INSURANCE: “Conduct of business” in “Business Squire” policy triggers coverage of wildfire that resulted from felling dead tree in yard of home-based business to protect business equipment and ,personal property from falling tree and then burning the branches for personal aesthetic reasons (“dual-purpose” conduct)… Strong.

Robert Fitte operates a home remodeling and siding business as sole proprietor in Helena. He uses a room of his home as an office, maintains a separate business phone, and deducts part of his business insurance and utility expenses from his taxes. He lists his home address in his Yellow Pages ad. He keeps work equipment and vehicles at his home and has no other business address. In 2012 he decided to remove a dead 70 tree from his yard, primarily to prevent it from falling on work equipment and to protect non-business personal property. He felled it 6/21/12, then stripped the branches and burned them in his yard. On 6/23, after he thought the fire had gone out, it ignited an adjacent wooded area. The flames spread to neighboring properties, allegedly causing damage that prompted claims against him including a State Court action by Kevin DeTienne. He had a $300,000 personal lines policy and a $1 million business policy from Mountain West. Mountain West has defended under the personal policy and committed to paying its limit. It is defending under the business policy subject to reservation of rights, but denies any obligation to provide coverage. The business policy states that Fitte is an insured “only with respect to the conduct of a business.” It limits coverage to his operations, listed as “siding installation” and “contractors-subcont work in connect w/BLDG const.”

Mountain West argues that the definition of “insured” limits coverage to damages arising only from business activity, and that “business conduct” must have been part of “a continuous or regular activity for the purpose of earning a profit or making a living.” Lambert (WV 1995). It also cites Eyler (Ky. 1992) and Miller(Mo. App. 1994) (business conduct involves a “continuity of activity with a profit motive.” It acknowledges that Fitte felled the tree “arguably” for both business and personal reasons, but argues that the claims arise from the separate act of burning the branches, which served an exclusively personal purpose — improving aesthetics of his property. It argues that even if the claims are attributed to the more general act of hazard removal they are still not covered because the conduct was only partly for business purposes. It argues that the phrase “only with respect to the conduct of a business” necessarily excludes conduct that serves both business and personal benefits. Heinz (Ida. 2001).

DeTienne and Fitte argue that the claims arise from Fitte’s tree removal operation, of which disposing of the branches was a part, and that he removed the tree at least in part to protect business equipment and therefore burning the tree was covered business conduct. DeTienne cites cases for his contention that the “conduct of business” includes activity that does not directly garner profit: Carpenter (Alaska 2003) (felling tree for firewood in home from which insured ran floor covering business was covered); United Pacific (ED NY 2006) (removal of ice from sidewalk at construction site construed as business activity); Lineham (Wis. 2000) (keeping dog at bar as guard & mascot is business activity). Fitte and DeTienne contend that the conduct should be covered even if Fitte acted for personal as well as business benefit — that “dual-purpose conduct” should be covered by both policies. They cite Cope (ND Indiana 1991) (vacation covered if sufficiently related to business purposes even if also partly recreational).

Carpenter is instructive as to whether the fire arose from business conduct: “Businesses necessarily engage in much conduct that is incidental to and supportive of revenue-earning operations. Businesses must, for example, acquire supplies, equipment and fuel, pay bills, bank, repair what they use, and send their employees on countless errands in support of operations.” Business operations also include keeping equipment safe, including disposal of a large dead tree that threatens assets. Disposal only began with felling the tree. Fitte continued disposal when he burned the branches. The fire resulted from the tree disposal that he undertook in part for business purposes. This is not a “cosmic, zen-like argument that all things are connected from the beginning of time” as Mountain West asserts. The connection between felling and disposal by burning is clear & concrete. Burning the tree was in part the “conduct of business” which, for a sole proprietor like Fitte, includes many tasks in support of the work for which he is actually paid. At the very least, “conduct of business” is ambiguous and must be construed in favor of the insured.

The business policy covers damages arising out of conduct of business, even if the conduct is also motivated by non-business interests. Mountain West’s argument that it limits coverage to conduct that is only for business relies on a strained interpretation of “only with respect to the conduct of a business.” A more reasonable reading is that it limits coverage to only conduct that served a business purpose — conduct must be business related, not purely personal. This would include business conduct that might also serve some personal benefit. If Mountain West intended to say that only conduct exclusively for business purposes was covered it certainly could have. Its interpretation would make coverage illusory or nearly so, allowing it to deny coverage even for conduct 99% motivated by business interests. Cope held that the identical “only with respect to the conduct of business” was ambiguous because “reasonable persons might well differ on the question of whether they exclude coverage for activities furthering dual purposes of recreation and profit.” It denied summary judgment, holding that coverage existed if the insured could prove at trial that the trip was sufficiently related to business. Mountain West contends that Cope turned on the “highly nebulous matter of whether a trip was for business or pleasure.” It is unclear why it believes the distinction between a trip and other activity is significant, but in any event, nothing in this case is highly nebulous. It is undisputed that Fitte was removing the tree for both business and personal benefits. Mountain West urges the Court to follow Heinz, which held that either a personal policy or a business policy, but not both, could apply. The policy in Heinz completely excluded business conduct, so the parties agreed that only one policy or the other would apply. Those critical circumstances do not exist here. In light of the plain language of the contract and the case law, Fitte’s “conduct of business” triggers coverage under the policy, notwithstanding the personal benefit he also derived from the conduct. Claims arising out of the fire must be covered by the business policy. Summary judgment for Fitte and DeTienne.

Mountain West Farm Bureau Mutual Ins. v. Fitte and DeTienne, 40 MFR 516, 8/19/13.

Randall Nelson (Nelson & Dahle), Billings, for Mountain West; Joe Seifert (Keller, Reynolds, Drake, Johnson & Gillespie), Helena, for Fitte; Thomas Budewitz, Helena, for De Tienne.

JURY WAIVER: Defendant failed to overcome presumption against waiver, failed to prove knowing waiver by buried unilateral provision, motion to strike jury demand denied… Molloy.

Impact Mechanical sued to collect $900,000 for work on Rainbow Dam. Walsh Const. counterclaimed against Impact and its associated company IMI Technology. Walsh, PPL Montana, and Travelers Casualty & Surety (“Walsh”) move to strike Impact’s jury demand. They seek to enforce a provision in the subcontractor agreement providing that Impact — and only Impact — “waives its right to a trial by jury in any and all disputes or claims arising out of or in relation to this Agreement.” Impact argues that it did not knowingly & voluntarily agree to the waiver buried in Walsh’s form contract. Walsh project manager Lucas Lowney and Impact VP Jeff Kueffner testified at the evidentiary hearing to their negotiations.

The 7th Amendment guarantees the right to a jury “in Suits at common law, where the value in controversy shall exceed twenty dollars.” That portends a fundamental right guarded by a presumption against waiver. A waiver of a jury in a civil case must be made knowingly & voluntarily. Palmer (9th Cir. 2009). There is a strong federal policy favoring juries in civil actions and the right to a jury in federal courts is a matter of federal law. Simler (US 1963). Even so, since jurisdiction here is based on diversity, the contract is interpreted under state law. Albert (9th Cir. 1959). The paragraph at issue also provides that the contract is to be governed by Montana law — where Rainbow Dam is situated. While Montana law recognizes that a contract may provide jury waiver when it has an arbitration clause, a contractual provision restricting enforcement of contractual rights “by the usual proceedings in the ordinary tribunals” is void. MCA 28-2-708. The parties and Court were unable to find any cases applying 28-2-708 to unilateral contractual jury waivers. Walsh makes the point that if it rendered contractual jury waivers void it would conflict with Montana Art. II §26 which authorizes trial without a jury upon lawful consent of the parties. However, the waiver here was a unilateral condition imposed by “corporate” that was not amenable to negotiation absence corporate counsel’s input. In any event, it is unnecessary to decide whether the unilateral waiver here is void under Montana law because the facts at the hearing show that Impact did not knowingly & voluntarily waive a jury.

4 factors are weighed in determining whether there was a knowing & voluntary waiver: negotiability of contract terms, conspicuousness of the waiver, relative bargaining power, and business acumen of the party opposing the waiver. Cannon (N.D.Cal. 2013). The ultimate question is whether the waiver is “unconscionable, contrary to public policy, or simply unfair.” Id. The facts show that all 4 favor Impact, compelling the conclusion that the unilaterally imposed waiver is unfair.

Negotiations on the subcontract were conducted in several meetings, phone calls, and emails. The only proof about the waiver was that Kueffner read the contract. Walsh contends that nothing was off the table, as evidenced by modification of scope of the work at Impact’s request and a rider containing clarifications to the subcontract. But Kueffner testified that Walsh refused his attempts to negotiate minor changes to how the work was to be performed. Most importantly, it is undisputed that the waiver was never discussed during negotiations. Although Lowney averred that he reviewed all contract documents with Kueffner “page by page,” he admitted he did not review Exh. A and that is the boilerplate language that he said he had no authority to alter absent specific approval by counsel. It was also established that Exh. A was part of Walsh’s form in use since at least 2008. Lowney actually referred to it as “boilerplate” and admitted that in his 6 years of negotiating contracts he had made fewer than 10 changes to it and most of them involved the indemnification clause and he never made changes to the waiver. While he was responsible for negotiating numerous million dollar contracts, he had no authority to make changes to Exh. A. Kueffner testified that the focus of negotiations was on the bond, timing of payments, scope & timing of the work, and safety. He testified that he told Lowney that he was not used to reading large contracts. Lowney replied that it was a standard form contract that all subcontractors were required to sign if they wanted to do business with Walsh. Kueffner admits that he read most of the contract, but focused on provisions describing the work he had to do and he did not really consider the significance of the jury waiver. The hurried reading of a jury waiver, without more, does not overcome the presumption against waiver or prove a knowing & intelligent waiver of a constitutional right.

The only thing that could make the waiver less conspicuous is if it was in fine print in a footnote. It is buried in the 5th sentence of a 6-sentence paragraph, in the 11th article of a 12-article, 8-page exhibit, that is one of 8 exhibits which total over 30 pages. It is not pronounced in any way, it is not set off by bold type, large type, or capitals, and Impact was not asked to initial it or sign the page. This does not rise to the level of proof required to show a knowing & intelligent waiver of a fundamental right.

Lowney’s testimony that he felt Impact’s bargaining power was similar to Walsh’s is belied by the fact that Walsh was a general contractor in charge of 20 subcontractors on a $245 million project, of which Impact’s portion was $1.3 million. It is a bit disingenuous to argue that the bargaining power of a nationwide sophisticated corporation is on the same level as a mom & pop operation committed to finding piece work. Moreover, Kueffner testified that there are half a dozen other companies in Montana that do the same type of work and that performing well would mean more work for PPL. Walsh’s proof on this factor is not persuasive.

Walsh invokes representations on Impact’s website that it has “a combined 57 years of experience in the energy industry” and claims Signal Peak Mine, Conoco Phillips, CHS, Stillwater Mining, and MillerCoors as clients as proof that it is a sophisticated energy player. Walsh also elicited testimony that Kueffner had an attorney review parts of the subcontract, but that he did not ask him to review the unilateral jury waiver. On the other hand, Impact is a relatively small company that Kueffner and his wife started 3 or 4 years before the events giving rise to this suit. Kueffner also testified that Impact had never been involved with a project that descended into litigation. The proof shows that Impact lacks the sophistication & acumen of Walsh when it comes to business practices or contract negotiations.

The essence of Walsh’s argument is that Kueffner read the contract and signed it so he must be bound by it. While that may be enough to bind Impact to an ordinary provision, the unilateral waiver of the 7th Amendment right to a jury is no ordinary provision. Because the first 3 considerations strongly favor Impact and the 4th is neutral or slightly in its favor, the compelling conclusion based on the proof is that Walsh has not met its burden. Unfairness of the waiver is particularly accentuated by the fact that Walsh retained its right to a jury. Walsh’s motion to strike jury demand is denied.

Impact Mechanical v. Walsh Const. et al, 40 MFR 484, 8/8/13.

James Ragain (Ragain Law Firm), Billings and Shane Colton & Joseph Cook (Edmiston & Shermerhorn), Billings, for Impact; Dennis Clarke (Smith, Walsh, Clarke & Gregoire), Great Falls, for IMI; Eric Nord (Crist, Krogh & Nord), Billings, for Walsh, PPL, and Travelers.

CONTRACT/FRAUD/CIVIL CONSPIRACY: Release not obtained by undue influence, release of all claims and payment is valid accord & satisfaction discharging contractual obligations, obviating breach of contract claim… claim of fraudulent misrepresentation of health of principal, value of company, and need to sell time-barred, not tolled by close relationship of parties, constructive fraud claim similarly time-barred… no colorable claim of civil conspiracy, object (sale of company), means (transfer of assets) were lawful, claim also time-barred… 3 other Defendants not party to contract, not liable for breach… Molloy.

Landtech Corp. was an oil & gas service company with principal place of business in Sidney. Elmer Christensen was president 1983-05. John Lence was attorney 1981-8/05 and had a 25-50% equity interest. He was paid a $2,500/mo retainer, later raised to $5,000. He is senior trustee of Lence Family Trust, a Texas trust. Landtech was dissolved by the Montana SOS in 12/06. Landtech Enterprises Ltd, also an oil & gas service company, was incorporated in Montana in 1998 with its principal place of business in Sidney. Christensen and Gary Wygal each had a 50% capital percentage. From 1999-2006 Christensen and his wife were members. It was dissolved by the Montana SOS in 12/07. Landtech Ltd’s assets were sold in 12/04 to Badlands Power Fuels of North Dakota which organized a new entity in 6/05 as a single member LLC, Landtech Enterprises LLC. Assets were transferred between Landtech Ltd and Landtech LLC through 7/05. The sale totaled $3.6 million and resulted in a net profit of $2.5 million+ for Landtech Ltd. Landtech Ltd, Lence Family Trust, and Lence’s attorney James Bartlett agreed in an Acknowledgment & Assignment in 3/04 that if Landtech Ltd or its assets were sold the net would be shared 50% to Christensens and 50% to Lence Family Trust. Over the course of correspondence, Christensen represented to Lence that he was in very poor health and unable to manage the company and it would have to be sold for far less than it was worth. when it sold in 12/04 to Landtech LLC. Lence Family Trust was not notified or given its 50%. On 8/11/05 Gary Jackson, a lawyer representing Landtech Ltd, wrote Lence and Bartlett offering $100,000 in full satisfaction of the Acknowledgment & Assignment. He included a document that would release Christensens and Landtech Ltd of all past & future claims including claims arising out of the Acknowledgment & Assignment. Bartlett asked for copies of the closing documents so Lence could make an informed decision. Jackson said Lence did not own an interest in Landtech Ltd and therefore he would not receive copies of the closing documents. Lence signed the Release that day. On 8/22/05 Bartlett sent Jackson the signed release along with a letter explaining that Lence signed because he was in dire straits and needed the money for his family and attorney. On 8/25/05 Jackson sent Bartlett a check for $100,000.

Lence’s secretary Janet Hagel on 9/9/05 signed a Notice of Rescission which stated that Lence and Lence Family Trust rescind the Release of Claims and that Christensen make a reasonable offer to settle payment of the half share owed to Lence Family Trust if he wanted to avoid being sued for fraud. Accompanying the notice was a handwritten letter from Lence to Christensen: “SHAME ON YOU. I THOUGHT OF YOU LIKE A BROTHER ALL OF THESE YEARS. SHAME ON YOU, ELMER.” Christensen maintained that he “did not owe John any money.” In 2012 Lence tried to look up Christensen to determine if he had died. A dozen Bakken trade journals and the Sidney Herald contained ads for Landtech LLC, all listing Christensen as manager. Lence then concluded he had been defrauded and sued 10/5/12 alleging breach of contract, fraud, civil conspiracy, and constructive fraud. Defendants request summary judgment.

The complaint implies that the breach of contract claim is asserted against all Defendants, but only Christensen and Landtech Ltd were parties to the contract. “The obligation of the contracts is limited to the contracting parties.” Gambles (Mont. 1977). Lence Family Trust has no legal basis for its breach of contract claim against Mrs. Christensen, Landtech Corp., or Landtech LLC.

Defendants contend that a valid accord & satisfaction releases them from any obligations under the original contract. “An accord is an agreement to accept in extinction of an obligation something different from or less than that to which the person agreeing to accept is entitled. Though the parties to an accord are bound to execute it, yet it does not extinguish the obligation until it is fully executed.” MCA 28-1-1401. “Acceptance by the creditor of the consideration of an accord extinguishes the obligation and is called satisfaction.” MCA 28-1-1402. Lence (creditor) agreed to take something less than that to which he was arguably entitled and Defendants fully executed their new obligation: to pay him $100,000. The Release of All Claims is an accord and the $100,000 check Lence took is a satisfaction. “The Montana Supreme Court defines a `release’ as `nothing more than an accord and satisfaction, or, one of several ways in which an obligation, contractually, may be discharged or “settled’` for less than or for something different than what is owed.”’ Greenwald (38 MFR 28) (quoting Watters (Mont. 2000). Lence is prevented by accord & satisfaction from enforcing a breach of contract claim against Christensen and Landtech Ltd. A party to a contract may rescind only if its consent “was given by mistake or obtained through duress, menace, fraud, or undue influence exercised by or with the connivance of the party as to whom the party rescinds.” MCA 28-2-1711(1). Lence claims that his consent to the Release was obtained through undue influence. Undue influence consists of “taking a grossly oppressive and unfair advantage of another person’s necessities or distress.” MCA 28-2-407(3). “For there to be undue influence it is necessary that there be a destruction of free agency.” Baby M (Mont. 1996). Although Christensen knew of Lence’s financial situation, there is no evidence that he used this knowledge in a grossly oppressive manner or to destroy Lence’s free agency and thereby convince him to sign the Release. He cannot meet the standard for undue influence and so cannot rescind the Release on that basis. Summary judgment for Defendants on breach of contract.

Lence Family Trust argues that Christensen’s representations about his health, value of Landtech Ltd, and the need to sell were fraudulent because he knew that what he was saying was false but made the representations anyway, hoping to convince Lence to take $100,000 instead of his half share. Defendants deny the fraud accusations, but claim that in any event the claim is time-barred. The acts that constitute fraud, according to Plaintiff, occurred in 2004 when Christensen made false representations about his health and need to sell, in 12/04 when Landtech Ltd was sold and the Lence Family Trust was not notified or given its 50%, and in 8/05 when Jackson offered Lence $100,000 as consideration for a Release of all Claims but refused access to the closing documents. Lence signed off anyway. The 9/05 Notice of Rescission and accompanying letter shows that he knew or suspected by 9/05 that he had been defrauded by Christensen. Defendants argue that the statute on fraud has run, but do not specify a date on which the claim accrued. This matters little, because at least 7 years passed between the events giving rise to the fraud claim and the filing of the suit in 10/12. Lence argues that he did not learn of the falsity of Christensen’s representations about his health until 2012. Nothing in the record shows why he waited 7 years to investigate. He also argues that the statute should be tolled because “the defendant was in a position of trust or confidence with the plaintiff,” citing Skierka (Mont. 1981) (“there must be some active affirmative concealment of the fraud … in order to postpone the running of the statute … unless there is some relation of trust or confidence between the parties which imposes upon a defendant the duty of making a full disclosure of the facts.” Christensen and Lence were friends and business partners for over 25 years. Whether Christensen had a duty to disclose all the facts to Lence is irrelevant because Lence allegedly learned of the fraud on his own. He rescinded the Release, demanded his half share, and threatened to sue in 9/05, indicating that he knew of facts & circumstances giving rise to Christensen’s fraud before he discovered that Christensen had prevaricated about his health and even though Christensen may have failed to make a full disclosure of the facts surrounding the sale of Landtech Ltd. There is no circumstance that would have tolled the statute. Summary judgment for Defendants on the fraud claim.

Plaintiffs’ civil conspiracy claim is based on the allegation that Defendants “agreed by words and conduct to accomplish the unlawful goal of cheating [Lence Family Trust] of its share of the proceeds of the sale of the companies through the unlawful means of defrauding [Lence Family Trust] with misrepresentations regarding the business and Mr. Christensen’s health.” However, the object of the alleged conspiracy (sale of Landtech Ltd) was lawful, and the means used to attain that object (transfer of company assets to Landtech LLC) were lawful. Duffy (Mont. 1975); CJS Conspiracy. The transfer of assets may have been with a malicious motive, as Plaintiff asserts, but malice is not enough to transform a legal transfer of assets into an unlawful conspiracy. Thus Plaintiff does not have a colorable civil conspiracy claim. It is also barred by the 3-year statute for an action upon a liability not founded upon an instrument in writing, since the misrepresentations and transfer of assets occurred in 2004 & 2005.

Plaintiff’s constructive fraud claim is based on the argument that Christensen and the Landtech companies breached their duty to disclose all material information about the sale by misrepresenting certain material facts. Fraud can be actual or constructive, MCA 28-2-404, but both are subject to a 2-year statute, MCA 27-2-203. The statute that bars Plaintiff’s fraud claim also bars its constructive fraud claim.

Summary judgment for Defendants on all counts.

Lence Family Trust v. Christensen, Landtech Enterprises Ltd et al, 40 MFR 496, 8/20/13.

Terry Wallace, Missoula, for Lence; Doug James (Moulton Bellingham), Billings, and William Crowley & Tracey Johnson (Boone Karlberg), Missoula, for Defendants.

ERISA: Treating cardiologist’s opinion that lawyer disabled because of heart condition, not depression, given greater weight than that of insurer’s consultants, LTD reinstated retroactively… Christensen.

Former Billings trial attorney Michael Tolstedt was diagnosed with and began prescription treatment for depression 9/30/09. He had a heart attack 10/13/09 and underwent 2 surgeries. Cardiologist Scott Sample recommended that he find low-stress work. He has been coaching and substitute teaching since 6/10. Sample wrote Standard Ins. 10/12/09 indicating that Tolstedt had heart disease due to his occupation and recommended low-stress work. He listed, inter alia, depression and hypertension as contributing to his disability. Tolstedt filed a claim for LTD under Standard’s group plan 11/11/09, and Standard approved it 2/5/10, listing 10/14/09 — 1 day after his heart attack — as the date of disability. Its consulting psychiatrist Toenniessen reviewed Tolstedt’s files and cited depression as why he was eligible for disability benefits. He maintained that the depression was disabling, not that it was a causal factor in his heart condition and associated treatment. Consulting cardiologist Richard Axelrod reviewed the cardiology reports and found “no evidence in the medical records” that he “experienced cardiac symptoms in relation to work stress.” Standard argues that in light of his 2 successful heart surgeries and favorable cardiologist reports he was physically capable of returning to work by 2/10, 3 months after his last stent procedure. It maintains that “the medical records do not support a conclusion that avoidance of stress was necessary.” It wrote Tolstedt 6/10/10 that he was “disabled by one or more conditions, including depression” and applied the 24-month mental disorders limitation. It asked him to provide any information that he is disabled by other conditions “not subject to the Limitation.” Neither of Standard’s consulting cardiologists, Garrison or Axelrod, actually examined Tolstedt.

To clarify the basis of the claim, Sample wrote Standard 2/4/11 that “coronary artery disease is the actual physical illness that triggered [Tolstedt’s] heart attack and disabled him from being a trial lawyer.” Standard responded that its cardiologist determined that he was capable of full-time work based on the “excellent results” of his heart treatment and that “LTD benefits were payable on the basis of his depression.” Tolstedt’s attorney wrote Standard 12/1/11 that it “has no legal or medical basis for discontinuing” payments. Standard responded that he had no limitations to work, his mental disorder pay period would expire in 1/12, and he was not eligible for benefits for his heart condition. Standard’s Administrative Review Unit denied Tolstedt’s appeal on the basis that he was “capable of performing his own occupation on the basis of his cardiac condition.”

Tolstedt sued Standard under 29 USC 1132(a)(1)(b) on the basis that it wrongfully refused to pay disability benefits. Magistrate Ostby recommended summary judgment for Standard. Tolstedt objected, citing Sample’s newly submitted affidavit that he is not physically able to serve as an attorney and is at high risk for another, potentially fatal, heart attack if he does not avoid chronic stress. Finding that Sample’s affidavit created a material fact issue, this Court ordered de novo review. Both parties submitted supplemental briefs. The sole issue is which party’s physicians are more credible.

The Court affords greater weight to Tolstedt’s treating physician. Sample treated his coronary artery disease since his heart attack. He is board-certified and Chairman of Cardiovascular Medicine at Billings Clinic. Although Standard argues that he saw Tolstedt only 3 times, he performed coronary interventions after his heart attack, had a follow-up 3 months after his last stent procedure, and has seen him annually since. In Sample’s opinion and based on his observations, Tolstedt would have increased risk of a potentially fatal heart attack if he continued the high-stress, sedentary work of an attorney. Tolstedt’s initial reviews after his coronary procedures which indicate an improved heart condition do not change Sample’s opinion that returning to his prior stressful work would put him at risk for a 2nd heart attack. Unlike Standard’s consultants, he has examined Tolstedt and observed his condition for 3 years. He has written 3 letters maintaining that he is disabled because of his heart condition and recommending strongly that he cease legal practice. Standard’s consultants were paid to review his records but never examined him and Standard never ordered an IME. They never directly challenged Sample’s findings that continuing his work as an attorney would increase his risk of a potentially fatal heart attack, but merely stated that there was no evidence that his heart disease was related to his work stress. The Court rejects this. “The information available to consulting physicians would have been more complete and their opinions commensurately more reliable if they had personally examined plaintiff.” Finazzi (WD Mich. 2004). Finazzi found that the plan administrator arbitrarily & capriciously denied benefits based on opinions of a cardiologist who had never examined the patient, ordered an IME, or challenged the treating physician’s findings. The Court finds Sample’s opinions more credible than those of Standard’s consultants. Tolstedt is entitled to benefits reinstated as of 1/12/12.

Reasonable attorney fees & costs may be awarded to either party under 29 USC 1132(g)(1). Pursuant to LR 54.2, fees will only be awarded by judicial order. Parties seeking fees must file a motion within 14 days specifying the grounds, amount sought, and terms of the fee agreement. Rule 54(d)(2)(B)(i)-(iv). The other party may object. Rule 23(h)(2).

Tolstedt v. Standard Ins., 40 MFR 444, 6/24/13.

Donald Harris (Harris & Warren), Billings, for Tolstedt; Andrew Altschul (Buchanan Angeli Altschul & Sullivan), Portland, and Steven Milch & Eric Peterson (Crowley Fleck), Billings, for Standard.