Schmitz v. Sun Life Assurance Co. of Canada
Docket: No. 14-3701
Court: Court of Appeals for the Seventh Circuit; August 22, 2016; Federal Appellate Court
Jeff Schmitz was terminated from Banner Engineering, Inc. in July 2008 due to poor performance and was insured for long-term disability under an ERISA group employee benefit plan funded by Sun Life Assurance Company. After being diagnosed with multiple sclerosis in October 2011, Schmitz applied for long-term disability benefits, claiming his cognitive issues at work were linked to his undiagnosed condition. Sun Life denied his application and subsequent appeal, determining he was not disabled at the time of his termination. Schmitz filed a lawsuit against Sun Life for judicial review of the denial but the district court granted summary judgment in favor of Sun Life, which Schmitz appealed. The court concluded Schmitz's lawsuit was untimely, as the Sun Life policy mandated written notice of claims within 30 days after an elimination period, with proof of claim required no later than 90 days post-elimination period. The elimination period ended on September 30, 2008, making proof of claim due by December 29, 2008, and the statute of limitations for filing a lawsuit expired on December 29, 2011. Schmitz did not file until March 2013, exceeding the contractual limitations. Schmitz argued that Minnesota law allowed for proof of loss to be submitted 90 days after the disability terminated, but this was dismissed based on precedent that stated such statutes do not apply to group insurance policies. He also contended that Sun Life needed to demonstrate prejudice due to the late submission of his claim, which was rejected as irrelevant to the contractual limitation issue. Ultimately, the court affirmed the district court's ruling that Schmitz’s lawsuit was filed after the expiration of the limitations period, thus it was untimely. The district court also found no abuse of discretion by Sun Life in denying the disability benefits.