ERISA does not contain a statute of limitations governing the filing of a lawsuit for employee benefits under an ERISA plan, nor does it specify when the clock begins to run.  Rather, a federal court hearing an ERISA benefits lawsuit will borrow from the forum state’s statute applicable to an analogous action (such as breach of contract) to arrive at the limitations period. The date upon which the deadline begins to run has been developed by federal common law:  In general, a benefit claim accrues after administrative remedies have been exhausted and the claim has been finally denied. White v. SunLife Assur. Co., 488 F. 3d 240, 246 (4thCir. 2007).

The White decision established the rule in the Fourth Circuit that a plan’s terms could not modify the accrual date.  In White, the plan language provided that a lawsuit must be filed within three years after proof of claim is required.  Because a claimant is required to exhaust administrative remedies before he can file suit, (Makar v. Carefirst, 872 F 2d 80 (4^th Cir. 1989)), the White Court found that the plan’s terms impermissibly “start[ed] the clock [running] before the participants [could] even file suit.” Id. at 247.  The White Court held that plan language could not trump federal common law with respect to the accrual date. (On the other hand, as clarified by the Fourth Circuit just last year, a plan’s time limit can trump the forum state’s statute, even if the plan’s time limit is shorter. Belrose v. Hartford Life & Accident Ins. Co., 478 Fed. Appx. 21 (4th Cir. 2012).) 

The Fourth Circuit found itself on one side of a Circuit split, the other side allowing ERISA plans to alter the accrual date.  See, Burke v. PriceWaterHouseCoopers LTD Plan, 572 F.3d 76 (2nd Cir. 2009); Rice v. Jefferson Pilot Financial Ins. Co., 578 F.3d 450 (6^th Cir. 2009).  Just last Friday, the United States Supreme Court unanimously sided with the latter, abrogating White. Heimeshoff v. Hartford Life & Accident Ins. Co., 2013 WL 6569594 (Dec. 16, 2013).  TheHeimeshoff Court recognized that the deadline under a statute of limitations generally begins to run when the cause of action “’accrues’ – that is, when the plaintiff can file suit.”  However, focusing on the sacrosanct ERISA principle that plan terms are to be enforced as written, the Court held that the parties could contract to commence the limitations period earlier, absent a controlling statute to the contrary, and as long as the period was reasonable.  The Court relied upon Order of the United Commercial Travelers v. Wolfe, 331 U.S. 586, 67 S. Ct. 1355 (1947) for its holding, declaring that “the Wolfe rule necessarily allows parties to agree not only to the length of the limitations period but also to its commencement,” even though the accrual date was not the issue before the Court in the Wolfe case. 

To allay fears of draconian consequences, the Heimeshoff Court suggested that equitable theories such as waiver, estoppel and equitable tolling could assist claimants in cases when the shortened limitation period resulted in inequitable circumstances.  These circumstances did not exist in its case, the Court found.  Justice Thomas delivered the opinion.