North Carolina Disability Help

North Carolina disability attorney is unsuccessful in obtaining disability insurance benefits for former TYCO employee

The Circuit Court of Appeals recently reviewed an unusual short term disability insurance denial by applying North Carolina law. The short-term disability coverage offered by TYCO is not governed by ERISA as the disability plan is self-funded. Unlike the majority of disability plans that are funded by disability insurance companies, a self-funded plan is generally not governed by ERISA. In this case, the North Carolina Disability Attorney representing the claimant attempted to argue that ERISA laws should apply to a policy that is not governed by ERISA.

I consider this case to be strange, because I have rarely ever seen a disability insurance case where the claimant’s attorney wanted ERISA to apply to the case. The bottom line with this case is that the short term disability policy offered by TYCO was written with language that gave TYCO the ability to handle short term disability claims in whatever manner they desired. This case is also another example of the old saying that “you get what you pay for”. This benefit offered by TYCO was either free to employees or the employees could pay a small amount each month. The pertinent language from the Circuit Court of Appeals opinion is provided below:

Under North Carolina law, Tyco’s short-term disability policy is a unilateral contract in which Tyco offered its employees an opportunity to apply for and to receive short-term disability benefits. See White v. Hugh Chatham Mem’l Hosp., Inc., 387 S.E.2d 80, 81 (N.C. Ct. App. 1990); Hamilton v. Memorex Telex Corp., 454 S.E.2d 278, 282-83 (N.C. Ct. App. 1995). A Tyco employee accepts that offer by entering or maintaining employment. See White, 387 S.E.2d at 81.
North Carolina law provides that a contract is construed as a whole, and that individual clauses are construed in their context. Sec. Nat’l Bank v. Educators Mut. Life Ins. Co., 143 S.E.2d 270, 275 (N.C. 1965). If a contract provides a party “discretionary power affecting the rights of others,” then that party must exercise its discretionary power “in a reasonable manner based upon good faith and fair play.” Mezzanotte v. Freeland, 200 S.E.2d 410, 414 (N.C. Ct. App. 1973). A contract confers “discretionary power” when the contract language provides one party with the right to exercise its sole judgment. See Midulla v. Howard A. Cain Co., 515 S.E.2d 244, 246 (N.C. Ct. App. 1999).
We consider the plain language of the short-term disability contract. See Holshouser v. Shaner Hotel Group Props. Ltd. P’ship, 518 S.E.2d 17, 18 (N.C. Ct. App. 1999). The stated purpose of Tyco’s short-term disability policy is to “establish the procedure to determine an employee’s eligibility to receive Short-Term and Long-Term Disability Benefits for non-occupational illness/injury.” The policy defines a “Short Term Disability” as “a condition that renders an employee incapable of performing the required duties of his/her occupation… due to non-occupational injury or illness.” The policy states that a short-term disability benefit “may” be available to an employee who has a short-term disability.
The policy includes a section entitled “Short-Term Disability Procedure.” In that section, the policy explains that an employee must notify his supervisor when he is unable to work due to an illness or injury. The policy further details the responsibilities of the supervisor in contacting the short-term disability “vendor.” According to the policy, the vendor is responsible for contacting the employee and the employee’s medical provider to verify the employee’s medical information.
The procedure section of the policy also explains the various requirements imposed after the approval or denial of an employee’s disability claim. For example, if a claim is approved, the employee must provide medical updates to the vendor on a regular basis. However, if the disability claim is denied, the employee must return to work immediately or appeal the denial of the claim within fourteen days.
A “disclaimer” is provided at the end of the policy. The disclaimer states that “[t]he Vice President of Human Resources, or designee, whose decision shall be final, shall make any interpretation(s) of, or exception(s) to [the] policy.”
The plain language of Tyco’s policy demonstrates that the policy does not guarantee that an employee will receive short-term disability benefits if the employee meets the policy’s requirements for establishment of a short-term disability. Instead, the policy merely provides that short-term disability benefits “may” be available to an employee who has a short-term disability. This language also must be construed in light of other policy provisions, including the disclaimer and the statement that a claim may be “approved” or “denied.” See Sec. Nat’l Bank, 143 S.E.2d at 275.
These provisions, when viewed together, provide employees alleging a disability with the right to file a claim for benefits, and with an established claims procedure that allows Tyco the right to exercise its judgment when reviewing claims made under the policy. This policy language provides Tyco with “discretionary power” to approve or deny claims. See Mezzanotte, 200 S.E.2d at 414. An employee’s right to short-term disability benefits therefore is contingent upon Tyco’s exercise of its discretionary power.
We are not persuaded by Leone’s argument that Tyco lacks discretionary power to approve or deny benefit claims because such power is not stated expressly in the policy. In advancing this argument, Leone exclusively relies on court decisions involving claims brought under the Employee Retirement Income Security Act (ERISA). See Gallagher v. Reliance Standard Life Ins. Co., 305 F.3d 264, 268-69 (4th Cir. 2002); Herzberger v. Standard Ins. Co., 205 F.3d 327, 331-32 (7th Cir. 2000). These ERISA cases, which reflect the fiduciary relationship of an employer to its employees in certain contexts not applicable here, are not relevant to our breach of contract analysis. See Griggs v. E.I. Dupont De Nemours & Co., 237 F.3d 371, 379-80 (4th Cir. 2001) (discussing the responsibilities of a fiduciary under ERISA). As explained above, we reach our conclusion concerning Tyco’s contractual authority upon consideration of the plain language of the entire policy.
We also observe that, under North Carolina contract law, Tyco was required to exercise its discretionary power “in a reasonable manner based upon good faith and fair play.” Mezzanotte, 200 S.E.2d at 414. The evidence in the record shows that Tyco acted reasonably in reviewing Leone’s second claim for short-term disability benefits. Tyco referred Leone’s claim to Dr. Bates for multiple reviews, considered Leone’s appeal and additional documentation, and relied on Dr. Bates’ various recommendations to deny Leone’s claim. Additionally, Leone has not presented any evidence that Tyco failed to exercise its discretionary power in a reasonable manner. Therefore, we hold that the district court did not err in granting summary judgment to Tyco on Leone’s breach of contract claim.

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I am a physician in my 30s who was practicing in my hospital based medical specialty until my Multiple Sclerosis diagnosis began to severely limit my physical ability to work.

My husband and I were obviously in distress at these very unwanted life changes and frankly overwhelmed with the possibility of a long and traumatizing legal battle ahead of us. We knew we were legally entitled to benefits through the separate private individual and employer based ERISA disability insurance policies we had, but even cursory research and discussion with colleagues made it clear that insurance companies will strategize with their own legal teams to find ways to not pay out benefits. We found many before us who had fallen unwittingly into legal pitfalls that prevented them from ultimately obtaining benefits. We realized we needed to seek legal counseling.

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For over 7 months, we have been working closely with Steven Dell and Merlin Bryan from Dell Disability Lawyers as they have guided us through the process of review and initial application for benefits from our two insurance policies (Hartford and Ameritas).

We are happy to announce we just received approval of claim from the Hartford insurance company.

At this time we are still working with this firm as we await the final decisions from Ameritas policy that we are hopeful will have a similar outcome.

As anyone with a chronic and progressive illness can tell you, time becomes a very precious commodity. Through their representation, Dell Disability Lawyers has allowed us to focus the majority of our time enjoying the time and function I have left while resting assured that our disability case laid in competent and caring hands.

The truth is that no amount of money can make up for what we have lost, but it is a huge comfort to have a team like Dell Disability Lawyers at our sides to help us ensure we will be able to continue to care for ourselves and our families.

We highly recommend Dell Disability Lawyers, Mr. Steven Dell and Ms. Merlin Bryan to handle your disability insurance claim.

Thank you Steven, thank you Merlin!

We will certainly plan on leaving another review for completeness once we have our final decision from Ameritas.

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I have been working with Dell Disability Lawyers for the past 5 years concerning my disability as it pertained to my employer. I have been more than pleased with them the entire time. They have always kept me informed of any paperwork needing completed or any changes coming ahead. Nothing has been a surprise. I would recommend them to you to help with your disability case if you’re trying to dip into the policy you’ve been paying for.

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I am a physician who has been disabled for over 10 years. During this time I have been represented by Cesar Gavidia and his assistant, Danielle Lauria. Their representation on my behalf has allowed me to concentrate on dealing with my disability/disease process and all associated complications and not having to deal with all the things that are necessary in a disability insurance claim. Based on my personal experience from many years of practicing medicine I would consider their work product, insight and effort in the disability insurance claim procedures to be superior. I would recommnend them, which I have done, with my highest level of confidence. In short, you will be well served with this practice.

Dan P.

I had to retire from my career due to a bad back that restricted me from performing my duties. I had LTD insurance and after a few years of receiving monthly benefits from this insurance company, they notified me that my benefits were terminated stating that I don’t qualify due to my duties not fitting into some “national job description” and a nurse had deemed me eligible to go back to work. It’s a crushing feeling to have this told to you over the phone with hardly any information given. Luckily, I came across Dell Disability Lawyers and spoke with Attorney Palamara who calmed me down and stated they would take my case. Within a couple of months my benefits were restored, and I had piece of mind. I cannot thank Attorney Palamara and the staff at Dell Disability Lawyers enough for their professionalism, no nonsense approach, personal and timely communication and quick ability to litigate my case.

Jen S.

I wanted to thank Mr. Symonds and his legal assistant Sonia for their professionalism, guidance and dedication towards my LTD insurance claim. Going through the denial process on my own was going to get me sicker and I knew it was time for help right away. I reached out to Dell Disability Lawyers for assistance and not too long after my call, I was connected with Sonia. Soon after that, I was talking about my case with Mr. Symonds. After a long and tedious process with the LTD insurer, we won the case. The wait can absolutely be lengthy, but in the end, it was all very much worth the fight. Thank you both so much for all that you have done for me! I also want to thank those who assisted in keeping me updated, as needed. Highly recommended for anyone who is going through the brutal process of an LTD denial.

Carl G.

I would like to thank Dell Disability Lawyers for taking care of my case and help me get the insurance coverage that I was rightfully in need of. Specially, I would like to thank Attorney Alexander Palamara and right-hand legal assistant, Sonia Nogueira, who made this process less stressful. They answered all my questions and kept me informed every step of the way.

Don’t get me wrong. They never promised or told me that I was going to win my case, as no one can guarantee that for you. What they did do, was letting me know that they were working hard for me and to keep positive. Something that I recommend everyone to do is to subscribe to their YouTube channel. That will give you an idea on how they operate and why they (for most of their cases) win their cases.

Since I was awarded disability, I am still having surgeries and thanks to them, I’ve been able to cover all those expenses.

Warm regards to everyone at Dell Disability Lawyers!

Clarisa B.

I’m so very Grateful and Thankful for the team at Dell Disability Lawyers. They worked tirelessly to get the best outcome for me. I’m so glad that I found them!!

Carole S.

Exceptional, efficient and professional service from Jay Symonds and Sonia Nogueira. They were both so helpful and knowledgeable and navigated me through a very stressful and difficult situation with New York Life.

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