Opinion ID: 724948
Heading Depth: 3
Heading Rank: 2

Heading: The disfavoring of implied additional terms

Text: 46 A second interpretive principle guiding our analysis is that pension plan trustees or administrators may not construe a plan so as to impose an additional requirement for eligibility that clashes with the terms of the plan. Lower federal courts have held that where plan trustees impose a standard [of eligibility for pension plan benefits] not required by the pension plan itself, that action  'result[s] in an unwarranted and arbitrary construction of the [p]lan.'  Morgan v. Mullins, 643 F.2d 1320, 1321 (8th Cir.1981) (quoting Maness v. Williams, 513 F.2d 1264, 1267 (8th Cir.1975)). 47 We have applied this principle in the context of severance benefits and disability benefits. In Blau v. Del Monte Corp., 748 F.2d 1348 (9th Cir.), cert. denied, 474 U.S. 865, 106 S.Ct. 183, 88 L.Ed.2d 152 (1985), an employer denied severance benefits to several employees. The terms of the severance plan provided for severance pay when jobs [were] 'eliminated' and 'alternative employment opportunities [were] unavailable within the [employer corporation].'  Blau, 748 F.2d at 1354. The employer denied severance benefits, however, because it insisted that the employees additionally needed to show that several other conditions were met, including that there were no positions available outside the corporation, Id. at 1354-55, and that the employees subsequently remained unemployed. Id. at 1355. We concluded that the employer in Blau was attempting to impose additional conditions of eligibility above and beyond those required by the terms of the plan, and we refused to imply other conditions into the plan[.] As we explained in Blau: Imposition of conditions outside the plan amounts to arbitrary and capricious conduct[.] Id. at 1356. 48 Recently, in Saffle, we extended this principle to disability benefits. In Saffle, a plan administrator denied an employee long-term benefits for total disability. The administrator concluded that the employee did not satisfy the definition of total disability because medical reports concluded the employee could return to work if her job was modified to allow her to perform exclusively sedentary work. On appeal, we rejected the administrator's interpretation of the disability plan in part because the administrator construed the plan to prohibit benefits if the employee was able to continue working with accommodations. Such an interpretation, we concluded, would operate to impose[ ] a new requirement for coverage: it would require the claimant to show that accommodations were futile. We rejected this implied additional term, explaining that a [plan] administrator lacks discretion to rewrite the [p]lan. Saffle, 85 F.3d at 459-60 (citations omitted). 49 Applying this principle here, we conclude that the Trustees worked a similar abuse of discretion in interpreting the CLPT plan's application requirement as a prohibition on the payment of retroactive retirement benefits. By retroactively denying benefits to a class of workers who have indisputably earned them, the Trustees have, in effect, imposed on those workers an additional requirement of eligibility: the submission of an application for benefits. We reject such an additional requirement as inconsistent with the terms of the CLPT plan, since nothing in the CLPT plan makes an application a prerequisite for eligibility. 50 Based on the plain language of the CLPT plan, we conclude that the submission of an application is not a condition of eligibility but is merely an administrative procedure that triggers the commencement of benefit payments. As such, the application requirement cannot override the CLPT plan's mandate that an employee who satisfies all of the requirements of eligibility shall be entitled to retire on a Regular Pension under this Plan[.] Section 2.02. Although an application is required for payments to begin, this administrative requirement does not operate to strip eligible retirees of the benefits they earned upon satisfying the three requirements of Plan Two. In construing the CLPT plan to prohibit the retroactive payment of benefits for which the Retirees are indisputably eligible, the Trustees offered an interpretation of the CLPT plan that clearly conflicted with its plain language. 51 Remand to the plan administrator is appropriate where that administrator has construe[d] a plan provision erroneously and therefore has not yet had the opportunity of applying the [p]lan, properly construed, to [a claimant's] application for benefits. Id. at 461. On the facts of this case, however, we conclude that remand is inappropriate. Although the Trustees misconstrued the terms of the CLPT plan, remand is not necessary because reevaluation of the merits of [the Retirees'] claim is not required here. Cf. Id. Unlike cases wherein we have remanded to the plan administrator, no factual determinations remain to be made in this case. Cf. Id. (remanding to the plan administrator for application of correct standard for determining whether claimant had total disability for purposes of disability benefits); Patterson v. Hughes Aircraft Co., 11 F.3d 948, 951 (9th Cir.1993) (remanding to plan administrator for factual determination as to cause of claimant's disability); and Mongeluzo v. Baxter Travenol Long Term Disability Benefit Plan, 46 F.3d 938, 944 (9th Cir.1995) (remanding for reevaluation of evidence in light of new medical standard).