                                                                                                                           Opinions of the United
2008 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


10-28-2008

Ross v. MetLife Ins Co
Precedential or Non-Precedential: Non-Precedential

Docket No. 07-4651




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                                                      NOT PRECEDENTIAL

                      UNITED STATES COURT OF APPEALS
                           FOR THE THIRD CIRCUIT


                                     No. 07-4651


                                     SAUL ROSS,
                              JEANETTE J. ANDREWS,
                              ARTRALIA B. ANDREWS,
                        Individually and on Behalf of All Others
                                   Similarly Situated

                                           v.

                 METROPOLITAN LIFE INSURANCE COMPANY,
                          a New York corporation

                                        Jeanette J. Andrews,
                                        Artralia B. Andrews,

                                                      Appellants


                    On Appeal from the United States District Court
                       for the Western District of Pennsylvania
                             (D.C. Civil No. 05-cv-00433)
                      District Judge: Hon. Donetta W. Ambrose


                   Submitted Pursuant to Third Circuit LAR 34.1(a)
                                  October 20, 2008

                   BEFORE: SMITH and COWEN , Circuit Judges
                        and THOMPSON*, District Judge



*Honorable Anne E. Thompson, Senior United States District Judge for the District of
New Jersey, sitting by designation.
                                 (Filed: October 28, 2008)



                                        OPINION


COWEN, Circuit Judge.

       Appellants Jeanette J. Andrews and Artralia B. Andrews appeal from the order of

the United States District Court for the Western District of Pennsylvania granting the

motion for summary judgment filed by Appellee Metropolitan Life Insurance Company

(“MetLife”). We will affirm.

                                             I.

       Appellants purchased from MetLife whole life insurance policies for their children

and grandchildren. The children were thirteen, eight, three, and half a year old at the

time the respective policies were issued. Prior to the purchases, the MetLife

representative completed standard-form applications for each policy. These forms are not

unique to juveniles, and one of the questions inquired about the proposed insured’s

tobacco use. Although she did not ask the Appellants themselves about tobacco use, the

representative simply checked “never” for the answer to this question. It appears,

however, that MetLife actually uses an aggregate or “blend” of smoker and non-smoker

mortality rates to calculate premiums for all juvenile insureds, regardless of whether or

not the specific juvenile smokes. Appellants signed the respective applications. By

signing the applications, Appellants specifically agreed that “[m]y statements are the


                                             2
basis of any policy issued.” (See, e.g., JA104.)

       The representative also provided Appellants with various policy illustrations. The

illustrations listed premium amounts and indicated a “Standard Nonsmoker” risk class for

the proposed insureds. (See, e.g., JA245.) They further stated that, “[i]f you apply for

this policy and the actual age, sex or risk class as shown in the policy (if issued) are

different, your MetLife representative will provide you with a revised illustration and can

explain any differences to you.” (See, e.g., id.) Appellants additionally received a copy

of MetLife’s Consumer Privacy Notice, informing them that “[w]e will tell you if we

cannot give you the coverage you asked for or if we can only provide it on a modified

basis.” (JA895.)

       MetLife then issued the juvenile life insurance policies. The policies stated that

“[t]his policy includes any rider and, with the application attached when the policy is

issued, makes up the entire contract.” (See, e.g., JA91.) Likewise, application statements

were deemed to be “representations and not warranties.” (See, e.g., id.) The policies in

turn set forth the premium amounts due each month, which matched the figures earlier

provided in the illustrations. Under the “POLICY SPECIFICATIONS” section of the

policies, the respective juveniles were listed as “POLICY CLASSIFICATION . . . .

STANDARD.” (See, e.g., JA84.)

       Appellants did not return the issued policies within the 10-day “free look” period.

The policies therefore went into effect, and Appellants paid the specified premiums. But

they eventually filed, together with another plaintiff named Saul Ross, a putative class

                                              3
action in the District Court, alleging that MetLife improperly treated the insurance

policies as “smoker-based” in its premium rate calculations even though the applications

themselves showed that the juveniles did not use any tobacco products. The Complaint

asserted four causes of action: (1) breach of contract; (2) breach of fiduciary duty; (3)

constructive fraud; and (4) unjust enrichment and imposition of a constructive trust.

       The District Court subsequently dismissed Ross’s claims in their entirety pursuant

to a prior release and settlement agreement, and Ross is not a party to the current appeal.

The District Court also dismissed Appellants’ fiduciary duty claim, but it permitted their

remaining claims to go forward. Following discovery, MetLife and Appellants filed

cross-motions for summary judgment, and Appellants also moved for class certification.

The District Court ultimately granted MetLife’s summary judgment motion as to the

breach of contract claim, denied Appellants’ motion for summary judgment, and denied

as moot their motion for class certification. Appellants then voluntarily dismissed their

remaining claims for constructive fraud and unjust enrichment, and filed a timely notice

of appeal.

                                              II.

       Appellants’ individual claim for breach of contract constitutes the only theory of

liability at issue in this current appeal.1 The parties appear to agree that the District Court


       1
         The District Court possessed jurisdiction over this diversity matter pursuant to
28 U.S.C. § 1332, and we in turn have appellate jurisdiction under 28 U.S.C. § 1291. We
exercise plenary review over the District Court’s summary judgment ruling and apply the
same legal standard that the District Court should apply. See, e.g., Curley v. Klem, 298

                                               4
was correct to apply Georgia law in this case. They also generally concur as to the actual

rules of Georgia law applicable to insurance contracts. As the District Court noted, when

the language of the insurance contract itself is clear and unambiguous, construction of the

contract is unnecessary. Instead, the clear and unambiguous terms of an insurance policy

“require no construction, and the plain meaning of such terms must be given full effect,

regardless of whether they might be beneficial to the insurer or detrimental to the

insured.” Tripp v. All State Ins. Co., 584 S.E.2d 692, 694 (Ga. Ct. App. 2003) (quotation

omitted). Accordingly, the District Court first considered whether an ambiguity existed

in the written insurance contracts. Contractual language is unambiguous if it is capable of

only one reasonable interpretation. See, e.g., Toy Wright Ventures, LLC v. Radlo Foods,

LLC, 635 S.E.2d 862, 862-63 (Ga. Ct. App. 2006). The language should be given “its

ordinary meaning or common signification as defined by dictionaries, because they

supply the plain, ordinary, and popular sense unless the words are terms of art.” W. Pac.

Mut. Ins. Co. v. Davies, 601 S.E.2d 363, 367 (Ga. Ct. App. 2004) (citations omitted).

       Purporting to apply these legal principles, the District Court agreed with MetLife

that the unambiguous language of the policies did not require the insurer to offer a “non-

smoking policy.” In the process, the District Court considered and rejected Appellants’

theory that MetLife committed a breach by charging them premiums at a higher “smoker-



F.3d 271, 276 (3d Cir. 2002). We therefore may affirm an order granting summary
judgment if it appears that there is no genuine issue of material fact and that the moving
party is entitled to judgment as a matter of law. See, e.g., id.

                                             5
based” rate. It also refused to find that the contractual language was at least ambiguous

with respect to the calculation of the premium rates. On appeal, Appellants argue at some

length that the District Court’s contractual ruling was erroneous. Nevertheless, after

reviewing the District Court’s thorough opinion, the parties’ various contentions, and the

record on appeal, we conclude that the District Court properly granted summary judgment

in favor of MetLife as to this breach of contract cause of action.

       As the District Court noted, “Plaintiffs repeatedly assert that Defendant charged

them a ‘higher rate,’ but do not assert that the rates due and agreed upon are anything

other than those clearly stated in the policy.” (JA13.) On the contrary, it appears that

MetLife promised to provide life insurance coverage in exchange for disclosed premium

payments, and fully honored its part of the bargain.

       In an effort to show that the contractual language was at least ambiguous with

respect to the smoking/non-smoking issue, Appellants have relied heavily on the negative

answers to the application question regarding tobacco use. The applications were made a

part of the eventual insurance contracts, and Appellants also agreed that “[m]y statements

are the basis of any policy issued.” (See, e.g., JA104.) But, as the District Court noted, it

was Appellants themselves who agreed to be bound by their own application statements.

Neither the applications nor the policies expressly required MetLife to use such statements

in any particular way with respect to the calculation of premium rates. Contrary to

Appellants’ characterizations, the District Court’s approach does not render the

application language and the answers regarding tobacco use superfluous or meaningless.

                                              6
In fact, it appears that the applications ultimately allowed Appellants to obtain life

insurance for their children and grandchildren. Finally, Appellants still “have not pointed

to any [case law] finding that the pertinent language can reasonably be read to obligate an

insurer, without express agreement, to give a particular weight or effect to each such

statement in its rate calculation method.” (JA14.)

       Likewise, the District Court properly rejected Appellants’ reading of the word

“Standard” in the policies themselves. Relying on WordPerfect’s dictionary, it found the

term to mean “‘of no special quality.’” (JA15.) While Appellants take issue with the use

of a wordprocessor dictionary and the definition offered, MetLife points out that the on-

line version of The American Heritage Dictionary likewise defines the term as “‘usual,

common, or customary.’” (Appellee’s Br. at 38.) According to Appellants, “the common

fact that the ‘usual’ juvenile is a ‘non-smoker’ combined with the ‘non-smoking’ basis

stated in Plaintiffs’ policies would lead an average lay insured to only one reasonable

conclusion: that their policies and premiums are non-smoking.” (Appellant’s Reply Br. at

18.) However, it appears clear that Appellants’ efforts to add terms to the parties’

agreements or to create ambiguity are ultimately without merit. The “Policy

Classification . . . . Standard” language, far from “suggest[ing] to Plaintiffs a child

without health concerns,” merely indicated that the children and grandchildren received

the customary policy classification for juveniles. (JA15.)

       Appellants also turn to the policy illustrations provided by the representative, as

well as the Consumer Privacy Notice. The policy illustrations did identify the risk class

                                               7
as “Standard Nonsmoker.” (See, e.g., JA245.) The District Court, however, correctly

found that the illustrations “remain nothing more than parol evidence,” which were “‘not

admissible to create an ambiguity where none exists.’” (JA17 (quoting Perrett v. Dollard,

338 S.E.2d 56, 57 (Ga. Ct. App. 1985))). Furthermore, the premiums ultimately charged

by MetLife were consistent with the premium figures included in the illustrations. On the

other hand, Appellants argue that MetLife failed to meet its alleged obligation under the

Consumer Privacy Notice to inform them if it could not provide the coverage requested or

could only provide such coverage on a modified basis. Even assuming that the Consumer

Privacy Notice was actually incorporated into the contracts between the parties, we

conclude there was never any modification requiring notification. We accordingly reject

the notion that MetLife was contractually obligated to provide information to Appellants

of its specific rate calculation method, at least without a prior request to do so.2

       In the end, the breach of contract claim has presented no genuine issue of material

fact, and MetLife is clearly entitled to judgment under Georgia law. The District Court’s

ruling was, in turn, supported by other district court decisions rejecting similar claims

with respect to juvenile life insurance policies. See, e.g., Alleman v. State Farm Life Ins.

Co., 508 F. Supp. 2d 452, 453-59 (W.D. Pa. 2007); Thompson v. Am. Gen. Life &

Accident Ins. Co., 448 F. Supp. 2d 885, 886-89 (M.D. Tenn. 2006). We therefore


       2
         Appellants appear to argue that MetLife violated a Georgia statutory provision
regarding the disclosure of premiums and “conditions of insurance.” We, however, do
not address this statutory argument because it was not raised by Appellants in their initial
appellate brief. See, e.g., Kost v. Kozakiewicz, 1 F.3d 176, 182 & n.3 (3d Cir. 1993).

                                               8
conclude that the District Court was correct to grant summary judgment in favor of

MetLife.

                                             III.

          For the foregoing reasons, we will affirm the District Court’s summary judgment

ruling.




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