Holcomb v. Aetna Life Insurance Company

• Citation: 255 F.2d 577
• Decision Date: 20 June 1958
• Docket Number: 5621.,No. 5620,5620
• Parties: Leona HOLCOMB, individually; Leona Holcomb, as guardian of the person of Donald George Fleming, a minor; Donald George Fleming, a minor; Frank T. Denham; May Cecilia Denham; Dorothy Lee Denham, a minor; Carolyn Denham Lumley; May Cecilia Denham as guardian of Dorothy Lee Denham, a minor; George Denham; Clarence Denham; Mary Jane Hopkins, nee Wright; and Mary Ellen Cash, Appellants, v. ?TNA LIFE INSURANCE COMPANY, a corporation; Francis X. Rettenmeyer, Executor of the Estate of Joseph A. Rettenmeyer, deceased; F. E. Pence; Virgil F. Sprankle; Grover D. Strother; A. N. Murphy; Justin W. Faherty and First National Bank and Trust Company of Oklahoma City, Appellees. Donald George FLEMING, a minor, individually, and by Leona Holcomb as Guardian; Mary Jane Hopkins; Frank T. Denham; May Cecilia Denham; Dorothy Lee Denham, a minor; Carolyn Denham Lumley; May Cecilia Denham as Guardian of Dorothy Lee Denham, a minor; George Denham; Clarence Denham and Leona Holcomb, individually, Appellants, v. ?TNA LIFE INSURANCE COMPANY, a corporation, and F. E. Pence, Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

255 F.2d 577 (1958)

Leona HOLCOMB, individually; Leona Holcomb, as guardian of the person of Donald George Fleming, a minor; Donald George Fleming, a minor; Frank T. Denham; May Cecilia Denham; Dorothy Lee Denham, a minor; Carolyn Denham Lumley; May Cecilia Denham as guardian of Dorothy Lee Denham, a minor; George Denham; Clarence Denham; Mary Jane Hopkins, nee Wright; and Mary Ellen Cash, Appellants, v. ?TNA LIFE INSURANCE COMPANY, a corporation; Francis X. Rettenmeyer, Executor of the Estate of Joseph A. Rettenmeyer, deceased; F. E. Pence; Virgil F. Sprankle; Grover D. Strother; A. N. Murphy; Justin W. Faherty and First National Bank and Trust Company of Oklahoma City, Appellees.

Donald George FLEMING, a minor, individually, and by Leona Holcomb as Guardian; Mary Jane Hopkins; Frank T. Denham; May Cecilia Denham; Dorothy Lee Denham, a minor; Carolyn Denham Lumley; May Cecilia Denham as Guardian of Dorothy Lee Denham, a minor; George Denham; Clarence Denham and Leona Holcomb, individually, Appellants, v. ?TNA LIFE INSURANCE COMPANY, a corporation, and F. E. Pence, Appellees.

Nos. 5620, 5621.

United States Court of Appeals Tenth Circuit.

May 12, 1958.

Rehearing Denied June 20, 1958.

Glenn O. Young, Sapulpa, Okl. (John W. Young, David Young and Glenn A. Young, Sapulpa, Okl., with him on the brief), for appellants.

Robert J. Woolsey, Tulsa, Okl. (J. C. Farmer, Otho Flippo and J. B. Bailey of Farmer, Woolsey, Flippo & Bailey, Tulsa, Okl., with him on the brief), for appellee Aetna Life Insurance Company.

Philip M. Landa, Tulsa, Okl., for appellee F. E. Pence.

Sam T. Allen, III Sapulpa, Okl. (Moraul Bosonetto, Sapulpa, Okl., with him on the brief), for appellee Francis X. Rettenmeyer.

Joseph Sharp, Tulsa, Okl., and Robert D. Looney, Oklahoma City, Okl., (Bryan W. Tabor of Rucker, Tabor & Cox; Robert D. Hudson of Hudson, Hudson & Wheaton, Tulsa, Okl.; Looney, Watts, Looney & Nichols and Joseph Rucks of Cochran, Dudley, Fowler, Rucks, Baker & Jopling, Oklahoma City, Okl., with them on the brief), for appellees First National Bank and Trust Company et al.

Before PICKETT, LEWIS and BREITENSTEIN, Circuit Judges.

LEWIS, Circuit Judge.

Appellants have been subjected to an adverse judgment rendered summarily after pre-trial which judgment includes a permanent injunction prohibiting them from further prosecution of asserted claims against appellees now pending or potential in the state courts of Oklahoma. The instant action is one in interpleader and its nature premises the trial court's ruling that the federal court provides the proper forum for the determination of the various issues interwoven through the claims of all the parties. Upon appellants' failure and refusal at pre-trial to tender those issues asserted by them against appellees in a pending state court suit the trial court took its summary action.

Aetna Life Insurance Company instituted this action in interpleader by filing a complaint in the District Court for the Northern District of Oklahoma alleging that the company had entered into a single premium annuity contract with Rosa B. Wright Rettenmeyer during her lifetime; that Mrs. Rettenmeyer had since died and that by the terms of the contract the company was then obligated to pay the continuing benefits to the contingent beneficiaries named in the agreement; that the beneficiaries asserted such contract rights to be valid and binding upon the company; that certain of the heirs¹ of Mrs. Rettenmeyer had by the instigation of an action in the state courts of Oklahoma attacked the validity of the annuity contract and were asserting the claim that Aetna, acting in concert with others, had through fraud and connivance practiced upon Mrs. Rettenmeyer converted certain of Mrs. Rettenmeyer's funds constituting the equivalent of the premium payments received by Aetna. Pointing to the existence of but a single liability but the possibility of being required, if separate suits prevailed, to disgorge the consideration of the annuity contract yet pay its benefits, Aetna named the heirs of Mrs. Rettenmeyer and the beneficiaries of the contract as defendants and sought relief in interpleader. The trial court issued a temporary injunction prohibiting the defendants from initiating or prosecuting any action against Aetna which touched the subject matter of the complaint in interpleader. The validity of this action of the trial court together with concomitant jurisdictional questions was tested and upheld by earlier appeal to this court, 228 F.2d 75, 81, wherein it was held that the controversy presented "justiciable questions appropriate for determination in an action in the nature of interpleader" and "questions which cannot be adjudicated with finality and conclusiveness as to all parties in interest in either of the cases pending in the state courts." Certiorari to the United States Supreme Court was denied, 350 U.S. 986, 76 S.Ct. 473, 100 L.Ed. 853, and the cause was returned to the District Court for further proceedings.

Subsequent to this remand, Aetna filed its complaint in the companion case here under consideration, alleging substantially the same bases for interpleader as to an endowment contract bought at the same time by Mrs. Rettenmeyer upon the life of Donald George Fleming. It was asserted that the balance of the proceeds from the purportedly converted bonds paid the premium upon this policy. The issues before the trial court and before this court are controlled by virtually the same facts and the same law and require no separate discussion.

Timely petitions for leave to intervene were filed by those persons other than Aetna who appellants asserted had participated in the conversion of Mrs. Rettenmeyer's bonds. Leave was accordingly granted and those parties are now included as present appellees.

Notwithstanding the earlier holding of this court as expressed in the opinion of Chief Judge Bratton, supra, that a justiciable issue in federal interpleader existed as to whether or not Aetna should be required to part with the premiums received by them for the annuity contract because of a conversion of Mrs. Rettenmeyer's bonds as asserted by appellants in the state court action, appellants refused to tender this issue at the pre-trial conference. To the contrary, counsel for appellants expressly stated that no claim was made relative to the obligation of Aetna under the contracts in opposition to payment to the beneficiaries² in accord with the contract terms. The trial court, after careful explanation of the posture of the case and the consequence of the position adopted by the parties, found that no issue of fact existed which was determinative of the issues properly present in the interpleader and rendered summary judgment accordingly. To support the summary disposition of the controversy the trial court expressly found the uncontroverted (in law) fact to be that the property asserted by appellants to have been converted by Aetna from the lifetime estate of Mrs. Rettenmeyer was the same property received by Aetna as consideration for its contracts. In this regard appellants now question first the power of the court to determine a question of fact at pre-trial and second the validity of the particular finding that the proceeds of the bonds allegedly converted paid the premium on the insurance policies. This question is vital to the determination of whether interpleader will lie as it must necessarily settle the issue of whether the conversion alleged in the state court action is sufficiently related to the contracts before the court to constitute a single transaction giving rise to a single liability.

The prior appeal of this case recognized that this issue was before the court to be determined on trial as to the annuity policy. As to the endowment policy, the complaint states:

"Plaintiff alleges further that its liabilities under said policy or its transactions with Rosa B. Wright Rettenmeyer can be fully determined and decided upon the issues presented by its complaint for declaratory judgment avoiding a multiplicity of suits for the reason that should the guardian of Donald George Fleming and the defendants other than Donald George Fleming prevail in the action and recover the monies paid for the premium by Rosa B. Wright Rettenmeyer, still the plaintiff might be faced with a suit by Donald George Fleming to enforce the contract of insurance * * *."

The issue before the court was precisely the one giving rise to an interpleader action and its determination cannot be circumvented by a refusal on the part of a party to offer any evidence.

The purpose of pre-trial conferences is to simplify the issues and eliminate waste of time and money by avoiding unnecessary proof...