§ 4.3.6.5.9 BREACH OF CONTRACT CLAIMS

• Jurisdiction: Arizona

§ 4.3.6.5.9 Breach of Contract Claims. ERISA preemption of breach of contract claims turns on the parties to the contract and the nature of the deal. Clearly, if the contract claim asserts a failure to provide benefits by an employee benefit plan or its sponsoring employer, administrator, or fiduciaries, the claim is preempted.¹⁴¹ The courts have thus far treated implied covenant of good faith and fair dealing claims in the same manner as breach of contract claims. These claims are preempted if the underlying contract claim would be preempted.¹⁴²

One troublesome issue is the impact of ERISA preemption on state estoppel principles. Generally, an employee benefit plan cannot be estopped from applying its own terms.¹⁴³ However, some courts have distinguished between estoppel of the plan from applying its own terms and estopping the plan from applying unwritten prior interpretations which are inconsistent with oral representations to participants.¹⁴⁴

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Notes:

^[141] E.g., Dedeaux, 481 U.S. 41; Taylor, 481 U.S. 58.

^[142] Dedeaux, 481 U.S. 41; Harper v. Am. Chambers Life Ins. Co., 898 F.2d 1432 (9th Cir. 1990); Kelley v. Sears, Roebuck & Co., 882 F.2d 453, 456 (10th Cir. 1989).

^[143] E.g., Degan v. Ford Motor Co., 869 F.2d 889 (5th Cir. 1989); Moran v. Aetna Life Ins. Co., 872 F.2d 296 (9th Cir. 1989).

^[144] See Law v. Ernst & Young, 956 F.2d 364 (1st Cir. 1992); Kane v. Aetna Life Ins. Co., 893 F.2d 1283 (11th Cir. 1990).