JOSEPH E. MARTINEZ, and JENNIE DARLENE MARTINEZ, as the spouse of Joseph E. Martinez, Plaintiffs-Appellants,
THE PLUMBERS & PIPEFITTERS NATIONAL PENSION PLAN, THE PLUMBERS & PIPEFITTERS NATIONAL PENSION FUND, and THE BOARD OF TRUSTEES OF THE PLUMBERS & PIPEFITTERS NATIONAL PENSION FUND, Defendants-Appellees
APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO. (D.C. NO. 1:12-CV-01063-MSK-MJW).
Dennis P. Walker, Boesen Law, LLC, Denver, Colorado, for Appellants.
R. Richard Hopp, O'Donoghue & O'Donoghue LLP, Washington, DC, for Appellees.
Before TYMKOVICH, MATHESON, and MORITZ, Circuit Judges.
TYMKOVICH, Circuit Judge.
Joseph Martinez was a long-term participant in the Plumbers and Pipefitters National Pension Plan, a multiemployer defined benefit pension plan governed by the Employee Retirement Income Security Act. Following some health problems, Martinez retired from plumbing in 2004 at age 56 and took advantage of the Plan's early retirement pension. After a few years in retirement, he felt well enough to resume working, and his pension was suspended during that time according to rules that prohibit retirement benefits during disqualifying employment. When he retired again in 2009, he asked the National Pension Fund to allow him to convert the pension benefits he previously elected from an early retirement pension to a disability pension--a change that would entitle him to higher monthly payments.
The Fund denied the conversion and the district court upheld the denial. We agree that the Plan language is unambiguous and allows Plan participants to apply for and receive only one type of pension benefit for life absent several clearly delineated exceptions, none of which apply to Martinez.
Accordingly, exercising jurisdiction under 28 U.S.C. § 1291, we affirm the Fund's denial of Martinez's claim for disability benefits.
I. Standard of Review and Plan Provisions
After discussing the standard of review that guides us, we explain the Plan language in some detail and how it was applied to Martinez's request for a disability pension.
A. Standard of Review
Our review is of the Fund's decision to deny Martinez benefits. Holcomb v. Unum Life Ins. Co. of Am., 578 F.3d 1187, 1192 (10th Cir. 2009). We accord no deference to the district court's judgment. Accordingly, like the district court, we must determine the proper standard of review to apply to the Fund's denial of benefits. LaAsmar v. Phelps Dodge Corp. Life, Accidental Death & Dismemberment & Dependent Life Ins. Plan, 605 F.3d 789, 796 (10th Cir. 2010).
In a suit to recover benefits under the Employee Retirement Income Security Act's (ERISA) enforcement provision, 29 U.S.C. § 1132(a)(1)(B), our review is de novo " unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan." Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989); see also Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 111, 128 S.Ct. 2343, 171 L.Ed.2d 299 (2008). In that case, we apply a deferential standard of review and " ask only whether the denial of benefits was arbitrary and capricious." Weber v. GE Grp. Life Assurance Co., 541 F.3d 1002, 1010 (10th Cir. 2008).
There is no question here that the Plan delegates such authority to the Trustees of the Fund and that a deferential standard of review is warranted. See Foster v. PPG Indus., Inc., 693 F.3d 1226, 1232 (10th Cir. 2013). The Plan reserves to the Trustees the discretion " to construe the terms of the Plan, to resolve any ambiguities, and to determine any questions which may arise with the Plan's application or administration, including but not limited to determination of eligibility for benefits." Aple. App. 167 (Section 9.03); id. at 174 (Section 10.06).
Martinez urges that even if the review would otherwise be deferential, procedural irregularities in the administrative appeal process warrant a lesser standard of deference. We have applied de novo review where deferential review would otherwise be required in the face of serious procedural irregularities. LaAsmar, 605 F.3d at 797; see, e.g., Rasenack ex rel. Tribolet v. AIG Life Ins. Co., 585 F.3d 1311, 1317-18 (10th Cir. 2009). It is unnecessary for us to determine whether the Fund in fact violated ERISA's procedural requirements or whether any of the alleged violations would be serious enough to warrant de novo review because, even considering the Fund's denial of benefits de novo, we would affirm.
B. Plan Provisions and Martinez's Election
The Plan offers seven types of pensions for which participants may apply upon retirement depending on the eligibility requirements. A participant who has not yet reached the normal retirement age of 65 is eligible for a disability pension if he is permanently and totally disabled and has accrued a certain number of employment hours and pension credit. The Plan deems a participant permanently and totally disabled only if the Social Security Administration (SSA) has awarded him social security disability benefits.
For a participant who wishes to begin receiving monthly benefits but has not yet received a decision from the SSA that would entitle him to a disability pension, the Plan offers the option of applying for a contingent early retirement pension. To be eligible, an applicant must be awaiting an SSA determination and otherwise be eligible for an early retirement pension. This is the situation in which Martinez found himself when he retired in 2004--awaiting a disability determination from the SSA. He decided to proceed with the application process and apply for a contingent early retirement pension.
The " contingent" aspect of the contingent early retirement pension refers to what happens to the pension when the SSA issues its decision. Before the decision issues, a contingent early retirement pensioner receives monthly benefits in the amount of an early retirement pension. When the decision issues, the pension is automatically adjusted in one of two ways. If the SSA issues a favorable determination, the pension is adjusted to a disability pension and " the Participant shall thereafter receive the amount of the Disability Pension and be considered a Disability Pensioner." Aple. App. 158 (Section 4.16(b)(i)). If the SSA denies benefits, however, " the Participant shall thereafter receive the amount of the Early Retirement Pension and be considered an Early Retirement Pensioner." Id. (Section 4.16(b)(ii)). The Plan provides that " [s]uch adjustments" --meaning the adjustment to a disability or early retirement pension--" shall be made automatically and the Participant shall not otherwise be entitled to change the form of benefit." Id. (Section 4.16(b)(iii)).
Martinez does not contend that he did not have access to the Plan provisions governing the operation of a contingent early retirement pension before he made the election on his application. Moreover, before finalizing an application for a contingent early retirement pension, the Fund requires applicants to sign a form titled Contingent Early Retirement Pension--Declaration of Understanding. Martinez executed this form, which provided, in pertinent part:
I understand that if I am denied a disability award from the [SSA], either upon appeal or choosing not to appeal:
o I will be considered an Early Retirement Pensioner, retaining the same Effective Date of Benefits as established for my Contingent Early Retirement Pension as if the benefit ...