RULING ON DEFENDANT’S MOTION FOR SUMMARY JUDGMENT [DKT. NO. 24]
The plaintiff, Michael J. Mullaly (“Mullaly”), brings this action under the Employment Retirement Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1101 et seq., against First Reliance Standard Life Insurance Company (“First Rebanee”). Mullaly claims that First Rebanee wrong-fuhy terminated disability benefits to which he was entitled under an employee welfare benefit plan.
First Reliance seeks summary judgment on all claims against it. More specifically, First Reliance asserts that it terminated Mullaly’s benefits because a functional capacity exam (“FCE”) indicated that he was no longer totally disabled under the policy. Mullaly claims that First Reliance’s interpretation of the policy terms is unreasonable, and that First Reliance should provide rehabilitative benefits to him because he is only able to work part-time. For the reasons set forth below, defendant’s motion for summary judgment is granted.
I. FACTUAL BACKGROUND
Michael Mullaly. served as a shipping clerk for Charles Freihofer Baking Company, Inc. (“Freihofer”) from 1987 until 1992. Mullaly’s compensation package with Freihofer included long term disability insurance coverage pursuant to a group policy issued by First Reliance.
On August 8,1990, Mullaly was involved in a ear accident. He suffered severe injuries to his back and neck. Throughout the next two years, Mullaly periodically was completely unable to work, worked subject to light duty work restrictions, and performed his full duties. In March of 1992, Mullaly’s condition had worsened, and his physicians determined that it was unlikely Mullaly would ever be able to fully perform his duties at the bakery. Mubaly appbed for benefits under Freihofer’s long term disability policy, and was found eligible to receive them as of August 25, 1992. First Reliance began paying Mullaly monthly benefits under the plan on September 4,1992.
Freihofer’s disability pobey provides for benefits upon a finding of “Total Disability.” Policy, Exh. 2 to Pi’s Memo, of Law in Supp. of Opp. to Def.’s Mot. for Summ. J. [Dkt. No. 30], at 7.0. In the first sixty months for which a monthly benefit is payable, an insured is “Totally Disabled” if he or she either “cannot perform the material duties of his/her regular occupation” or “is capable of only performing the material duties on a part-time basis or part of the material duties on a Full-time basis.” Policy at 2.1. After a monthly benefit has been paid for sixty months, an insured is “Totally Disabled” if he or she “cannot perform the material duties of any occupation. Any occupation is one that the In
First Reliance did not dispute that Mul-laly was unable to perform his previous job as a shipping clerk, and was therefore entitled to benefits for the first sixty months of his disability. After that sixty-month period, which terminated in 1997, First Reliance initiated an investigation to determine whether Mullaly was able to perform the material duties of any occupation. First Rebanee requested, and Mullaly consented to, an FCE, which was performed on March 10, 2000. Mullaly claims that Alexander Peaker, a claims analyst supervisor at First Reliance, informed him that, were the FCE to estabbsh that Mul-laly could perform some occupation in which Mubaly would earn less than his monthly benefit, First Reliance would make up the difference between Mubaly’s earnings and the amount of his monthly benefit.
As a result of the FCE, First Rebanee identified six occupations suitable for Mul-laly’s physical condition. The occupations were: (1) dispatcher, maintenance service, (2) surveibanee system monitor, (3) identification clerk, (4) information clerk, (5) telephone solicitor, and (6) answering service operator. On May 11, 2000, Mullaly’s physician confirmed that Mubaly had the physical capacity to perform the duties associated with those occupations. Based on this evaluation, First Rebanee completely terminated Mubaly’s benefits -on July 18, 2000. Following First Reliance’s termination of benefits, Mubaly’s physician clarified his assessment of Mubaly’s physical condition via letter, which indicated that Mubaly could not work any more than six hours per day. In August of 2000, Mubaly sought and obtained employment as a part-time counterperson at Riverdale Cleaners in Cromwell, Connecticut, where he continues to work.
II. SUMMARY JUDGMENT STANDARD
In a motion for summary judgment, the burden is on the moving party to estabbsh that there are no genuine issues of material fact in dispute and that it is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c);
Anderson v. Liberty Lobby, Inc.,
In assessing the record, the trial court must resolve all ambiguities and draw all inferences in favor of the party against whom summary judgment is sought.
Anderson,
“The mere existence of
some
alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no
genuine
issue of
material
fact.”
Anderson,
III. DISCUSSION
A. Standard of Review
There is no dispute that the Plan is an “employee welfare benefit plan” governed by ERISA. See 29 U.S.C. § 1002(1). As such, Mullaly’s action for wrongful termination of long term disability benefits is a claim under Section 502(a)(1)(B) of ERISA, 29 U.S.C. § 1132(a)(1)(B).
When evaluating a challenge to denial of benefits under an ERISA plan, a court must first determine whether the Plan confers discretionary authority on the Plan’s Administrator. “[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 & Rubber Co. v. Bruch,
First Reliance concedes that the Second Circuit’s ruling in Kinstler v. First Reliance, supra, established that First Reliance’s standard disability policy, which is at issue in this case, does not confer upon First Reliance discretionary authority to construe its terms. Def s Memo, of Law in Supp. of Mot. for Summ. J. at 8. Because the defendant does not claim that the arbitrary and capricious standard of review applies, the court will review First Reliance’s denial of Mullaly’s benefits de novo.
In conducting such review, the court will construe the terms of an ERISA plan according to federal common law.
Fay v. Oxford Health Plan,
B. Mullaly’s Entitlement to Disability Benefits under the Policy
Mullaly claims that he is entitled to a payment of partial benefits under the policy’s Rehabilitation Provision. 1 He argues that he is entitled to these benefits because he has not, and argues is not able to, return to full-time employment. Because his monthly earnings at his current job are less than his monthly benefit under the policy, Mullaly argues he is entitled to some compensation from First Reliance to fill that gap.
The policy’s Rehabilitation Provision states that, “[i]f, during a period of Total Disability for which a Monthly Benefit is payable, an Insured accepts Rehabilitative Employment, we will continue to pay the Monthly Benefit less 50% of any of the money received from this Rehabilitative Employment.” Policy at 7.1. “Rehabilitative Employment” is defined as
work in any gainful occupation for which the Insured’s training, education or experience will reasonably allow. The work must be supervised by a Physician or a licensed rehabilitation specialist approved by us. Rehabilitative Employment does not include performing all the material duties of his/her regular occupation on a Full-time basis.
Policy at 2.0.
Implicit in Mullaly’s argument is the assertion that he is still totally disabled under the policy, and therefore eligible for benefits, because he is only able to perform the material duties of his occupation as a counterperson on a part-time basis. However, the definition of “Totally Disabled” that applies after sixty months of eligibility, unlike that applicable to the first sixty months, does not differentiate between part-time and full-time work. The definition applicable to the first sixty months of eligibility provides that an insured is “Totally Disabled” if he is capable of “only performing the material duties [of his regular occupation] on a part-time basis,” the definition applicable after, sixty months does not make this distinction. An insured is “Totally Disabled” under the latter definition if he “cannot perform the material duties of any occupation ... that the Insured’s education, training or experience will reasonably allow.” Policy at 2.1. Therefore, even if Mullaly’s physical limitations allow only part-time work, the text of the policy does not support the conclusion that the inability to work full-time renders a person “Totally Disabled” after the first sixty months of eligibility.
This court’s interpretation of the policy’s “Total Disability” provision is consistent with the weight of authority in other jurisdictions. In the absence of clear language permitting part-time employment, courts have uniformly declined to consider a claimant, who is capable of working part-time, eligible for benefits under a general disability policy.
See, e.g., Doyle v. Paul Revere Life Ins. Co.,
Further undermining Mullaly’s position that he is entitled to rehabilitative benefits is the text of the Rehabilitation Provision itself. This provision, read in conjunction with the definition of “Total Disability” that applies after sixty months of benefits are paid, indicates that it is not possible for an individual to be “Totally Disabled” after sixty months of eligibility and also to be engaged in “Rehabilitative Employment.” The definition of “Totally Disabled” after the first sixty months of eligibility tracks the definition of “Rehabilitative Employment” word for word. “Rehabilitative Employment” is “work in any gainful occupation for which the Insured’s training, education or experience will reasonably allow.” Policy at 2.0. To be “Totally Disabled,” the insured must not be able to “perform the material duties of any occupation ... that the Insured’s education, training or experience will reasonably allow.” Policy at 2.1. Analyzing these two provisions together, it is apparent that, if an individual is able to engage in “Rehabilitative Employment” after sixty months of eligibility, he is, by definition, not “Totally Disabled” under the policy.
Even if Mullaly were “Totally Disabled” under the policy, its terms, read as a whole, indicate that the Rehabilitation Provision only applies to work performed for the policyholder, in this case, Freihofer. The court reaches this conclusion through an analysis of the provisions governing “Other Income Benefits” and rehabilitative employment. The benefit provisions specify that the claimant’s monthly benefit will be reduced by the amount of “Other Income Benefits.” Policy at 7.0. These Other Income Benefits include “wages, excluding the amount allowable under the Rehabilitation Provision” “that the Insured is entitled to receive from you.” Id. “You” in the policy is a clear reference to Freihofer, the policyholder, and does not refer to other employers not insured by the policy.
The Rehabilitation Provision must be read in conjunction with this benefit provision. Were the Rehabilitation Provision to apply in the absence of an accompanying provision for benefit reduction, it would make little sense. The Rehabilitation Provision, which states that “during a period of Total Disability,” First Reliance will pay a claimant his monthly benefit “less 50% of any of the money received from this Rehabilitative Employment,” clearly contemplates that benefits, to which a Totally Disabled claimant would be entitled if he did not work, will be reduced by the amount of wages earned. Policy at 7.1. If benefits were
not
reduced by the amount
Mullaly does not advance this unreasonable result, but rather argues that the policy should be interpreted to treat his employment at Riverdale Cleaners identically to any work he might obtain at Frei-hofer. Mullaly’s position, however, finds no support in the plain language of the contract. As discussed above, the clause governing “Other Income Benefits” only provides for a reduction in benefits, subject to the Rehabilitation Provision, for wages paid by the policyholder, Freihófer. Therefore, the Rehabilitation Provision and the provision governing Other Income Benefits, when read together, indicate that Mullaly, who is not employed by Freihofer, is not engaged in “Rehabilitative Employment.”
For these reasons, the court concludes that, because Mullaly was capable of performing part-time work, he was not “Totally Disabled” under the policy at the time his benefits were terminated on July 18, 2000. In addition, even if he were “Totally Disabled” under the policy, Mullaly’s work at Riverdale Cleaners is not “Rehabilitative Employment” under the policy. Therefore, First Reliance’s termination of Mullaly’s benefits was proper.
C. Oral Representations by Employees of First Reliance
Mullaly argues that, even if the court does not find that the policy allows for a payment of benefits to him, promissory estoppel should prevent First Reliance from terminating those benefits. In support of this claim, Mullaly argues that he only submitted to the FCE because Mr. Peaker and other representatives of First Reliance informed him that he would continue to receive benefits even if it was determined he was able to work part-time.
Under Second Circuit case law, promissory estoppel in ERISA cases requires satisfaction of four elements: “ ‘(1) a promise, (2) reliance on the promise, (3) injury caused by the reliance, and (4) an injustice if the promise is not enforced.’ ”
Aramony v. United Way Replacement Benefit Plan,
Mullaly has not established that a material issue of fact exists with respect to the third element above, injury caused by the reliance. Though Mullaly claims that he would not have submitted to the FCE if he had known his benefits would be terminated, he has no right to refuse the exam under the policy. The policy provides that First Rebanee “will, a our expense, have the right to have a Claimant interviewed and/or examined .,. physically ... to de
IV. CONCLUSION
For the reasons set forth above, defendant’s motion for summary judgment [Dkt. No. 24] is GRANTED as to all claims asserted in plaintiffs complaint. The clerk is ordered to close this case.
SO ORDERED.
Notes
. Mullaly’s Second Amended Complaint included a claim for reinstatement of his full monthly disability benefit, but he abandoned that claim in his opposition to defendant's motion for summary judgment. Pi's Memo. of Law in Supp. of his Opp. to Def.'s Mot. for Summ. J. [Dkt. No. 30] at 11.