Metro. Life Ins. Co. v. Cotter

Decision Date15 March 2013
Docket NumberSJC–11135.
Citation464 Mass. 623,984 N.E.2d 835
CourtUnited States State Supreme Judicial Court of Massachusetts Supreme Court


Praven Shenoy, Brocktown, for the defendant.

Joseph M. Hamilton (David L. Fine, Westborough, with him) for the plaintiff.

Julie Simon Miller, of the District of Columbia, & Jeffrey L. Williams, for America's Health Insurance Plans, amicus curiae, submitted a brief.



After paying disability benefits to the defendant, James M. Cotter, for several years, the plaintiff, Metropolitan Life Insurance Company (MetLife), determined that Cotter had failed to satisfy a clause in his “own occupation” disability insurance policy that required him to receive care by a physician that “is appropriate for the condition causing the disability.” 1 Interpreting this clause as requiring Cotter to pursue treatment aimed at returning him to his prior occupation, MetLife advised Cotter that the care he was receiving was not appropriate because it expressly disavowed a return to his prior occupation, and, indeed, was focused on a “ return to work in [an] alternate occupation.” MetLife informed Cotter that it would continue to pay him benefits under a reservation of rights during the pendency of the litigation, and filed an action in the Superior Court seeking a judgment declaring that it had no continuing obligation to pay benefits to Cotter and reimbursement of benefits it had paid under the unilaterally asserted reservation of rights. Cotter filed counterclaims for violations of G.L. c. 93A and G.L. c. 176D.

Following a jury-waived trial, a Superior Court judge directed the entry of a judgment declaring that, because Cotter was not receiving care “appropriate for the condition causing the disability,” MetLife was not required to continue paying him benefits, but declaring also that MetLife was not entitled to restitution of any benefits paid. The judge denied Cotter's counterclaims and his motion for reconsideration. The judge also denied MetLife's motion to amend the judgment. Both parties filed timely notices of appeal, and we granted Cotter's motion for direct appellate review.

We are asked to determine the standard of care required where a disability insurance contract conditions payment of benefits upon receipt of care “appropriate for the condition causing the disability.” We must determine also whether, absent a policy provision authorizing such reimbursement,an insurer may obtain reimbursement of benefits paid to an insured who was not receiving the required care.

We conclude that Cotter is not entitled to benefits under the policy, since he is not receiving care designed to enable him to return to his prior occupation, and affirm so much of the judgment as declares that MetLife has no continuing obligation to pay Cotter disability benefits. We conclude also that MetLife is not entitled to reimbursement for benefits it has paid Cotter, and affirm so much of the judgment as declares that Cotter has no obligation to reimburse MetLife for such benefits, but on grounds other than those relied on by the trial judge. See Kelly v. Avon Tape, Inc., 417 Mass. 587, 590, 631 N.E.2d 1013 (1994) (appellate court may uphold correct ruling by trial court on ground different from that relied on by trial court).

1. Background. We recite the facts found by the trial judge, augmented by facts in the record that the parties do not dispute. In 1995, Cotter purchased an “own occupation” disability insurance policy 2 from an affiliate of MetLife.3 In September, 2004, Cotter was diagnosed with cancer of the prostate; he underwent a radical prostatectomy in November. Following the surgery, Cotter took a leave of absence from his job as a sales manager for a global broker of electronic components, a position involving long hours in a high-stress, fast-paced environment, which Cotter described as akin to working on the trading floor of a stock exchange.4 He also filed a claim for disability benefits. Although Cotter returned to work on January 31, 2005, he was unable to perform satisfactorily, in part due to postsurgical incontinence, and his employment was terminated two weeks later. He resubmitted his disability claim, this time for disability occasioned by incontinence. In February, 2005,5 Cotter began receiving disability payments of $5,750 per month, and began treatment for incontinence with two urologists.

As part of his treatment for incontinence, Cotter had been referred to a social worker at the Dana Farber Cancer Institute.Staff there determined that Cotter was not recovering well from the psychological and emotional effects of the surgery and his postsurgery limitations, and recommended that Cotter receive psychological counselling. In September, 2005, Cotter began seeing Dr. Jonathan Weiss, a licensed psychiatrist who was one of the practitioners on a list provided by Cotter's medical insurer.

Cotter's difficulties with incontinence were largely resolved by October, 2005, and one of his urologists notified MetLife that Cotter should be able to return to work by November 5. MetLife advised Cotter by letter that his benefits would be discontinued as of November 30, and suggested that, if he still felt unable to return to work, he submit any additional medical information relative to his claim.

Following receipt of MetLife's letter, Cotter requested that his claim be reopened on the basis of a psychiatric disability. On November 30, Weiss submitted a letter to MetLife stating that Cotter was in “treatment with” him and that Cotter was “not able to return to work at this time for medical reasons.” On December 22, 2005, Weiss submitted an “attending physician's statement” requested by Metlife. Weiss reported that Cotter was suffering from “major depression, single episode, severe,” with “gradual stabilization anticipated.” In February, 2006, Weiss changed his diagnosis to “major depression, recurrent,” a diagnosis which has remained unchanged since then. Weiss prescribed a treatment regimen of antidepressant and antianxiety medications and “supportive” therapy. While Weiss monitored the impact of the medications, and the dosages of certain medications have changed, his general recommendations of antidepressant and antianxiety medications and supportive therapy have not changed since that time.

Cotter reported to Weiss that he felt he was unable to think or function as he had before, and that he would be unable to perform under the high-stress conditions of his job in the electronics industry. He had difficulty concentrating or handling multiple tasks at one time, a necessity in the electronics broker trading floor environment where he had managed numerous people calling out purchase and sale orders for his approval while the customer, frequently in another country, waited on the telephone. Cotter also discussed these concerns with his then MetLife claims representative. In May, 2006, Cotter obtained a teaching certificate and subsequently began working as a substitute special education teacher in a public high school.6 In October, 2006, he began serving as an aide to one of the school's students with autism, a position which paid $14,273 per year. MetLife continued to pay the full $5,750 monthly disability benefitduring this period. 7

In the spring of 2007, MetLife assigned Cotter's file to a new claims representative who arranged for him to be evaluated by two independent medical examiners (IMEs), Dr. Lawrence S. Fieman, a neuropsychologist, and Dr. Ronald Schouten, a psychiatrist. Fieman reviewed Cotter's medical records, conducted a clinical interview, and administered the Minnesota Multiphasic Personality Inventory–2 (MMPI–2) test. Fieman concluded that Cotter's clinical profile did not support a diagnosis of major depression, but noted that fatigue and lack of focus “are not addressed” by the MMPI–2. Fiemen opined that Cotter's medications 8 could be contributing to his reported fatigue and anxiety, and that there were “no significant psychological barriers to full time employment.”

After interviewing Cotter and reviewing his medical records, Schouten determined that Cotter did “not appear to be suffering from Major Depression or another significant Axis I disorder ... [but did] evidence symptoms consistent with chronic Adjustment Disorder with mixed depression and anxiety.” Schouten credited Cotter's statements that he had difficulty concentrating and focusing on tasks; that stress, pressure, and decisionmaking overwhelm him; and that the multitasking required in his former employment with the brokerage firm would be impossible for him. Schouten's clinical examination supported Cotter's reported difficulties in concentration and inattention, consistent with anxiety and depression. Schouten noted Cotter's concerns about his medical conditions and the financial pressures on his family, but noted also that Cotter found teaching to be lower stress and more rewarding than his previous occupation. Schouten determined that “Cotter's current symptoms [did] appear to be interfering with his ability to return to work,” and that [a]t present, [his] attentional difficulties would interfere with his ability to handle multiple high-pressure business transactions.” Schouten observed also that “the role of his multiple medications,” at least five of which could have effects on the central nervous system, “cannot be ruled out.”

Schouten concluded, “Most importantly, it is clear from examination of Mr. Cotter that he has suffered what can only be described as an existential crisis as a result of his medical problems. This has led him to question the meaning of life, his career choices, and how he has provided for his family. He is now drawn to a vocation that is less stressful and provides him with emotional fulfillment....

“Mr. Cotter is exhausted and frightened...

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