Lockhart v. United Mine Workers of America 1974 Pension Trust

• Decision Date: 17 September 1993
• Docket Number: No. 93-1276,93-1276
• Citation: 5 F.3d 74
• Parties: 17 Employee Benefits Ca 1563 Clarence E. LOCKHART, Plaintiff-Appellee, v. UNITED MINE WORKERS OF AMERICA 1974 PENSION TRUST; Paul R. Dean; Michael H. Holland; Marty D. Hudson; Elliott A. Segal, Trustees, Defendants-Appellants.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 74

5 F.3d 74

17 Employee Benefits Ca 1563

Clarence E. LOCKHART, Plaintiff-Appellee, v. UNITED MINE WORKERS OF AMERICA 1974 PENSION TRUST; Paul R Dean; Michael H. Holland; Marty D. Hudson Elliott A. Segal, Trustees, Defendants-Appellants.

No. 93-1276.

United States Court of Appeals Fourth Circuit.

Argued July 15, 1993.

Decided Sept. 17, 1993.

Glenda Sullivan Finch, Associate Gen. Counsel, UMWA Health & Retirement Funds, Washington, DC, argued Robert D. Valer, Asst. Gen. Counsel, UMWA Health & Retirement Funds (on the brief), for defendants-appellants.

H. John Taylor, Rand, WV, argued, for plaintiff-appellee.

Before WILKINSON, LUTTIG, and WILLIAMS, Circuit Judges.

OPINION

WILLIAMS, Circuit Judge:

Clarence Lockhart applied to the United Mine Workers of America 1974 Pension Trust for a disability pension, claiming that he was totally disabled "as a result of a mine accident." UMWA 1974 Pension Plan, Art. II.C. (J.A. at 244.) The Trustees of the 1974 Pension Trust denied his application, and Lockhart sought relief in district court under Sec. 502(a)(1)(B) of the Employee Retirement Income Security Act, 29 U.S.C. Sec. 1132(a)(1)(B) (1988). Both parties moved for summary judgment. The district court concluded that the Trustees' denial of a disability pension was arbitrary and capricious, and therefore granted Lockhart's motion for summary judgment and ordered the Trustees to award Lockhart a disability pension. We reverse and remand for the entry of an order granting summary judgment to the Trustees.

I.

Lockhart was employed by Amherst Industries, Inc., as a shake-out operator at a coal tipple in Huntington, West Virginia. Lockhart and his co-workers regularly parked on a vacant lot located across several railroad tracks from the Amherst facilities. ¹ The employees could not reach the tipple from the lot without crossing at least two sets of railroad tracks.

On January 17, 1976, several railroad cars blocked Lockhart's path to work. As Lockhart climbed between two cars, the cars moved, causing Lockhart to lose his balance and fall underneath the railroad cars. The moving cars severed both of his legs. ²

Lockhart applied for and received Social Security Disability benefits with an onset date of January 17, 1976. The benefits were terminated nine months later when Lockhart returned to his job at Amherst. Lockhart continued his employment at the tipple until February 28, 1989, when the tipple permanently ceased operations. Lockhart's Social Security benefits were then reinstated.

On November 16, 1989, Lockhart applied for a disability pension from the Trust, contending that he became "totally disabled as a result of a mine accident" within the meaning of Article II.C of the UMWA 1974 Pension Plan. ³ (J.A. at 244.) The Director of the UMWA Health and Retirement Funds Field Service Office denied Lockhart's application on the ground that Lockhart had failed to establish that he was involved in a "mine accident." (J.A. at 1.) Lockhart appealed to the Trustees for a review of his disability determination. In a written "Decision on Review," the Trustees concluded that Lockhart was not entitled to a disability pension under the terms of the 1974 Pension Trust because Lockhart's "injury occurred en route to work and was not a direct result of his performance of classified work for a signatory employer," (J.A. at 188), and therefore did not occur "as a result of a mine accident."

Lockhart subsequently commenced this action in district court against the Trust and the Trustees, alleging that he met the necessary eligibility requirements for a disability pension and that the Trustees arbitrarily, capriciously, and unreasonably denied his application for such a pension. Shortly thereafter, the parties filed an agreed motion to remand the case to the Trustees for reconsideration in light of any new evidence which Lockhart could produce. On March 13, 1992, Lockhart submitted a sworn statement detailing the facts regarding his 1976 accident. The Trustees again upheld their denial of Lockhart's application for disability benefits on the ground that Lockhart's statement provided no new material evidence.

After the Trustees' decision, both parties moved for summary judgment. The district court concluded that the Trustees' decision not to grant benefits to Lockhart was arbitrary and capricious and granted summary judgment for Lockhart. In reaching this conclusion, the district court focused on the similarities between the circumstances which surrounded Lockhart's injury and the circumstances which led the Trustees to grant a disability pension to another mine worker, Donald Harless. An internal Pension Funds document described the decision to grant disability benefits to Harless as follows:

In 1981 the Funds granted a disability retirement pension to Donald Harless ("Harless"), a miner who was injured when he fell on ice while walking across the parking lot to the lamphouse after changing into his work clothes in the company bathhouse. Harless' employer did not use a time clock. The Funds relied heavily on DB-6(78) and on workman's compensation law in its decision. The Funds felt Harless satisfied the criteria set forth in DB-6(78) in that he was preparing for the start of his work day.

(J.A. at 208.) ⁴ The district court concluded that Lockhart's case and Harless's case were "directly comparable" and "not distinguishable." (J.A. at 287.) The court reasoned that "[b]oth miners were 'within the course of [their] employment' because they were 'preparing for the start of [their] work day,' " and also mentioned the fact that neither employer used a time clock. (J.A. at 288.) Having found that Harless and Lockhart were similarly situated, the district court concluded that it was arbitrary and capricious to grant benefits to one mine worker and deny them to the other, and consequently granted summary judgment for Lockhart.

II.

We review the district court's grant of summary judgment de novo. Baber v. Hospital Corp. of Am., 977 F.2d 872, 874 (4th Cir.1992). However, under Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989), our power to review a decision of the trustees of an employee benefits plan to deny benefits is significantly more limited. Firestone held that if "the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan," id. at 115, 109 S.Ct. at 956-57, courts should review a denial of benefits only for abuse of discretion, see id. at 111, 109 S.Ct. at 954. We have previously determined that the abuse of discretion standard applies to review of the Trustees' decisions under the UMWA 1974 Pension Plan. In Boyd v. Trustees of the United Mine Workers Health and Retirement Funds, 873 F.2d 57, 59 (4th Cir.1989), we stated:

There is no question that the Trustees of the UMW Pension Plan here have discretionary authority, since they have the power of "full and final determination as to all issues concerning eligibility for benefits" and "are authorized to promulgate rules and regulations to implement this Plan...." Pension Plan, Art. VIII.A, B(1). Therefore, we must review the Trustees' decision denying [the employee] disability pension benefits for abuse of discretion.

(Ellipses in original.) ⁵ In determining whether the trustees of an employee benefits plan abused their discretion in denying benefits,

[w]e must give due consideration, for example, to whether the administrators' interpretation is consistent with the goals of the plan; whether it might render some language in the plan meaningless or internally inconsistent; whether the challenged interpretation is at odds with the procedural and substantive requirements of ERISA itself; whether the provisions at issue have been applied consistently; and of course whether the fiduciaries' interpretation is contrary to the clear language of the plan.

The dispositive principle remains, however, that where plan fiduciaries have offered a reasonable interpretation of disputed provisions, courts may not replace it with an interpretation of their own.

De Nobel v. Vitro Corp., 885 F.2d 1180, 1188 (4th Cir.1989) (internal citations and quotation marks omitted); see also Crosby v. Crosby, 986 F.2d 79, 83 (4th Cir.1993) (prime consideration is reasonableness of trustees' decision); Finley v. Special Agents Mut. Benefits Ass'n, Inc., 957 F.2d 617, 621 (8th Cir.1992) (following De Nobel).

Lockhart's challenge to the Trustees' denial of benefits focuses principally on the fourth De Nobel factor, the consistency with which the Trustees have interpreted governing plan provisions. But as De Nobel explains, the Trustees must consider other factors as well, such as the language of the plan and any rules or regulations promulgated thereunder. We turn now to consider those factors.

III.

The award of benefits under any ERISA plan is governed in the first instance by the language of the plan itself. See Callahan v. Rouge Steel Co., 941 F.2d 456, 460 (6th Cir.1991) (most important factor in considering whether denial of benefits was arbitrary and capricious is the language of the plan); see also 29 U.S.C.A. Sec. 1104(a)(1)(D) (West 1985 & Supp.1993) (trustees must discharge duties in accordance with documents and instruments governing the plan); 29 U.S.C. Sec. 1102(a)(1), (b)(4) (1988) (benefit plans must be in writing and must specify the basis on which payments are to be made from the plan). If the denial of benefits is " 'contrary to the clear language of the [p]lan,' " De Nobel, 885 F.2d at 1188 (quoting Dennard v. Richards Group, Inc., 681 F.2d 306, 316 (5th Cir.1982)), the decision will constitute an abuse of discretion. See Davis v. Burlington Indus., Inc., 966 F.2d 890, 895 (4th Cir.1992) ("If the plan language is unambiguous, however, we would not defer to a contrary interpretation by the" trustees.); cf. Dennard, 681 F.2d at 314 ("When the...