Opinion ID: 1308260
Heading Depth: 1
Heading Rank: 3

Heading: Allowance of Recovery for Central United's Failure to Provide Medical Insurance Benefits Pursuant to Severance Agreement.

Text: Central United urges that the trial court erred in permitting the jury to award damages for denial of the medical insurance coverages granted Wooldridge and his wife under the severance agreement. This issue was raised in the district court by an objection to an instruction that told the jury that in its consideration of damages it could consider the difference, reduced to present value, of the cost of major medical insurance for Wooldridge and his wife to age sixty-five and which Wooldridge would have had to pay if Central United had abided the terms of the severance agreement. The jury was similarly instructed as to the cost of Medicare supplemental coverage after plaintiff his wife reached age sixty-five and the cost of the $10,000 life insurance policy promised in the severance agreement. The objection to the instruction was premised on Central United's contention that it was not required to honor the provisions of the severance agreement pertaining to these insurance coverages because of language in the severance agreement stating: It is hoped that these Plan coverages for retirees will be continued indefinitely, but the Company does reserve the right to change or terminate the Plan at any time. Relying on this language, Central United's objection to the instruction was: We believe that is improper to give [the challenged instruction] for the reason that the contract upon which the plaintiff is claiming recovery in this case provided on its face in not ambiguous language that these benefits could be cut off at any time. They could be terminated or changed by the company. . . . The plaintiff himself said that all of these benefits could have been taken away whether he performed his end of the agreement or not. In reviewing the record, it is apparent that the severance agreement identified the life insurance and medical insurance benefits to be paid to Wooldridge by attaching schedules of those benefits as they appeared in the company's retirement plan. The language pertaining to the employer's right to change or terminate the benefits referred to a retirement plan. Wooldridge was not claiming a right to these insurance coverages as a retiree but, rather, as a party to a severance agreement that expressly conferred these benefits irrespective of his employment status with the company. The district court concluded that it was for the jury to determine whether this contract language supported Central United's claim that it could discontinue these benefits at will. That ruling affords no basis for reversal of the judgment. It was at least as favorable to Central United as the facts warranted. A strong argument could have been made that because Wooldridge was not a retiree the language did not apply to him as a matter of law. Our conclusions on this issue are not altered based upon Wooland dridge's own ambiguous testimony when questioned about these coverages.