Title: Mass Mutual Life v. Ouellette

State: vermont

Issuer: Vermont Supreme Court

Document:

NOTICE:  This opinion is subject to motions for reargument under V.R.A.P.
 40 as well as formal revision before publication in the Vermont Reports.
 Readers are requested to notify the Reporter of Decisions, Vermont Supreme
 Court, 109 State Street, Montpelier, Vermont 05609-0801 of any errors in
 order that corrections may be made before this opinion goes to press.


                                 No. 91-448


 Massachusetts Mutual Life                    Supreme Court
 Insurance Company
                                              On Appeal from
      v.                                      Washington Superior Court

 James E. Ouellette                           May Term, 1992


 Alan W. Cheever, J.

 Samuel Hoar, Jr., of Dinse, Erdmann & Clapp, Burlington, for
   plaintiff-appellee

 Gregory W. McNaughton, Barre, for defendant-appellant


 PRESENT:  Gibson, Dooley, Morse and Johnson, JJ.


      DOOLEY, J.   Plaintiff, Massachusetts Mutual Life Insurance Company,
 issued disability and life insurance policies to defendant, James E.
 Ouellette, an optometrist.  When defendant was found guilty of lewd and
 lascivious conduct with a minor and was imprisoned, he filed a claim with
 plaintiff seeking disability benefits and a waiver of his obligation to pay
 life insurance premiums.  In response, plaintiff sought a declaratory
 judgment that it was not required to honor these claims.  Plaintiff's motion
 for summary judgment was granted.  Defendant appeals, claiming that the
 court erred in failing to find him disabled under the policies and in
 granting summary judgment.  We affirm.
       As part of the plea agreement that underlies defendant's conviction,
 he sold his optometry practice and surrendered his license to practice
 optometry, his usual occupation for the purposes of the policies at issue.
 Following the commencement of his sentence, defendant filed a claim with
 plaintiff for "total disability" benefits and requested a waiver of life
 insurance premiums, relying on the following policy provisions:
         "[T]otal disability" means incapacity of the insured . .
         . which requires the care of a legally qualified
         physician . . . .
         . . . .

         [T]he Company will deem the insured to be totally
         disabled if the incapacity prevents the insured from
         performing substantially all of the duties of his usual
         occupation, business, employment or profession. . . .

         "Total disability due to sickness" means only total
         disability (as defined above) resulting from or
         contributed to by illness, disease, bodily or mental
         infirmity of the insured.

 In his claim, defendant stated that he suffered from atypical paraphilia,
 primarily pedophilia, and that this was a recognized mental disorder.  He
 claimed that this illness had caused him to be totally disabled, within the
 meaning of the policy provisions, and thus entitled to disability benefits
 and a waiver of his premium obligation.
      It is undisputed that defendant's mental disorder, pedophilia, first
 manifested itself in the mid to late 1970s, and that the resulting behavior
 continued until his arrest in 1987.  Defendant did not seek medical
 attention for his mental disorder in the ten years prior to his conviction.
 He was placed under the care of a physician for the first time, for
 diagnosis and evaluation, in the course of this litigation and presently
 receives counseling in prison.  He was physically and mentally able to
 perform all the duties of optometry until the time of his incarceration and
 loss of license.
      Plaintiff denied defendant's insurance claim, asserting that the
 inability of defendant to perform the duties of his profession was caused by
 his conviction and the surrender of his optometry license, not by any
 illness or disease.  The trial court agreed with this contention in its
 summary judgment decision.  Defendant argues that this decision is wrong
 because it granted summary judgment when there were disputed issues of
 material fact and because it misinterpreted the insurance policy.
      Summary judgment is appropriate if, after giving the opposing party the
 benefit of all reasonable doubts and inferences, there is no genuine issue
 of material fact and the moving party is entitled to judgment as a matter
 of law.  V.R.C.P. 56(c); Howard Bank v. Estate of Pope, 156 Vt. 537, 539,
 593 A.2d 471, 472 (1991).   This standard applies in the present proceeding
 as well as at the trial level.  See Garneau v. Curtis & Bedell, Inc., 3 Vt.
 L.W. 113, 113 (April 24, 1992).
      We agree with the trial court that the material facts of this case are
 not in dispute, and the only issue for resolution is the application of the
 law to those facts.  Defendant's theory is that he is incapacitated by an
 illness, pedophilia, and that the illness prevents him "from performing
 substantially all of the duties of his usual occupation," as those terms are
 used in the policies, because it has caused his incarceration.  None of the
 factual predicates of this argument are disputed by the plaintiff.
 Therefore, summary judgment is proper if plaintiff is correct on the law.
      The trial court ruled that because defendant could still be practicing
 optometry had he not surrendered his license and been incarcerated, his
 inability to practice optometry was caused by the legal consequences of his
 behavior and not by a disability.  This holding follows the general rule
 that disability insurance policies provide coverage for factual
 disabilities, not legal disabilities.  15 G. Couch, Cyclopedia of Insurance
 Law, { 53.41 (2d ed. 1982).
      Although defendant's argument is novel in the context of a private
 disability insurance claim, it has been uniformly rejected in analogous
 federal cases involving determinations of "total disability" under the
 Social Security Act.  The definition of disability in the Social Security
 Act requires that the disabled individual be unable "to engage in any
 substantial gainful activity by reason of any medically determinable
 physical or mental impairment. . . ."  42 U.S.C. { 423(d)(1)(A) (emphasis
 supplied). (FN1) Focusing on the causation element in the definition, courts
 interpreting the Act have held that persons in prison because of acts
 alleged to result from mental impairments are not eligible for disability
 benefits. (FN2) See, e.g., Pierce v. Gardner, 388 F.2d 846, 847-48 (7th Cir.
 1967); Bertram v. Secretary of H.E.W.,