Gray v. Higgins

• Decision Date: 16 July 1992
• Docket Number: No. A92A1291,A92A1291
• Citation: 421 S.E.2d 341,205 Ga.App. 52
• Parties: GRAY v. HIGGINS.
• Court: Georgia Court of Appeals

Page 341

421 S.E.2d 341

205 Ga.App. 52

GRAY v. HIGGINS.

No. A92A1291.

Court of Appeals of Georgia.

July 16, 1992.

Glaze, Glaze, Fincher & Brakefield, Gary H. Brakefield, William A. Grabbe, Jonesboro, for appellant.

Samuel W. Wethern, Fayetteville, for appellee.

BIRDSONG, Presiding Judge.

This is an appeal from the order of the superior court granting summary judgment in favor of appellee Anne M. Higgins and denying summary judgment for appellant administratrix.

In October of 1963, pursuant to a settlement agreement made part of a final divorce decree entered in 1964, deceased husband, William E. Gray, agreed to assign and to make his spouse, Anne M. Higgins then Anne M. Gray, the owner of a certain $25,000 whole life insurance policy, and to keep the policy current and in effect. Following the death of the deceased in October, 1989, appellee was informed the policy had been allowed to lapse in 1967, and that neither this policy nor any other $25,000 policy was then in force which named her beneficiary. In May, 1991, appellee brought suit against her former husband's estate seeking $25,000 in damages. Held:

1. Appellee is a real party in interest within the meaning of OCGA § 9-2-20(a). See Insured Lloyds v. Bobo, 116 Ga.App. 89, 90, 156 S.E.2d 518; Tyler v. Nat. Life, etc., Ins. Co., 48 Ga.App. 338 (2), 172 S.E. 747 (generally an action on an insurance policy or written binder must be brought in the name of the legal titleholder, and one other than the person to whom the policy was issued cannot maintain an action thereon in his own name, unless the policy has been duly assigned to him in writing).

2. The settlement agreement, which was incorporated into the divorce decree, pertinently provides as follows: "[William E. Gray] agrees to assign irrevocably to [appellee] before this divorce becomes final, insurance policy No. 707344 ... in the sum of $25,000. [Appellee] shall be sole owner of said policy, but agrees to maintain the children as beneficiaries during their minority. (First party agrees to maintain an additional policy on his life of not less than $25,000 so long as any of the children are minors. First party further agrees to maintain the second party as primary beneficiary on said policy. When the youngest of the children has reached her majority, first party shall have the right to change the beneficiary on said policy as he sees fit.) [William E. Gray] further agrees to pay all premiums on both policies and to see that they are kept current and in force." (Provisions in parentheses pertain to a second policy not here at issue.)

The portion of the settlement agreement creating an obligation to pay insurance premiums constitutes periodic alimony rather than equitable property division. Sapp v. Sapp, 259 Ga. 238, 240 (4), 378 S.E.2d 674. Absent a "manifest intention of the parties" to the contrary, the obligation to pay periodic alimony terminates on the death of the paying spouse (Dolvin v. Dolvin, 248 Ga. 439, 441, 284 S.E.2d 254) or of the surviving spouse (Ramsay v. Sims, 209 Ga. 228, 233-234, 71 S.E.2d 639, reversed on other grounds, Dolvin v. Dolvin, supra). Compare Winokur v. Winokur, 258 Ga. 88, 365 S.E.2d 94; Rooks v. Rooks, 252 Ga. 11, 15, 311 S.E.2d 169 (Weltner, J., concurring). This rule applies "to separation agreements as well as decrees of divorce." Schartle v. Trust Co. Bank, 239 Ga. 248, 249, 236 S.E.2d 602. Additionally, as of the effective date of OCGA § 19-6-5(b) (Code Ann. § 30-209), periodic alimony also terminates upon the remarriage of the receiving spouse. Appellant has not contested the trial court's holding, pursuant to Candler v. Wilkerson, 223 Ga. 520, 521, 156 S.E.2d 358, that OCGA § 19-6-5(b), providing for automatic termination of alimony upon remarriage, could not be applied retroactively to this settlement agreement.

(a). A settlement agreement is a contract and the question of its enforceability is for the court to decide. Graves v. State, 260 Ga. 779, 399 S.E.2d 922. Where a settlement agreement is incorporated into a final decree of divorce, a suit seeking damages for the violation of its terms need not be initiated solely upon the decree; but an action ex contractu may be maintained due to a breach of the settlement agreement. OCGA § 9-2-4; see also Russell v. Fulton Nat. Bank, 247 Ga. 556, 276 S.E.2d 641, overruled on other grounds, Dolvin v. Dolvin, supra; Brooks v. Jones, 227 Ga. 566, 569 (1), 181 S.E.2d 861; Ramsay v. Sims, supra. Accordingly, the trial court did not err in finding the settlement agreement constituted a valid and enforceable contractual obligation that was incorporated into the final divorce decree.

(b) "Where the parties in a divorce action enter into a settlement agreement, its meaning and effect should be determined according to the usual rules for the construction of contracts, the cardinal rule being to ascertain the intention of the parties. [Cit.] In approving and adopting a settlement agreement, the court adopts the meaning and effect of the agreement as it was intended by the parties." Cousins v. Cousins, 253 Ga. 30, 31 (1), 315 S.E.2d 420; Anderson v. Larkin, 190 Ga.App. 283, 284, 378 S.E.2d 707.

The pertinent terms of this settlement agreement are clear and unambiguous; accordingly, we will look to the settlement contract alone to find the intention of the parties. Health Svc. Centers v. Boddy, 257 Ga. 378, 380, 359 S.E.2d 659. Examining the language of the settlement agreement, we find the parties intended that upon the death of William E. Gray the deceased would have kept current and in force a $25,000 insurance policy assigned to and then owned by appellee, and that the requirements for deceased to pay premiums on the policy and to see that it was kept "current and in force," were to be a non-severable part of this agreement. Additionally, the parties intended that the children, during their minority, would be the beneficiaries of this policy (the children have reached the age of majority in this case). Equally clear in this agreement is the parties' inherent intent that after the children had reached the age of majority (which they reached prior to the death of William E. Gray), appellee, being declared the "sole owner" of the policy, would be vested with the sole authority to change the policy beneficiaries and to declare whomever she desired (including herself) to be the beneficiary thereof.

Further, considering the purpose of the settlement agreement and the terms of the document in its totality, we find that the portions of the settlement agreement provisions referring to a specific policy number were incidental to the true contractual intent of the parties and merely served to identify the particular $25,000 policy then in force; but that the true and paramount intent of the parties, at the time the settlement contract was executed and again when it was incorporated into the divorce decree, was that upon the death of William E. Gray some type of $25,000 insurance policy would be current and in force and that ownership of this policy would have been transferred to the appellee. Accordingly, payment of $25,000 on the death of the deceased was not intended to be "restricted" to the specific policy referred to in the agreement. In fact, the maintenance of a current and in force insurance policy was merely the "financial vehicle" chosen by the parties to provide $25,000 on the death of deceased. "The cardinal rule of construction is to ascertain the intention of the parties. If that intention is clear and it contravenes no rule of law and sufficient words are used to arrive at the intention, it shall be enforced irrespective of all technical or arbitrary rules of construction." (Emphasis supplied.) OCGA § 13-2-3.

Moreover, assuming arguendo, William E. Gray had intended that his obligation to provide a current and in force policy of insurance for appellee at the time of his death (by means of making periodic alimony payments in the form of insurance...