Sayegh v. Unum Group

Background

Neil Sayegh sought damages from his former insurer, Provident Life and Casualty Insurance Company, alleging that Provident miscalculated his residual disability benefits. Sayegh became partially disabled in 2010 and held three relevant Provident policies. Those policies stated that the maximum benefit period for his residual benefits extended to his sixty-fifth birthday, November 11, 2015.

Each policy also required written proof of loss within 90 days after the end of each period for which Provident was liable. If providing proof within that period was not reasonably possible, the policies allowed additional time, but required the proof no later than one year after the 90-day period unless the insured was legally unable to provide it. The policies further stated that a legal action could not be started more than three years after the time proof of loss was required.

Provident approved Sayegh’s claim in or about 2010. Later, Sayegh sought a recalculation of his benefits. Provident sent letters in 2016 and 2018 stating that his claim or file remained closed. One 2018 letter said that Sayegh could submit additional information for evaluation but also reminded him of the three-year limitations period and stated that the letter did not waive a timeliness defense. Sayegh filed the lawsuit in state court on July 6, 2020, and it was later removed to federal court.

Issue and Rule

Provident moved for summary judgment under Federal Rule of Civil Procedure 56. Summary judgment is entered when the evidence shows no genuine dispute about a material fact and the moving party is entitled to judgment as a matter of law. Provident argued that the policies’ three-year contractual limitations periods barred Sayegh’s claims.

The court explained that parties may agree by contract to a shorter limitations period if it is reasonable. The parties agreed that New York law applied. The court therefore examined when the policies required proof of loss and when the three-year period began.

Court’s Analysis

The court did not need to decide whether the phrase “each period for which we are liable” created a new limitations period for every month of claimed disability or one period for the entire disability. The policies’ plain terms set the maximum benefit period at Sayegh’s sixty-fifth birthday, November 11, 2015. The court therefore determined that the end of the latest period for which Provident could be liable was November 11, 2015.

The court calculated that proof of loss was due, at the latest, on February 9, 2017—90 days after November 11, 2015, plus the additional one-year period allowed by the policies. The three-year limitations period therefore required Sayegh to file suit by February 9, 2020, at the latest. Because he filed on July 6, 2020, the court held that his lawsuit was time barred. The court noted that the lawsuit would also be untimely under Provident’s earlier proposed deadline of February 9, 2019.

The court rejected Sayegh’s argument that the policies were ambiguous and that the limitations period could not begin while his disability continued. The court distinguished the case he cited because that case involved lifetime disability benefits and policy language tied the deadline to termination of a period of disability. Sayegh’s policies instead referred to the end of the period for which Provident was liable and set a maximum benefit period.

The court also rejected Sayegh’s argument that New York’s default six-year limitations period applied. It concluded that the policies’ three-year period applied to his action because he was seeking to recover benefits under the policies and the policies expressly governed legal actions to recover under them.

Finally, the court rejected Sayegh’s argument that Provident’s March and May 2018 letters restarted or waived the limitations period, or prevented Provident from asserting a timeliness defense. The letters stated that the claims remained closed. The March letter also expressly reaffirmed the three-year period. The court found no evidence that Provident had caused Sayegh to delay pursuing his rights.

Disposition

Judge Jesse M. Furman concluded that Sayegh’s lawsuit was barred by the limitations periods in the policies. The court granted Provident’s motion for summary judgment, directed the Clerk of Court to enter judgment in Provident’s favor, and closed the case.