Opinion
026723/09.
Decided September 8, 2010.
Bleakley, Platt Schmidt, LLP, One North Lexington Avenue, White Plains, New York, Counsel for Plaintiff The William Penn Life Insurance Company of New York.
Chiariello Chiariello, Dominic L. Chiariello, Esq., Glen Cove, New York, Counsel for the Defendant Justina Coleman.
Anthony T. Scotto, Esq., Garden City, New York, Counsel for the Defendant Chrystal Coleman.
The Motion by the Defendant, JUSTINA COLEMAN, and the Cross-motion by the Defendant, CHRYSTAL COLEMAN, an infant by her mother and natural guardian HILDA COLEMAN a/k/a HILDA RAMIREZ, seeking summary judgment directing the Plaintiff to turn over to them the life insurance proceeds for Neil Coleman, deceased, is decided as provided for herein.
Neil Coleman obtained the subject life insurance policy from the Plaintiff in 1996. He subsequently married the Defendant, JUSTINA COLEMAN and named her the beneficiary of the life insurance proceeds in 1997. In 2006, Neil Coleman and Justina Coleman were divorced. There were no children of the marriage.
Neil Coleman was diagnosed with advanced lung cancer. His brother, Francis Coleman, states that Neil Coleman and he met with attorney, John Lynch in October, 2008, for the purpose of getting Neil Coleman's affairs in order. Among other things, John Lynch prepared a Power of Attorney, appointing Francis Coleman, as Neil Coleman's attorney-in-fact. Neil Coleman's life insurance policy was discussed, and Neil Coleman advised his brother, in John Lynch's presence that he wanted his only child, the Defendant, Chrystal Coleman, to be the beneficiary of the insurance policy. Later, in Francis Coleman's presence, Neil Coleman called his insurance agent, Al Tretola ("Tretola"), who informed Neil Coleman that he would mail a change of beneficiary form to him. Francis Coleman avers that when the change of beneficiary forms arrived, he filled them out in accordance with Neil Coleman's instructions and mailed them to the Plaintiff.
Neil Coleman was hospitalized on October 18, 2008, and died on October 20, 2008.
The Plaintiff states that on October 27, 2008, it received the Beneficiary Change Form signed by Francis Coleman, as attorney-in-fact. According to the Plaintiff, the form was incorrectly completed, as it was not dated and did not "list percentage next to beneficiary" (complaint, par. 8-9). Consequently, it returned the papers to Neil Coleman's address and advised of the deficiencies.
The Beneficiary Change Form was returned to the Plaintiff dated "10/28/08" and indicated that Chrystal Coleman was the beneficiary to receive "100%" of the insurance proceeds. Francis Coleman states that he inserted the current date on the Beneficiary Change Form, not the date the form was originally completed. Francis Coleman insists that he originally completed the Beneficiary Change Form, and mailed it to the Plaintiff, prior to Neil Coleman's death (Francis Coleman affidavit, ¶ 9).
Both Neil Coleman's ex-wife Justina Coleman, and his infant daughter Chrystal Coleman, claim to be the beneficiary of the subject insurance policy. Consequently, the plaintiff commenced this interpleader action, both Defendants served answers, and at this time each Defendant seeks summary judgment in her favor.
For the record, the subject insurance policy provides, as follows:
Change of Owner and Beneficiary
The Owner may change the designations of Owner and Beneficiary during the Insured's lifetime. Written notice of change must be filed at the Home Office at the address shown on the cover page in a form acceptable to the Company. The new designation will then take effect as of the date the Owner signed the notice. Such a change does not affect any payment made or other action taken by the Company before the notice is received.
(Exhibit 1 Attached to the Cross-motion, at p. 4).
Summary judgment is the procedural equivalent of a trial. S.J. Capelin Assoc., Inc. v Globe Mfg. Corp., 34 NY2d 338, 341 (1974). Summary judgment will not be defeated by mere conclusions or unsubstantiated allegations ( Zuckerman v. City of New York, 49 NY2d 557), or conjecture and surmise ( Singer v. Neri , 31 AD3d 738 [2nd Dept. 2006]).
The paramount factor in resolving a controversy regarding a change of beneficiary is the intent of the insured. McCarthy v Aetna Life Ins. Co., 92 NY2d 436, 440 (1998) On this record, both the insured's brother and his attorney attest as to Neil Coleman's clear intent that the proceeds of his insurance policy should go to his only child rather than his ex-wife.
In addition to intent, "there must be an act or acts designed for purpose of making the change, though they fall short of accomplishing it. Aetna Life Ins. Co. v. Sterling, 15 AD2d 334, 335 (1st Dept), affd 11 NY2d 959 (1962) (where old policy had not yet expired when insured died, new beneficiary rejected); see also Hunnell v. Hunnell, 45 AD2d 521 (4th Dept. 1974), affd 37 NY2d 931 (1975) (no affirmative act by insured). While the method prescribed by the insurance contract must be followed in order to effect a change of beneficiary ( McCarthy at p. 440), strict compliance is unnecessary ( Cable v. Prudential Ins. Co. of America, 89 AD2d 636 [3rd Dept. 1982]) (failure to return the policy for indorsement, before death of insured, did not invalidate change of beneficiary). Substantial compliance will suffice. See McCarthy at p. 440-441; see Lopez v. Massachusetts Mutual Life Ins. Co., 170 AD2d 583 (2nd Dept. 1991) (waiver found; but even in absence of waiver, Court would conclude that handwritten letter by insured requesting beneficiary change from wife to mother constituted "substantial compliance").
It has been held that where the insured executed a change of beneficiary, but died before it could be transmitted to the insurance company, the insured had completed all that was humanly possible for him to do because he was then on his deathbed ( Greenfield v. Massachusetts Mut. Life Ins. Co., 253 A.D. 51 (3rd Dept. 1937) (change of beneficiary from estranged wife to siblings, brother-in-law, and friend upheld); see also Luhrs v. Luhrs, 123 NY 367 (1890) (new beneficiary upheld where insured complied with all requirements for change before he died); Van Alstine v. Metropolitan Life Ins. Co., 23 Misc 2d 959 (Sup Ct, Monroe Cty, 1959) (change in beneficiary upheld where insured did all that was reasonably possible to make the change before his death).
In this case Neil Coleman did all he could do to bring about the change of beneficiary when, with advanced lung cancer, he requested the proper form and appointed his brother attorney-in-fact. Under these circumstances, the Court finds that the Francis Coleman's execution and mailing of the Beneficiary Change Form before the insured's death constitutes "substantial compliance." Equity considers done that which ought to have been done. Lahey v. Lahey, 174 NY 146 (1903)
The Defendant, Justina Coleman's reliance upon John Hancock Mut. Life Ins. Co. v. McManus, 247 AD2d 513 (2nd Dept. 1998), is misplaced, as in John Hancock, unlike this matter, "completion of the new form was within" the power of the insured to accomplish. Cook v. Aetna Life Ins. Co., 166 AD2d 895 (4th Dept. 1990) is similarly inapposite, as no evidence was presented that there was any affirmative act by the insured to effect a change of beneficiary.
The Defendant, Justina Coleman's attack upon the power-of-attorney, as lacking the proper acknowledgment, has been shown to be erroneous and her attorney's description of Neil Coleman's brother as "obviously interested in the outcome" is inaccurate as well as misguided. Finally, fax markings on top of some of the documents supplement, rather than contradict, the attestation of mailing.
Accordingly, it is hereby ORDERED, that the motion by the Defendant, Justina Coleman (Mot. Seq. 01) for summary judgment is DENIED, and it is further
ORDERED, that the cross-motion by Defendant, CHRYSTAL COLEMAN, an infant by her mother and natural guardian HILDA COLEMAN a/k/a HILDA RAMIREZ, is GRANTED; and it is further
ORDERED, that the Plaintiff is to turn over the subject life insurance proceeds to HILDA COLEMAN A/K/A HILDA RAMIREZ, the mother and natural guardian of CHRYSTAL COLEMAN, who shall deposit and maintain such proceeds in an account at HSBC Bank, 366 North Broadway, Jericho, New York 11753, and it is further
ORDERED, that the account shall be in the name of Hilda Coleman a/k/a Hilda Ramirez, mother and natural guardian, in trust for the infant, Chrystal Coleman; and it is further
ORDERED, that the account shall be fully insured at all times; and it is further;
ORDERED, that the account shall have the highest interest yield available regardless of whether it be a savings account, a Certificate of Deposit, or other form of deposit; and it is further
ORDERED, that no withdrawal shall be made from the account before the infant reaches the age of eighteen years without further Order of this Court; and it is further
ORDERED, that upon Chrystal Coleman's demand therefor, and upon presentation of proper proof of age, and without further Court Order, HSBC Bank shall pay over to Chrystal Coleman the entire contents of the account after she reaches the age of eighteen years.
This constitutes the decision and order of the Court.