Court Opinion

ID: 9797763
Source: CourtListenerOpinion
Date Created: 2023-08-31 04:28:49.42354+00
Date Added: 2024-06-11T08:58:18.990227
License: Public Domain

EDMONDS, P. J.,
concurring.
In light of the United States Supreme Court’s decisions regarding the Employment Retirement Security Act of 1974 (ERISA), Congress should, in fairness to both insurers and policyholders, amend section 502(a)(3)(A) of the act to permit insurers to recover directly from policyholders amounts that are duplicated by amounts recovered from a third party that causes injury to the policyholder. Under the existing language of the act, ERISA policyholders are unjustly enriched because they are entitled to retain the benefits paid by insurers even though they have subsequently received compensation from third-party wrongdoers for the identical losses. In light of the Court’s holding in Great-West Life & Annuity Ins. Co. v. Knudson, 534 US 204, 122 S Ct 708, 151 L Ed 2d 635 (2002), and its predecessors, there appears to exist no effective way in which an insurer can obtain direct reimbursement from the policyholder. According to the Court, Congress does not intend for insurers to have a remedy for recovery against the policyholders that results in personal liability to the policyholder. Although it may be legally possible for an insurer to recover benefits through a constructive trust on the money itself or through other means where the personal liability of the policyholder is not involved, the use of such remedies cannot help but complicate and perhaps frustrate the purposes for which the act was enacted by causing increased delay in the resolution of *199claims and increased legal costs to both parties. While I concur with the majority’s analysis, our result in this case, dictated by United States Supreme Court precedent, is draconian in its effect on the parties, particularly in light of the ordinary equitable principle that a person should be compensated for a loss only once.