Nale v. Ford Motor Co. Uaw Ret. Plan

• Decision Date: 31 March 2010
• Docket Number: No. 09-cv-13401.,09-cv-13401.
• Parties: Fayette L. NALE, Plaintiff,v.FORD MOTOR COMPANY UAW RETIREMENT PLAN, Defendant.
• Court: U.S. District Court — Eastern District of Michigan

703 F.Supp.2d 714

Fayette L. NALE, Plaintiff,v.FORD MOTOR COMPANY UAW RETIREMENT PLAN, Defendant.

No. 09-cv-13401.

United States District Court,

E.D. Michigan,

Southern Division.

March 31, 2010.

Sherry A. Wells, Royal Oak, MI, for Plaintiff.

David R. Deromedi, Sherry D. O'Neal, Dickinson Wright, Detroit, MI, for Defendant.

FINDINGS OF FACT AND CONCLUSIONS OF LAW REGARDING CROSS-MOTIONS FOR DECISION ON THE ADMINISTRATIVE RECORD

GERALD E. ROSEN, Chief Judge.

I. INTRODUCTION

In the present suit, Plaintiff Fayette L. Nale challenges the denial of her claim for benefits by the Defendant Ford Motor Company-UAW Retirement Plan. The central question is whether Plaintiff's voluntary manslaughter conviction in the death of her husband disqualifies her from collecting survivorship benefits under his pension. The Court's subject matter jurisdiction over this case rests upon the fact that the Defendant Plan is governed by the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq.

Both parties have now moved for a decision on the administrative record. ¹ Each of these motions has been briefed by the parties. Upon reviewing the parties' cross-motions and accompanying briefs, the pleadings, and the administrative record, the Court finds that the relevant allegations, facts, and legal arguments are adequately presented in these materials, and that oral argument would not significantly aid the decisional process. Accordingly, the Court will decide the parties' cross-motions “on the briefs.” See Local Rule 7.1(e)(2), U.S. District Court, Eastern District of Michigan.

As discussed below, the Court will decide the parties' motions under the guidelines set forth by the Sixth Circuit in Wilkins v. Baptist Healthcare System, Inc., 150 F.3d 609, 619 (6th Cir.1998).² This opinion and order sets forth the Court's findings of fact and conclusions of law. To the extent that any findings of fact constitute conclusions of law, they are adopted as such. To the extent that any conclusions of law constitute findings of fact, they are so adopted.

II. FINDINGS OF FACT

A. The Parties

Plaintiff Fayette Lynn Nale and her husband, Michael, were married for over thirty years. Both had careers with Ford Motor Company, before retiring. ³ During his marriage to Plaintiff, Michael Nale enrolled in the Defendant Ford Motor Company-UAW Retirement Plan and designated Plaintiff as the beneficiary under the automatic surviving spouse method of payment option. On September 13, 2007, Michael Nale died when he was stabbed by Plaintiff in the course of a domestic dispute. Plaintiff was subsequently prosecuted on second degree murder and manslaughter charges.⁴ She pled not guilty, denying intentionally or negligently causing his death. On February 19, 2009, she was acquitted of the second degree murder charges, but convicted of voluntary manslaughter under Mich. Comp. Laws § 750.321. A little over a month later, she was sentenced to a minimum of 34 months and a maximum of 15 years in prison. She is currently incarcerated at a women's correctional facility in Ypsilanti, Michigan, and has not pursued an appeal of her conviction.

The Defendant Retirement Plan is a pension plan governed by ERISA, which provides retirement benefits to eligible hourly UAW-represented employees of Ford Motor Company and its affiliates, pursuant to a collective bargaining agreement. Individual benefit determinations are made by a Board of Administration that consists of six members, three representing the company and three representing the union. The Board's duties and powers are set forth in the Retirement Plan document (the “Plan”). ( See Admin. Record at 302-55.) Apart from the Plan, the administrative record also includes the Summary Plan Description (the “SDP”) ( see Admin. Record at 356-412). Both the Plan and the SDP describe participation requirements as well as circumstances that may affect retirement benefits.

B. The Pertinent Plan Provisions

Under the Plan, an eligible employee is entitled to retirement benefits upon or after reaching “his/her normal retirement age.” (Plan at 76; Admin. Record at 330.) The amount of benefits is determined by reference to an employee's “Benefit Class,” which in turn is determined by the date of retirement. (Plan at 76-77; Admin. Record at 330.) The plan further provides survivor's benefits for an employee's spouse if the employee dies on or after reaching retirement age. (Plan at 65; Admin. Record at 324.) The monthly survivor's benefit generally becomes automatically payable to the spouse on the first of the month following the date of the employee's death. (Plan at 89; Admin. Record at 336.) Finally, these provisions are all covered by Article IX, which provides: “Where federal law does not control, the Plan, and all rights thereunder, shall be governed, construed, and administered in accordance with the laws of the State of Michigan.” (Plan at 162; Admin. Record at 353.)

The Plan is administered by a Board of Administration. Article VII provides in relevant part:

It shall be the function of the Board to administer the Plan .... The Board shall have jurisdiction to pass upon all questions concerning the application or interpretation of the provisions of the Plan which it is empowered to administer. After review of an appeal, the disputed benefits under this Plan will be paid only if the Board decides in its discretion that the employee or claimant is entitled to them under the terms of the Plan. The Board shall decide all such questions in accordance with the terms of the Plan, and all such decisions of the Board shall be final and binding upon the Company, the Union, the employees, and the beneficiaries or claimants under the Plan, subject only to the arbitrary and capricious standard of judicial review ...

(Plan at 148; Admin. Record at 346.) ⁵

C. Plaintiff's Claim for Benefits

Plaintiff was not paid survivorship benefits from her husband's retirement plan following his death in September 2007. The benefits administration office's case file indicates that Ford stopped payment pending investigation of Plaintiff's eligibility in light of the then on-going homicide investigation and prosecution. There is no record of a formal application for benefits from Plaintiff and no formal denial letter.⁶ Following her conviction of manslaughter, Plaintiff, by and through counsel, filed a claim for benefits on March 27, 2009. The request stated:

Mrs. Nale was acquitted of the charge of Second Degree Murder, and found Guilty of the Lesser Charge of Manslaughter by a Jury in the death of her husband. Manslaughter is a non-intent crime which indicates that the jury at least understood that she did not want her husband dead. Therefore, under state law and, I trust, the regulations for surviving spouse pension benefits, Mrs. Nale is eligible to receive those benefits, retroactive to the date of his death-September 13, 2007.

(Admin. Record at 29.) In the months that followed, Ford treated Plaintiff's request as an appeal from denial of benefits and requested additional information from Plaintiff in an attempt to clarify the eligibility issue.

The Board finally reviewed Plaintiff's request at a meeting held on July 2, 2009. They were unable to make a determination and put the case on hold pending more research on the legal questions underpinning Plaintiff's claim. A Board of Administration employee contacted Plaintiff to inform her of the delay and to invite her to submit any additional information that may inform the Board's decision before its next planned meeting at the end of July.⁷ The Board met again on July 29, 2009, where it decided to deny Plaintiff's claim.

On August 10, 2009, Ford Motor Company issued a letter denying the claim, citing Article IX of the Plan and Plaintiff's manslaughter conviction. The letter also informed Plaintiff of her rights to bring suit under ERISA. In the week that followed, Plaintiff corresponded with the Ford benefit claims administration office to obtain complete copies of the Plan and the SDP. Plaintiff's counsel wrote to say that, although she had received a copy of the plan documents prior to the Board's July 29 meeting, such copy included all portions that govern claim procedures but lacked Article IX. (Admin. Record at 6.)

Plaintiff filed this case on August 27, 2009, claiming wrongful denial of benefits because, she argues, under Michigan law the manslaughter conviction “is not considered an intentional causing of death such that [Plaintiff] should be denied survivor benefits.” (Compl. ¶ 11.) On or around the same date, Plaintiff filed an appeal in a related probate proceeding in Macomb County Probate Court, challenging that court's order forfeiting and revoking Plaintiff's rights to her husband's estate and denying Plaintiff's request to remove her husband's mother as personal representative of the estate. The appeal is still pending. Defendant argues that Plaintiff was properly denied the benefits on the basis of Michigan's “slayer statute” and analogous federal common law, which are made applicable to the Plan through Article IX.

III. CONCLUSIONS OF LAW

A. Applicable Standard of Review

The Supreme Court has ruled that the standard of review in ERISA cases is de novo unless the benefit plan gives the plan administrator discretion to determine eligibility for benefits or construe plan terms:

Consistent with established principles of trust law, we hold that a denial of benefits challenged under § 1132(a)(1)(B) is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.

Firestone Tire and Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989). See also

Wilkins v. Baptist Healthcare System, Inc., 150 F.3d 609, 616 (6th Cir.1998). However, “where an ERISA plan expressly affords discretion to trustees to make benefit...