Opinion
14-P-1670
11-20-2015
SALLY A. SHUTTLE v. MICHAEL LIGOR, executor, & another.
NOTICE: Summary decisions issued by the Appeals Court pursuant to its rule 1:28, as amended by 73 Mass. App. Ct. 1001 (2009), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
Approximately one year before he died on August 26, 2008, Demetre P. Ligor changed the beneficiary of his life insurance policy from the plaintiff, Sally A. Shuttle, to his wife, Pandora Ligor. When, upon Demetre's death, Pandora received the death benefit provided by the policy, about $63,000, Shuttle commenced this action against Pandora and Michael Ligor, the executor of the estate, to obtain the proceeds of the policy. Shuttle's amended complaint alleged that Demetre's estate was liable to her for breach of contract and that Pandora was liable on a theory of unjust enrichment. After a bench trial, a judge of the Superior Court found that Shuttle had acquired an equitable interest in the policy and declared that the defendants were jointly and severally liable to Shuttle for the death benefit and the accrued interest. From that judgment, Pandora and Michael have appealed. We conclude there was no basis for the judgment against Pandora, but otherwise affirm.
We use first names for Demetre, Pandora, and Michael to avoid confusion.
Background. We summarize the facts found by the judge. Shuttle worked for Demetre's company, Applied Measurements, Inc. (company), for many years in a variety of capacities. Her work was excellent and Demetre was grateful. At some point between 2000 and 2005, Demetre informed Shuttle that he had designated her as the beneficiary under a life insurance policy, explaining, as the judge found, that "this was intended to be her retirement plan as compensation for her working for less money than her performance merited." Over the next several years the company downsized and eventually stopped paying Shuttle's then $39,000 salary. Nonetheless, out of loyalty to Demetre, because she had been designated as beneficiary under the policy, and because the company continued to require her services, Shuttle continued to perform substantial work for the company.
In 2006, Demetre suffered a stroke. Shuttle asked him whether he wished to change the beneficiary on his life insurance policy, to which he responded unequivocally in the negative. Thereafter, using her own funds, Shuttle paid several of the premiums of the life insurance policy and continued to perform services for the company. However, unbeknownst to Shuttle, in April, 2007, Demetre changed the beneficiary of the life insurance policy to Pandora, to whom he had been married for sixty-two years.
Discussion. A. Judgment against Michael. As previously noted, the judge concluded that Shuttle had acquired an equitable interest in the insurance policy. See Johnny's Oil Co. v. Eldayha, 82 Mass. App. Ct. 705, 714 (2012) ("Detrimental reliance on an offer or a promise [also known as promissory estoppel] is a substitute for consideration. Therefore, an offer that reasonably induces the other party to act is enforceable as a contract in the same manner as any other contract to the extent necessary to avoid injustice"). Michael argues that the judge erred because Shuttle presented no evidence showing that Demetre originally named her as the beneficiary of the policy for the purpose of causing her to change her position, but instead did so only to reward Shuttle for her past services to the company. Thus, according to Michael, Shuttle never acquired any equitable interest in the policy.
This argument ignores the judge's findings that, at the time Demetre designated Shuttle as the beneficiary under the policy, Demetre's company required Shuttle's future performance, and that Shuttle in fact continued to provide valuable services to the company even after she no longer was receiving a salary. In addition, Shuttle made at least three payments on the policy. Contrary to Michael's assertion, the evidence supports the judge's conclusion that Demetre promised the proceeds of the life insurance policy to Shuttle and that she changed her position in reliance on this promise by continuing to perform services, uncompensated, for the company. Accordingly, we will affirm the portion of the judgment against Michael.
The judge found that Shuttle's interest in the policy arose "before and apart from her three payments of life insurance premiums." Based on this conclusion, the judge correctly determined that the statutory protection from creditors afforded to a widow who is designated as the beneficiary on a life insurance policy does not apply here. See G. L. c. 175, § 126; Massachusetts Linotyping Corp. v. Fielding, 312 Mass. 147, 153 (1942) ("Section 126 would not, we think, be fair and reasonable if it had the effect of depriving a party of an equitable right or title acquired in the policy before the married woman became a beneficiary without making any provision reimbursing such party in any way for the cost of acquiring that interest").
B. Judgment against Pandora. The judge also summarily concluded that Pandora was unjustly enriched by the life insurance benefit that she received, but made no findings of fact regarding the circumstances in which Demetre changed the beneficiary of the policy to Pandora. "There are, to be sure, circumstances under which the innocent recipient of money, or goods the money bought, may be required to make restitution to the person from whom the money was wrongfully obtained." Jensen v. Daniels, 57 Mass. App. Ct. 811, 818 (2003). "Under Massachusetts law, a court will declare a party a constructive trustee of property for the benefit of another if he acquired the property through fraud, mistake, breach of duty, or in other circumstances indicating that he would be unjustly enriched." Fortin v. Roman Catholic Bishop of Worcester, 416 Mass. 781, 789, cert. denied, 511 U.S. 1142 (1994). Here, neither the amended complaint, which simply alleges that Pandora "received a benefit and this benefit was unjust as [Shuttle] had a valid contract with the defendant for this amount," nor the judge's findings, provide a foundation for entry of judgment against Pandora on a theory of unjust enrichment. Accordingly, we must vacate the portion of the judgment against Pandora.
So much of the judgment as (1) ordered Pandora to pay Shuttle $62,876.54 plus interest and costs, and (2) adjudged Pandora jointly and severally liable, are vacated. The remainder of the judgment is affirmed.
So ordered.
By the Court (Katzmann, Vuono & Agnes, JJ.),
The panelists are listed in order of seniority. --------
Clerk Entered: November 20, 2015.