CUMMINGS BY TECHMEIER v. Briggs & Stratton Ret.

• Decision Date: 19 April 1985
• Docket Number: Civ. A. No. 83-C-722.
• Citation: 606 F. Supp. 659
• Parties: Barbara Jean CUMMINGS, a minor, by her Guardian ad litem, Willard P. TECHMEIER; and Laverne H. Cummings, Special Administratrix of the Estate of Dennis G. Cummings, Plaintiffs, v. BRIGGS & STRATTON RETIREMENT PLAN, the First Wisconsin Trust Company, plan trustee, Briggs & Stratton Retirement Committee, plan administrator, and Frank J. Sprtel, Defendants.
• Court: U.S. District Court — Eastern District of Wisconsin

606 F. Supp. 659

Barbara Jean CUMMINGS, a minor, by her Guardian ad litem, Willard P. TECHMEIER; and Laverne H. Cummings, Special Administratrix of the Estate of Dennis G. Cummings, Plaintiffs, v. BRIGGS & STRATTON RETIREMENT PLAN, the First Wisconsin Trust Company, plan trustee, Briggs & Stratton Retirement Committee, plan administrator, and Frank J. Sprtel, Defendants.

Civ. A. No. 83-C-722.

United States District Court, E.D. Wisconsin.

April 19, 1985.

COPYRIGHT MATERIAL OMITTED

Willard P. Techmeier, Stanley J. Lowe, Techmeier, Sheedy & Associates, Milwaukee, Wis., for plaintiffs.

David R. Cross and Peter W. Bunde, Quarles & Brady, Milwaukee, Wis., for defendants.

DECISION AND ORDER

REYNOLDS, Chief Judge.

This is an action for benefits and statutory penalties under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq. Federal jurisdiction is based on 28 U.S.C. § 1331.

The complaint contains two counts. First, plaintiffs contend that benefits are payable and owing to Barbara Jean Cummings by virtue of her status as beneficiary of the Briggs & Stratton Retirement Plan. Second, plaintiffs contend that the defendants failed to comply with a request for information, in violation of 29 U.S.C. §§ 1025(a) and 1132(c). Presently before the Court are (1) plaintiffs' motion to compel discovery; (2) defendants' motion to dismiss defendant Frank J. Sprtel; (3) plaintiffs' oral motion for summary judgment, which was made at the close of a hearing on August 16, 1984; (4) defendants' motion to dismiss defendant First Wisconsin Trust Company; (5) defendants' motion for summary judgment; and (6) defendants' unopposed motion to strike plaintiffs' jury demand. The motions are treated seriatim. In substance, I conclude that the plaintiffs are entitled to judgment with respect to their claim for benefits on the basis of the present record, and therefore, their motion for summary judgment will be granted in part. I further conclude that the amount of benefits to be awarded cannot be determined on the basis of the present record, and therefore, the parties will be directed to submit information on this point. I further conclude that the defendants are entitled to summary judgment on the claim for statutory penalties.

The following facts are not in dispute. Plaintiff Barbara Jean Cummings is a minor resident of Milwaukee, Wisconsin, and is the surviving child of Dennis G. Cummings. Plaintiff LaVerne H. Cummings is the special administratrix of the estate of Dennis G. Cummings and was formerly Dennis G. Cummings's spouse. Defendant Briggs & Stratton Retirement Committee Plan ("the Plan") is an employee benefit plan within the meaning of 29 U.S.C. § 1132(d). The terms and conditions of the Plan are bargained for between management and labor of the Briggs & Stratton Corporation, and are incorporated into a collective bargaining agreement. Defendant The First Wisconsin Trust Company is a Wisconsin trust company bank and the trustee of the Plan. Defendant Briggs & Stratton Retirement Committee ("the Retirement Committee") is the administrator of the Plan. Defendant Frank J. Sprtel is a member of the Retirement Committee.

Dennis G. Cummings, now deceased, was an employee of the Briggs & Stratton Corporation and a participant in the Plan. He was hired by the Briggs & Stratton Corporation in 1952. He had a high school education and lacked sophistication in the area of employee benefits.

The Plan does not contain an automatic survivorship feature, that is, it does not provide that benefits payable to a Plan participant go to the participant's survivor if the participant dies while employed. If the survivor of such a Plan participant is to receive benefits, the participant must have affirmatively elected a payment option that would include payment to a surviving spouse or beneficiary. Among the options payment to a surviving spouse or beneficiary. Among the options available under the Plan is a "Ten Year Certain and Life Option." This option is set forth in Article VI, § 6.4(a) of the Plan. It provides that a Plan participant may elect to receive a reduced pension payable until death, and if the Plan participant's death occurs before the pension has been paid for ten years, payment of the pension will be made in the reduced amount to a beneficiary designated by the Plan participant for the balance of the ten-year period. This option differs from the other options in that it contemplates payment of benefits to a designated beneficiary other than the Plan participant's spouse.

On May 15, 1972, Dennis Cummings and his spouse were divorced in Milwaukee County Circuit Court. The decree of divorce provided, inter alia,

9. That all of the rights of the defendant in his pension program at Briggs & Stratton Corporation is awarded to him and the plaintiff is divested of all right, title and interest therein providing, however, that the defendant shall change the beneficiary therein to the name of the minor children of the parties and each child shall be divested of such right when he or she reach the age of eighteen (18) years.

Under the terms of the Plan, Mr. Cummings could not have designated his daughter as a beneficiary at the time the decree was entered. None of the defendants in the present action were parties to the divorce proceeding. However, Briggs & Stratton Corporation's records include information that Mr. Cummings was divorced.

In 1978, when Mr. Cummings approached his sixtieth birthday, the Retirement Committee mailed to him information about the Fifty Percent Joint and Survivor Pension Option available under §§ 6.1 and 6.2 of the Plan. This option provides for payment of a monthly annuity to a Plan participant's spouse if the participant dies before retiring. Cummings replied that he would not elect the option, stating: "I am single and not eligible for this retirement plan."

On December 4, 1981, when Mr. Cummings approached his thirtieth year of service, the Retirement Committee mailed to him a packet of information explaining the preretirement options available to him under the Plan. He did not respond to this mailing.

In May 1982, Mr. Cummings was diagnosed as having lung cancer. Shortly thereafter, it was determined that his condition was terminal. He was hospitalized but returned home in late June 1982. He gradually became confused and disoriented.

On June 29, 1982, the Retirement Committee sent Mr. Cummings the same information that had been sent to him the previous December. Both times he was told that if he did not elect a survivorship option, no one would receive any pension benefits if he died while still employed. However, Mr. Cummings never returned an application form for a survivorship option.

Mr. Cummings died on August 1, 1982. He never designated his minor children as pension beneficiaries as the divorce decree required.

On or about August 11, 1982, Barbara Jean Cummings, through a legal representative, wrote to the Retirement Committee requesting a statement of the amount of benefits due her. The Retirement Committee, through Frank J. Sprtel, replied on or about August 13, 1982, stating that no benefits were due and that the matter would be referred to legal counsel. A second letter, dated August 23, 1982, confirmed that no benefits would be paid. Barbara Jean Cummings made a second request on or about March 30, 1983. On April 6, 1983, counsel for the Retirement Committee wrote to her, again informing her that no benefits would be paid. This action was filed soon thereafter.

1. The plaintiffs' motion to compel discovery is denied. The issues with respect to which plaintiffs seek evidence are whether the Retirement Committee had actual or constructive knowledge of the terms of Dennis Cummings's divorce decree, whether the Retirement Committee knew Dennis Cummings was unaware of or misunderstood the terms of the divorce decree, and whether the Retirement Committee or its agents misled him with respect to the options available under the Plan. Resolution of these issues is unnecessary to a determination of these motions. Moreover, plaintiffs' request for discovery was untimely.

2. The defendants' motion to dismiss defendant Frank J. Sprtel is granted. The proffered statutory basis for Mr. Sprtel's liability is 29 U.S.C. § 1132(c) which provides:

Administrator's refusal to supply requested information. Any administrator who fails or refuses to comply with a request for any information which such administrator is required by this title to furnish to a participant or beneficiary (unless such failure or refusal results from matters reasonably beyond the control of the administrator) by mailing the material requested to the last known address of the requesting participant or beneficiary within 30 days after such request may in the court's discretion be personally liable to such participant or beneficiary in the amount of up to $100 a day from the date of such failure or refusal, and the court may in its discretion order such other relief as it deems proper.

However, the Retirement Committee is the administrator of the Plan for the purpose of this subsection, not Mr. Sprtel. Because the relief plaintiffs seek cannot be granted against Mr. Sprtel in his individual capacity, the claim against him will be dismissed with prejudice.

3. Turning next to the substance of the first claim for relief, I observe that the undisputed facts raise a question respecting Dennis Cummings's intentions. It is not clear why he did not designate Barbara Jean Cummings as a beneficiary, as the divorce decree required. A reading of the Plan's description leads to the conclusion that Mr. Cummings's pension payments would have been larger if he did not designate a surviving beneficiary. Thus, there may have been a calculated choice on his part not to elect the survivorship option. However, the documents relevant to his insurance benefits, which have been submitted to the court, disclose that he...