Wyper v. Providence Washington Ins. Co.

• Decision Date: 01 April 1976
• Docket Number: D,No. 439,439
• Citation: 533 F.2d 57
• Parties: James WYPER, Jr., Plaintiff-Appellant, v. PROVIDENCE WASHINGTON INSURANCE COMPANY, Defendant-Appellee. ocket 75-7347.
• Court: U.S. Court of Appeals — Second Circuit

Page 57

533 F.2d 57

James WYPER, Jr., Plaintiff-Appellant, v. PROVIDENCE WASHINGTON INSURANCE COMPANY, Defendant-Appellee.

No. 439, Docket 75-7347.

United States Court of Appeals Second Circuit.

Argued Jan. 30, 1976.

Decided April 1, 1976.

Paul W. Orth, Hartford, Conn. (Hoppin, Carey & Powell, Hartford, Conn., of counsel), for plaintiff-appellant.

George Muir, Hartford, Conn. (Gordon, Muir & Foley, Hartford, Conn., of counsel), for defendant-appellee.

Before HAYS, MULLIGAN and GURFEIN, Circuit Judges.

GURFEIN, Circuit Judge:

The plaintiff-appellant, a former employee and president of the Providence Washington Insurance Company, sued the company in the United States District Court for the District of Connecticut, for breach of contract. He claimed that the company improperly failed to award him a pension of $20,000 a year for life which he was entitled to because he had allegedly become, while in its employ, physically and mentally incapacitated through the disease of alcoholism. Jurisdiction rests on diversity of citizenship. 28 U.S.C. § 1332. Appellee pleaded the general issue with the affirmative defense of release.

The case was tried to a jury and at the close of the plaintiff's case, the trial court (Blumenfeld, Judge) directed a verdict in favor of the defendant. ¹ This appeal followed. For reasons that will appear, we affirm.

I

In 1966, and for many years before, appellant had been an employee of the Hartford Fire Insurance Company and had attained an executive position. In September 1966, appellant left to become executive vice president of appellee with the understanding that he would shortly thereafter become president. At the time, appellee agreed that appellant would be credited under its pension plan with past prior service from September 1, 1940. Appellee has not denied that it assumed this obligation. Appellant remained in appellee's employ less than two years, leaving the company on May 7, 1968. Since appellant has not yet reached age 65, he has no present claim for regular retirement benefits under the plan.

The appellant alleges that he is entitled to benefits, however, as an "incapacitated" person under the pension plan, the relevant portion of which reads as follows:

". . . any employee who, after being ten years continuously in the service of the Company, shall become physically or mentally incapacitated to fill his or her position may be retired by a majority vote of the Pension Board from active service.

"Service with other similar institutions may be considered as with this Company for the purpose of calculating the term of service." ²

Appellant claims that he is entitled to be paid about $20,000 a year for the rest of his life because of his alleged incapacity "to fill his position," resulting from alcoholism. He failed to present such a claim at the time of his severance from the company. He asserts the claim in this action brought four-and-one-half years later. Drawing all reasonable inferences from the evidence in the light most favorable to the plaintiff, 5A Moore's Federal Practice P 50.02(1); Pinto v. Spigner, 163 Conn. 191, 192-93, 302 A.2d 266, 267 (1972), we find that a jury, accepting the credibility of all favorable witnesses, could have found as follows:

After about one year in the new employment, plaintiff, who had always been a social drinker, began to drink more heavily. By late 1967, he manifested various physical symptoms associated with alcoholism and, after a brief period "on the wagon" in December, renewed his drinking to a greater and greater extent. His former wife testified that beginning in early 1968, several months before his severance, her then husband would sometimes consume two or three drinks at breakfast, and would return home in an intoxicated condition after work. She also testified that in March 1968 (about a month before his decision to resign), her husband was so intoxicated one Saturday morning that after leaving to play tennis with Mr. Branch, chairman of the board of defendant, he returned home within twenty minutes.

Three former officers of the company also testified for appellant. Each stated that he had observed Mr. Wyper dozing off at important meetings of company officers and directors, and that he often smelled of liquor. One testified that shortly before a directors' meeting in 1968, plaintiff was unable to conduct a scheduled review of financial matters, apparently on account of his intoxicated condition. Another witness testified that in the spring of 1968 he had a conversation with plaintiff to inform him that "talk" about his drinking problem was going around the company to his discredit. It may be inferred that, shortly before his severance, his excessive drinking had become generally known in the company.

Following a meeting of the Board of Directors in early April 1968, plaintiff was informed "that he was not the man for the job." It was apparently understood by all concerned that plaintiff would either have to resign or would not be elected again at the directors' meeting following the annual shareholders' meeting. Plaintiff decided to resign in one month, after he would have conducted the forthcoming annual shareholders' meeting on May 7, 1968. Plaintiff attributed his decision at the time to machinations of specific directors on the board, not conceding that he was incompetent (and certainly not that he was incapacitated) to "fill his position" as president. There was some evidence that the company preferred to have plaintiff resign rather than to be compelled not to rehire him in order to minimize any claims he might have against the company.

With respect to his actual physical and mental condition during the month preceding his resignation, the following could be found: Plaintiff drove to and from work every day. He was present at directors' meetings and at the annual shareholders' meeting. At home, however, his wife testified that she stopped consulting him on family matters because "his answers made no sense," and that he did not perform his usual household chores. Plaintiff himself testified at trial and at deposition that he felt himself quite competent to perform his job in the months preceding his resignation. He acknowledged that his drinking got worse during the last month of employment, because his resignation was already imminent and raised obvious personal problems. At one point, he testified that he was incapacitated from performing his job through that last month. Nowhere in his testimony did appellant claim that he had been incapacitated from performing his job earlier than during the last month when he already knew he was leaving. He testified, however, that from late 1967 through May 1968, there were certain days when he could not function well because of excessive drinking.

On May 7, 1968, appellant was able to conduct, and did conduct, the annual stockholders' meeting as president of the company. At the board of directors' meeting which followed, the board voted to grant appellant three months' severance pay if he would sign a letter of resignation and a release form prepared by Mr. Branch. The release was signed by appellant that afternoon. Appellant testified that following this meeting he had three drinks. He remembers none of the subsequent events of the day, and, accordingly, does not recall signing the release. He concedes, however, that the signatures on the letter of resignation and release form both dated May 7 are his. The release states that appellant has accepted three months' severance pay "in full satisfaction of all claims" against the defendant except those as a stockholder. Though appellant testified that he did not recall signing the release, he also testified that he did not intend to sign away his pension rights.

Testimony of two physicians was also introduced. Dr. Fischer, who testified by deposition, examined the plaintiff on April 25, 1968, twelve days before his severance, and concluded that plaintiff was an alcoholic and had been such for several months. He observed an enlarged liver, as well as other physical symptoms, but refused to offer an opinion on whether plaintiff was "incapacitated" to perform his job. He simply said that a person in plaintiff's condition would probably not function well in any job if he was drinking. Dr. Fischer saw appellant again on May 25, 1968, at which time he noted "Alc very little " and "omit alc" (sic ). Dr. Nichols testified at trial. He first examined plaintiff on June 3, 1968, a month after the severance, and found the liver quite enlarged and distended on physical examination, and found certain degrees of liver disturbance through chemical testing. The physical appearance of plaintiff was that of an alcoholic. Dr. Nichols stated that at the time of examination, plaintiff was an alcoholic, and the state of his physical condition suggested he had been an alcoholic for at least two or three months. He stated as a conclusion that on June 3rd, and for at least one month before, plaintiff would not have been competent to perform the job of president of an insurance company on account of the disease of alcoholism, since the job involved complicated discretionary judgments.

Following his resignation and for several years after, appellant received repeated treatments for alcoholism. The defendant acknowledges that alcoholism is regarded by the medical profession as a disease. Plaintiff states that he is no longer drinking, with the inference that he is no longer "incapacitated."

Under the foregoing circumstances, appellant made no application whatever for a pension based on "incapacity" after his resignation. He made no formal request for a disability pension until four years after his severance from the company. Shortly after his resignation he made one informal inquiry of one pension board member on whether he was entitled to a pension, but did not assert that he was "incapacitated" in any way. While the pension board, which was...