U.S. Court of Appeals, 10th Circuit Weighs in on ERISA-Plan Legal Action Time Limitations

The U.S. Court of Appeals for the 10th Circuit has affirmed a trial court’s finding that ERISA-plan legal action time limitations, which are shorter than a state’s statute of limitations, are enforceable if they are reasonable. Salisbury v. Hartford Life and Accident Insurance Co., No. 08-3316.

Hartford was represented by Karrie Clinkinbeard and Patrick Kenny of Armstrong Teasdale LLP.

The appellate ruling, which upheld the U.S. District Court for the District of Kansas’ grant of summary judgment in favor of Hartford, sided with earlier decisions by the 5th, 6th, 7th and 8th U.S. Circuit Courts of Appeal.

The case was brought by Carol Ann Salisbury, a participant in a group long-term-disability insurance plan issued by Hartford. Salisbury had sued Hartford about five years after she lost an administrative appeal of the insurer’s denial of certain benefits. The terms of the insurance plan required participants to file suit within three years.

Salisbury became disabled in 2000 when she was injured at work. She did not file for benefits, however, until the summer of 2002.

On October 15, 2002, Hartford approved and paid her benefits for the period from August 3, 2000, to August 2, 2002, because she was unable to perform one or more essential duties of her occupation. But because the plan’s definition of disabled was more restrictive for periods after the first two years of disability, Hartford denied benefits for any time after August 2, 2002.

In 2003 Salisbury administratively appealed the denial of further benefits and Hartford rejected the appeal that same year. Salisbury sued Hartford in March, 2008 but the trial court held that the suit was time-barred.

In the 10th Circuit Salisbury argued that the language of the plan was ambiguous, circular and confusing making it difficult to determine when the limitations period began. The district court and the appellate court disagreed and said the period was easily determinable.

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