Plan’s refusal to change distribution method upheld: participant’s claim of clerical error “not credible”

The U.S. Court of Appeals in Atlanta (CA-11) rejected as “not credible” a divorced retiree’s claim that a clerical error by the employer caused him to receive a lower monthly pension amount than what he had elected. Thus the plan administrator properly refused to change the retiree’s pension distribution from a reduced monthly benefit (beginning after the first five years) with spousal survivor benefits, to a full monthly pension with no survivor’s benefits.

The retiree divorced at some point during the first five years of retirement. Having received in the sixth year of retirement a reminder of the reduction in monthly benefits that he’d elected, the retiree (with the ex-wife’s written cooperation) told the plan the reduced distribution was the mistaken result of a clerical error made by an HR employee. He’d always intended, he said, to elect the full monthly benefit option, with no survivor’s benefits. The plan denied this request and the district court affirmed the denial.

The appellate court also rejected the retiree’s contention as “not credible.” The retiree’s election form clearly indicated intent to choose the survivor option. The form’s layout gave little chance for confusion, with the checkbox for each of the two options located on different pages. Additionally, the ex-wife’s name and birth date were disclosed on the form, as required when choosing the survivor option. Finally, while the retiree told the benefit appeals committee that neither he nor his ex-wife had signed the election form, his ex-wife was unwilling to go that far. In her affidavit she admitted to signing the form.

Source: Huffstutler v. Goodyear Tire & Rubber Company (CA-11).

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer’s Benefits Reports.

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