Opinion ID: 618491
Heading Depth: 2
Heading Rank: 2

Heading: Did a Delegation Occur?

Text: The Plan asserts that evidence of a delegation of authority to Partners can be found in a 2005 document entitled Partners HealthCare System, Inc. Health and Welfare Plan Document (the Partners Plan Document), which the Plan characterizes as a Summary Plan Description (SPD). The document, published under Partners' name, purports to be a wrap-around plan document that contains the definitions, participation and administration provisions of the various Partners health and welfare plans, which includes the Plan at issue here as well as over forty others, and incorporates by reference the various Benefit Contracts associated with the Plan to form a complete plan document. The language supposedly effecting the delegation, located in Section II, Article IX of the Partners Plan Document, simply states, Partners acts as the Plan Administrator for ERISA purposes of the Plans. The Partners Plan Document further provides that, as Plan Administrator, Partners has the discretion to determine all matters relating to eligibility, coverage and benefits under each Plan and has the full power to interpret each Plan and is responsible for the operation of each Plan. Our cases involving delegation of fiduciary authority under ERISA do not directly address what sort of evidence will suffice to show that delegation has been effected. To some extent, the answer in an individual case may depend upon whether the ERISA -25- plan at issue sets forth particular procedures to canalize the delegation process. However, often, as here, the plan will not specify a mechanism for delegation. In these cases, our precedents hint at some basic guidelines for determining whether the evidence before the court establishes the delegation of fiduciary authority. First, it is not enough merely to show that the putative delegate is carrying out discretionary functions of plan administration. In Rodriguez-Abreu, a senior executive of the defendant employer conducted a review of the denial of plaintiff's benefits and corresponded with the plaintiff regarding his eligibility. 986 F.2d at 582, 584. The defendant argued that these circumstances alone were sufficient to show that the plan fiduciaries had delegated their discretion to the executive, triggering a deferential standard of review. We disagreed. Noting that there was no expression of intent that [the executive] act as the delegate of the Fiduciaries in the plan documents or elsewhere in the record, we found no valid delegation of authority and thus employed a de novo standard of review. Id. at 584. Second, evidence of the delegation may be provided by a written instrument other than the plan documents themselves. In Terry, the benefit plan at issue conferred discretionary authority to administer the plan to the Bayer Corporation, and Bayer in turn delegated that authority to an internal Benefit Administration Committee. 145 F.3d at 37-38. The only evidence of this -26- delegation was an internal organizational document (the Administrative Procedures for the Benefit Administration Committee), which, among other things, explained that the Committee had been formed to 'act on behalf of [Bayer] by assisting [Bayer] in fulfilling its administrative duties which are set forth in the employee benefit plans.' Id. at 35, 38. We found this clear and direct delegation -- by written instrument -- from the Plan Administrator to the Benefit Committee sufficient to justify a deferential standard of review. Id. at 38; see also Wallace, 585 F.3d at 14-15 (holding extra-plan written instrument transferring discretionary authority to administer plan to third party sufficient evidence of valid delegation to trigger review under the arbitrary and capricious standard). Here, we have a written document -- the Partners Plan Document -- that purportedly gives to Partners the discretionary authority to administer the Plan. However, the relevant terms in the Partners Plan Document represent nothing more than the bare assertion by a third party of discretionary authority over administration of the Plan. The document states simply that Partners acts as the Plan Administrator for all plans listed among its pages,11 and that Partners has the discretion to 11 As Maher points out, the Partners Plan Document never accurately refers to the Plan. In a table detailing the various subsidiary plans to which it applies, the Partners Plan Document lists an MGH LTD Insurance Plan. The Plan is not, in fact, an insurance plan, as it is funded through a trust, and thus the -27- determine all matters relating to eligibility, coverage and benefits under each Plan and has the full power to interpret each Plan and is responsible for the operation of each Plan. This is at best corroborative evidence of a transfer of authority from the Hospital to Partners, but insufficient on its own to establish the delegation. The Plan has offered no evidence of an agreement between the Hospital and Partners, a corporate resolution by the Hospital, or other such documentation that would indicate that the Hospital affirmatively granted discretionary authority over the Plan to Partners. In arguing over the effect of the Partners Plan Document, the parties vigorously dispute whether it properly qualifies as an SPD for the Plan.12 This is a question that need not be resolved here, as nothing turns on it. Even if the Partners Plan Document qualified as an SPD, there would be a direct conflict with the primary Plan document that must be resolved in the Plan document's favor. Each document purports to grant full discretionary authority over the Plan, with the power to make final and binding decisions, to a different entity. Where there is a conflict reference to an LTD Insurance Plan is erroneous. 12 Maher argues at some length that the Partners Plan Document fails to include all categories of information required by statute to be present in an SPD. See 29 U.S.C. § 1022(b). The Plan counters that the Partners Plan Document explicitly states that it is only one of several documents that collectively constitute the summary plan description for each Plan, implying that those additional documents supply the missing information. -28- between the plan and the SPD, the plan language will generally control, except in situations where the beneficiary relied to her detriment on the SPD. See Ringwald v. Prudential Ins. Co. of Am., 609 F.3d 946, 948-49 (8th Cir. 2010) (disregarding grant of discretionary authority that appeared only in SPD); Schwartz v. Prudential Ins. Co. of Am., 450 F.3d 697, 699-700 (7th Cir. 2006) (same, and explaining that SPD controls if participant detrimentally relied on it); cf. Mauser v. Raytheon Co. Pension Plan for Salaried Emps., 239 F.3d 51, 54-55 (1st Cir. 2001) (where SPD conflicts with a plan's terms, the SPD will control if the claimant demonstrates significant or reasonable reliance on the SPD). Thus, to the extent that the Partners Plan Document qualifies as an SPD, the grant of discretionary authority in the Plan document must still be credited over the conflicting grant in the putative SPD.13 In sum, the Plan by its terms did not authorize the Hospital to delegate its authority, and, even if the Plan had permitted such delegation, there is insufficient evidence that the 13 The majority fails to confront the inconsistency between the documents and, indeed, cites the Partners Plan Document as evidence that the Hospital was authorized to delegate its discretionary authority. But a bare assertion of authority by the putative delegee is even less meaningful as proof that delegation was authorized than it is as evidence that a delegation in fact occurred. In effect, the majority assumes that Partners' assertion that it had authority is evidence that it was given that authority. Such circular reasoning is both illogical and unpersuasive. -29- Hospital in fact delegated its authority to Partners. Partners' denial of Maher's benefits must therefore be reviewed de novo.