The Seventh Circuit Court of Appeals affirmed a summary judgment in favor of a university, retirement plans governed by the Employee Retirement Income Security Act of 1974 (ERISA), and the plans’ recordkeeper, in a case brought by heirs asserting claims for benefits, breach of fiduciary duty, and negligence. The court held that a power of attorney executed by the plan participant’s spouse did not validly authorize her agent to waive her right to a joint and survivor annuity because it lacked the express grant of authority required under Wisconsin law. Havlik v. Univ. of Chicago, No. 25-2821 (7th Cir. July 20, 2026).
Edward Lyon, a University of Chicago physician, participated in two ERISA-governed retirement plans from 1960 to 1996. In 1998, he designated his wife, Valerie Lyon, and his trust as beneficiaries, with Valerie’s notarized consent. The plans’ default forms of benefit were a 50 percent joint and survivor annuity, which a married participant could only change by making a “qualified election” accompanied by a spousal waiver that was explicit, written, and notarized, as required by both the plans and ERISA, 29 U.S.C. § 1055(c)(2)(A). Neither ERISA nor the plans addressed whether an agent under a power of attorney may consent to a spousal waiver on a spouse’s behalf.
In 2014, Valerie executed a Wisconsin statutory power of attorney naming her son-in-law, Daniel Davies, as her agent. The document granted Daniel general authority over a range of subjects and included special instructions permitting him to change beneficiary designations on Valerie’s accounts, but it did not expressly authorize him to waive her right to a survivor annuity. In 2019, shortly before his death, Edward submitted a new beneficiary form naming trusts for his 36 grandchildren as the primary beneficiaries of his retirement plans and removing Valerie as a beneficiary. Daniel signed the required spousal consent on Valerie’s behalf, also in 2019. TIAA, recordkeeper of the plans, initially rejected the form in December 2019, shortly after Edward's death, citing an apparent missing signature. The family did not learn until January 2022, well after both Edward and Valerie had died, that the real deficiency was that the power of attorney did not explicitly authorize Daniel to waive Valerie’s spousal rights, foreclosing any opportunity to cure it. Their heirs sued the university, its plans, and TIAA, asserting claims for benefits, breach of fiduciary duty, and negligence. The district court granted summary judgment to the defendants. The heirs appealed.
The Seventh Circuit affirmed. The court determined that Wisconsin’s Uniform Power of Attorney for Finances and Property Act distinguishes between actions that an agent may take under general authority and those requiring an express, specific grant. Under Wisconsin Statute section 244.41(1)(f), an agent may waive a principal’s right to a survivor annuity, including a retirement plan survivor benefit, only if the power of attorney expressly grants that authority. The heirs argued that a more general provision, Wisconsin Statute section 244.51(2)(i), governed because it allows an agent with only general authority to consent to a reduction in a payment from a trust or beneficial interest. The court rejected their argument, reasoning that the specific statute addressing survivor annuity waivers controlled over the more general estate-related provision, and that the placement of survivor-benefit waivers among the acts requiring express authorization reflected a deliberate legislative choice to guard against ambiguous waivers of spousal rights.
The court further found that, because Edward never made a valid qualified election choosing an alternative form of payment, the default joint and survivor annuity remained in effect, meaning that the express authorization requirement set forth in section 244.41(1)(f) applied on its face. Because Valerie’s power of attorney granted Daniel only general authority over beneficiary designations and did not specifically address waiver of survivor annuity rights, the 2019 spousal consent was invalid, and the heirs’ claim for benefits failed.
The court also denied the heirs’ motion to certify a question to the Wisconsin Supreme Court, finding that the proposed question mischaracterized the benefit at issue and that the case turned on fact-specific circumstances unsuited to certification. Finally, the court rejected the heirs’ alternative claims for breach of fiduciary duty against the university and negligence against TIAA, concluding that the university had acted consistently with the law and plan terms and that ERISA preempted the negligence claim because TIAA’s recordkeeping function was central to plan administration.
The court thus affirmed the district court’s judgment in favor of the defendants.
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