Hand v. Unum Provident Corp. , 202 F. App'x 689 ( 2006 )

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS October 12, 2006
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
)))))))))))))))))))))))))) Clerk
No. 05-60365
Summary Calendar
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WILLIAM HAND
Plaintiff–Appellant,
v.
UNUM PROVIDENT CORPORATION; THE PAUL REVERE LIFE INSURANCE
COMPANY
Defendants–Appellees.
Appeals from the United States District Court
for the Southern District of Mississippi
No. 3:01-CV-0267
Before SMITH, GARZA, and PRADO, Circuit Judges.
PER CURIAM:*
This is an appeal by an insured of several district court
orders following a jury trial that found that the arthritic
condition in the insured’s hands that prevented him from
performing orthopedic surgery was not covered by the insured’s
“own occupation” disability insurance policy. Because we find no
reversible error in either the district court’s rulings or the
*
Pursuant to 5TH CIRCUIT RULE 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIRCUIT
RULE 47.5.4.
jury’s verdict, we AFFIRM.
I. BACKGROUND
Plaintiff-Appellant Dr. William Hand (“Hand”), a Mississippi
resident, practiced orthopedic surgery for approximately thirty
years. In December 1992, Hand purchased an “own occupation”
disability insurance policy (“the policy”) from Defendant-
Appellee Paul Revere Life Insurance Company, whose parent company
is Defendant-Appellee UNUM Provident Corporation (collectively,
“Defendants”). Pursuant to the policy, Defendants were obligated
to pay Hand $6000 a month should he ever become totally disabled.
As defined by the policy,
“Total Disability” means that because of Injury or
Sickness:
a. You are unable to perform the important duties
of Your Occupation; and
b. You are receiving Physician’s Care.
“Your Occupation” is defined in the policy as “the occupation or
occupations in which You are regularly engaged at the time
Disability begins.”
Hand subsequently developed severe arthritis in his hands,
which he contends resulted in the total and permanent loss of his
ability to perform orthopedic surgery by January 1, 1999. Hand,
however, did not seek treatment from a doctor at that time.
Instead, he sought and obtained a series of jobs that did not
require him to perform orthopedic surgery. It was not until
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April 18, 2000, that Hand visited Dr. Aubrey Lucas (“Dr. Lucas”)
for evaluation of his arthritis. Dr. Lucas determined that
Hand’s arthritis prevented him from performing orthopedic
surgery, and Hand then filed a claim for disability benefits with
Defendants.
Defendants conducted an investigation into Hand’s claim, and
on September 22, 2000, issued a letter denying Hand’s request for
disability benefits. Defendants’ stated reason for denial was
that, as of April 18, 2000, Hand’s occupation was that of a non-
operating orthopedic physician, not an orthopedic surgeon.
Therefore, the arthritis that kept Hand from performing
orthopedic surgery did not render Hand unable to perform the
important duties of his occupation.
II. PROCEDURAL HISTORY
Dissatisfied with this result, Hand brought suit in
Mississippi state court, claiming that Defendants breached the
insurance contract and acted in bad faith in denying his claim.
He requested both compensatory and punitive damages. Defendants
removed the case to federal court on the basis of diversity. See
28 U.S.C. § 1332 (1993 & Supp. 2006). The parties filed motions
for summary judgment shortly before trial, and concluded briefing
on the motions three days before the final pretrial conference.
The district court denied both motions, and the case proceeded to
trial before a jury.
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Following several days of testimony, the court presented the
jury with the following two interrogatories:
1. Do you find that the plaintiff, William Hand, is
totally disabled to perform the important duties of the
occupation of Orthopedic Surgeon?
. . .
2. If you answered the immediately preceding
interrogatory “Yes,” what is the date on which the
plaintiff was totally disabled?
With respect to the first interrogatory, the trial court
specifically instructed the jurors that they were not to consider
the Physician’s Care clause in reaching their decision.1 The
jury answered “Yes” to the first interrogatory, and “April 18,
2000" to the second interrogatory.
Based on these responses, the trial court found that
Defendants were not liable under the policy. Because it was
undisputed that Hand had not performed orthopedic surgery since
October 1998, the trial court reasoned that Hand’s occupation as
of April 18, 2000, did not require him to perform orthopedic
surgery. Therefore, Hand’s arthritis did not render him totally
disabled from performing the important duties of his occupation.
Accordingly, the court entered judgment for Defendants, and Hand
now appeals.
III. DISCUSSION
1
The Physician’s Care clause is the second prong of the
definition of “Total Disability,” which requires the insured to
be under a doctor’s care before he is considered totally disabled
under the policy.
4
Hand brings eleven points of error in this appeal. The
court will address Hand’s challenges to the trial court’s summary
judgment rulings, the trial court’s interpretation of the policy,
the admission of certain evidence and argument, the jury
instructions, and the jury’s findings. Because of our
disposition of the above issues, we need not address the
remaining points of error brought by Hand.
A. Summary Judgment Rulings
Hand first claims that the district court erred in denying
his motion for partial summary judgment. However, orders denying
summary judgment are not reviewable on appeal where a final
judgment adverse to the movant has been rendered on the basis of
a subsequent full trial on the merits. Johnson v. Sawyer, 120
F.3d 1307, 1316 (5th Cir. 1997); Black v. J.I. Case Co., 22 F.3d
568, 569-70 (5th Cir. 1994). Because Hand received an adverse
final judgment after a jury trial on the merits of his case, he
may not now appeal the denial of his motion for partial summary
judgment. Thus, the court will not consider whether Hand’s
motion was properly denied.
In a related argument, Hand asserts that by denying
Defendants’ motion for summary judgment, which asserted that the
policy was unambiguous, the trial court impliedly found that the
policy was ambiguous, which Hand claims should result in a
verdict in his favor. Hand’s argument is misplaced. Even in the
absence of a factual dispute, “a district court has the power to
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‘deny summary judgment in a case where there is reason to believe
that the better course would be to proceed to a full trial.’”
Black, 22 F.3d at 572 (quoting Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 255 (1986)). Further, the grant or denial of a
partial summary judgment is interlocutory in nature and may be
revised by the district court at any time. See Streber v.
Hunter, 221 F.3d 701, 737 (5th Cir. 2000); see also F.D.I.C. v.
Massingill, 24 F.3d 768, 774 (5th Cir. 1994) (noting a partial
summary judgment order has no res judicata effect). Thus, the
trial court’s denial of Defendants’ motion for summary judgment
did not necessarily mean that the trial court found the policy
ambiguous, nor did it bind the trial court to a finding in favor
of Hand. Therefore, the trial court’s rulings on the summary
judgment motions were not erroneous.
B. Contract Interpretation
Hand next faults the trial court’s interpretation of the
policy, specifically, the trial court’s interpretation of “Your
Occupation” and the Presumptive Total Disability Benefits clause.
We review the district court’s interpretation of an insurance
contract de novo. Coleman v. Sch. Bd. of Richland Parish, 418
F.3d 511, 515 (5th Cir. 2005).
Hand first claims that the trial court erred in not finding
the term “Your Occupation” ambiguous. As noted above, “Your
Occupation” is defined as “the occupation or occupations in which
[the insured is] regularly engaged at the time Disability
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begins.” Defendants claim “Disability” must be a “Total
Disability” before benefits are due, while Hand asserts that his
“Disability” began at the onset of his arthritic condition.
Thus, Hand argues that “Your Occupation” is ambiguous, and must
be construed in his favor. As the parties agree that Mississippi
law applies to this case, the court turns to Mississippi case law
for its principles of contract interpretation.
Pursuant to Mississippi law, when a contract is clear and
unambiguous as to its wording, its meaning and effect are matters
of law. Farmland Mut. Ins. Co v. Scruggs, 886 So. 2d 714, 717
(Miss. 2004); U.S. Fid. & Guar. Co. v. Omnibank, 812 So. 2d 196,
198-99 (Miss. 2002). When interpreting a contract, the court’s
focus is upon the objective facts, that is, the language of the
contract. Tupelo Redev. Agency v. Abernathy, 913 So. 2d 278, 284
(Miss. 2005); Facilities, Inc. v. Rogers-Usry Chevrolet, Inc.,
908 So. 2d 107, 110-11 (Miss. 2005). In the case of insurance
contracts, ambiguous terms are to be construed most strongly
against the insurance company who prepared the contract.
Farmland, 886 So. 2d at 717.
The conflict over the interpretation of “Your Occupation” in
this case stems from differing beliefs as to the meaning of
“Disability.” In interpreting an insurance policy, the court is
to look at the policy as a whole, consider all relevant portions
together and, whenever possible, give operative effect to every
provision in order to reach a reasonable overall result. J & W
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Foods Corp. v. State Farm Mut. Auto. Ins. Co., 723 So. 2d 550,
552 (Miss. 1998). Section 1.13 of the policy defines the term
“Disability” as “continuing periods of Total Disability, Residual
Disability and/or Recovery.” As Residual Disability and Recovery
are not at issue in this case, Disability must mean Total
Disability. Therefore, “Your Occupation” is defined, for
purposes of Hand’s situation, as the occupation in which he was
regularly engaged at the time he became totally disabled.
Because the policy is clear and unambiguous as to the definition
of “Your Occupation,” the trial court did not err in its
interpretation of “Your Occupation.”2
Hand next argues that the trial court erred in denying his
motion for judgment as a matter of law on his claim for
Presumptive Total Disability Benefits (the PTDB provision).
Pursuant to the PTDB provision,
If Injury or Sickness causes You to totally and
irrevocably lose . . .
d. Use of both hands . . .
We will presume You to be Totally Disabled as long as
such loss continues and whether or not You are able to
work or require Physician’s Care.
Hand asserts that simply losing the ability to perform orthopedic
2
Because the interpretation of “Your Occupation” is clear
and unambiguous, this court need not consider Hand’s argument
that extrinsic evidence, namely the claims manual, defined
Disability differently. See Facilities, 908 So. 2d at 111
(holding that only if the contract is unclear or ambiguous may a
court go beyond the text of the contract to determine the
parties’ true intent).
8
surgery constitutes the loss of use of both hands under the PTDB
provision. Alternatively, Hand claims the policy is ambiguous
and must be construed in his favor.
Again, when interpreting an insurance policy, the court is
to “give operative effect to every provision . . . .” J & W
Foods, 723 So. 2d at 552. If loss of use in the PTDB provision
means loss of use only for purposes of the insured’s ability to
work, as suggested by Hand, then the phrase “whether or not You
are able to work” would be superfluous. Thus, the trial court
was correct in its determination that loss of use for purposes of
the PTDB clause required more than loss of the ability to work.
Therefore, the trial court did not err in concluding that the
PTDB provision did not provide benefits to Hand.
C. Trial Rulings
Hand also takes issue with several rulings of the district
court during trial that he claims prejudiced his case. First,
Hand asserts that the fact that the trial court waited until
after both sides had rested to decide that the policy was
unambiguous harmed the presentation of his case because he had
focused on ambiguity. Hand, however, has not provided this court
with any citations to the record, evidence, or specific
descriptions of how the trial court’s actions in this case
prejudiced his trial presentation. A district court has the
inherent power to manage and control its own docket in order to
achieve the orderly and expeditious disposition of cases. See
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United States v. Colomb, 419 F.3d 292, 299 (5th Cir. 2005);
Woodson v. Surgitek, Inc., 57 F.3d 1406, 1417 (5th Cir. 1995).
Hand’s failure to identify specific prejudice gives this court no
reason to find the trial court’s actions improper.
Hand next argues that the trial court erred in permitting
Defendants to present evidence that Hand had stated in several
job applications in 1998 and 1999 that he was able to perform
surgery. Hand claims this information was not known to
Defendants at the time they denied his claim and that, under
Mississippi law, the fact finder may only consider the reasons
for denial given by the insurer at the time of the denial,
relying on Sobley v. Southern National Gas Company, 210 F.3d 561,
564 (5th Cir. 2000).
We review a trial court’s evidentiary rulings for an abuse
of discretion. Gomez v. St. Jude Med. Daig Div., Inc., 442 F.3d
919, 927 (5th Cir. 2006); Perez v. Tex. Dep’t of Criminal
Justice, 395 F.3d 206, 210 (5th Cir. 2004), cert. denied, 126 S.
Ct. 545 (2005). An erroneous evidentiary ruling is reversible
error only if it affects a party’s substantial rights. Perez,
395 F.3d at 210. Under this standard, the trial court’s actions
do not constitute reversible error. As stated in Sobley,
Under Mississippi law, an insurer may rely on any
exclusion in the policy to show that no coverage existed,
whether or not that exclusion was the stated basis for
denial. However, once coverage is established, a court
should evaluate whether there was an arguable basis for
denial of coverage based solely on the reasons for denial
of coverage given to the insured by the insurance
10
company.
210 F.3d at 564. Hand did not establish coverage in this case;
thus, the trial court did not need to undertake the second step
of the analysis and consider whether Defendants had an arguable
basis for denial, in which case Defendants’ evidence might have
been inadmissible. Further, Hand claimed throughout the case
that he had been disabled as early as 1998. Defendants were
entitled to present evidence in rebuttal that Hand was not
disabled from performing surgery. Therefore, the trial court did
not commit reversible error by refusing to exclude Defendants’
evidence.
Hand next asserts that his due process rights under the
United States Constitution were violated when he was not
permitted to discuss the Physician’s Care clause or Defendants’
internal procedures in his closing argument. However, the
Physician’s Care clause and Defendants’ internal procedures were
irrelevant to the ultimate jury issues, which dealt with if and
when Hand became disabled from performing orthopedic surgery.
Thus, the trial court’s decision to exclude such arguments was
neither a due process violation nor reversible error. There is
likewise no merit to Hand’s claim that he was harmed when the
court interrupted his closing argument after he referenced the
Physician’s Care clause. Therefore, Hand has not shown that the
trial court’s limitations on closing arguments violated his due
process rights.
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D. Jury Instructions
Hand complains that the jury instructions were
contradictory, incomplete, and unnecessary. Challenges to jury
instructions are reviewed under an abuse of discretion standard.
Brown v. Parker Drilling Offshore Corp., 410 F.3d 166, 179 (5th
Cir. 2005). A judgment should be reversed “only if the charge as
a whole creates a substantial doubt as to whether the jury has
been properly guided in its deliberations.” C. P. Interests,
Inc. v. Cal. Pools, Inc., 238 F.3d 690, 700 (5th Cir. 2001); see
also Int’l Ins. Co v. RSR Corp., 426 F.3d 281, 291 (5th Cir.
2005) (stating that “[g]reat latitude” is shown to the trial
court with respect to jury instructions).
Hand asserts the instructions were contradictory because the
trial court told the jury not to consider the policy in reaching
its decision, yet also told the jury to consider “all the
evidence,” which happened to include the policy. The court has
reviewed the instructions in question and finds that they were
not so confusing as to cause “substantial doubt” that the jury
was properly guided in its deliberations. See C. P. Interests,
238 F.3d at 700. While in general, the jury was told to consider
all of the evidence, the trial court specifically emphasized that
the jury was not to consider the policy. This court presumes
that the jury heard, understood, and followed the trial court’s
instructions. See United States v. Bernard, 299 F.3d 467, 476
(5th Cir. 2002). Therefore, the trial court did not abuse its
12
discretion in instructing the jury as it did with respect to
consideration of the policy.
Hand also claims the instructions were incomplete because
they did not provide the jury with a definition of “totally
disabled” or the “important duties of an orthopedic surgeon.” As
pointed out by Defendants, however, the trial court did instruct
the jury as follows:
I have provided to you the definition of total disability
which means that in order for one to be totally disabled
within the meaning of the policy, it is not necessary
that he be wholly incapacitated to perform any duty
incident to his occupation, but if the insured is
prevented by his injury or illness from doing any
substantial acts required of him, or his physical
condition is such that in order to perfect a cure or
prolong life, he ceases his work, he is totally disabled
within the meaning of the policy.
Hand has not demonstrated how such definition was insufficient or
an abuse of discretion. Therefore, again, there is no cause for
reversal.
Finally, Hand asserts that the first interrogatory--whether
Hand was totally disabled as an orthopedic surgeon--was
unnecessary because it was undisputed that he was totally
disabled. The instruction, however, did not harm Hand, as the
jury answered the interrogatory “Yes.” Any assertion by Hand
that the jury was confused by this appears to be speculation and
not grounds for reversal. Thus, in sum, the trial court did not
abuse its discretion in formulating the jury instructions in this
case, and, therefore, there is no reversible error.
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E. Jury’s Findings
Hand claims the jury’s finding that he was not totally
disabled until April 18, 2000, is against the great weight of the
evidence. In evaluating the sufficiency of the evidence to
support a jury’s verdict, we view all evidence and draw all
inferences in the light most favorable to the verdict. Bryant v.
Compass Group USA, Inc., 413 F.3d 471, 475 (5th Cir. 2005)
(noting that the jury’s verdict is afforded great deference),
cert. denied, 126 S. Ct. 1027 (2006). The court must determine
whether the state of proof is such that reasonable and impartial
minds could reach the conclusion the jury expressed in its
verdict. Am. Home Assurance Co. v. United Space Alliance,
L.L.C., 378 F.3d 482, 487 (5th Cir. 2004). The verdict must
stand unless there is a lack of substantial evidence, viewed in
the light most favorable to the successful party, to support the
verdict. Id.Hand testified that he was totally disabled beginning
January 1, 1999; however, Hand presented no medical evidence of
his disability until April 18, 2000, when he was diagnosed by Dr.
Lucas. Dr. Lucas stated that Hand had been disabled since
January 1, 1999, but also stated that the date was based in large
part upon Hand’s medical history in which Hand claimed he had
been disabled since January 1, 1999. Further, Defendants have
not conceded that Hand was disabled as early as January 1, 1999,
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as is contended by Hand. Indeed, Defendants presented evidence
that Hand’s job applications in 1998 and 1999 contained no
mention of his disability. Given the conflicting evidence and
the absence of any medical evidence of a disability in 1999, the
jury was entitled to find that Hand became totally disabled on
April 18, 2000. Thus, the jury’s verdict is not against the
great weight of evidence, and there is no cause for reversal on
this count.
F. The Remaining Issues
Because of the above rulings, the court finds it unnecessary
to address Hand’s remaining arguments in great detail.
Given the trial court’s finding that the policy did not
cover Hand’s arthritis, there was no harm in dismissing Hand’s
bad faith and punitive damages claims, as a finding of coverage
is required before an insured may obtain punitive damages for bad
faith practices. Sobley, 210 F.3d at 564. For the same reason,
there was also no reversible error in the trial court’s decision
to strike Hand’s expert, who was to be presented during the
punitive damages phase.
Hand’s argument that the Physician’s Care clause is
unenforceable under Mississippi law is likewise mooted by the
jury’s findings. Application of the Physician’s Care clause
would have resulted in a finding of total disability on April 18,
2000, which is the same date the jury found Hand became totally
disabled from performing the important duties of an orthopedic
15
surgeon. Therefore, the Physician’s Care clause has no impact on
the result of this case.
Hand also asserts that the trial court’s decision effected a
forfeiture or invalid modification of his policy. This argument
is unavailing, as the trial court simply interpreted the policy
as written. Hand’s disagreement with that interpretation does
not mean that the court modified the policy or caused Hand to
forfeit the policy. Thus, the court concludes there are no
grounds for reversing the trial court’s decision on the basis of
forfeiture or modification.
Finally, to the extent Hand incorporates arguments made in
his trial court briefing but not in his briefing before this
court, we consider those arguments abandoned. See Yohey v.
Collins, 985 F.2d 222, 224-25 (5th Cir. 1993) (stating that
arguments must be briefed to be preserved).
IV. CONCLUSION
For the reasons above, we AFFIRM the judgment of the
district court.
AFFIRMED.
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