PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
VERDELLE BLACKSHEAR,
Plaintiff-Appellant,
v.
RELIANCE STANDARD LIFE INSURANCE No. 06-2126
COMPANY, a Delphi Financial
Company,
Defendant-Appellee.
Appeal from the United States District Court
for the Eastern District of North Carolina, at Raleigh.
James C. Fox, Senior District Judge.
(7:05-cv-00064-F)
Argued: September 26, 2007
Decided: December 7, 2007
Before NIEMEYER and TRAXLER, Circuit Judges, and
Samuel G. WILSON, United States District Judge for the
Western District of Virginia, sitting by designation.
Reversed by published opinion. Judge Traxler wrote the opinion, in
which Judge Niemeyer and Judge Wilson joined.
COUNSEL
ARGUED: Jeffrey Stephen Miller, Jacksonville, North Carolina, for
Appellant. Joshua Bachrach, RAWLE & HENDERSON, Philadel-
phia, Pennsylvania, for Appellee.
2 BLACKSHEAR v. RELIANCE STANDARD LIFE
OPINION
TRAXLER, Circuit Judge:
Verdelle Blackshear appeals a decision of the district court award-
ing summary judgment to Reliance Standard Life Insurance Company
("Reliance Standard") and refusing to disturb the denial of Black-
shear’s claim for benefits under a group life insurance policy. For the
reasons that follow, we reverse.
I.
Reliance Standard issued a group life insurance policy to Duplin
General Hospital that became effective on January 1, 2003. The group
policy, which was part of Duplin General’s employee welfare benefit
plan, covered both present and future hospital employees. The policy
set forth the following benefits schedule:
SCHEDULE OF BENEFITS
NAMES OF SUBSIDIARIES, DIVISIONS OR AFFILI-
ATES TO BE COVERED: None
ELIGIBLE CLASSES: Each active, full-time employee,
except any person employed on a temporary or seasonal
basis.
WAITING PERIOD:
Present Employees - Exempt*: none
Non-exempt*: none
Future Employees - Exempt*: 180 days
Non-exempt*: none
* as defined by the Fair Labor Standards Act, as amended.1
1
The Fair Labor Standards Act of 1938 imposes minimum wage and
maximum hour requirements. See generally 29 U.S.C.A. §§ 201-219
(West 1998 & Supp. 2007). Certain types of employees are exempt from
these provisions. See 29 U.S.C.A. § 213. The parties agree that the dece-
dent in this case was a "non-exempt" employee.
BLACKSHEAR v. RELIANCE STANDARD LIFE 3
INDIVIDUAL EFFECTIVE DATE: The first of the Policy
month coinciding with or next following completion of the
Waiting Period, if applicable.
J.A. 19. The statutorily required Summary Plan Description ("SPD")
issued to the employees included an identical schedule of benefits.
See 29 U.S.C.A. § 1022 (West 1999), § 1024(b) (West 1999 & Supp.
2007).
On June 10, 2003, Verdie Blackshear ("Verdie") began working at
Duplin General as a nurse and received a copy of the SPD for Duplin
General’s employee welfare benefit plan. Verdie died six months later
on December 14, 2003. Blackshear, Verdie’s named beneficiary
under the policy, filed a claim on January 8, 2004, with Reliance
Standard for the life insurance proceeds of $81,078.40. According to
the language of both the SPD and the policy itself, non-exempt
employees such as Verdie hired after the issuance of the Policy were
not subject to a service waiting period, meaning that the coverage pro-
vided by the policy took effect immediately upon Verdie’s employ-
ment.
Upon receiving the claim, Reliance Standard contacted the Human
Resources Department for Duplin General to verify Verdie’s non-
exempt status and the effective date of her coverage. In a letter dated
January 21, 2004, Susan Hayes, Duplin General’s Vice President for
Human Resources, wrote that, contrary to the actual language of the
policy and the SPD, the "policy should cover all employees for life
insurance after six (6) months of employment" and that "[t]here
should be no discrimination between exempt and non-exempt
employees." J.A. 167. On January 26, 2004, Reliance Standard re-
issued Duplin General’s group policy. The amended policy, which
had the same January 1, 2003, effective date, eliminated the distinc-
tion between exempt and non-exempt employees and instead imposed
a six-month service waiting period for all employees before coverage
would take effect. The Individual Effective Date remained the same:
"The first of the Policy month coinciding with or next following com-
pletion of the Waiting Period." J.A. 276 (emphasis added).
Reliance then denied Blackshear’s claim on the grounds that Ver-
die was not insured under Duplin General’s group policy on Decem-
4 BLACKSHEAR v. RELIANCE STANDARD LIFE
ber 12, 2003, the date of her death, for failure to satisfy the waiting
period as defined in the amended policy:
Verdie Blackshear was employed June 10, 2003. . . . [T]he
applicable 6 month Waiting Period of Full-time employment
would have been satisfied on December 10, 2003. The
scheduled effective date of insurance for Ms. Blackshear
was January 1, 2004. . . .
As Verdie Blackshear died prior to the scheduled effec-
tive date of her coverage, January 1, 2004, she did not sat-
isfy the eligibility requirements . . . and the life insurance
coverage did not go into effect in accordance with the terms
of the policy . . .
We are aware that due to a clerical error, booklets were
printed that did not correctly state the applicable 6 month
waiting period of employment. [Duplin General] confirmed
in [a] telephone conversation [on] March 5, 2004 and in ear-
lier conversations with our staff that all eligible employees
of Duplin General Hospital are subject to the 6 month Wait-
ing Period of Full-Time employment and that the original
booklets contained an error regarding application of the
Waiting Period for non-exempt employees. This error has
now been corrected and new booklets have been forwarded
to [Duplin General] for distribution to . . . eligible employ-
ees.
J.A. 109.
Blackshear sought review of the denial of her claim for benefits
under Reliance Standard’s appeal review procedure. Reliance Stan-
dard concluded that its original determination to deny benefits was
proper and denied Blackshear’s appeal. In affirming its denial of ben-
efits, Reliance Standard acknowledged that "an error had occurred in
the initial Policy and booklet printing with regard to the applicable
‘WAITING PERIOD,’" and classified the omission of the waiting
period for non-exempt employees in the original policy and SPD as
a "clerical error" that was inconsistent with "the original intention of
the Policy." J.A. 93. In addition to its conclusion that "original inten-
BLACKSHEAR v. RELIANCE STANDARD LIFE 5
tion" prevails over unambiguous language in the policy and the SPD,
Reliance Standard also relied upon the "General Provisions" section
of the policy that provides "[c]lerical errors in connection with the
Policy or delays in keeping records for the Policy, whether by you,
us, or the Plan Administrator . . . (1) will not terminate insurance that
would otherwise have been effective; and (2) will not continue insur-
ance that would otherwise have ceased or should not have been in
effect." J.A. 93.
Ultimately, Blackshear filed this action against Reliance Standard
under ERISA, seeking review of the denial of benefits. See 29
U.S.C.A. § 1132(a)(1)(B) (West 1999). The parties filed cross-
motions for summary judgment. Applying a modified abuse of discre-
tion standard of review, see Bynum v. Cigna Healthcare of North
Carolina, Inc., 287 F.3d 305, 311 (4th Cir. 2002), the district court
determined that Reliance Standard did not abuse its discretion in
applying the "clerical errors" provision of the policy and that substan-
tial evidence supported its conclusion that, "‘but for the clerical
error,’ Verdie Blackshear’s coverage under the life insurance policy
could not have gone into effect until January 1, 2004." J.A. 330.
Accordingly, the district court entered summary judgment in favor of
Reliance Standard.
On appeal, Blackshear argues that the clear and unambiguous lan-
guage originally set forth in the SPD and the policy controls and
afforded Verdie insurance coverage immediately upon employment
without a waiting period. Reliance Standard’s disregard of this unam-
biguous language, contends Blackshear, amounted to an abuse of dis-
cretion.
II.
In reviewing the denial of benefits under an ERISA plan, a court’s
first task is to consider de novo whether the relevant plan documents
confer discretionary authority on the plan administrator to make a
benefits-eligibility determination. See Firestone Tire & Rubber Co. v.
Bruch, 489 U.S. 101, 115 (1989); Johannssen v. District No. 1-Pacific
Coast Dist., MEBA Pen. Plan, 292 F.3d 159, 168 (4th Cir. 2002).
"When a plan by its terms confers discretion on the plan’s administra-
tor to interpret its provisions and the administrator acts reasonably
6 BLACKSHEAR v. RELIANCE STANDARD LIFE
within the scope of that discretion, courts defer to the administrator’s
interpretation." Colucci v. Agfa Corp. Severance Pay Plan, 431 F.3d
170, 176 (4th Cir. 2005), cert. denied, 126 S. Ct. 2300 (2006). In this
case, the policy provided as follows: "Reliance Standard Life Insur-
ance Company shall serve as the claims review fiduciary with respect
to the insurance policy and the Plan. The claims review fiduciary has
the discretionary authority to interpret the Plan and the insurance pol-
icy and to determine eligibility for benefits." J.A. 263. The parties
agree that the plan confers discretionary authority upon Reliance
Standard, as the plan administrator, to make benefit decisions accord-
ing to the terms of the plan. Cf. Stup v. Unum Life Ins. Co. of Am.,
390 F.3d 301, 307 (4th Cir. 2004) (applying abuse of discretion
review where ERISA plan afforded the administrator "the discretion-
ary authority both to determine an employee’s eligibility for benefits
and to construe the terms of this policy") (internal quotation marks
omitted). Under the abuse of discretion standard, the reviewing court
will not disturb the plan administrator’s decision as long as it was rea-
sonable. See Firestone, 489 U.S. at 111; Booth v. Wal-Mart Stores,
Inc., 201 F.3d 335, 342 (4th Cir. 2000).
Typically, once it has determined that the abuse of discretion stan-
dard applies, the reviewing court turns to the question of whether the
administrator’s exercise of discretion was reasonable as determined
by the application of a number of well-established factors. See Booth,
201 F.3d at 342-43; Colucci, 431 F.3d at 176. However, when the
plan administrator’s own business interests will be affected directly
by its decision on the claim for benefits, a conflict of interest arises
that "may operate to reduce the deference given to a discretionary
decision of that fiduciary . . . to the extent necessary to neutralize any
untoward influence resulting from that conflict." Booth, 201 F.3d at
343 n.2. (internal quotation marks omitted). In effect, we use a
"sliding-scale standard of review" when a genuine conflict exists:
"‘[t]he more incentive for the administrator . . . to benefit itself by a
certain interpretation of benefit eligibility . . ., the more objectively
reasonable the administrator[’s] . . . decision must be and the more
substantial the evidence must be to support it.’" Stup, 390 F.3d at 307
(quoting Ellis v. Metro. Life Ins. Co., 126 F.3d 228, 233 (4th Cir.
1997)).
Because Reliance Standard insures the very plan it administers, the
district court concluded that it was operating under a conflict of inter-
BLACKSHEAR v. RELIANCE STANDARD LIFE 7
est. Reliance Standard does not challenge the district court’s applica-
tion of the modified abuse of discretion standard under the
circumstances, and we agree that this standard of review was appro-
priate for judicial review of decisions in which Reliance Standard was
actually exercising its discretionary authority under the plan. See
Bynum, 287 F.3d at 312-13.
With these principles in mind, we turn to the substantive issues.
III.
Broadly speaking, "ERISA plans are contractual documents which,
while regulated, are governed by established principles of contract
and trust law." Haley v. Paul Revere Life Ins. Co., 77 F.3d 84, 88 (4th
Cir. 1996). Accordingly, courts must enforce and follow "the plan’s
plain language in its ordinary sense." Bynum, 287 F.3d at 313 (inter-
nal quotation marks omitted). Moreover, "even as an ERISA plan
confers discretion on its administrator to interpret the plan, the admin-
istrator is not free to alter the terms of the plan or to construe unam-
biguous terms other than as written." Colucci, 431 F.3d at 176. To the
extent the administrator enjoys discretion to interpret the terms of a
plan in the course of making a benefits-eligibility determination, such
interpretive discretion applies only to ambiguities in the plan. See id.
("Interpretive discretion only allows an administrator to resolve
ambiguity."); Kress v. Food Employers Labor Relations Ass’n, 391
F.3d 563, 567 (4th Cir. 2004) (explaining that "discretionary authority
is not implicated" where "the terms of the plan itself are clear"). An
administrator’s discretion never includes the authority "to read out
unambiguous provisions" contained in an ERISA plan, and to do so
constitutes an abuse of discretion. Colucci, 431 F.3d at 176; see id.
("[F]or instance, if a plan unambiguously provides 20 weeks of com-
pensation as a severance benefit for an employee who has worked for
the company for 10 years, the administrator abuses its discretion by
reading the plan to provide 17 weeks of compensation.").
It is undisputed that, at the time of Verdie’s death, the plan docu-
ments relevant to Duplin General’s group life insurance clearly and
unequivocally afforded coverage for Verdie and other non-exempt
employees without a waiting period. Thus, in concluding that, con-
trary to the written instruments, Verdie was in fact subject to a 180-
8 BLACKSHEAR v. RELIANCE STANDARD LIFE
day waiting period, Reliance Standard was not resolving an ambiguity
in the policy’s language but reading a clear and unambiguous provi-
sion out of the written plan documents.
Nevertheless, Reliance Standard contends that we should not dis-
turb its decision to deny benefits for two reasons. First, Reliance Stan-
dard asserts that the failure to include a service waiting period in the
original policy was a "clerical error" and that the policy permitted it
unilaterally to amend or correct "clerical errors" in the terms of the
policy. Second, Reliance Standard argues that the omission of a wait-
ing period was the result of a scrivener’s error and that the doctrine
of equitable reformation permits the policy to be corrected retroac-
tively to reflect the actual intent of the contracting parties. We con-
clude that the denial of benefits cannot stand under either theory.
A.
According to Reliance Standard, the "clerical errors" provision set
forth in the group policy permitted it to make its benefits-eligibility
determination based on extrinsic evidence of the contracting parties’
original intent instead of the written terms of the policy. After receiv-
ing Blackshear’s claim and reviewing correspondence between
Duplin General and Reliance Standard before the original policy was
issued, Reliance Standard amended the policy to include a service
waiting period for all employees and then relied upon the amended
version of the policy to deny Blackshear’s claim for benefits. Thus,
we must decide whether it was permissible for Reliance Standard to
deny Blackshear’s claim based on a retroactive amendment to the pol-
icy.
The group policy is part of an "employee welfare benefit plan," see
29 U.S.C.A. § 1002(1) (West 1999), which is "exempt from the statu-
tory vesting requirements that ERISA imposes on pension benefits."
Wheeler v. Dynamic Eng’g, Inc., 62 F.3d 634, 637 (4th Cir. 1995).
Generally speaking, "a plan participant’s interest in welfare benefits
is not automatically vested," and an employer sponsoring the plan
may therefore unilaterally "terminat[e] or modify[ ] previously
offered benefits that are not vested." Gable v. Sweetheart Cup Co., 35
F.3d 851, 855 (4th Cir. 1994); see Wheeler, 62 F.3d at 637 ("[A]n
BLACKSHEAR v. RELIANCE STANDARD LIFE 9
employer may amend the terms of a welfare benefit plan or terminate
it entirely.").
Nevertheless, the terms of a plan may create vested rights in wel-
fare benefits even though the employer is under no obligation to do
so. See Wheeler, 62 F.3d at 638. "An employer or plan sponsor may
unilaterally modify or terminate welfare benefits, unless it contractu-
ally agrees to grant vested benefits." Chiles v. Ceridian Corp., 95
F.3d 1505, 1510 (10th Cir. 1996). Once an employer or plan sponsor
grants vested rights under a welfare benefit plan, however, it may not
retroactively amend the plan to deprive a beneficiary of a vested ben-
efit. See Wheeler, 62 F.3d at 638, 640. In Wheeler, this court rejected
an attempt to amend a group medical insurance policy to eliminate
coverage retroactively for a specific course of treatment that the bene-
ficiary had already begun. See id. at 640. We concluded that the bene-
ficiary’s rights under a welfare benefit plan providing medical
insurance vested at the moment the triggering event under the policy
occurred and that the plan could not be amended to deny coverage
after that point. See id. at 638-40. Numerous courts have taken, in a
wide array of circumstances, a similarly dim view of any amendment
that attempts to retroactively eliminate vested welfare benefit rights.
See Member Servs. Life Ins. Co. v. American Nat’l Bank & Trust Co.
of Sapulpa, 130 F.3d 950, 954-57 (10th Cir. 1997); Filipowicz v.
American Stores Benefit Plans Comm., 56 F.3d 807, 815 (7th Cir.
1995); Bartlett v. Martin Marietta Operations Support, Inc. Life Ins.
Plan, 38 F.3d 514, 517 (10th Cir. 1994); Wulf v. Quantum Chem.
Corp., 26 F.3d 1368, 1377-78 (6th Cir. 1994); Confer v. Custom
Eng’g Co., 952 F.2d 41, 43 (3d Cir. 1991) (per curiam).
Accordingly, we must determine whether Blackshear’s right to life
insurance proceeds vested before Reliance Standard issued the
amended policy. In Wheeler, we referred to general state insurance
law in concluding that under a group medical insurance policy, bene-
fits vest at the time that the covered loss occurs. See 62 F.3d at 638
("[U]nder a medical insurance policy or plan . . . insur[ing] against
illness, coverage for all medical costs arising from a particular illness
vests when the illness occurs."). Under "general principles of insur-
ance contract law . . . such benefits do vest when performance is due
under the contract. At that point, the contract is no longer executory
and must be performed in accordance with the terms then in exis-
10 BLACKSHEAR v. RELIANCE STANDARD LIFE
tence." Member Servs., 130 F.3d at 956. In the case of a group life
insurance policy, the right to benefits vests — i.e., performance
becomes due — at the time of the plan participant’s death. See Fili-
powicz, 56 F.3d at 815; Adams v. Jefferson-Pilot Life Ins. Co., 558
S.E.2d 504, 507 (N.C. App. 2002); see generally 4 Lee R. Russ &
Thomas F. Segalla, Couch on Insurance § 58:16 (3d ed.) ("[T]he
rights of the named beneficiary vest at the instant of the insured’s
death, and cannot be affected by any subsequent act of the insurer.").
Here, Blackshear’s rights under the plan vested at the moment Verdie
died, which was prior to the issuance of the amended policy contain-
ing a service waiting period. The insertion of a waiting period had the
effect of dispossessing Blackshear of rights that were already vested
and was therefore impermissible.
In rejecting the denial of benefits based on a post-death amendment
to a group life insurance policy, the Seventh Circuit explained that the
employer could not
retroactively modify a life insurance policy after the
insured’s death so as to take away the life insurance pro-
ceeds due a beneficiary at the date of the insured’s death . . .
[A]t [the insured’s] death [the beneficiary] became entitled
to the . . . insurance proceeds, not based on ERISA’s vesting
principles, but based on general insurance law which pro-
vides that a beneficiary’s right to insurance proceeds vests
on the date of the insured’s death. . . . A later modification,
even one which is retroactive, can have no effect on a bene-
ficiary’s claim to benefits.
Filipowicz, 56 F.3d at 815. We agree with this reasoning and con-
clude that Reliance Standard may not rely on its amended policy to
deny benefits to Blackshear.
We also conclude that the "clerical errors" provision does not dic-
tate a different result. This provision provided that "[c]lerical errors
in connection with the Policy or delays in keeping records for the Pol-
icy, whether by you, us, or the Plan Administrator . . . will not con-
tinue insurance that would otherwise have ceased or should not have
been in effect." J.A. 93. Reliance Standard argues that the failure to
include a waiting period in the original policy was a "clerical error"
BLACKSHEAR v. RELIANCE STANDARD LIFE 11
upon which Blackshear cannot rely to "continue insurance that . . .
should not have been in effect." Assuming such an omission would
even qualify as a "clerical error," and assuming that this provision
relates in some way to the sponsor’s general right to amend or elimi-
nate the policy at anytime (which it does not), we believe the lan-
guage still in no way authorizes the administrator to divest benefits
that are already due by amending, modifying or correcting the lan-
guage of the policy itself.
In sum, Reliance Standard may not deprive Blackshear of vested
benefits based on the waiting period in the amended policy. We con-
clude that its application of the "clerical errors" provision to arrive at
such a result was an abuse of discretion.
B.
Having concluded that Reliance Standard may not deny life insur-
ance benefits to Blackshear by amending the policy, we turn to the
question of whether it can achieve the same result via the equitable
doctrine of reformation.
Reliance Standard argues that regardless of what the plan dictates,
the omission of the waiting period resulted from a scrivener’s error
and that the policy should be enforced according to the true intent of
the contracting parties. In denying benefits, Reliance Standard indeed
based its decision on its view of the intent of the contracting parties
to apply a service waiting period before coverage became effective
for individual employees. We conclude that Reliance Standard had no
authority to reform the policy in this manner and that, in any event,
equitable reformation is not appropriate under these circumstances.
The doctrine of equitable reformation permits a court to exercise
its equitable powers to reform a contract to correct a mutual mistake
of fact or a scrivener’s error that fails to capture the true intent of the
contracting parties. "In contract law, a scrivener’s error, like a mutual
mistake, occurs when the intention of the parties is identical at the
time of the transaction but the written agreement does not express that
intention because of that error; this permits a court acting in equity
to reform an agreement." 27 Richard A. Lord, Williston on Contracts
§ 70:93 (4th ed.). The party seeking reformation of the contract must
12 BLACKSHEAR v. RELIANCE STANDARD LIFE
present evidence that is "clear, precise, convincing and of the most
satisfactory character that a mistake has occurred and that the mistake
does not reflect the intent of the parties." International Union v.
Murata Erie N. Am., Inc., 980 F.2d 889, 907 (3d Cir. 1992) (internal
quotation marks omitted).
The salient point for our purposes, however, is that reformation,
whether it is based upon scrivener’s error or mutual mistake, is most
decidedly a remedy available in a court of equity. "The purpose of
proving a mistake is to correct what has become an erroneous situa-
tion. Equity will act to bring an erroneous writing into conformity
with the true agreement . . . A mistake, in and of itself, has no legal
effect." 27 Williston on Contracts § 70:17. The doctrine of equitable
reformation does not apply in the context of an administrator’s inter-
pretation of an ERISA plan; the administrator cannot simply "reform"
a plan to correct what it unilaterally perceives to be a mistake or error
contained in the plan’s written terms. Rather, reformation, like other
forms of equitable relief, must be requested by the party seeking to
reform the contract and granted by a court. See Audio Fid. Corp. v.
Pension Benefit Guar. Corp., 624 F.2d 513, 518 (4th Cir. 1980 (not-
ing that "a court of equity can reform a contract to correct a mistake
disclosed by oral proof" if "the mistake [is] mutual, or . . . [is] accom-
panied by fraud on the part of [one] contracting party"); see also
Nechis v. Oxford Health Plans, Inc., 421 F.3d 96, 103 (2d Cir. 2005);
Cinelli v. Security Pac. Corp., 61 F.3d 1437, 1444-45 (9th Cir. 1995);
International Union, 980 F.3d at 907-08. Accordingly, to the extent
Reliance Standard ignored the unambiguous written terms of the plan
and denied benefits based on extrinsic evidence of the "true intent" of
the contracting parties, Reliance Standard acted outside of the scope
of its discretion.
We also reject Reliance Standard’s suggestion that the district court
in fact applied the doctrine of equitable reformation. In no sense did
the district court reform the group policy. The district court saw the
issue as "whether Reliance Standard abused its discretion in its appli-
cation of the ‘clerical error’ provisions of the Policy." J.A. 330. The
district court’s focus, therefore, was on Reliance Standard’s applica-
tion of a specific provision contained in the plan; to the extent the
court considered and discussed evidence of Duplin General’s original
request that the group policy include a waiting period, it did so to
BLACKSHEAR v. RELIANCE STANDARD LIFE 13
determine whether there was substantial evidence in the record to sup-
port application of the "clerical error" provision. Of course, the dis-
trict court’s omission of any discussion of the doctrine of equitable
reformation is not surprising in view of Reliance Standard’s failure to
request or refer to such relief in its pleadings or its legal memoranda
submitted with the cross-motions for summary judgment.
Even though Reliance Standard did not afford the district court an
opportunity to pass on this issue below, we need not return the case
for the district court to address the propriety of equitable reformation.
We conclude that, under the circumstances of this case, it would be
inappropriate for the court to exercise its equitable powers to reform
the policy. To do so would undercut important fundamental aims of
ERISA. For example, reforming the policy to deprive Blackshear of
benefits that are due based on extrinsic documents would foster
uncertainty about employee benefits rather than furthering ERISA’s
goal of "ensur[ing] that an employee’s rights and obligations can be
readily ascertained from the plan documents." Cinelli, 61 F.3d at
1445. A paramount goal of ERISA "is to enable plan beneficiaries to
learn their rights and obligations at any time." Curtiss-Wright Corp.
v. Schoonejongen, 514 U.S. 73, 83 (1995). Thus, ERISA favors "reli-
ance on the face of written plan documents" so that "every employee
may, on examining the plan documents, determine exactly what his
rights and obligations are under the plan." Id. (first emphasis added).
The fundamental requirement that plan participants have sufficient
notice of their rights under an ERISA plan drove our decisions in
Pierce v. Security Trust Life Insurance Co., 979 F.2d 23 (4th Cir.
1992) (per curiam), and Aiken v. Policy Management Systems Corp.,
13 F.3d 138 (4th Cir. 1993) (per curiam), which hold that, if there is
a conflict between the Summary Plan Description (SPD) and the
actual language of the Plan as to the terms of the plan, the SPD con-
trols. This is so even if the policy language, not the SPD, reflects the
actual intent of the contracting parties. Indeed, we reasoned that the
SPD should prevail essentially because it is the "employee’s primary
source of information regarding employment benefits." Pierce, 979
F.2d at 27 (internal quotation marks omitted). Post-hoc reformation
of the policy here would run contrary to the principles underlying
Pierce and Aiken, particularly since the SPD does not contradict or
conflict with the language of the Duplin General group policy. In this
14 BLACKSHEAR v. RELIANCE STANDARD LIFE
case, the SPD and the plan itself agree; there is utterly no indication
of an error or mistake. This case is unlike one where a clerical or
scrivener’s error would be apparent.
Finally, equitable reformation in the circumstances of this case is
inappropriate in view of ERISA’s protection of vested rights. Pension
benefit plans create benefits that vest according to statute and are non-
forfeitable. See Nachman Corp. v. Pension Benefit Guar. Corp., 446
U.S. 359, 374-75 (1980). Although benefits under a welfare benefit
plan do not statutorily vest, if the plan creates vested rights, then the
employer or sponsor is not free simply to strip away such rights uni-
laterally. See Wheeler, 62 F.3d at 638. In our view, equitable reforma-
tion would cut the legs out from under Wheeler and permit Reliance
Standard to make an end run around Wheeler’s prohibition against
divesting benefits in these circumstances.
Accordingly, we conclude that equitable reformation is not appro-
priate.
IV.
For the foregoing reasons, we reverse the decision of the district
court and remand for judgment to be entered in favor of Blackshear.
REVERSED