Harris v. Harris, s. 24113-3-
| Decision Date | 28 January 1991 |
| Docket Number | 24204-1-I,Nos. 24113-3-,s. 24113-3- |
| Citation | 60 Wn.App. 389,804 P.2d 1277 |
| Court | Washington Court of Appeals |
| Parties | , 65 Ed. Law Rep. 594 Barbara HARRIS, Appellant, v. Wanda HARRIS, Respondent, Teachers Insurance and Annuity Association of America & University of Washington, Defendants. |
Lee Olwell, Bellevue, Bensen, Hattrup & Stege, Clinton H. Hattrup, Malcom Edwards, Seattle, for appellant.
Julin, Fosso, Sage, McBride & Mason, William F. Knowles, Seattle, for respondent.
In this case we are asked to review competing claims of a widow and a former spouse to the retirement annuity plan benefits of the deceased former husband.
Frederic Harris and Wanda Harris were married from May 27, 1967, to July 15, 1971. They had one son. During their marriage, Frederic named Wanda as primary beneficiary, and their son as contingent beneficiary, of retirement annuity proceeds payable upon Frederic's death. Frederic's retirement annuity plan was offered through his employer, the University of Washington, and provided by the Teacher's Insurance and Annuity Association of America (TIAA). Frederic and Wanda's divorce decree awarded the interest in the retirement annuity plan to Frederic. TIAA's records showed that Wanda remained the designated primary beneficiary at the time of Frederic's death.
Frederic was remarried in 1971 to Barbara Harris, and remained married to her until his death in 1988. During their marriage, Frederic executed a will naming Barbara as executrix and leaving her all of his property. Four months prior to Frederic's death, Frederic and Barbara entered into a 3-pronged community property agreement. The agreement provided:
Section 1. All property of whatsoever nature or description, whether real, personal or mixed, and wheresoever situated, now owned or hereafter acquired by us or either of us, whether separate or community property, shall be construed and is hereby declared to be community property.
Section 2. Upon the death of either of us, title to all community property, as herein defined, shall immediately vest in fee simple in the survivor of us.
Barbara alleges that a few days after the entry of the divorce decree in Frederic's prior marriage, Frederic submitted a form to the University of Washington changing the beneficiary of his TIAA plan from Wanda to Barbara. TIAA has no record of this. Barbara supports this allegation with her own affidavit and with handwritten notes, attached to her affidavit, purportedly written by Frederic.
Barbara Harris filed this action on September 8, 1988, against Wanda Harris, TIAA, and the University of Washington, seeking a declaration that she is the beneficiary of Frederic's TIAA retirement plan and seeking an award of all benefits thereunder. Alternatively, she sought damages for negligence against TIAA and the University of Washington, who she alleges lost the change of beneficiary form that Frederic allegedly filled out in her favor. The negligence claim is not at issue on this appeal.
Barbara moved for summary judgment based on the community property agreement and her own affidavit. Wanda filed a cross motion for summary judgment, claiming that as named beneficiary of the TIAA contract, she is entitled to all of the proceeds except one-half of the amount attributable to contributions made during the marriage of Frederic and Barbara. Wanda also filed a motion to strike Barbara's affidavit, claiming the affidavit was inadmissible under the deadman's statute, RCW 5.60.030.
The trial court entered an order striking Barbara's affidavit. It later denied Barbara's motion for summary judgment and granted Wanda's cross-motion for summary judgment. In a subsequent order, the trial court divided the benefits between the parties, awarding Barbara one-half of the value attributable to the contract after the second marriage.
Barbara Harris appealed all of the trial court's rulings. Wanda Harris cross-appealed the trial court's order regarding distribution of the funds between the parties, contending the trial court failed to award her all of the growth traceable to the contributions she was awarded.
I.
A motion for summary judgment should be granted only if the pleadings, affidavits, depositions, and admissions on file demonstrate that there is no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. Wilson v. Steinbach, 98 Wash.2d 434, 437, 656 P.2d 1030 (1982). In this case, only questions of law were raised by the parties, so the case was appropriately resolved on summary judgment.
Barbara Harris claims she is entitled to all of the proceeds of her deceased husband's retirement annuity contract by virtue of their community property agreement. She argues that this case is controlled by Neeley v. Lockton, 63 Wash.2d 929, 389 P.2d 909 (1964). In Neeley, the decedent participated in a pension plan funded by his employer for 13 1/2 years. During that time, he was married three times to three different women. During his first marriage, he designated his first wife as beneficiary of the accrued contributions in the event of his death before retirement. After his second marriage, he changed the beneficiary to his second wife. Although he took a third wife after divorcing the second, the designation of his second wife as beneficiary was never changed, and she remained the designated beneficiary at the time of his death. However, during his third marriage, he entered into a community property agreement which provided that all property of both spouses was declared to be community property, and that upon the death of either, all property would pass to the survivor. He remained married to his third wife until the time of his death.
The three wives stipulated that each was entitled to one-half of the funds accrued during her marriage, these funds being community property. The only funds in dispute were decedent's separate property, consisting of contributions made during the intervals when he was single, and the other one-half of the community property contributions, which became his separate property upon failure of either divorce decree to mention the pension fund.
The Neeley court was confronted with a conflict between the beneficiary designation in the pension fund and the community property agreement. Under the terms of the beneficiary designation, the decedent's separate property interest in the pension plan went to the named beneficiary (second wife) upon his death. Under the terms of the community property agreement, the decedent's separate property interest in the pension plan was converted to community property upon execution of the agreement, and went to his widow (third wife) upon his death.
The majority held that the community property agreement, rather than the beneficiary designation, controlled the disposition of the husband's interest in the pension plan. The court's reasoning began with the principle that "contracts, and particularly beneficiary designations, will control only to the extent that they are not inconsistent with the community property law", Neeley, 63 Wash.2d at 932, 389 P.2d 909 (citing Wilson v. Wilson, 35 Wash.2d 364, 212 P.2d 1022 (1949)). Since community property agreements are solely the creature of community property law, created by RCW 26.16.120, 1 the court accorded them the status of law rather than contract, and went on to examine the legislative intent behind the law. Neeley, 63 Wash.2d at 933-34, 389 P.2d 909. The basic consideration behind RCW 26.16.120, the court found, was to provide a simple and certain way of disposing of community property upon the death of either spouse. This legislative purpose should be given full force and effect by according reasonable amplitude and scope to the community property agreement. The words " 'whole or any portion of' " in the statute evidence an intent that the agreement be all-inclusive. Neeley, 63 Wash.2d at 934, 389 P.2d 909.
The Neeley court also based its reasoning on the expectations of the husband and wife entering such an agreement. The agreement expressly includes any and all property of either of them, and so they have a right to rely on the assertion that no interest has been reserved by a previous inconsistent beneficiary designation. In contrast, the court found that the pension company's need for administrative convenience in ascertaining claimants to the fund was a far lesser interest. Neeley, 63 Wash.2d at 935, 389 P.2d 909.
Appellant Barbara Harris correctly asserts that the facts of her case are on all fours with Neeley. Neeley was decided in 1964 and has not been overruled or questioned in any other case. It was cited as current law in Cross, The Community Property Law in Washington (Rev.1985), 61 Wash.L.Rev. 13 (1986). It has been relied on in subsequent cases for some general propositions, but not for its holding. See, e.g., Porter v. Porter, 107 Wash.2d 43, 53, 726 P.2d 459 (1986) (); Bosone v. Bosone, 53 Wash.App. 614, 617, 768 P.2d 1022 (1989) ().
One other case, Lyon v. Lyon, 100 Wash.2d 409, 670 P.2d 272 (1983), has dealt with the conflict between a community property agreement and another instrument granting survivorship rights. In Lyon, two brothers, Richard and Edward, were deeded property as joint tenants. In a joint tenancy, the surviving joint tenant takes sole title upon the death of the other. Lyon, 100 Wash.2d at 411, 670 P.2d 272. Prior to the conveyance of this property, Edward had entered into a 3-pronged community property agreement with his wife. The court held that the joint tenancy interest conveyed to Edward had become community property...
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