In Shore v. International Painters and Allied Trades Industry Pension Plan, Nos. 10-15365, 10-15437 (9th Cir. 2011) (Unpublished Memorandum), the plaintiff brought suit under ERISA for disability benefits, retroactive to 1974, against Allied Trades Industry Pension Plan (the “Plan”). The district court granted summary judgment to the plaintiff, and the Plan appealed.
The plaintiff had worked for employers who contributed to the Plan, until he suffered an on-the-job injury. Due to the injury, the plaintiff became permanently and totally disabled on March 15, 1974, as later determined by the Social Security Administration (“SSA”) in awarding him disability benefits. The plaintiff applied for a disability pension from the Plan in 2003. The Plan denied his application, concluding: (1) his pension credits under the Plan had never vested and were thus nullified by his break in service as of 1977 and (2) his failure to apply for a disability pension within twelve months of receiving the SSA disability award disqualified him.
In analyzing the case, the Court noted that the Plan did not grant discretionary authority to the plan administrator, so the Plan’s denial of the disability pension is reviewed de novo. The Court then said that, once the SSA deemed the plaintiff to be eligible for Social Security disability benefits, which it did as of 1974, he satisfied all of the eligibility requirements for a disability pension under the Plan (i.e., he was permanently and totally disabled, and he had sufficient pension and future service credits). The Plan does not condition entitlement to a disability pension on advance application. Thus, by its terms, the Plan entitles the plaintiff to a disability pension retroactive to his disability onset date of March 15, 1974. The application for benefits is merely a procedural requirement to initiate payment of the benefits, rather than a condition of entitlement. The Court concluded that the plaintiff’s failure to apply for the benefits until 2003 cannot destroy his entitlement to them. Also, the Court said that the Plan’s break-in-service provisions do not apply to a worker-like the plaintiff- who has satisfied all pension eligibility requirements and is already entitled to retire. Thus, the plaintiff’s pension credits were not nullified.
As such, the Court affirmed the district court’s ruling, upholding the grant of the disability pension retroactive to 1974.
Note: With respect to the application for benefits being merely a procedural requirement, the Court hinted that a plan might be able to condition entitlement to the benefits on making an advance application, if the plan contains appropriate language.