The Eastern District Court of Louisiana found American United Life Insurance Company (“AULIC”) wrongfully terminated long-term disability benefits for a Louisiana trial attorney suffering from cardiac issues. The court found that AULIC incorrectly interpreted the policy language when it determined that the claimant’s occupation was that of a general attorney and not a trial attorney.
Factual Background
Plaintiff Walter Richard House was a partner in the law firm of House, Kingsmill & Riess, L.L.C., earning $350,000.00 a year. House worked for 25 years as a trial attorney when he suffered a heart attack in October 1999 at 49 years of age. House returned to working as a trial attorney, and a year later required emergency quadruple bypass surgery. During the year he worked, House billed more than 2000 hours in pretrial, trial, and appellate work.
House sought disability benefits in November 2000 from AULIC with support from his treating cardiologist, who repeatedly informed AULIC that he could not practice trial law, but could tolerate a different area of law. His treating cardiologist further concluded that House could engage in only limited stress situations and limited interpersonal relations. House did return to work, however, as a transactional attorney performing non-litigation work.
House’s Disability Claim
House’s claim forms to AULIC noted the unusual mental and/or physical requirements of his occupation as a trial attorney included intense and stressful involvement with clients, courts, and opposing counsel. House further noted that he had no history or typical risk factors for heart disease, and attributed the stress of his trial practice as an important contributing factor to his cardiac condition. House’s doctor advised AULIC that a return to the stress of trial would could result in several medical consequences--including death.
AULIC paid nine months of total disability benefits to House while evaluating his claim. After first notifying House that an independent medical examination (“IME”) was necessary to evaluate his claim, AULIC terminated the claim in November 2001. AULIC based its decision on House’s post-operative activities and current employment, he could perform the occupation of attorney.
In response to AULIC’s termination, House filed suit seeking payment of long term disability benefits as well as attorney’s fees.
Attorney Versus Trial Attorney
Under the AULIC policy, the definition of disability for attorneys meant that “because of Injury or Sickness the Person cannot perform the material and substantial duties of his regular occupation.”
AULIC argued that House’s distinction between his current employment as an attorney and his occupation at the firm as a trial attorney was unsupported. They also argued that House could perform the duties of his regular occupation--a sedentary occupation as an attorney, as it is normally performed in the national economy. Notably, AULIC failed to explain its position on the material and substantial duties of this sedentary occupation.
The Court’s Decision
The Easter District Court of Louisiana disagreed with AULIC, for several reasons including:
- The disability policy did not define the phrase “regular occupation;”
- Since “regular occupation” could be interpreted to mean a specific type of law or specialty as well as the general practice of law, it was an ambiguous term to be construed in favor of House; and
- Until its denial letter, AULIC had never suggested House’s “regular occupation” was anything other than that of a trial attorney and it had acknowledged this, in writing.
The court noted that a fair reading of AULIC’s disability policy supported the conclusion that for House to be disabled, he must be able to perform the substantial and material duties of his occupation as a trial attorney, not the general practice of law. Accordingly, he met the definition of total disability under AULIC’s policy.
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