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    Howe v. First Tennessee National, 4th Cir. (2007)

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    This unpublished opinion from the United States Court of Appeals for the Fourth Circuit affirms the district court's ruling in a case brought by John Howe against his former employer. The court held that: (1) Howe's state law contract claims regarding long-term disability benefits were preempted by ERISA; (2) amending the complaint to bring ERISA claims would be futile because the settlement agreement expressly stated the benefits were subject to the underlying plan documents; and (3) under both Maryland contract law and ERISA, the settlement agreement unambiguously provided that Howe's benefits were governed by the plan documents, which terminated benefits at age 65 rather than the stated date of 2020.

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    Howe v. First Tennessee National, 4th Cir. (2007)

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    This unpublished opinion from the United States Court of Appeals for the Fourth Circuit affirms the district court's ruling in a case brought by John Howe against his former employer. The court held that: (1) Howe's state law contract claims regarding long-term disability benefits were preempted by ERISA; (2) amending the complaint to bring ERISA claims would be futile because the settlement agreement expressly stated the benefits were subject to the underlying plan documents; and (3) under both Maryland contract law and ERISA, the settlement agreement unambiguously provided that Howe's benefits were governed by the plan documents, which terminated benefits at age 65 rather than the stated date of 2020.

    Original Description:

    Filed: 2007-11-29 Precedential Status: Non-Precedential Docket: 06-1464

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    This unpublished opinion from the United States Court of Appeals for the Fourth Circuit affirms the district court's ruling in a case brought by John Howe against his former employer. The court held that: (1) Howe's state law contract claims regarding long-term disability benefits were preempted by ERISA; (2) amending the complaint to bring ERISA claims would be futile because the settlement agreement expressly stated the benefits were subject to the underlying plan documents; and (3) under both Maryland contract law and ERISA, the settlement agreement unambiguously provided that Howe's benefits were governed by the plan documents, which terminated benefits at age 65 rather than the stated date of 2020.

    Copyright:

    Public Domain
    Download as PDF or read online from Scribd
    Download as pdf
    11 views6 pages

    Howe v. First Tennessee National, 4th Cir. (2007)

    Uploaded by

    Scribd Government Docs
    This unpublished opinion from the United States Court of Appeals for the Fourth Circuit affirms the district court's ruling in a case brought by John Howe against his former employer. The court held that: (1) Howe's state law contract claims regarding long-term disability benefits were preempted by ERISA; (2) amending the complaint to bring ERISA claims would be futile because the settlement agreement expressly stated the benefits were subject to the underlying plan documents; and (3) under both Maryland contract law and ERISA, the settlement agreement unambiguously provided that Howe's benefits were governed by the plan documents, which terminated benefits at age 65 rather than the stated date of 2020.

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    UNPUBLISHED

    UNITED STATES COURT OF APPEALS


    FOR THE FOURTH CIRCUIT

    No. 06-1464

    JOHN N. HOWE,
    Plaintiff - Appellant,
    versus
    FIRST TENNESSEE NATIONAL CORPORATION, d/b/a
    First Horizon National Corporation; FIRST
    HORIZON HOME LOAN CORPORATION, formerly known
    as FT Mortgage Companies,
    Defendants - Appellees.

    Appeal from the United States District Court for the District of
    Maryland, at Baltimore. William D. Quarles, Jr., District Judge.
    (1:05-cv-01468-WDQ)

    Submitted:

    September 17, 2007

    Decided:

    November 29, 2007

    Before SHEDD, Circuit Judge, HAMILTON, Senior Circuit Judge, and


    Samuel G. WILSON, United States District Judge for the Western
    District of Virginia, sitting by designation.

    Affirmed by unpublished per curiam opinion.

    James P. Ulwick, Jean E. Lewis, KRAMON & GRAHAM, P.A., Baltimore,


    Maryland, for Appellant. Thomas L. Henderson, O. John Norris, III,
    LEWIS, FISHER, HENDERSON, CLAXTON & MULROY, L.L.P., Memphis,
    Tennessee, for Appellees.

    Unpublished opinions are not binding precedent in this circuit.

    PER CURIAM:
    John Howe brought this action under the district courts
    diversity jurisdiction against his former employer, FT Mortgage
    Companies

    (FT

    Mortgage)

    and

    related

    corporation,

    First

    Tennessee National Corporation (First Tennessee), claiming that


    they breached their promise to extend long-term disability benefits
    to him beyond the maximum term of his benefits plan.1

    The district

    court found that the Employee Retirement Income Security Act


    (ERISA) preempted Howes state law claims and denied Howe leave
    to amend his complaint to assert an ERISA claim because that
    amendment would be futile.

    We affirm.

    I
    Howe worked as an asset manager for FT Mortgage for four
    years. In 1997, Howe was forced to stop working by a heart
    condition and began receiving short-term disability benefits under
    FT Mortgages benefits plan.

    On September 3, 1997, near the end of

    Howes short-term disability period, a benefits counselor at FT


    Mortgage sent Howe a letter stating that he understood that Howe
    might be applying for long-term disability benefits under the plan.
    The 1997 letter explained the long-term disability benefits Howe

    First Tennessee National Corporation, which does business as


    First Horizon National Corporation, is the parent company of First
    Tennessee Bank National Association, which, in turn, is the parent
    corporation of FT Mortgage Companies. FT Mortgage is now known as
    First Horizon Home Loan Corporation.
    2

    would receive if Howes application were approved and concluded:


    [y]our

    Long-Term

    Disability

    Benefits

    03/06/2020 as long you remain disabled.

    will

    continue

    until

    At that time, you will be

    eligible to retire from First Tennessee Bank.

    The statement that

    Howes long-term disability benefits would continue until March 6,


    2020 when Howe became eligible to retire was in error because Howe
    would be 80 years old in 2020 and would have been eligible to
    retire 15 years earlier at age 65.
    In a separate action in 1998, Howe sued FT Mortgage and First
    Tennessee to recover certain retention and severance benefits he
    believed he was due.

    The parties settled the lawsuit.

    Under the

    settlement agreement, FT Mortgage and First Tennessee agreed to pay


    Howe $22,144 plus attorneys fees.

    In return, Howe agreed to

    release FT Mortgage and First Tennessee from all liability to him


    except for certain stock options and for the benefits outlined in
    the September 3, 1997 letter from the Company to Mr. Howe . . .
    subject to the terms and conditions of the underlying prospectus
    and plan documents that govern those benefits.2

    The full paragraph contained in the settlement agreement


    reads:
    Notwithstanding anything to the contrary in this
    Agreement, Mr. Howe shall continue to be entitled to the
    Company benefits outlined in the September 3, 1997 letter
    from the Company to Mr. Howe, attached hereto as Exhibit
    A, and the remaining options (which vest and can be
    exercised on April 21, 1999 and expire on November 10,
    2000) shown on attached Exhibit B, subject to the terms
    and conditions of the underlying prospectus and plan
    documents that govern those benefits. (emphasis added)
    3

    Howe brought this state law contract action claiming that the
    1998 settlement agreement, which incorporated the 1997 letter,
    provided that he would receive long-term disability benefits until
    2020

    and

    that

    agreement

    by

    FT

    Mortgage

    terminating

    and

    First

    benefits

    Tennessee
    at

    age

    breached
    65,

    in

    that
    2005.

    Alternatively, Howe sought leave to amend his complaint to claim


    that the 1998 settlement agreement and letter constituted an ERISA
    plan.

    The district court held that ERISA preempted Howes state

    law contract claim.

    The court also denied Howe leave to amend

    because the settlement agreement did not create an ERISA plan and
    that even if the agreement had created a plan, it was expressly
    subject

    to

    the

    existing

    plans

    documents

    which

    provide

    that

    eligibility for long-term disability terminates when the employee


    reaches 65.

    II
    We agree with the district court and affirm on its reasoning,
    which we see no reason to explore further here.

    We also affirm on

    the additional ground that whether we were to apply Maryland


    contract law or ERISA to the 1998 settlement agreement, we would
    reach the same result because the settlement agreement is expressly
    and unambiguously subject to the same underlying plan documents and
    under those plan documents Howes disability benefits terminated at
    age 65.

    Construction of the meaning of an agreement begins with the


    language

    of

    the

    agreement.

    When

    the

    language

    employed

    is

    unambiguous, the court is required to give effect to its ordinary,


    natural or plain meaning.

    Catawba Indian Tribe of South Carolina

    v. City of Rock Hill, 501 F.3d 368, ___ (4th Cir. 2007) (stating
    that objective

    interpretation of contracts gives force to the

    language of the contract when it is plain and capable of legal


    construction);

    Honeycutt v. Honeycutt, 822 A.2d 551 (Md. 2003);

    Restatement (Second) of Contracts 202 (1981).


    The

    1998

    settlement

    agreement

    expressly

    subjects

    Howes

    disability benefits to the terms and conditions of FT Mortgages


    plan documents.

    The plan documents terminate long-term disability

    benefits at the time of retirement eligibility, age 65.

    Howe

    attempts to create ambiguity by claiming that only the stock


    options listed after the disability benefits in the settlement
    agreement are subject to plan documents. However, this court reads
    the entire sentence and finds that the unambiguous language of the
    settlement agreement forecloses any further argument.

    Howes

    benefits are subject to FT Mortgages benefits plan, and that plan


    terminates benefits at 65.
    Therefore, this court finds that Howe is entitled only to
    long-term disability benefits provided for in FT Mortgages ERISA
    plan until age 65, not until 2020 when he reaches age 80.

    III
    For the reasons stated above, this court affirms the judgment
    of the district court.
    AFFIRMED

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