Opinion
Case No. 02-4168-SAC
September 25, 2003
MEMORANDUM AND ORDER
This statutory interpleader action was brought by an insurance company which paid into court the proceeds from a life insurance policy, of which both defendants claim to be the proper beneficiary. See 28 U.S.C. §; 1335, 1397, 2361 and Fed.R.Civ.P. 22(2). The court previously granted plaintiff's motion for judgment on the pleadings, and now decides defendant Alan Barber's motion for summary judgment against co-defendant Sonya Barber.
FACTS
The controlling facts are undisputed. Defendant Alan Barber is a resident of Kansas and the brother of the decedent, Mark Barber. Defendant Sonya Barber is a resident of Texas and the surviving spouse of the decedent.
On or about May 12, 1985, Mark Barber applied for and soon thereafter received life insurance from plaintiff in a face amount of $50,000. The application listed the primary life insurance policy beneficiary as Lyle D. Barber, the father of the decedent, and the contingent beneficiaries as Scott C. Barber and Alan L. Barber, brothers of the decedent.
The policy provided that the owner could change the beneficiary at any time before the insured dies, pursuant to certain terms and conditions. Thereafter, Mark Barber changed the beneficiary from his father to the following, on the dates noted:
November 1, 1986 — "Sonya L. Barber, wife of the insured, if living otherwise to Lyle D. Barber, father of the insured."
May 21, 1998 — "Sonya L. Barber, wife of the insured, if living, otherwise to Alan. L. Barber, brother of the insured, or if both said wife and brother shall die before the insured, to Killian C. Barber and Skyler D. Barber, children of the insured, the survivor or survivors equally."
May 15, 2002 — "Alan L. Barber, brother of insured."
All such changes were made in accordance with the terms and conditions required by the policy.
Approximately two months after the last change in beneficiary, Mark Barber committed suicide.
SUMMARY JUDGMENT STANDARD
More than a "disfavored procedural shortcut," summary judgment is an important procedure "designed'to secure the just, speedy and inexpensive determination of every action.' Fed.R.Civ.P. 1." Celotex Corp. v. Catrett, 477 U.S. 317(1986). At the same time, a summary judgment motion does not empower a court to act as the jury and determine witness credibility, weigh the evidence, or choose between competing inferences. Windon Third Oil and Gas Drilling Partnership v. Federal Deposit Ins. Corp., 805 F.2d 342, 346 (10th Cir. 1986), cert. denied, 480 U.S. 947 (1987).
Under this standard, this court examines the record to determine whether any genuine issue of material fact is in dispute, construing the factual record and reasonable inferences therefrom in the light most favorable to the nonmoving party. See Curtis v. Oklahoma City Pub. Schs. Bd. of Educ., 147 F.3d 1200, 1214 (10th Cir. 1998). When the nonmovant will bear the burden of proof at trial, he can survive summary judgment only by going beyond the pleadings and presenting evidence sufficient to establish the existence, as a triable issue, any essential and contested element of his case. See McKnight v. Kimberly Clark Corp., 149 F.3d 1125, 1128 (10th Cir. 1998).
ANALYSIS
Alan Barber, as the last named beneficiary, seeks to recover the proceeds of Mark Barber's life insurance policy. In support of his motion for summary judgment, he contends that "the only possible claim Defendant Sonya Barber might make is that since she was the spouse of Mark Barber at the time the insurance policy beneficiary was changed," the change in beneficiaries is improper. (Dk. 27, p. 3.) Alan Barber then cites authority for the proposition that Mark Barber, while married, was entitled to and could change the beneficiaries under his life insurance policy without the consent of his spouse. See Wear v. Mizell, 263 Kan. 175 (1997).
Sonya Barber does not challenge the above proposition, but instead asserts that the purported change of beneficiary on May 15, 2002 to Alan Barber had no legal effect because Mark Barber lacked the mental incapacity to change beneficiaries. She additionally contends that the change of beneficiary to Alan Barber was void as against public policy because it was pursuant to an illegal conspiracy for Alan Barber to abduct her minor children, and the insurance proceeds were to be used for that purpose. In support of her assertions, Sonya Barber has attached an affidavit which provides specific facts in support of these defenses.
Mental Capacity to Change Beneficiary
Under Kansas law, it is well established that a person must possess sufficient mental capacity to understand the nature and effect of the act which he undertakes. DeBauge Bros., Inc. v. Whitsitt, 212 Kan. 758, 762 (1973), citing Mills v. Shepherd, 159 Kan. 668 (1945) ("The test of mental capacity to contract is whether the person possesses sufficient mind to understand in a reasonable manner the nature and effect of the act in which he is engaged.")
This general rule applies in the context of a change in the beneficiary in a life insurance policy as well.
. . . with respect to designation of a beneficiary in a life insurance policy the universal rule is that the mental capacity necessary for a valid change of beneficiary by an insured is the same as that necessary to execute a valid will, deed or contract (44 Am.Jur.2d, Insurance, § 1778, p. 692).
Union Nat. Bank of Wichita v. Mayberry, 216 Kan. 757, 762 (1975).
Although Kansas courts have not specifically held that a presumption of mental capacity exists in the insurance context, they have generally recognized a presumption of "sanity, competency, and capacity." Matter of Estate of Hendrickson, 248 Kan. 72, 77-78 (1991) (adopting the general presumption "that a person who has contracted a marriage was mentally capable of contracting it, and the burden is on the party alleging mental incapacity to prove it," citing Annot., Mental Capacity to Marry, 82 A.L.R.2d § 9, p. 1053). "Generally speaking, the infirmities of a contract are required to be proved by the party asserting such infirmities." Scott v. Farrow, 192 Kan. 666, 673 (1964). Accordingly, Sonya Barber has the burden to present affidavits or other forms of acceptable evidence that set forth specific facts showing that there is a genuine issue for trial that Mark Barber was not mentally capable of changing the beneficiary on his life insurance policy.
In meeting this burden, it is insufficient for Sonya Barber to show that plaintiff was suicidal generally. Lack of capacity to contract cannot be presumed from the mere fact of suicide itself. See generally American Financial Life Ins. and Annuity Co. v. Youn, 7 Fed.Appx. 913, 2001 WL 369826, *4 (10th Cir. Apr. 13, 2001) (Table) (interpleader action finding evidence insufficient to overcome Oklahoma presumption of mental capacity); Velez v. Metro. Life Ins. Co., 723 F.2d 7 (10th Cir. 1983) (finding sufficient mental capacity to change beneficiary of life insurance policy, notwithstanding suicide approximately one month later). Instead, Sonya Barber has the burden to show that on the date Mark Barber changed beneficiaries, he lacked the mental capacity to contract. See generally Curry v. Stewart, 189 Kan. 153, 156-157 (1962) (finding "one's dissipated condition, standing alone, is not itself a ground for avoiding a contract or deed.")
"Both expert and lay testimony is competent on the question of mental capacity." In re Estate of Farr, 274 Kan. 51, 66 (2002). The fact that no expert physician has opined on decedent's lack of mental capacity is thus not fatal to Sonya Barber's case. See Farr, 274 Kan. at 66 ("The trier of fact is not obligated to adopt the views and opinions of a physician, no matter how highly qualified, and to reject nonexpert testimony.")
The court has carefully examined the affidavit from Sonya Barber in light of her burden to show incapacity on the relevant date, May 15, 2002. Although it does not relate any specific events occurring on that date, evidence of lack of capacity before or after that date serves as an aid in determining whether the decedent had capacity at the time he changed the beneficiary. See e.g., Farr, 274 Kan. at 64 (regarding testamentary capacity). The affidavit sets forth dates and details concerning Mark Barber's loss of a child, loss of his job, loss of his wife and children by their temporary move to Texas, treatment at a Medical Center for his mental condition, prior threat of suicide at the end of April, 2002, and his aberrant behavior surrounding the date on which he changed the beneficiary. The court finds the affidavit sufficient to raise a question of fact whether on the date when the beneficiary was changed, the insured lacked the mental capacity to contract.
Accordingly, the court finds it unnecessary to reach Sonya Barber's other contention relating to public policy. Defendant Alan Barber's motion for summary judgment must be denied.
The court will initiate a telephone hearing on October 9, 2002, at 10:30 a.m., which time the defendants should be prepared to discuss the possibility of setting this case for a settlement conference.
IT IS THEREFORE ORDERED that defendant Mark Barber's motion for summary judgment (Dk. 26) is denied.
Dated this ___ day of September, 2003, Topeka, Kansas.
Sam A. Crow, U.S. District Senior Judge