Opinion ID: 2070577
Heading Depth: 1
Heading Rank: 4

Heading: severance plan interpretation

Text: [¶ 15] If we assume that the L.L. Bean plan was a welfare plan for the purposes of ERISA, cases decided pursuant to ERISA indicate that Niehoff would not have been eligible for benefits under L.L. Bean's severance pay policy. Contract language in an ERISA action is to be given its plain meaning. Rodriguez-Abreu v. Chase Manhattan Bank, N.A., 986 F.2d 580, 586 (1st Cir.1993) (citation omitted). [¶ 16] The L.L. Bean manual provides for severance pay for employees who are dismissed because of continued poor attendance or tardiness due to documented disability, illness or family illness/problems. Niehoff claims he falls within this provision. However, when he was terminated, Niehoff had no position at L.L. Bean and thus no job he could poorly attend. The term poor attendance can be reasonably interpreted to imply that benefits are not awarded to an employee who has lost his position and is on longterm disability leave. Rather, the employee must be presently in a position of employment at L.L. Bean, although the employee is repeatedly absent or late while attempting to continue working. Niehoff was not presently working at his position because he was on medical leave, and entirely absent from work. [¶ 17] Even if the manual terms are considered to be ambiguous, Niehoff's legal malpractice claim fails under ERISA case law and the applicable summary judgment standard. If contract language is ambiguous or uncertain, its interpretation is a question of fact to be determined by a factfinder. See Kandlis v. Huotari, 678 A.2d 41, 43 (Me.1996); Town of Lisbon v. Thayer Corp., 675 A.2d 514, 516 (Me.1996). However, while an argument between parties about the meaning of a contract is typically an argument about a `material fact,' summary judgment is not necessarily foreclosed. Allen v. Adage, Inc., 967 F.2d 695, 698 (1st Cir. 1992) (citations omitted) (an ERISA action affirming a grant of summary judgment for an employer that denied severance pay to its employees). [¶ 18] In ERISA cases, the usual rule that ambiguities in contracts are construed against the drafter does not apply. Even if there is ambiguity in the language ... the evidence presented about the parties' intended meaning may be so one-sided that no reasonable person could decide the contrary (citations omitted). Furthermore, [w]hen interpreting severance pay plans in the ERISA context, ambiguous terms are generally not construed against the employer. Rodriguez-Abreu, 986 F.2d at 586 (citing Allen, 967 F.2d at 701). In Allen, the court decided that where the defendant offered uncontroverted proof of past practice under the plan, the extrinsic evidence, though not robust, is one-sided and points unerringly in the same direction. Allen, 967 F.2d at 702. The court noted that past practice is still frequently used by courts as a device for deciphering the meaning of ambiguous plan provisions. Id. [¶ 19] Shankman addressed the issue of L.L. Bean's past practices by its Rule 7(d) statement that [s]ince the early 1980's it has consistently been the practice at L.L. Bean not to award severance pay to employees on long term disability. Shankman cites the affidavit of L.L. Bean's Director of Total Quality Human Resources, who stated: Since at least 1983, L.L. Bean, Inc.'s policy has been that persons who cannot return to work within one year due to disability do not receive severance benefits after their employee status has ended.... Since Mr. Niehoff was unable to return to work within six months [of receiving long term benefits], his position was filled. L.L. Bean did agree to allow Mr. Niehoff to return to another position if he did so prior to February 19, 1992. Mr. Niehoff did not return to work prior to February 19, 1992, and, consistent with company policy, his status as an employee of L.L. Bean, Inc. ceased. The director cited provisions from L.L. Bean's manual, dated 3/1/92 (after Niehoff's termination), in support of her statements that this was L.L. Bean's continuing practice. [¶ 20] Rule 7(d) statements, supported by appropriate record references, are deemed to be admitted unless properly controverted by the statement required to be served by the opposing party. M.R. Civ. P. 7(d)(2). For Niehoff to prevail under the applicable summary judgment standard, which requires that we not construe the plan terms against L.L. Bean, Niehoff had to produce evidence of past practices placing Shankman's evidence in dispute. Niehoff did not do so. The uncontroverted evidence points to a past practice by L.L. Bean of not granting severance pay to individuals such as Niehoff, who lose their positions after six months of disability leave, and are subsequently terminated due to their inability to return to work a year after the leave commenced. This uncontroverted evidence governs interpretation of the severance plan pursuant to ERISA. See Allen, 967 F.2d at 702. [¶ 21] In conclusion, Niehoff has not shown that he could have recovered had Shankman brought his claims under ERISA, even when we presume L.L. Bean's policy to be an ERISA welfare plan. Because we presume that the L.L. Bean severance pay plan is an ERISA covered plan, we need not address Niehoff's claim that ERISA preemption is established by collateral estoppel. We also do not reopen examination of the state law claims resolved in the prior actions. [¶ 22] Because disputes of material fact are not generated to support the claim that Shankman's actions constituted legal malpractice, Niehoff's claims fail. The entry is: Judgment affirmed.