This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2004).
IN COURT OF APPEALS
Patricia Ann Holliday, individually and
as personal representative and sole heir of the
Estate of George Frances Holliday, Jr.,
Filed June 27, 2006
St. Louis County District Court
File No. 69-CX-04-601504
Kenneth A. Knudson, Knudson, Gee, Torvinen & Watson, S.C., 1507 Tower Avenue, 312 Board of Trade Building, Superior, Wisconsin 54880; and
Thomas F. Andrew, Brown, Andrew
& Signorelli, P.A.,
Stephen G. Andersen, Amy E. Mace, Ratwik, Roszak & Maloney, P.A., 300 U.S. Trust Building, 730 Second Avenue South, Minneapolis, Minnesota 55402 (for respondent)
Considered and decided by Toussaint, Chief Judge; Hudson, Judge; and Worke, Judge.
U N P U B L I S H E D O P I N I O N
Appellant Patricia Holliday, on her own behalf and on behalf of the estate of George Holliday, Jr., brought an action against respondent Independent School District No. 709 after she was denied access to the school district’s retirement-insurance plan and to the “fund balance” that remained on her husband’s account after he died. On appeal from summary judgment in favor of the school district, Holliday argues that (1) the inferences to be drawn from the facts support a prima facie case of discrimination based on disparate treatment and disparate impact under the Age Discrimination in Employment Act; (2) the inferences to be drawn from the facts support a prima facie case of disparate-treatment discrimination under the Minnesota Human Rights Act; (3) genuine issues of material fact remain as to whether the Hollidays were fraudulently induced to believe that they could withdraw and re-enroll in the school district’s retirement-insurance plan; (4) the school district made fraudulent or negligent misrepresentations on which the Hollidays relied to their detriment; and (5) the school district converted the “fund balance.” We affirm.
husband, George Holliday, Jr., was a retired employee of respondent Independent
School District No. 709,
The number of unused days not used in the payment determined above shall be multiplied by the director’s daily rate of pay and the amount then used to pay the retired director’s or spouse’s hospitalization insurance premiums until the total amount is exhausted except that at the time that the director and/or spouse becomes eligible for Medicare coverage the District’s contribution will only be the amount of Medicare supplemental insurance under a School District group plan for such purpose.
Collective Bargaining Agreement, Article VIII § 8.6.
The school district also had a policy governing health-insurance benefits for retirees, which stated: “[i]f a retiree dies while participating in the retiree subgroup plan, the surviving spouse may convert the retiree’s coverage to single coverage for the spouse only. This shall apply to retirees from all bargaining units.” Guidelines of the Duluth Public School Retirement Insurance Plans, dated February 6, 1998, paragraph 5(e).
In an August 17, 2000 memorandum, Mr. Holliday stated that he understood that if a spouse was not covered under the school district’s group-health plan at the time of the employee’s death, the spouse would not be eligible for coverage. Over the next two years, the parties exchanged several memoranda expressing and/or confirming that Mr. Holliday’s spouse—appellant—would not be allowed to reenter the school district’s insurance plan should Mr. Holliday die while she was not covered under the school district’s plan. Further, in a March 7, 2001 letter, the school district informed Mr. Holliday that the fund balance was only available to pay health-insurance premiums for the school district’s group plan.
Up until December 31, 2000, Mr. Holliday maintained family coverage in the school district’s group plan. From then until March 1, 2002, however, Mr. Holliday maintained single coverage. In March 2002, when Mr. Holliday became eligible for Medicare, he left the school district’s group plan completely. In June 2002, when Mr. Holliday died, neither he nor his wife (appellant) was enrolled in the school district’s group-health plan. As a result, the school district denied appellant access to the fund balance, which was $55,711.80 at the time of Mr. Holliday’s death.
In June 2003, appellant filed suit against the school district. The district court granted the school district’s motion for summary judgment. This appeal follows.
D E C I S I O N
courts review a grant of summary judgment to determine whether there is a
disputed issue of material fact and whether the district court erred in its
application of the law. State by Cooper v. French, 460 N.W.2d 2,
Appellant argues that the district court erred in granting summary judgment regarding appellant’s claims that the school district (1) violated the Age Discrimination in Employment Act; (2) violated the Minnesota Human Rights Act; (3) was unjustly enriched; (4) fraudulently misrepresented appellant’s rights as they related to the availability of the fund balance; and (5) committed conversion of appellant’s property interest. The appropriateness of summary judgment is applied to each claim as follows.
A. Age Discrimination in Employment Act
Appellant first argues that facts and circumstances unique to the Hollidays resulted in discrimination against them due to their age, in violation of the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. § 623 (a)(1) (2000).
the ADEA, it is unlawful for an employer to “discriminate against any
individual with respect to his compensation, terms, conditions, or privileges
of employment, because of such individual’s age.” 29 U.S.C. § 623 (a)(1). There are two theories of discrimination:
disparate impact and disparate treatment.
Evers v. Alliant Techsystems, Inc.,
241 F.3d 948, 953 (8th Cir. 2001). To
prove an ADEA disparate-impact claim, a specific employment practice must be
identified and adequate statistical evidence must be presented to show that the
practice alleged resulted in the employee suffering an adverse employment
action because of his membership in the protected group.
respect to appellant’s disparate-treatment claim, the ultimate question is
“whether the plaintiff was the victim of intentional discrimination.” Reeves
v. Sanderson Plumbing Prods., Inc., 530
The district court determined that the circumstances did not give rise to an inference of discrimination; therefore, appellant’s ADEA claim failed. We agree with the district court’s determination. Nothing in the record suggests that any actions of the school district were motivated by Mr. Holliday’s age or appellant’s age. The result would have been the same for any eligible employee who was not covered by the school district’s group-health plan at the time of his or her death. While it is true that an eligible employee must be retired, and retired persons are typically “older” persons, these circumstances are insufficient to infer age discrimination. To hold otherwise would mean that any policy negatively affecting retirees would give rise to an inference of discrimination and would be subject to a disparate-treatment claim. We do not believe that is the intent of the ADEA.
Even viewing the facts in the light most favorable to appellant, it is undisputed and controlling that when Mr. Holliday died, neither he nor appellant was enrolled in the school district’s health plan. Because there is no fact issue or error in the district court’s application of the law, we affirm the district court’s grant of summary judgment on appellant’s ADEA claim.
B. Minnesota Human Rights Act
next argues that the school district likewise violated the MHRA. Under the Minnesota Human Rights Act
(“MHRA”), it is an unfair employment practice for an employer to discriminate
against a person because of age “with respect to hiring, tenure, compensation,
terms, upgrading, conditions, facilities, or privileges of employment.” Minn. Stat. § 363A.08, subd. 2 (2004). Because the MHRA and the ADEA are analyzed
under the same McDonnell Douglas
framework, appellant’s failure to make a prima facie case under the ADEA is
fatal to her MHRA claim as well. See Snow v.
C. Unjust Enrichment
Appellant argues that because the school district was not required to pay out the fund balance, it was unjustly enriched at appellant’s expense. Appellant argues that whether the school district wrongfully “beguiled” Mr. Holliday into believing that he could withdraw and re-enroll in the school district’s group plan is a material issue of fact.
To establish a claim for unjust
enrichment, appellant “must show that another party knowingly received
something of value to which he was not entitled, and that the circumstances are
such that it would be unjust for that person to retain the benefit.” Schumacher
v. Schumacher, 627 N.W.2d 725, 729 (
Here, the district court found that there was no proof that the school district’s conduct was illegal or morally wrong. The obligation of the school district was governed by the collective-bargaining agreement. It is undisputed that Mr. Holliday contacted the school district and the health-care-plan provider in order to weigh his multiple coverage options (under the school-district plan, his wife’s plan, and his Medicare). In a memorandum dated August 25, 2000, the school district informed Mr. Holliday of his options and the conditions under the bargaining agreement, the health-care plan, and COBRA, stating that:
[S]hould a retiree die, their spouse would be allowed to continue as a surviving spouse only if coverage for the spouse is already in effect. Therefore, under our current contract your spouse would not be allowed to reenter should you die while she is covered elsewhere.
This is in compliance with COBRA law that defines a qualified beneficiary as an individual who is covered under the group health plan on the day before the qualifying event. Mere eligibility for coverage is not sufficient to be a qualified beneficiary, regardless of the reason that the individual is not covered under the plan.
This is consistent with our previous carrier. In depth discussions took place with Blue Cross Blue Shield regarding this issue. They did concede to allow a retiree with a fund balance to reenter upon a qualifying event or open enrollment, but not a spouse in the event of the retiree’s death.
* * * *
As previously indicated to you, the only guarantee for your spouse to continue under ISD 709’s group insurance plan is continuous coverage under the plan.
After receiving this letter, Mr. Holliday chose to discontinue his coverage to preserve his fund balance until he and his wife were eligible to re-enroll. Unfortunately, Mr. Holliday died before re-enrolling. There is nothing in the record to support appellant’s claims that Mr. Holliday was misled regarding his ability to discontinue drawing on his fund balance and re-enroll later. The school district agreed that he could do so, but it warned him of the risk if he were to die before he and his wife were re-enrolled. Mr. Holliday took that risk in order to stretch his fund balance. Appellant claims that a May 13, 2002 letter from Blue Cross Blue Shield misled Mr. Holliday, but that letter was received after Mr. Holliday had discontinued his coverage and did not address the primary issue in this case: whether appellant could reenter the health plan after Mr. Holliday’s death if she was not covered at the time of his death. The Blue Cross letter merely indicated under what conditions Mr. and Mrs. Holliday could re-enter the group plan, assuming both were still alive.
Because appellant was not enrolled in the school district’s health-care plan at the time of Mr. Holliday’s death, she was not entitled to access the fund balance for her future health care. Accordingly, the school district did not wrongfully benefit from the unused fund balance under the contract with Mr. Holliday. The district court’s determination that appellant failed to establish her unjust-enrichment claim is affirmed.
D. Fraudulent Misrepresentation
appellant argues that the terms of the collective-bargaining agreement are
ambiguous and therefore the district court erred in granting summary judgment. Donnay
v. Boulware, 275
In order to prevail on a claim of fraudulent misrepresentation, a claimant must show that:
1. a representation was made;
2. the representation was false;
3. the representation involved a past or present fact;
4. the fact was material;
5. the fact was susceptible to being known;
6. the representation was made with knowledge that it was false or it was asserted as knowledge without knowing whether it was true or false;
7. it was intended that the claimant act on that representation;
8. the claimant did act;
9. the claimant’s actions were in reasonable reliance on the representation;
10. the claimant suffered damages; and
11. the misrepresentation was a proximate cause of the claimant’s damage.
Appellant has failed to produce evidence on several of the necessary requirements. First, the school district’s representation that appellant could re-enter the health plan upon a qualifying event (becoming no longer covered under her employer’s health plan or becoming eligible for Medicare) was not a “past or present fact.” This future event never occurred because Mr. Holliday died before the occurrence of a qualifying event. Second, there is no evidence in the record that the school district made any false statements to Mr. Holliday. The school district informed Mr. Holliday that his fund balance could only be used by his wife if she were enrolled at the time of his death. The school district also informed Mr. Holliday of the limitations on his re-enrollment. Even when viewed in the light most favorable to appellant, the information provided to Mr. Holliday was not false. Finally, there was no showing that the school district intended for Mr. Holliday to act in any certain way regarding its representations. The record shows that Mr. Holliday, after weighing his alternatives, elected to discontinue his coverage in an attempt to preserve a larger portion of the fund balance for himself and his wife to pay for supplemental Medicare coverage. When the school district provided information regarding re-enrollment conditions, Mr. Holliday had already discontinued his enrollment in the plan.
Without evidence establishing that the school district made a false representation involving a past or present fact, or any showing of intent that Mr. Holliday should act in a certain way, appellant’s claim for fraudulent misrepresentation cannot survive summary judgment.
Lastly, appellant argues that the
school district illegally converted the fund balance from its lawful
possessor—appellant. “Conversion occurs
when a person willfully interferes with the personal property of another
without lawful justification that deprives the lawful possessor of use and
possession.” Indep. Sch. Dist. No. 404 v. Castor, 670 N.W.2d 758, 766 (
Appellant did not have a valid property interest in the fund balance. The fund balance was a benefit, limited to a specific purpose as defined in the collective-bargaining agreement. The fund balance could only be used to pay premiums on the group-health plan after retirement as long as certain conditions were met. The condition of enrollment in the health plan at the time of Mr. Holliday’s death was not met. Because appellant was not enrolled in the school district’s health plan at the time of her husband’s death, she had no property interest in the fund, and, therefore, her conversion claim fails.
Because there are no issues of material fact, and because appellant has failed to provide proof sufficient to establish the necessary elements of her claims, we affirm the district court’s grant of summary judgment in favor of the school district.