DANIEL HOVLAND, Chief Judge, District
Summary:
In an Interpleader action, Defendant Richmond filed a Motion for Summary Judgment asserting Defendant Black had no legitimate claim to the proceeds of a life insurance policy. Although based on the evidence, affidavits, and exhibits presented to date, the Court found Defendant Black appears to have little evidence to support her claim. Nevertheless, the Court found that there are genuine issues for trial that preclude summary judgment at this stage.
Before the Court is a Motion for Summary Judgment filed by Donald Richmond on Janurary 5, 2004. For the reasons set forth below, the Court denies Richmond's motion.
I. BACKGROUND OF THE CASE
This matter arose from a dispute over a life insurance policy held by Lois Richmond. On or about September 10, 1986, Lois Richmond became the owner of life insurance policy number 864017626 issued by Merrill Lynch Life Insurance Company ("Merrill Lynch"). Donald Richmond was named as the beneficiary. Lois Richmond died on March 5, 2003. On March 11, 2003, Donald Richmond advised Merrill Lynch of Lois' death. Shortly thereafter, Merrill Lynch advised Richmond that Lois' surviving daughter, Karen Black, had contacted the company and had alleged the marriage of Donald and Lois was fraudulent and void. Black asserted the policy proceeds should be paid to her, rather than to Donald Richmond, the named beneficiary.
Merrill Lynch filed this interpleader action on November 10, 2003, because it was unable to determine who was the lawful beneficiary of Lois Richmond's life insurance policy. On November 13, 2003, the Court found Merrill Lynch's interpleader action was well taken and ordered the proceeds from the policy to be deposited with the Court. On January 5, 2004, Richmond filed a Motion for Summary Judgment and on February 11, 2004, Merrill Lynch also filed a Motion for Summary Judgment.
II. LEGAL ANALYSIS
It is well-established that summary judgment is appropriate when, viewed in a light most favorable to the non-moving party, there are no genuine issues of material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Graning v. Sherburne County, 172 F.3d 611, 614 (8th Cir. 1999). A fact is "material" if it might effect the outcome of the case and a factual dispute is "genuine" if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The basic inquiry for purposes of summary judgment is whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law. Quick v. Donaldson Co., Inc., 90 F.3d 1372, 1376 (8th Cir. 1996). The moving party has the initial burden of demonstrating to the Court that there are no genuine issues of material fact. If the moving party has met this burden, the non-moving party cannot simply rest on the mere denials or allegations in the pleadings. Instead, the non-moving party must set forth specific facts showing that there are genuine issues for trial. Fed.R.Civ.P. 56(e). A mere trace of evidence supporting the non-movant's position is insufficient. Instead, the facts must generate evidence from which a jury could reasonably find for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986).
In his summary judgment motion, Donald Richmond contends that under North Dakota law, the proceeds of a life insurance policy are to be paid to the named beneficiary. Karen Black does not dispute that a beneficiary is entitled to the proceeds. However, Black contends her mother was fraudulently induced into naming Richmond as the beneficiary. Black alleges that Richmond was married to another woman at the time he (Richmond) married her mother. According to Black, Richmond's false assertion that he was free to marry her mother induced her mother into naming him as the beneficiary of the life insurance policy.
Under North Dakota law, an insured has the right to designate the person or persons who shall be beneficiaries under a life insurance contract. McCarney v. Knudsen, 342 N.W.2d 380, 383 (N.D. 1983). When a beneficiary is named, the proceeds belong to the beneficiary and not to the insured's estate. Id. In addition, the North Dakota Supreme Court has held that a beneficiary's right to receive the proceeds from an insurance policy is not dependent upon martial status, unless the insurance policy conditions receipt upon marital status. Nunn v. Equitable Life Assurance Society of the United States, 272 N.W.2d 780, 782-83 (N.D. 1979). The policy at issue here did not condition the beneficiary's receipt of the proceeds on his or her marital status. (Docket No. 29). Thus, Richmond is correct when he argues that a named beneficiary is entitled to the proceeds of the insurance policy.
However, North Dakota law also provides that "[a] person who has been fraudulently induced to enter into a contract may either rescind the contract, or retain the benefits of the contract and obtain damages for injuries from the fraud." West v. Carlson, 454 N.W.2d 307, 310 (N.D. 1990). Under North Dakota law, "a marriage contracted by a person having a former husband or wife living, if the former marriage has not been annulled or dissolved, is illegal and void from the beginning unless such former husband or wife was absent and believed by such person to be dead for a period of five years immediately preceding such marriage." N.D.C.C. § 14-03-06.
In response to Richmond's motion for summary judgment, Black submitted several documents for the Court's review including a photocopy of a marriage license solemnizing the marriage of Donald Richmond and Henrietta Bauts on May 19, 1943, in Cook County, Illinois; a warranty deed from National Resort Communities, Inc., to Donald G. Richmond and wife, Rita E. Richmond, dated August 20, 1973; and a quit claim deed from Rita E. Richmond to Donald G. Richmond, dated March 12, 1998. Both the deeds are from Travis County, Texas. An affidavit was also submitted by Karen Black.
Taking the evidence in the light most favorable to Black, the Court finds Black has set forth sufficient facts to show there are genuine issues for trial. Fed.R.Civ.P. 56(e). The evidence provided by Black shows Donald Richmond was married to a Henrietta "Rita" Bauts in Illinois in 1943 and he may have never obtained a divorce from this marriage. Although neither party sets forth the date Lois Richmond and Donald Richmond married, it appears the marriage took place on March 23, 1982. (Docket No. 21, 1-2). Thus, Donald Richmond and Lois Richmond were married for 21 years at the time of her death.
The facts as set forth by Black could lead a reasonable fact-finder to conclude that Richmond never obtained a divorce from Rita Richmond; the second marriage may be void; and that Lois Richmond named Donald Richmond as the beneficiary on her life insurance policy as a result of fraudulent representations made concerning his marital status. Black carries the burden of proof. The mere fact that Donald Richmond's first marriage may not have been legally dissolved at the time of his marriage to Lois Richmond in 1982, will not, standing alone, be sufficient to show that Lois Richmond was fraudulently induced into marrying Donald Richmond and naming him as the beneficiary of a life insurance policy. Based on the evidence, affidavits, and exhibits presented to date, this appears to be a weak case. Nevertheless, the Court finds there are genuine issues for trial that preclude summary judgment at this stage.
Finally, this case is scheduled for trial on April 18, 2005. There is no reason the trial cannot be expedited and there is no need for any extensive discovery. The Court will set this case for trial in six (6) months with the scheduling and other discovery deadlines to be modified accordingly. The case is set for a 3-day trial beginning October 27, 2004.
III. CONCLUSION
The Court DENIES Donald Richmond's Motion for Summary Judgment (Docket No. 8).
IT IS SO ORDERED.