adkins' disability resulted from accidental bodily injury "directly and independently of all other causes," the district court determined that "the great weight of the evidence is that the May 8, 1985 injury would not have totally disabled Plaintiff had he not had the previous back injuries" and granted summary judgment for Reliance. ^*

In referring to Adkins' "previous back injuries," however, the district court did not distinguish between Adkins' initial 1973 injury and resulting spinal fusion and the two subsequent injuries he sustained in 1979 and 1982, after the policy was in effect. Thus, the district court may have found that any one or any combination of the three previous injuries contributed to Adkins' disability. We believe that this unresolved ambiguity is critical, for the result reached necessarily implies a standard too strict to have been applied in this case, as will become apparent. We further believe that the medical evidence in the record does not clarify the issue to such an extent that we should confidently engage in the necessary fact finding to the exclusion of the district court in the first instance.

If the 1973 injury and spinal fusion contributed in a sufficient amount to Adkins' disability, the language of the policy would appear to exclude coverage. If the 1973 injury was not a sufficient factor, however, and one or both of the accidents sustained in 1979 and 1982 contributed to the disability, we believe Adkins is entitled to recover because the policy was in effect when those accidents occurred.

On remand then, the question to be determined is how much effect, if any, the 1973 injury had on Adkins' present condition of disability.

In construing the statute, we are told that we are to develop a federal common law of rights and obligations of ERISA-regulated plans. Firestone, 489 U.S. at 110-14, 109 S.Ct. at 954-56, quoting Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 56, 107 S.Ct. 1549, 1558, 95 L.Ed.2d 39 (1987). Firestone also provides that "ERISA was enacted to 'promote the interests of employees and the beneficiaries in employee benefit plans....' " 489 at 113, 109 S.Ct. at 955 (quoting Shaw v. Delta Airlines Inc., 463 U.S. 85, 90, 103 S.Ct. 2890, 2896, 77 L.Ed.2d 490 (1983)).

Firestone 's quotation from Shaw should guide us in our construction of the statute. Promoting the interests of employees and the beneficiaries does not seem to us to mean, as is so frequently said, that the purpose of legislation is corrective and it must be liberally construed in favor of the beneficiary. The Court could have said just that if it desired. Instead, on two occasions, it has used the quoted language. Just as importantly, however, we do not feel that that language calls for an overly literal compliance with those decisions most favorable to a finding of no liability. After all, as at least some of the authority has noted, in order to recover under such policies as the one here involved, and with such a stringent construction, a claimant would have to be in perfect health at the time of his most recent injury before the policy would benefit him, and that, of course, is a condition hardly obtained, however devoutly to be wished.

In 84 A.L.R.2d 176 is the extensive Annotation "Pre-existing physical condition as affecting liability under accident policy or accident feature of life policies." That Annotation is supplemented in Later Cases for...