Linda Bond v. Cerner Corp. ( 2002 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 02-1379
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Linda D. Bond, *
*
Plaintiff - Appellant, *
*
v. * Appeal from the United States
* District Court for the Western
Cerner Corporation, * District of Missouri.
*
Defendant - Appellee. *
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Submitted: September 12, 2002
Filed: November 6, 2002
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Before BYE, RICHARD S. ARNOLD, and BEAM, Circuit Judges.
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BYE, Circuit Judge.
Linda Bond appeals the district court's1 adverse grant of summary judgment
upholding the plan administrator's denial of her claim for total disability benefits
under her former employer's employee welfare benefit plan. We affirm.
1
The Honorable Gary A. Fenner, United States District Judge for the Western
District of Missouri.
I.
Bond began working for Cerner Corporation on December 12, 1994, as a
clinical marketing specialist. Cerner offered its employees total or partial disability
benefits in accordance with its employee welfare benefit plan as follows:
What Constitutes Total Disability?
You are considered totally disabled and eligible for total disability
benefits:
During the first 36 months for which benefits are payable and during the
applicable elimination period - if you are unable to perform the
substantial and material duties of your regular occupation and do not
engage in any other work for wage or profit for which you are or
become qualified by education, training or experience.
After the first 36 months of benefit payments - if you are unable to
perform the substantial and material duties of any occupation for which
you are or become qualified by education, training or experience.
Partial Disability Benefits
You can receive monthly benefits if your disability allows you to return
to your regular job in a reduced capacity or on a part-time basis. Partial
Disability benefits are payable in the same manner as the total disability
benefit less a percentage of your monthly earnings during partial
disability.
Appellant's App. 55.
The policy defines total and partial disability as follows:
"Partial Disability," means that the Insured Employee, because of Injury
or Sickness, is:
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(1) continuously unable to perform the substantial and material duties
of his regular occupation;
(2) under the regular care of a licensed physician other than himself; and
(3) gainfully employed in his regular occupation on a partial and/or part-
time basis.
“Total Disability” means that, during the Elimination Period and the
Insured Employee Occupation Period . . . the Insured Employee, because
of Injury or Sickness, is:
(1) continuously unable to perform the substantial and material duties
of his regular occupation;
(2) under the regular care of a licensed physician other than himself; and
(3) not gainfully employed in any occupation for which he is or becomes
qualified by education, training or experience.
After the Monthly Benefit has been payable for the Insured Employee
Occupation Period [as it was in Bond's case] . . . "Total Disability"
means that, because of Injury or Sickness, the Insured Employee is:
(1) continuously unable to perform the substantial and material duties
of any occupation for which he is or becomes qualified by education,
training or experience; and
(2) under the regular care of a licensed physician other than himself.
Id. at 53-54.
The plan does not define "continuously unable to perform the substantial and material
duties of [his or any] occupation."
It is undisputed Bond became temporarily totally disabled in April, 1996, and
drew short-term disability benefits. She returned to her job on a part-time basis in
September, 1996, and was paid partial disability benefits for over three years until her
position was eliminated and she was terminated in December, 1999. Thereafter,
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Bond applied for and was denied total disability benefits because she was able to
engage in part-time work. The plan administrator (Cerner) also denied benefits
claiming Bond was able to perform full-time, low-level work.
Bond argued her ability to engage in part-time work did not mean she was
unable to meet the definition of total disability, i.e., "continuously unable to perform
the substantial and material duties of any occupation." Indeed, in order to obtain
partial disability benefits Bond had shown she was "continuously unable to perform
the substantial and material duties of her occupation" and "gainfully employed in her
regular occupation on a partial and/or part-time basis." Therefore, Bond argued she
could be employed part-time and still be continuously unable to perform the
substantial and material duties of an occupation. Furthermore, Bond pointed out that
the definition of total disability for the first 36 months included a prohibition against
part-time work in any occupation, but the prohibition was eliminated for the period
after 36 months, thereby implicitly indicating an intention to allow partial or part-time
work.
The district court rejected Bond's arguments finding she failed to grasp the
significance of the single word distinction between the definition of partial disability
and total disability, i.e., "her" [occupation] versus "any" [occupation]. The district
court determined that a substantial and material part of Bond's occupation was the
ability to work eight hours a day, five days a week. The court further determined she
had proven she was only able to work part-time in her occupation, and was therefore,
"continuously unable to perform the substantial and material duties of her
occupation." But the court determined Bond had failed to meet her burden of proving
"that a 'material and substantial' duty of all occupations . . . is to work eight hours a
day, five days a week . . .." (Emphasis in original). In other words, the district court
found Bond did not qualify for total disability benefits because, even though her
occupation required full-time employment, she failed to prove all occupations
required full-time employment.
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We agree the district court properly denied Bond's request for total disability
benefits, but affirm on an alternative basis. See Cooksey v. Delo, 94 F.3d 1214, 1218
(8th Cir. 1996) (holding we may affirm the district court on any basis supported by
the record).
II.
The parties agree the plan at issue is governed by the provisions of the
Employee Retirement Income Security Act (ERISA) 29 U.S.C. §§ 1001-1461. We
review the denial of ERISA benefits under a de novo standard unless the plan gives
the plan administrator discretionary authority to determine eligibility for benefits or
to construe the terms of the plan. Delk v. Durham Life Ins. Co., 959 F.2d 104, 105
(8th Cir. 1992) (citing Firestone Tire & Rubber Co. v Bruch, 489 U.S. 101, 115
(1989)). Bond asserts, and Cerner does not contest, that the plan contains no such
grant of discretion, and therefore, we review the district court's grant of summary
judgment de novo.
The parties agree Bond qualified for and received partial disability benefits for
over 36 months. The parties also agree Bond was "continuously unable to perform
the substantial and material duties of her regular occupation" and able to work part-
time. Building on these facts, Bond argues her receipt of partial disability benefits
proves a claimant can work part-time and still qualify for total disability benefits, i.e.,
be continuously unable to perform the substantial and material duties of any
occupation.
It is the plan's second definition of total disability, applicable after receipt of
benefits for 36 months, that applies to Bond's claim for total disability benefits. To
obtain benefits under this definition, Bond must show an inability to "continuously
. . . perform the substantial and material duties of any occupation . . .." Cerner
contends, and the district court found, Bond does not meet this definition because she
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is able to work on a part-time basis. Bond argues, however, that if she previously
worked part-time and was considered "continuously unable to perform the substantial
and material duties of her occupation," part-time work should not preclude a finding
she is "continuously unable to perform the substantial and material duties of any
occupation." Bond's argument has some appeal. If part-time work does not preclude
a finding she was continuously unable to perform her occupation, why should part-
time work preclude a finding she is continuously unable to perform any occupation?
Especially if, as suggested by the district court, "continuously unable to perform the
substantial and material duties" means unable to work eight hours a day, five days a
week.
Bond's argument is strengthened by the fact that the plan definition of total
disability during the first 36 months contains an express prohibition against working
part-time. On the other hand, the definition of total disability after 36 months
contains no such prohibition. As Bond argues, if the drafters of the plan intended
part-time employment to disqualify a claimant from receiving total disability benefits
after 36 months, they possessed the ability to include such language in the plan.
Bond's construction of the plan language, however, leads to results clearly not
intended by the plan. If Bond's construction is accepted, she is due a greater level of
benefits after termination than she was while working part-time. Under her
construction, the relevant inquiry for purposes of determining the benefit level is the
availability of work, not ability to work. Because this is a disability plan such a
construction is untenable. Furthermore, the plan distinguishes between "partial
disability" and "total disability." Bond's construction would render the distinction
meaningless.
The district court denied Bond's claim for benefits because she failed to prove
a substantial and material part of all occupations is the ability to work eight hours a
day, five days a week. We believe it is unnecessary to impose such an onerous
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burden on Bond, and we doubt any claimant could ever prove all occupations require
full-time employment. We also see some appeal in Bond's argument that if
"continuously unable," as used in the context of partial disability, means able to work
part-time, the identical meaning should attach when used to define total disability.
Nevertheless, we believe the district court properly resolved the claim in favor of the
plan.
When construing the language of an ERISA plan we begin by examining the
language of the plan documents. DeGeare v. Alpha Portland Indus., 837 F.2d 812,
816 (8th Cir. 1988). "Each provision should be read consistently with the others and
as part of an integrated whole." Id. (emphasis added). If the plan is deemed
ambiguous, extrinsic evidence may be considered. Id. But any ambiguities should
be construed against the drafter only as a last step. Id.
The construction advanced by Bond ignores the requirement that all parts of
the contract be given effect. McOsker v. Paul Revere Life Ins. Co., 279 F.3d 586,
588 (8th Cir. 2001). Bond asks us to construe the plan in such a manner as to find her
qualified for total disability benefits versus partial disability benefits depending upon
whether she is working, as opposed to her level of disability. According to Bond, she
could continue to work in her occupation on a partial or part-time basis and receive
partial disability benefits or she could quit or be terminated and work on a partial or
part-time basis in another occupation and receive total disability benefits. Such a
result would be absurd and would render the partial disability provisions superfluous.
In McOsker we interpreted the provisions of a plan containing a total disability
clause and a residual disability clause. Id. at 588. The plan provided total disability
if the claimant was "unable to perform the important duties of his occupation," and
residual disability when the claimant was "unable to perform one or more of the
important duties of his occupation." Id. We determined the plan language required
someone claiming partial disability to show he could not perform some of the
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important duties of his occupation, and someone claiming total disability benefits to
show he was unable to perform all of the important duties of his occupation. Id. We
recognized the plan document did not contain such express language, but read the
language into the contract because any other construction would render the residual
disability clause meaningless. Id. A similar construction must be placed on this
contract.
We believe, in the context of the partial disability definition, "continuously
unable to perform the substantial and material duties of his occupation" means the
claimant is unable to continuously perform some of those duties. In such instances,
the plan provides for partial disability if the claimant is gainfully employed in his
regular occupation on a partial or part-time basis. In the context of total disability
during the first 36 months, a claimant must show he is unable to continuously perform
all of "the substantial and material duties of his occupation." Finally, the plan
provides total disability benefits beyond 36 months only when the claimant is able to
show he is continuously unable to perform all the duties of any occupation. Such a
construction allows the partial disability and total disability clauses to be read
together as part of an integrated whole and comports with reason and authority.
III.
For the reasons stated herein, the judgment of the district court is affirmed.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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