                                                                       F I L E D
                                                                United States Court of Appeals
                                                                        Tenth Circuit
                                   PUBLISH
                                                                       OCT 24 2000
                  UNITED STATES COURT OF APPEALS
                                                                     PATRICK FISHER
                                                                            Clerk
                                TENTH CIRCUIT



 FRANK PIRKHEIM and ROXANNE
 PIRKHEIM, as parents of Logan
 Pirkheim,

       Plaintiffs-Appellants,                          No. 99-1297

 v.

 FIRST UNUM LIFE INSURANCE, a
 foreign corporation,

       Defendant-Appellee.


                 Appeal from the United States District Court
                         for the District of Colorado
                             (D.C. No. 97-B-2528)


Diane Vaksdal Smith (Scott J. Eldredge with her on the briefs) of Burg Simpson
Eldredge & Hersh, P.C., Englewood, Colorado, for Plaintiffs-Appellants.

Sandra L. Spencer (Todd Clarke with her on the brief) of White and Steele, P.C.,
Denver, Colorado, for Defendant-Appellee.


Before BRORBY, HOLLOWAY and BRISCOE, Circuit Judges.


BRORBY, Circuit Judge.
      Frank and Roxanne Pirkheim sued First Unum Life Insurance Company

(First Unum) in state court to recover accidental death benefits for the death of

their minor son, Logan. First Unum removed the case to federal district court

alleging federal question jurisdiction pursuant to 28 U.S.C. § 1331 and ERISA, 29

U.S.C. § 1132(e)(1). The district court granted summary judgment for First

Unum holding, as a matter of law, there were no benefits payable under the

policy. The Pirkheims appeal and we affirm.



      The significant facts are not in dispute. Logan Pirkheim was born with a

congenital heart defect. At approximately eight months of age, Logan underwent

heart surgery to correct the defect. Although doctors successfully repaired the

structural defects in Logan’s heart, the surgery resulted in nerve damage, causing

Logan to suffer an abnormal heart beat, or cardiac arrhythmia. To correct this

problem, the doctors implanted a pacemaker, which functioned properly after

implantation. A little over four years later, however, Logan began suffering from

arrhythmic seizures (which the pacemaker was designed to prevent) and died.



      The cause of Logan’s death was not immediately determined. The original

death certificate did not identify a cause of death and indicated an autopsy was

pending. After conducting an autopsy, the pathologist concluded, in relevant part,


                                         -2-
“the cause of death was apparent pacemaker failure in this 5-year-old boy who

was pacemaker dependent following repair of his congenital heart disease.        ”

(Emphasis added.) After examining the pacemaker, the manufacturer’s laboratory

concluded:

      The tests show that the pacemaker was performing within all
      mechanical and electrical specifications for a unit at this stage. The
      battery depletion analysis showed that the battery was depleted. The
      tests show that the “Elective Replacement Indicator” as well as the
      “Intensified Follow-up Indicator” were triggered prior to the device
      going to “no-output.”

(Emphasis added.) In short, death was caused by the failure of the pacemaker,

which in turn was caused by the battery becoming depleted.



      At the time of his death, Logan was an insured under an accident insurance

policy purchased by his father through his employer. The policy states, in

pertinent part:



                                INSURING CLAUSE

             We agree with the Policyholder to cover each Insured for any
      loss described in Part I in return for the payment of premiums and
      subject to the provisions which follow.    The loss must result directly
      and independently of all other causes from accidental bodily injury
      which occurs while this policy is in force as to the Insured, herein
      called “injury”.

(Emphasis added.) Mr. Pirkheim filed a claim for accidental death benefits


                                          -3-
pursuant to the policy. First Unum rejected his claim on the ground “that death

was not an accidental bodily injury direct and independent of all other causes.”

Mr. Pirkheim appealed this decision. On reconsideration, First Unum affirmed its

denial of benefits. Mr. and Mrs. Pirkheim then filed this suit. The parties filed

cross motions for summary judgment pursuant to Rule 56 of the Federal Rules of

Civil Procedure.



      The district court granted First Unum’s motion for summary judgment,

concluding, as a matter of law, (1) the pertinent policy language is unambiguous,

and (2) Logan Pirkheim’s death “did not result independently of all other causes;”

therefore, “the plan administrator did not err in denying accidental death benefits

to Mr. and Mrs. Pirkheim.” The district court further held the common law

doctrine of reasonable expectations does not apply where, as here, an ERISA

policy 1 is unambiguous. Mr. and Mrs. Pirkheim challenge each of these rulings.

We have jurisdiction pursuant to 28 U.S.C. § 1291.



                                Standard of Review

      We review the district court's summary judgment ruling de novo, applying


      1
          The Pirkheims and First Unum stipulated the policy is governed by
ERISA.


                                         -4-
the same legal standard used by the district court. Summary judgment is

appropriate "if the pleadings, depositions, answers to interrogatories, and

admissions on file, together with the affidavits, if any, show that there is no

genuine issue as to any material fact and that the moving party is entitled to a

judgment as a matter of law." Fed. R. Civ. P. 56(c). “When applying this

standard, we view the evidence and draw reasonable inferences therefrom in the

light most favorable to the nonmoving party.”       Simms v. Oklahoma ex. rel. Dep't

of Mental Health & Substance Abuse Serv.        , 165 F.3d 1321, 1326 (10th Cir.),   cert.

denied , 120 S. Ct. 53 (1999). When reviewing cross-motions for summary

judgment, "our review of the record requires that we construe all inferences in

favor of the party against whom the motion under consideration is made," in this

case the Pirkheims.       Andersen v. Chrysler Corp. , 99 F.3d 846, 856 (7th Cir.1996).



                            The Policy Language is Not Ambiguous

       Applying standard tenets of contract construction cited with approval by

this court,   2
                  the district court had no trouble concluding Logan Pirkheim’s death


       2
         "Questions involving the scope of benefits provided by a plan to its
participants must be answered initially by the plan documents, applying the
principles of contract interpretation." Chiles v. Ceridian Corp., 95 F.3d 1505,
1515 (10th Cir. 1996). In other words, “[i]n interpreting the terms of an ERISA
plan we examine the plan documents as a whole and, if unambiguous, we construe
them as a matter of law.” Id. at 1511. We give the words their common and
ordinary meaning, as a reasonable person in the position of the plan participant

                                              -5-
was due to “accidental bodily injury,” thus satisfying that condition of the

“Insuring Clause.” We wholeheartedly agree with the district court’s

interpretation of “accidental bodily injury.” In our view, this case really boils

down to whether the phrase “directly and independently of all other causes from

accidental bodily injury” is ambiguous. Ambiguity exists when a contract

provision is “reasonably susceptible to more than one meaning, or where there is

uncertainty as to the meaning of a term.”     Stewart v. Adolph Coors Co. , 217 F.3d

1285, 1290 (10th Cir. 2000) (quotation marks and citations omitted).



       We hold the words “directly and independently of all other causes,” given

their plain and ordinary meaning in context of this particular insuring clause,   3
                                                                                      are


(not the actual participant) would have understood them. See id.; see also McGee
v. Equicor-Equitable HCA Corp., 953 F.2d 1192, 1202 (10th Cir. 1992).

       3
         The Pirkheims cite a number of cases for the proposition the phrase
“directly and independently of all other causes” is ambiguous. However, the
cases the Pirkheims rely on (1) involve diversity jurisdiction and/or the
application of state law not at issue here, see Murray v. United of Omaha Life Ins.
Co., 145 F.3d 143 (3d Cir. 1998); Carroll v. CUNA Mut. Ins. Soc., 894 P.2d 746,
747 (Colo. 1995); Life Ins. Co. of N. Am. v. Evans, 637 P.2d 806 (Mont. 1981);
Burgett v. Stuyvesant Life Ins. Co., 236 So.2d 306 (La. Ct. App. 1970); (2)
appropriately apply the reasonable expectations doctrine under circumstances in
which the language limiting coverage is not sufficiently conspicuous to inform the
insureds as to its impact, see Henry v. Home Ins. Co., 907 F.Supp. 1392, 1396-97
(C.D. Cal. 1995); or (3) interpret an insuring clause grammatically different from
that reviewed here, see Carroll, 894 P.2d at 747. This is an ERISA case, not a
diversity case. For reasons discussed below, the reasonable expectation doctrine
does not apply in this case. Moreover, the insuring clause in this case

                                             -6-
not ambiguous. In stating the “    loss must result directly and independently of all

other causes from accidental bodily injury     ,” the policy imposes two obvious

conditions. First, the loss must result   directly from accidental bodily injury.

Second, the loss must result    independently of all other causes. In short, we agree

with the district court the word “directly” modifies the phrase “from accidental

bodily injury.” Any other interpretation in this context is contrived.



       Because Logan Pirkheim’s death did not occur independent of all other

causes, e.g. , his cardiac arrhythmia, one of the two express policy conditions was

not satisfied. Accordingly, we hold the plan administrator did not err in denying

accidental death benefits to Mr. and Mrs. Pirkheim.



                       The Doctrine of Reasonable Expectations

       The doctrine of reasonable expectations is a state common law doctrine

whereby courts will interpret policy language liberally to protect the reasonable

expectations of insureds and intended beneficiaries, “‘even though a careful

examination of the policy provisions indicates that such expectations are contrary



conspicuously limits coverage, and the word “directly” as used in the policy
language here is reasonably read to modify the phrase “from bodily injury.”
These differences are significant and fully distinguish the case at hand from those
upon which the Pirkheims rely.


                                             -7-
to the expressed intention of the insurer.’”         Saltarelli v. Bob Baker Group Med.

Trust , 35 F.3d 382, 386 (9th Cir. 1994) (quoting Robert E. Keeton & Alan I.

Widiss, Insurance Law: A Guide to Fundamental Principles, Legal Doctrines, and

Commercial Practices § 6.3 (West 1988)). Under this modern doctrine, which

derived from the law of adhesion contracts and construction of ambiguities in

insurance policies, Saltarelli , 35 F.3d at 386, an insurer that wishes to avoid

liability under an insurance contract “must not only use clear and unequivocal

language evidencing its intent to do so, but it must also call such limiting

conditions to the attention of the insured.”         Leland v. Travelers Indem. Co.,   712

P.2d 1060, 1064 (Colo. Ct. App. 1985).



       At least one circuit has affirmatively adopted and applied the doctrine of

reasonable expectations “as a principle of the uniform federal common law

informing interpretation of ERISA-governed insurance contracts” where the

contract was ambiguous and the coverage limitation inconspicious.              Saltarelli , 35

F.3d at 387 (court refused to enforce pre-existing condition exclusion because it

was buried within a conjunctive reading of several definitions of the plan, and

thus, was not conspicuous enough to attract the attention of a reasonable layman).

The Pirkheims argue the reasonable expectation doctrine applies in this case, even

if the language at issue is not ambiguous, because an unduly restrictive


                                               -8-
interpretation of the insuring clause defeats coverage in violation of ERISA’s

general purpose to “promote the interests of employees and their beneficiaries in

employee benefit plans and to protect contractually defined benefits.”       Firestone

Tire & Rubber Co. v. Bruch , 489 U.S. 101, 112 (1989) (citations and quotations

omitted). We do not agree. General ERISA principles simply do not permit us to

re-write the terms of the insurance contract. Where the insuring clause or

exclusionary provision is conspicuous,    4
                                              clear, and unequivocal, we conclude

application of the common law doctrine of reasonable expectation is improper.

See Meester v. IASD Health Serv. Corp         ., 963 F.2d 194, 196-97 (8th Cir. 1992);

see also Rolf v. Health & Welfare Plan for Employees of Cracker Barrel Old

Country Store, Inc. , 25 F.Supp.2d 1200, 1205 (D. Kan. 1998);        Jefferson v.

Scariano , 949 P.2d 120, 121 (Colo. Ct. App. 1997) (application of reasonable

expectations doctrine “require[s] as a predicate fact that the contract be

ambiguous”).



      The reasonable expectation doctrine does not influence our interpretation of

the ERISA plan at issue because we hold the language of the “Insuring Clause”

conspicuously and unambiguously excludes coverage for Logan Pirkheim’s death.



      4
          The Pirkheims do not argue the insuring clause is inconspicuous.


                                              -9-
We therefore AFFIRM the district court’s grant of summary judgment in favor of

First Unum.




                                     -10-
