FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

SUSAN SALYERS, an individual,

Plaintiff-Appellant,

v.

METROPOLITAN LIFE INSURANCE 

COMPANY, Guardian Ad Litem, 

MetLife, Inc.,

Defendant-Appellee.

No. 15-56371

D.C. No.

2:14-cv-07490-

PA-JC

OPINION

Appeal from the United States District Court

for the Central District of California

Percy Anderson, District Judge, Presiding

Argued and Submitted March 6, 2017

Pasadena, California

Filed September 20, 2017

Before: Harry Pregerson, Richard A. Paez,

and Marsha S. Berzon, Circuit Judges.

Opinion by Judge Pregerson
2 SALYERS V. METROPOLITAN LIFE INS. CO.

SUMMARY*

Employee Retirement Income Security Act

The panel reversed the district court’s judgment in favor 

of the defendant following a bench trial in an ERISA action 

concerning life insurance.

The plaintiff bought a $250,000 life insurance policy on 

her husband, but the defendant insurer paid out only $30,000 

because the plaintiff had not submitted evidence of 

insurability with her coverage election, as required under the 

ERISA-governed benefits plan. The panel held that the 

defendant waived the evidence of insurability requirement 

because it did not ask the plaintiff for a statement of health, 

even as it accepted her premiums for $250,000 in coverage. 

The panel held that, under the federal common law of 

agency, the knowledge and conduct of the policyholderemployer could be attributed to the defendant. The panel 

remanded the case to the district court with instructions to 

enter judgment in favor of the plaintiff for the amount of the 

$250,000 policy that remained unpaid.

 * This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
SALYERS V. METROPOLITAN LIFE INS. CO. 3

COUNSEL

Christian J. Garris (argued), Law Offices of Christian J. 

Garris, Los Angeles, California, for Plaintiff-Appellant.

Ian Seth Linker (argued), Metropolitan Life Insurance Co.,

New York, New York; Misty A. Murray, Hinshaw & 

Culbertson LLP, Los Angeles, California; for DefendantAppellee.

OPINION

PREGERSON, Circuit Judge:

Plaintiff-Appellant Susan Salyers (“Salyers”), a nurse at 

Providence Health & Services (“Providence”), bought a 

$250,000 life insurance policy on her husband through an 

ERISA-governed benefits plan. Salyers paid premiums 

commensurate with that amount of coverage. When 

Salyers’s husband died shortly thereafter, DefendantAppellee Metropolitan Life Insurance Company 

(“MetLife”) paid out only $30,000. MetLife refused to pay 

the full $250,000 because Salyers had not submitted 

evidence of insurability with her coverage election, as 

required under the plan. After unsuccessfully appealing the 

denial of benefits through MetLife’s administrative process,

Salyers filed suit against MetLife. The district court 

conducted a bench trial and entered judgment for MetLife. 

Salyers appealed. We reverse.

FACTUAL AND PROCEDURAL BACKGROUND

Salyers is a nurse at Providence. She was a participant 

in an ERISA-governed employee welfare benefits plan (“the 

Plan”) that provided, among other benefits, dependent life 
4 SALYERS V. METROPOLITAN LIFE INS. CO.

insurance. MetLife issued the group policy that funded life 

insurance benefits under the Plan.

At the time Salyers first applied for dependent life 

insurance in 2013, the Summary Plan Description listed 

eligibility requirements for Dependent Life Insurance 

coverage and described “How the Plan Works”:

Each fall you elect your Dependent Life 

benefit options to be effective for the next 

calendar year. During your first enrollment 

as newly benefits eligible employee [sic], you 

may select any amount of spouse/Adult 

Benefit Recipient domestic partner coverage 

up to $50,000 without evidence of 

insurability (statement of health). After the 

first year, spouse/Adult Benefits Recipient 

domestic partner coverage amounts may be 

increased by one level per year for coverage 

levels up to and including $50,000. No 

evidence of insurability is required for this 

increase. Evidence of insurability is required 

for any coverage amount above $50,000 or 

for any increase of more than one benefit 

level.

On August 15, 2013, Salyers submitted her benefits 

elections to Providence. On the Benefits Enrollment Form, 

which warns that “MetLife may require evidence of 

insurability depending on your election,” Salyers elected life 

insurance coverage in the amount of $20,000 for herself and 

$20,000 for her spouse, Gary Wolk (“Gary”). Because 

Salyers elected only $20,000 in coverage for Gary, no 

evidence of insurability was required.
SALYERS V. METROPOLITAN LIFE INS. CO. 5

Although Salyers elected only $20,000 in coverage for 

Gary, Providence mistakenly entered $500,000 in its system. 

Due to this administrative error, Providence deducted 

premiums from Salyers’s paycheck based on $500,000 in 

coverage during the last four months of 2013. During that 

time, neither Providence nor MetLife asked Salyers to 

submit a statement of health or any other evidence of 

insurability for Gary’s 2013 coverage.1

During the next open enrollment period, Salyers elected 

$250,000 in life insurance coverage for Gary, effective 

January 1, 2014. The 2014 Plan documents reiterated that 

evidence of insurability was required for elections of 

coverage of over $50,000. The Plan’s 2014 open enrollment 

guide stated that “any coverage you elect requiring a 

statement of health will not take effect until approved by 

MetLife.” Salyers did not submit a statement of health or 

other evidence of insurability with her 2014 election. 

Nonetheless, Salyers’s premium payments were adjusted to 

reflect her new election of $250,000 in coverage, and, again, 

neither Providence nor MetLife asked for a statement of 

health or other evidence of insurability.2

 1 None of the Plan documents in the record define “evidence of 

insurability” or “statement of health,” and no statement of health form 

appears in the record.

2 According to a MetLife employee’s notes, “Typically[,] if an 

employee wants to elect an amount that requires SOH [(a statement of 

health),] Providence would put the amount of life insurance at the max 

without SOH ($50k for spouse life), mark it as pending, wait for the SOH 

to be approved by MetLife and send a letter. This was not done.” 

Apparently, because Salyers’s 2014 election of $250,000 was lower than 

the mistakenly-entered $500,000 from the prior year’s enrollment, 

Providence’s system did not flag the new coverage election.
6 SALYERS V. METROPOLITAN LIFE INS. CO.

Gary died on January 10, 2014. On January 15, 2014, 

Providence sent a letter to Salyers offering its condolences 

and stating that Salyers had $250,000 in coverage for Gary. 

On January 20, 2014, Salyers submitted a claim for benefits 

to MetLife. Accompanying the claim was an Employer’s 

Statement from Providence, which said that Salyers had 

been enrolled in the Plan effective September 1, 2013, and 

that she had $250,000 in dependent life insurance coverage 

for Gary.

Upon receiving the claim, MetLife confirmed with 

Providence that there was no statement of health on file for 

Gary, which led Providence to discover its keystroke error 

from the 2013 enrollment. Providence then submitted a 

revised Employer’s Statement to MetLife, which stated that 

Gary had life insurance coverage in the amount of $30,000. 

This amount reflected the coverage for which Gary was 

eligible under the Plan without providing evidence of 

insurability: the initial election of $20,000 in 2013, plus a 

“one level” increase of $10,000 for the following year.

MetLife ultimately paid Salyers $30,000, and 

Providence refunded the premiums that were deducted from 

Salyers’s paychecks based on the unapproved higher 

coverage amount. Salyers called MetLife to ask why it had 

not paid the full $250,000. Around that time, a MetLife 

employee wrote a note in the file explaining that the full 

amount should be paid:

Providence has asked if we can pay this, since 

the employee had been enrolled in this 

amount and was paying premiums. On their 

enrollment confirmations it was showing this 

amount, so the employee thought that was 

their coverage. I do agree with their 

assessment that this should be paid since the 
SALYERS V. METROPOLITAN LIFE INS. CO. 7

$250,000 is what the employee thought they 

had.

Despite that recommendation, counsel for Providence 

explained to Salyers’s counsel that Salyers was not entitled 

to the additional $220,000 because she had failed to submit 

evidence of insurability as required by the Plan. Salyers 

appealed to MetLife in a letter dated July 15, 2014.

After reviewing Salyers’s appeal and the administrative 

claim file, MetLife responded that additional benefits were 

not payable because MetLife had not received and approved 

evidence of insurability for Gary as required by the Plan. 

MetLife claimed that its receipt of premiums did not create 

coverage.

In a letter dated August 12, 2014, Salyers’s counsel 

appealed MetLife’s formal denial. After another review of 

the claim file and Salyers’s appeal letter, MetLife upheld its 

initial denial of benefits on the same grounds as before, and 

so notified Salyers by letter dated August 22, 2014. In that 

letter, MetLife explained that it re-examined the entire claim 

file and that no new information had been presented to 

change the denial decision.

Salyers then filed suit against MetLife in the U.S. 

District Court for the Central District of California. She 

claimed that MetLife should be estopped from contesting 

coverage or, in the alternative, that MetLife waived its right 

to enforce the evidence of insurability requirement. The 

district court conducted a bench trial on July 28, 2015, and 

concluded that Salyers had not sustained her burden of 

establishing an entitlement to the unpaid benefits. The 

district court entered judgment on August 14, 2015. This 

timely appeal followed.
8 SALYERS V. METROPOLITAN LIFE INS. CO.

JURISDICTION AND STANDARD OF REVIEW

This court has jurisdiction under 28 U.S.C. § 1291. We 

review the district court’s findings of fact for clear error and 

its legal findings de novo. See Pannebecker v. Liberty Life 

Assur. Co. of Boston, 542 F.3d 1213, 1217 (9th Cir. 2008).

DISCUSSION

Salyers raises three arguments on appeal: (1) MetLife 

waived the evidence of insurability requirement because it 

did not ask Salyers for a statement of health, even as it 

accepted her premiums for $250,000 in coverage; 

(2) MetLife should be estopped from contesting coverage 

based on the evidence of insurability requirement; and 

(3) MetLife did not conduct a full and fair review of 

Salyers’s claim. Because we conclude that MetLife waived 

the evidence of insurability requirement, we need not reach 

Salyers’s other claims.

A. Salyers’s Waiver Claim

A waiver occurs when “a party intentionally relinquishes 

a right” or “when that party’s acts are so inconsistent with an 

intent to enforce the right as to induce a reasonable belief 

that such right has been relinquished.” See Intel Corp. v. 

Hartford Accident & Indem. Co., 952 F.2d 1551, 1559 (9th 

Cir. 1991). Courts have applied the waiver doctrine in 

ERISA cases when an insurer accepted premium payments 

with knowledge that the insured did not meet certain 

requirements of the insurance policy. See, e.g., Gaines v. 

Sargent Fletcher, Inc. Grp. Life Ins. Plan, 329 F. Supp. 2d 

1198, 1222 (C.D. Cal. 2004) (holding that an insurer waived 

its right to rely on evidence of insurability requirement as 

grounds for denial of benefits by receiving payments without 

“giving any indication” that the insured had failed to submit 
SALYERS V. METROPOLITAN LIFE INS. CO. 9

evidence of insurability); Pitts v. Am. Sec. Life Ins. Co., 

931 F.2d 351, 357 (5th Cir. 1991) (finding waiver in ERISA 

action where insurer continued accepting payments after 

learning of plan participant’s breach of policy requirements).

This is not, however, a straightforward waiver case, in 

which the insurer had actual notice of the facts and failed to 

act. As the district court found, MetLife and Providence 

created a system in which Providence was responsible for 

interacting with plan participants and MetLife remained 

largely ignorant of individual plan participants’ coverage 

elections. Because of this compartmentalized system, until 

Salyers made her claim for benefits, MetLife did not know 

that (1) premiums had been deducted from Salyers’s 

paycheck or (2) Salyers had elected coverage in an amount 

that required evidence of insurability under the Plan.

MetLife argues that, under the circumstances, its 

inaction—failing to ask Salyers for a statement of health—

was not “so inconsistent with an intent to enforce” the Plan’s 

evidence of insurability requirement as to constitute a 

waiver. See Intel Corp., 952 F.2d at 1559; see also Yale v. 

Sun Life Assur. Co. of Canada, No. 1:12-cv-01429-AWISAB, 2013 WL 5923073, at *11 (E.D. Cal. Oct. 31, 2013) 

(holding that plaintiff failed to establish waiver of evidence 

of insurability requirement because insurer was unaware that 

plaintiff was required to—yet did not—submit evidence of 

insurability). Salyers contends that MetLife’s purported 

ignorance of the facts does not negate its obligation to pay 

the entire $250,000 because, under agency law, Providence’s 

knowledge and conduct may be attributed to MetLife. We 

agree.
10 SALYERS V. METROPOLITAN LIFE INS. CO.

B. Federal Common Law of Agency

a. Congress Authorized the Development of 

Federal Common Law under ERISA

In UNUM Life Ins. Co. of Am. v. Ward, the Supreme 

Court held that ERISA preempts state laws that deem a 

policyholder-employer an agent of the insurer in 

administering group policies. 526 U.S. 358, 379 (1999). 

The Court noted that automatically applying state agency 

rules in the ERISA context would force an employer to 

“assume a role . . . that it has not undertaken voluntarily” and 

affect “not merely the plan’s bookkeeping obligations,” but 

also “the basic services that a plan may or must provide to 

its participants and beneficiaries.” Id. The Court’s holding 

left open the opportunity for federal courts to apply agency 

law in the ERISA context as a matter of federal common law.

As the Supreme Court has recognized, Congress 

empowered courts to “develop a federal common law of 

rights and obligations under ERISA-regulated plans.” 

Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 110 

(1989) (citing Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 56 

(1987) (internal quotation marks omitted)). “Congress 

realized that the bare terms, however detailed, of [ERISA] 

would not be sufficient to establish a comprehensive 

regulatory scheme.” Menhorn v. Firestone Tire & Rubber 

Co., 738 F.2d 1496, 1499 (9th Cir. 1984). For example, 

given the complexity of employee benefit plans, the ERISA 

statutory scheme could not address every aspect of the 

relationships that develop between employees, employers, 

and insurers. In this context, a federal common law of 

agency can “supplement[] the statutory scheme 

interstitially.” Id.
SALYERS V. METROPOLITAN LIFE INS. CO. 11

b. Federal Common Law of Agency Furthers the 

Policy Goals of ERISA

In developing a body of federal common law governing 

employee benefit plans, we have the “obligation” to adopt a 

federal rule that “best comports with the interests served by 

ERISA’s regulatory scheme.” PM Grp. Life Ins. Co. v. 

Western Growers Assur. Trust, 953 F.2d 543, 546 (9th Cir. 

1992). Congress specifically stated that it is “the policy of 

[ERISA] to protect . . . the interests of participants in 

employee benefit plans and their beneficiaries” and to 

“increase the likelihood that participants and beneficiaries 

. . . receive their full benefits.” 29 U.S.C. §§ 1001(b), 

1001b(c)(3). Common law principles of agency effectuate 

those policy goals.

The Restatement of Agency3 defines agency as “the 

fiduciary relationship that arises when one person (a 

‘principal’) manifests assent to another person (an ‘agent’) 

that the agent shall act on the principal’s behalf and subject 

to the principal’s control, and the agent manifests assent or 

otherwise consents so to act.” Restatement (Third) of 

Agency § 1.01 (2006). The legal consequences of an agent’s 

actions may be attributed to a principal when the agent is 

acting within its authority. Restatement (Third) of Agency 

§ 2 intro. note (2006). Additionally, a principal is generally 

charged with notice of facts that an agent knows or has 

reason to know and that are material to her duties as an agent. 

Restatement (Third) of Agency § 5.03 (2006).

 3 The federal common law of agency has frequently been derived 

from the Restatement of Agency. See, e.g., Cmty. for Creative NonViolence v. Reid, 490 U.S. 730, 740 (1989) (citing the Restatement 

(Second) of Agency to give meaning to the term “scope of employment” 

in the Copyright Act).
12 SALYERS V. METROPOLITAN LIFE INS. CO.

These agency principles, which we adopt into the federal 

common law, further Congress’s goals under ERISA by 

preventing insurers from evading their obligation to pay 

benefits. “Preempting state agency laws without replacing 

them . . . [gives insurers] little incentive to monitor ongoing 

administration, or to make sure that new information . . .

reaches the beneficiaries.” Joshua A.T. Fairfield, ERISA 

Preemption and the Case for a Federal Common Law of 

Agency Governing Employer-Administrators, 68 U. Chi. L. 

Rev. 223, 241–42 (2001). Adopting an agency rule as a 

matter of federal common law in this case would not “affect 

the actuarial soundness of the plan” or “fashion a new 

ERISA remedy.” Thrall v. Prudential Ins. Co. of Am., No. 

3:05-CV-00067-RAM, 2008 WL 5156344, at *4 (D. Nev. 

Dec. 5, 2008). Rather, applying the federal common law of 

agency with regard to direct interactions with the insured 

creates incentives for diligent oversight and prevents an 

insurer from relying “on a compartmentalized system to 

escape responsibility.” See Lesser v. Metro. Life Ins. Co., 

No. CV 09-5699 RSWL (CWx), 2010 WL 4916607, at *5 

(C.D. Cal. Nov. 24, 2010); see also Kobold v. Aetna U.S. 

Healthcare, Inc., 258 F. Supp. 2d 1317, 1323–24 (M.D. Fla. 

2003) (concluding that imputing the knowledge of an agent 

to its principal under federal common law of agency is 

consistent with ERISA policy); Steinberg v. Mikkelsen, 

901 F. Supp. 1433, 1438–39 (E.D. Wis. 1995) (same).

C. Providence Acted as MetLife’s Agent

The legal consequences of an agent’s actions may be 

attributed to a principal when the agent has actual authority 

(express or implied) or apparent authority. Restatement 

(Third) of Agency § 2 intro. note (2006). “Express actual 

authority derives from an act specifically mentioned to be 

done in a written or oral communication.” NLRB v. District 
SALYERS V. METROPOLITAN LIFE INS. CO. 13

Council of Iron Workers of the State of California and 

Vicinity, 124 F.3d 1094, 1098 (9th Cir. 1997). “Implied 

actual authority comes from a general statement of what the 

agent is supposed to do; an agent is said to have the implied 

authority to do acts consistent with that direction.” Id. 

“Apparent authority results when the principal does 

something or permits the agent to do something which 

reasonably leads another to believe that the agent had the 

authority he purported to have.” Hawaiian Paradise Park 

Corp. v. Friendly Broad. Co., 414 F.2d 750, 756 (9th Cir. 

1969).

We cannot say whether Providence was acting with 

express actual authority as an agent of MetLife, because the 

contract and other relevant communications between 

Providence and MetLife are not in the record. However, we 

have no trouble concluding that Providence had apparent 

authority, and perhaps even implied actual authority, to 

enforce the evidence of insurability requirement on 

MetLife’s behalf.

Even when an insurer retains control over whether a 

submitted claim was eligible for benefits, a principal-agent 

relationship may still exist where the employer handles 

“nearly all the administrative responsibilities.” See Thrall, 

2008 WL 5156344, at *4–5. The district court found that 

“[t]he task of flagging policies for missing evidence of

insurability was delegated to Providence,” and “Providence 

was responsible for insuring that a statement of health or 

evidence of insurability accompanied Salyers’ selection of 

coverage.” We see no error in those findings. The Plan’s 

enrollment guide informed plan participants that MetLife 

used the statement of health form to determine whether to 

approve coverage. MetLife retained final say on the form 

and contents of the statement of health document. Yet, 
14 SALYERS V. METROPOLITAN LIFE INS. CO.

MetLife played no part in collecting it from plan 

participants.

A plan participant would have reasonably believed that 

Providence did not collect evidence of insurability of its own 

accord but on MetLife’s behalf. Providence’s direct 

interaction with plan participants, coupled with MetLife’s 

failure to engage with Salyers about evidence of insurability, 

suggested that Providence had apparent authority on the 

collection of evidence of insurability. See Restatement 

(Third) Of Agency § 3.03 (2006) (“A principal’s inaction 

creates apparent authority when it provides a basis for a third 

party reasonably to believe the principal intentionally 

acquiesces in the agent’s representations or actions.”). 

Therefore, we conclude that Providence was MetLife’s agent 

for purposes of enforcing the evidence of insurability 

requirement.

Our holding in this case does not mean that a policyholder employer is always an agent of the insurer in every 

aspect of plan administration in which it participates. The 

nature of the relationship between the employer and insurer 

and the nature of the interactions with the insured must be 

considered on a case-by-case basis. Accordingly, MetLife’s 

concerns about an automatic agency rule are inapt.

D. MetLife Waived the Evidence of Insurability 

Requirement

Because Providence was acting as MetLife’s agent for 

purposes of collecting, tracking, and identifying 

inconsistencies with the evidence of insurability 

requirement, Providence’s knowledge and conduct with 

regard to those matters are attributed to MetLife. See

Restatement (Third) of Agency § 2 intro. note, § 5.03 

(2006).
SALYERS V. METROPOLITAN LIFE INS. CO. 15

Providence knew or should have known that Salyers’s 

2014 coverage election required evidence of insurability, 

because Providence’s system showed $250,000 in coverage. 

Despite having not received evidence of insurability from 

Salyers in 2014 or earlier, Providence began deducting 

premiums from Salyers’s paycheck every two weeks

between September 2013 and February 2014, in amounts 

corresponding to $500,000 in coverage for 2013 and 

$250,000 for 2014. Plus, just five days after Gary’s death, 

having still not received evidence of insurability, Providence 

sent a letter to Salyers confirming coverage of $250,000.

The deductions of premiums,4 MetLife and Providence’s 

failure to ask for a statement of health over a period of 

months, and Providence’s representation to Salyers that she 

had $250,000 in coverage were collectively “so inconsistent 

with an intent to enforce” the evidence of insurability 

requirement as to “induce a reasonable belief that [it] ha[d] 

been relinquished.” See Intel Corp., 952 F.2d at 1559; see 

also Gaines, 329 F. Supp. 2d at 1222. Accordingly, MetLife 

 4 Several district courts in our circuit have held that waiver “cannot 

be used to create coverage beyond that actually provided by an employee 

benefit plan.” Flynn v. Sun Life Assur. Co. of Canada, 809 F. Supp. 2d 

1175, 1187 (C.D. Cal. 2011); Yale v. Sun Life Assur. Co. of Canada, No. 

1:12-cv-01429-AWI-SAB, 2013 WL 5923073, at *13 (E.D. Cal. Oct. 31, 

2013). But where, as here, premium payments have been accepted 

despite the plan participant’s alleged noncompliance with policy terms, 

“giving effect to the waiver . . . does not expand the scope of the ERISA 

plan; rather it provides the Plaintiff with an available benefit for which 

he paid.” Gaines v. Sargent Fletcher, Inc. Grp. Life Ins. Plan, 329 F. 

Supp. 2d 1198, 1222 (C.D. Cal. 2004).
16 SALYERS V. METROPOLITAN LIFE INS. CO.

waived the evidence of insurability requirement, and it 

cannot contest coverage on that basis.5

CONCLUSION

The district court erred when it held that MetLife did not 

waive the evidence of insurability requirement. 

Accordingly, we REVERSE and REMAND with 

instructions to enter judgment in favor of Salyers for the 

amount of the $250,000 policy that remains unpaid.

 5 Generally, “[t]he doctrine of waiver looks to the act, or the 

consequences of the act, of one side only, in contrast to the doctrine of 

estoppel, which is applicable where the conduct of one side has induced 

the other to take such a position that it would be injured if the first should 

be permitted to repudiate its acts.” Intel Corp. v. Hartford Accident & 

Indem. Co., 952 F.2d 1551, 1559 (9th Cir. 1991) (internal citations and 

quotation marks omitted). We are mindful, however, of our previous 

statement that “in the insurance context, the distinction between waiver 

and estoppel has been blurred. . . . [I]t is consistent with ERISA to 

require an element of detrimental reliance or some misconduct on the 

part of the insurance plan before finding that it has affirmatively waived

a limitation defense.” Gordon v. Deloitte & Touche, LLP Grp. Long 

Term Disability Plan, 749 F.3d 746, 752-53 (9th Cir. 2014) (internal 

citations and quotation marks omitted). Assuming, without deciding, 

that our holding in Gordon applies beyond the waiver of a statute of 

limitations defense at issue in that case, the record reflects that Salyers 

detrimentally relied on Providence and MetLife’s conduct, presumably 

by not buying other insurance. In a letter to Salyers, MetLife admits that 

“it appears that Ms. Salyers detrimentally relied on having Dependent 

Life Insurance great[er] than $30,000.”