[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
FILED
U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
No. 05-11663 August 8, 2006
THOMAS K. KAHN
CLERK
D. C. Docket No. 02-20678-CV-AMS
DAVID M. BILLINGS,
Plaintiff-Appellee,
versus
UNUM LIFE INSURANCE COMPANY OF AMERICA,
a foreign corporation and subsidiary of Unumprovident
Corporation,
Defendant-Appellant.
Appeal from the United States District Court
for the Southern District of Florida
(August 8, 2006)
Before DUBINA and KRAVITCH, Circuit Judges, and MILLS,* District Judge.
__________________________
*Honorable Richard Mills, United States District Judge, for the Central District of Illinois, sitting
by designation.
DUBINA, Circuit Judge:
Appellant, UNUM Life Insurance Company (“UNUM”), appeals the district
court’s order granting summary judgment in favor of appellee, David Billings
(“Billings”), as to his claim under the Employment Retirement Income and
Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., for wrongful denial of
disability benefits due to Obsessive Compulsive Disorder (“OCD”). UNUM
contends that the district court erred in finding that its policy’s mental illness
limitation, limiting benefits to twenty-two months due to mental disorders, is
ambiguous, and thus erred in holding that the limitation does not apply to limit
Billings’s benefits due to OCD. In this appeal, we are presented with an issue of
first impression in this circuit, whether a “mental illness” limitation of an ERISA-
governed contract, which fails to provide whether an illness is categorized as
mental based on its symptoms or etiology, is ambiguous. We hold that it is and
affirm the district court’s order granting summary judgment.
Additionally, UNUM appeals the district court’s final judgment awarding
Billings benefits for his claim under ERISA for wrongful denial of disability
benefits due to Meniere’s Disease. UNUM challenges the district court’s findings
of fact and conclusions of law that Billings is “disabled” under the terms of the
policy due to Meniere’s Disease. Alternatively, UNUM challenges the district
2
court’s award of disability benefits for the time period between the last day of trial
and the day the district court entered judgment twenty-two months later.
I. FACTS
Billings was a pediatrician employed at Pediatric Professional Associates,
P.A. and was covered under a group long term disability policy (“policy”) issued
by UNUM when he was diagnosed in November 1996 as suffering from OCD and
Major Depression. Billings was advised by his treating physician that due to
OCD, he could not practice pediatrics. On January 21, 1997, Billings stopped
working as a pediatrician and has not practiced medicine since. Billings filed a
claim with UNUM on or about June 3, 1997, for disability benefits under the
policy due to OCD and Major Depression. UNUM approved his claim and began
paying disability benefits effective July 21, 1997.
UNUM’s policy provides that it will pay the insured monthly benefits upon
proof that the insured “is disabled due to sickness or injury.” (R. Vol. 1, Tab. 27,
Second Am. Compl., Ex. A, Policy at L-BEN-1.) The policy further provides that
“‘[d]isability’ and ‘disabled’ mean that because of injury or sickness the insured
cannot perform each of the material duties of his regular occupation. Note: For
physicians, ‘regular occupation’ means the speciality in the practice of medicine
which the insured was practicing just prior to the date disability started.” (Policy
3
at L-DEF-4.) “Sickness” is further defined as “illness or disease.” (Policy at L-
DEF-3.) However, the policy contains the following limitation for “mental
illness:” “[b]enefits for disability due to mental illness will not exceed twenty-four
months of monthly benefit payments.” (Policy at L-BEN-5.) The policy goes on
to define “mental illness” as “mental, nervous or emotional diseases or disorders
of any type.” (Policy at L-BEN-6.)
In February 1999, UNUM informed Billings that, pursuant to the policy’s
mental illness limitation, his benefits based on OCD and Major Depression would
terminate on July 20, 1999. Billings then filed a disability claim based on
Meniere’s Disease.1 UNUM initially approved Billings’s continuation of
disability benefits due to Meniere’s Disease. However, after further investigation
UNUM determined that Billings did not meet the policy’s definition of “disabled”
because the severity of the Meniere’s Disease did not render Billings incapable of
performing the material duties of a pediatrician. Accordingly, UNUM terminated
Billings’s benefits effective August 13, 2001.
Billings filed a complaint against UNUM under ERISA alleging wrongful
denial of benefits and sought back benefits from August 2001. In Count I of the
1
Billings presented expert testimony that Meniere’s Disease is a disease of the inner ear
which is characterized by episodic vertigo, progressive hearing loss, tinnitus (ear-ringing or
whistling), and a sense of aural “fullness” or pressure. (R. Vol. 10 at 45-47.)
4
complaint,2 he alleged that UNUM wrongfully denied him benefits due to OCD,3
and in Count II he alleged that UNUM wrongfully denied him benefits due to
Meniere’s Disease. Both parties filed cross-motions for summary judgment as to
Count I. The undisputed facts established that OCD is a physiological condition,
that is, it has a physical or organic cause, with symptoms that are mental in nature.
Billings argued that: (1) the mental illness limitation is ambiguous because it does
not provide whether an illness is classified as mental based on its symptoms or its
origin, and thus has to be construed against the insurer; and (2) when construed
against the insurer, the limitation does not apply to organically based illnesses
such as OCD. UNUM contended that the mental illness limitation applies to all
disorders or diseases which are characterized by mental symptoms, regardless of
cause, because to do otherwise would render the limitation meaningless.
The district court held that the policy’s mental illness limitation is
ambiguous and must be construed against UNUM under the applicable Florida
state law doctrine of contra proferentem. When construed against UNUM, the
district court held that the limitation does not apply to an illness with an organic or
2
“Complaint” in this opinion refers to Billings’s Second Amended Complaint.
3
Billings also sought wrongful denial of benefits due to Major Depression in Count I.
However, it is undisputed that Billings later abandoned this claim and that it is not at issue in this
appeal.
5
physical cause. Accordingly, the district court granted Billings summary judgment
as to Count I. After a six-day bench trial, the district court entered final judgment
in favor of Billings as to Count II. At trial, it was undisputed that Billings suffered
from Meniere’s Disease; however, the dispute centered on the severity of
Billings’s disease. Based on Billings’s testimony, documentation of his episodes,4
and the testimony of his family members and his treating physician, the district
court found that Billings was disabled due to Meniere’s Disease under the terms of
the policy.
In UNUM’s opposition to Billings’s proposed final judgment, it requested
the district court remand Billings’s claim for back benefits due to Meniere’s
Disease to UNUM, rather than award back benefits up to the day judgment was
entered. In doing so, UNUM argued it could determine in the first instance
whether Billings continued to be entitled to benefits. The district court entered
final judgment twenty-two months after the last day of trial and awarded Billings
back benefits due to Meniere’s Disease up to the day it entered judgment. UNUM
timely appeals.
II. ISSUES
4
An “episode” is a period in which Billings experiences vertigo as a result of Meniere’s
Disease.
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1. Whether the policy’s mental illness limitation is ambiguous, and thus
must be construed against UNUM such that organically based illnesses do not fall
within the limitation.
2. Whether the district court erred in awarding Billings disability benefits
based on clearly erroneous findings of fact that he was disabled due to Meniere’s
Disease under the terms of the policy.
3. Alternatively, whether the district court erred in awarding benefits up to
the day it entered judgment, rather than remanding to UNUM as the plan
administrator to determine whether Billings’s disability continued up to the day
judgment was entered twenty-two months after trial.
III. STANDARDS OF REVIEW
“We review a district court’s grant of summary judgment de novo, applying
the same legal standards that controlled the district court’s decision.” Levinson v.
Reliance Standard Life Ins. Co., 245 F.3d 1321, 1325 (11th Cir. 2001). A denial
of ERISA benefits is reviewed de novo where, as here, the plan administrator is
accorded no discretion. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115
(1989). We review findings of fact under a clearly erroneous standard. Fed. R.
Civ. P. 52(a). Whether the district court erred in awarding back benefits rather
7
than remanding the case to UNUM is a question of law reviewed de novo.
Levinson, 245 F.3d at 1325.
IV. DISCUSSION
At the outset, we address whether we must reach the merits of all the issues
before this court on appeal. Billings contends that we need not reach the merits of
whether his disability benefits due to OCD are limited to twenty-four months
under the mental illness limitation if we affirm his entitlement to disability
benefits due to Meniere’s Disease. UNUM, on the other hand, asserts that we
must reach the merits of the mental illness limitation issue because the district
court’s order granting summary judgment to Billings as to Count I represents an
ongoing legal impediment to UNUM.5 For example, UNUM argues that if
Billings’s Meniere’s Disease ceases, under the district court’s order it will be
required to continue to provide disability benefits to Billings due to OCD. We
conclude that because the district court’s order continues to affect the rights of
UNUM, and UNUM continues to have a cognizable interest in the outcome, we
5
At oral argument, UNUM asserted for the first time that this court should vacate the district
court’s order granting summary judgment if we affirm Billings’s award of disability benefits due to
Meniere’s Disease. UNUM provided the court with supplemental authority supporting its contention
that we should vacate the district court’s order. However, we will not consider new issues raised
outside the parties’ opening briefs. See Randolph v. Green Tree Fin. Corp., 244 F.3d 814, 816 (11th
Cir. 2001). Accordingly, we deem the issue abandoned. Furthermore, even if we were to address
UNUM’s argument, we would not vacate the district court’s order for the reasons discussed above.
8
must address the mental illness limitation issue. See Iron Workers Local #272 v.
Bowen, 624 F.2d 1255, 1262 (5th Cir. 1980).6
A. Mental Illness Limitation
UNUM argues that the policy’s mental illness limitation, defining a “mental
illness” as “mental, nervous or emotional diseases or disorders of any type,” is not
ambiguous because it is not susceptible to more than one reasonable interpretation.
Specifically, UNUM contends that the district court’s interpretation is
unreasonable because it writes the provision out of the policy by preventing it
from applying to OCD, a mental disorder, regardless of its cause. UNUM further
contends that the district court’s interpretation is unreasonable in light of ERISA’s
tenets for contract interpretation, which require that words be given their plain
meaning. UNUM argues that if the plain meaning is applied to the term “mental
illness” in the policy, it unambiguously encompasses all illnesses that manifest
through mental symptoms, regardless of the ultimate cause of the illness.
UNUM’s argument is based on the opinions of the Eighth and Fifth
Circuits, which hold that applying the plain meaning to a mental illness limitation
resolves any ambiguity regarding the classification of an illness as “mental” under
6
This court adopted as binding precedent all of the decisions of the former Fifth Circuit
handed down prior to the close of business on September 30, 1981. Bonner v. City of Prichard, 661
F.2d 1206, 1209 (11th Cir. 1981) (en banc).
9
the policy. See Brewer v. Lincoln Nat’l Life Ins. Co., 921 F.2d 150, 153-54 (8th
Cir. 1990) (applying the plain and ordinary meaning as understood by a layperson
to the limitation, and thus holding the policy classified illnesses as mental based
on their symptoms because “[t]he cause of a disease is a judgment for experts”);
Delk v. Durham Life Ins. Co., 959 F.2d 104, 105 (8th Cir. 1992) (clarifying that
the court in Brewer held that the limitation “ceased to be ambiguous when it was
accorded its ordinary, and not specialized, meaning”); Lynd v. Reliance Standard
Life Ins. Co., 94 F.3d 979, 983-84 (5th Cir. 1996) (adopting the Eighth Circuit’s
reasoning in Brewer). Reasoning that “laymen know and understand symptoms,”
these circuits have held that applying the plain meaning to a mental illness
limitation eliminates any ambiguity by focusing on the symptoms of the illness to
determine whether it falls within the mental illness limitation. Brewer, 921 F.2d at
154; Lynd, 94 F.3d at 983.
Billings, on the other hand, argues that the mental illness limitation is
ambiguous because the policy is silent as to whether an illness is classified as
“mental” under the policy based on its origin or symptoms. Billings argues that a
reasonable interpretation of the policy is that an illness is classified as “mental”
based on its origin rather than its symptoms. Because the policy does not provide
how it classifies an illness as “mental,” Billings asserts that each party presented
10
reasonable interpretations of the limitation, and thus the policy is ambiguous.
Applying the state doctrine of contra proferentem, and thereby construing the
limitation against UNUM, Billings contends that OCD does not fall within the
limitation because it is undisputedly an organically, or physically, based illness.
Billings’s argument is consistent with the Seventh and Ninth Circuits’
reasoning that a mental illness limitation that fails to “contain any language
suggesting whether the cause or the manifestation [of an illness] determines
whether an illness is covered” is ambiguous. Phillips v. Lincoln Nat’l Life Ins.
Co., 978 F.2d 302, 311 (7th Cir. 1992); Patterson v. Hughes Aircraft Co., 11 F.3d
948, 950 (9th Cir. 1993). Construing the ambiguity against the drafter under the
applicable state law doctrine of contra proferentem, these circuits have held that
the limitation does not include organically based illnesses. Phillips, 978 F.2d at
311; Patterson, 11 F.3d at 950.
This court has held that “[a]n insurance contract is ambiguous if it is
susceptible to two or more reasonable interpretations that can fairly be made.
When one of these interpretations results in coverage and another results in
exclusion, ambiguity exists in the insurance policy.” Dahl-Eimers v. Mut. of
Omaha Life Ins. Co., 986 F.2d 1379, 1381 (11th Cir. 1993) (citations omitted).
The district court reasoned that because mental illnesses are categorized according
11
to either their origins or symptoms, each party presented reasonable interpretations
of the mental illness limitation where the policy was silent as to the proper
classification. Accordingly, the district court held that the limitation is
ambiguous, and applying the applicable state law doctrine of contra proferentem
by construing the limitation against the drafter, it held that organically based
illnesses do not fall within the limitation.
As set out above, our sister circuits have reached differing conclusions
regarding the ambiguity of a mental illness limitation that fails to provide whether
an illness is classified as mental based on its origin or symptoms. Compare
Patterson v. Hughes Aircraft Co., 11 F.3d 948, 950 (9th Cir. 1993) (holding that a
mental illness limitation containing the exact language at issue in this case is
ambiguous because it does not “specify whether a disability is to be classified as
‘mental’ by looking to the cause of the disability or to its symptoms,” and thus
construed in favor of the insured, does not encompass organically based illnesses),
and Phillips v. Lincoln Nat’l Life Ins. Co., 978 F.2d 302, 304, 310-11 (7th Cir.
1992) (holding that a mental illness limitation limiting the maximum payment for
“care of mental illness or care of nervous conditions of any type or cause” is
ambiguous because the plan contains “no definition or explanation of the term
‘mental illness,’” and thus, construed against the insurance company does not
12
include physically based illnesses), with Brewer v. Lincoln Nat’l Life Ins. Co., 921
F.2d 150, 153-54 (8th Cir. 1990) (applying the plain and ordinary meaning to
resolve the ambiguity), and Delk v. Durham Life Ins. Co., 959 F.2d 104, 105 (8th
Cir. 1992) (acknowledging that the court in Brewer resolved the ambiguity by
applying the plain meaning), and Lynd v. Reliance Standard Life Ins. Co., 94 F.3d
979, 983-84 (5th Cir. 1996) (adopting the Eighth Circuit’s reasoning in Brewer).7
We, however, agree with the reasoning of the Seventh and Ninth Circuits. We
therefore hold that because “[t]he policy contains no definition or explanation of
the term ‘mental [disorder],’ and offers no illustration of the conditions that are
included or excluded,” and fails to “contain any language suggesting whether the
cause or the manifestation determines whether an illness” falls within the
limitation, it is ambiguous as applied to Billings. Kunin v. Benefit Trust Life Ins.
Co., 910 F.2d 534, 541 (9th Cir. 1990); see Phillips, 978 F.2d at 310-11.
7
In its order, the district court described the circuit split as pertaining to whether a mental
illness limitation is ambiguous, citing the Eighth and Fifth Circuits as holding that a mental illness
limitation is unambiguous. We do not read the Eighth and Fifth Circuits’ opinions as holding that
a mental illness limitation is unambiguous. Rather, we conclude from those opinions, and a
subsequent opinion, that the circuits found it ambiguous, but applied the plain meaning to resolve
the ambiguity. See Delk v. Durham Life Ins. Co., 959 F.2d 104, 105 (8th Cir. 1992) (explaining that
in Brewer it was able to “resolve the ambiguity in the language by interpreting the language as would
‘an average plan participant’” and holding that the policy “ceased to be ambiguous when it was
accorded its ordinary, and not specialized meaning”).
13
Furthermore, we are not persuaded by the Eighth and Fifth Circuits’
reasoning that the ambiguity can be resolved by applying the plain meaning. See
Brewer, 921 F.2d at 154; Delk, 959 F.2d at 105-06; Lynd, 94 F.3d at 983-84.
Applying the plain meaning to the limitation does not resolve the ambiguity; doing
so merely adopts one reasonable interpretation over the other. It is well-
established in this circuit, and among our sister circuits, that once we conclude an
ERISA-governed plan is ambiguous, we apply the doctrine of contra proferentem
to resolve the ambiguities in the insurance contract. E.g., Lee v. Blue Cross/Blue
Shield of Ala., 10 F.3d 1547, 1551 (11th Cir. 1994). “Application of this rule
requires us to construe ambiguities against the drafter . . . .” Id. In doing so, we
must conclude that Billings’s organically based OCD does not fall within the
policy’s mental illness limitation. See Mongeluzo v. Baxter Travenol Long Term
Disability Benefit Plan, 46 F.3d 938, 943 (9th Cir. 1995) (explaining that
“[b]ecause of the rule that ambiguities are to be resolved in favor of the insured, if
either a cause or a symptom of the disease were physical and caused the disability
in whole or in part, then” the disease does not fall within the mental illness
limitation); Phillips, 978 F.2d at 310-11, 314 (holding that upon applying the
doctrine of contra proferentem, the insured’s organically based illness does not
fall within the mental illness limitation as a matter of law).
14
Accordingly, we affirm the district court’s order granting summary
judgment as to Count I.
B. Disability Award
UNUM contends that the district court erred in awarding Billings disability
benefits due to Meniere’s Disease because its findings of fact regarding the
severity and predictability of Billings’s episodes are clearly erroneous.
Specifically, UNUM argues that the district court’s findings of fact are clearly
erroneous because it ignored inconsistent and contradictory evidence regarding the
effects of Billings’s disease. UNUM asserts that the presumption afforded to the
district court that it is in the superior position to make credibility determinations is
undermined in this case by the twenty-two month delay between the last day of
trial and the district court’s entry of findings of fact and conclusions of law.
Alternatively, UNUM challenges the sufficiency of the evidence supporting the
award of benefits through the last day of trial up to the day the district court
entered judgment twenty-two months later. We are not persuaded by UNUM’s
arguments.
Based on the district court’s credibility determinations of Billings’s
testimony, it found that Billings was unable to perform the material duties of his
job as a result of Meniere’s Disease, and thus was disabled under the terms of the
15
policy. The district court stated that its credibility determination was based on its
observations of Billings during his testimony, the corroboration of his testimony
by his treating physician and family members, and evidence which included
contemporaneous notes regarding his illness that he documented in his calendars.
It is well-established that,
[a] finding [of fact] is clearly erroneous and reversible under Rule 52(a)
only when the reviewing court on the entire evidence is left with a definite
and firm conviction that a mistake has been committed. If the district
court’s findings of fact are plausible in light of the record viewed in its
entirety, the court of appeals must accept them even if it is convinced that
had it been sitting as the trier of fact, it would have weighed the evidence
differently.
Childrey v.Bennett, 997 F.2d 830, 833 (11th Cir. 1993) (citations and internal
quotation marks omitted). Upon careful review of the record as a whole, we are
not “left with a definite and firm conviction that a mistake has been committed.”
Id. We will not re-weigh the evidence as UNUM essentially requests. Moreover,
the twenty-two month delay alone does not undercut the presumption that the
district court is in the best position to make credibility determinations.
Accordingly, we conclude that the district court’s findings of fact are not clearly
erroneous.
Furthermore, we are not persuaded by UNUM’s alternative argument that
the award of disability benefits through the last day of trial up to the day the
16
district court entered judgment twenty-two months later was not supported by
sufficient evidence. UNUM contends that the district court’s award of benefits
was not supported by record evidence because there was no evidence before the
court that Billings continued to suffer from Meniere’s Disease after the last day of
trial. Additionally, UNUM argues that the district court should have remanded the
case to UNUM as the plan administrator to determine in the first instance whether
Billings continued to suffer a disability past the last day of trial.
UNUM relies on this court’s statement that, “as a general rule, remand to
the plan fiduciary is the appropriate remedy when the plan administrator has not
had an opportunity to consider evidence on an issue.” Levinson, 245 F.3d at 1330
(citing Jett v. Blue Cross & Blue Shield of Ala., Inc., 890 F.2d 1137, 1140 (11th
Cir. 1989)). However, in Levinson we explained that the above statement was
“made in the context of the beneficiary asking the court to consider additional
evidence concerning his eligibility under the plan.” Id. at 1329. Accordingly, in
Levinson we held that because “all of the evidence before the district court showed
that [the insured]’s condition had not improved and tended to show that he was
still disabled under the terms of the plan, remand was neither a necessary nor an
appropriate remedy.” Id. at 1330. Accordingly, we affirmed the district court’s
award of benefits. Id.
17
UNUM contends that Levinson is distinguishable from the present case
because the record in Levinson contained evidence that the insured continued to
suffer a disability through the last day of trial, and benefits were awarded only
through that date. Although we have not squarely addressed whether the insured
is required to continue to present evidence of an on-going disability throughout
trial and the entry of judgment in order to ensure an award of disability benefits
through such date, the First Circuit has clearly rejected such an argument.
In Cook v. Liberty Life Assurance Co., 320 F.3d 11, 23-25 (1st Cir. 2003),
the First Circuit held that an award of back pay disability benefits for the forty-two
months between the time the insured’s disability benefits were terminated and
judgment was entered was appropriate, despite the fact that there was no evidence
of the insured’s disability status past the day benefits were terminated. The court
noted that “the absence of information about [the insured]’s disability status
resulted directly from [the insurer]’s arbitrary and capricious termination of [the
insured]’s benefits” because the insured was no longer obligated under the policy
to provide evidence of a continuing disability after her benefits were terminated.
Id. at 24. Thus, the court reasoned that “[i]t would be patently unfair to hold that
an ERISA plaintiff has a continuing responsibility to update her former insurance
company and the court on her disability during the pendency of her internal
18
appeals and litigation, on the off chance that she might prevail in her lawsuit.” Id.
at 24-25. We agree.
After reviewing the record, we conclude that although there was no
evidence in the record that Billings continued to suffer a disability during the
period between the last day of trial and the day the district court entered judgment,
there was also no evidence before the district court indicating that Billings’s
condition had improved during such time period. Therefore, we affirm the district
court’s final judgment awarding disability benefits due to Meniere’s Disease.
V. CONCLUSION
For the foregoing reasons, we affirm the district court’s order granting
summary judgment in favor of Billings and final judgment awarding disability
benefits due to Meniere’s Disease.
AFFIRMED.
19