Mitchell v. Mitchell

• Decision Date: 28 November 1969
• Docket Number: No. 15538,15538
• Citation: 448 S.W.2d 807
• Parties: Juanita B. MITCHELL et al., Appellants, v. Minerva K. MITCHELL, Appellee. . Houston (1st Dist.)
• Court: Texas Court of Appeals

Page 807

448 S.W.2d 807

Juanita B. MITCHELL et al., Appellants, v. Minerva K. MITCHELL, Appellee.

No. 15538.

Court of Civil Appeals of Texas Houston (1st Dist.).

Nov. 28, 1969.

Rehearing Denied Dec. 31, 1969.

Bernard & Bernard, Donald R. Bernard, Joy F. Vandervort, Houston, for appellants.

Orrin H. Bonney, Houston, for appellee.

BELL, Chief Justice.

Appellant, Juanita Mitchell, the former wife of Clifford E. Mitchell, deceased, suing individually and as next friend of two minor children born to her marriage with said deceased, sought to recover from Metropolitan Life Insurance Company and Minerva K. Mitchell the proceeds of a group life insurance policy issued to Clifford E. Mitchell as an employee of the United States Post Office Department. The policy was in the amount of $20,000.00 and was issued pursuant to the Federal Employees Group Life Insurance Act of 1954. (5 U.S.C.A., Sections 2091 et seq., now Sections 8701 et seq.). She was joined by three adult children born to the marriage. Juanita's marriage to Clifford was terminated by divorce. Thereafter, Clifford married Minerva and was married to her when he died. In his policy of insurance Clifford made no designation of a beneficiary. Minerva claimed the proceeds as his widow. Metropolitan tendered the money into court. The appellee and appellants filed motions for summary judgment. Appellants' motion was overruled and that of appellee was granted.

It appears from the record that Juanita and Clifford were married in 1942. To that marriage five children were born. This marriage was terminated by divorce in July, 1965. The divorce decree made no mention of the insurance policy. When the Federal Employees Group Insurance Act of 1954 became effective Clifford was an employee of the Post Office Department. He took out insurance in the amount of $20,000.00 pursuant to his rights under the Act and a certificate was issued to him. The premiums were paid by payroll withholdings. The premiums were thus paid, up to the time of the divorce, from the community of Clifford and Juanita. After Clifford's marriage to Minerva in January, 1966, the premiums were paid from their community until his death in January, 1968.

The Act did not require, but it permitted, the designation of a beneficiary. Section 4 of the Act of 1954 (5 U.S.C.A., Section 2093) provided as follows:

'Any amount of group life insurance * * * in force on any employee at the Date of his death shall be paid, upon the establishment of a valid claim therefor, to the person or persons Surviving at the date of his death, in the following order of preference:

'First, to the beneficiary or beneficiaries, as the employee may have Designated by writing received in the employing office prior to death;

'Second, If there be no such beneficiary, to the widow or widower * * *;

'Third, if none of the above, to the child or children of such employee and descendants of deceased children by representation; * * *'

There are fourth, fifth and sixth categories, but they are not applicable here. (All emphases, unless otherwise stated, are ours)

The certificate issued to Clifford under the heading 'Who Receives Your Death Benefits' provides as follows:

'You do not need to name a beneficiary if you are satisfied to have the death benefits of your insurance paid in the order of precedence noted below. If you are survived by a designated beneficiary, the benefits will be paid to the Beneficiary. If there is no designated Beneficiary surviving, the benefits will be paid to your widow or widower under category (1); and if you have no survivor falling in category (1), the benefits will be paid to the survivors falling in category (2); and so on, as necessary, to the other categories.'

Then are listed the categories, category (1) being widow or widower, category (2) being child or children. Then follow categories (3), (4) and (5).

There is then this provision in the certificate with regard to Naming a beneficiary or Changing the designation:

'If you want to name a beneficiary or change the designation, you can do so By filing a written notice, signed And witnessed, with your employing office which can supply appropriate forms for this purpose. * * * You do not need the consent of anyone to change your beneficiary. To be valid, your designation or change of beneficiary must be received by your employing office before your death.'

In 1966 the Act was amended and is now carried as U.S.C.A., Section 8701 et seq. The changes made that are material here were in 5 U.S.C.A., Section 2093 dealing with the order of precedence in the payment of death benefits. Paragraph (a) of 8705, that was in effect at the time of Clifford's death, reads the same as Section 2093 except that it provides that the first order of payment shall be to the beneficiary or beneficiaries designated by the employee 'in a signed and witnessed writing received before death in the employing office.' The old act had merely used the term 'designated by a writing.' A further paragraph was made by the addition of this sentence: 'For this purpose, a designation, change or cancellation of beneficiary in a will or other document not so executed and filed has no force and effect.'

Appellants assign five points of error, contending in substance that the trial court erred in granting appellee's motion for summary judgment for the following reasons:

1. The record conclusively showed Juanita was the rightful beneficiary because she was the 'widow' of the deceased within the contemplation of the policy.

2. Under her alternative pleading she was the donee of the policy because after she was divorced from deceased he came to their home to get his personal papers and refused to take the insurance certificate that she handed him. He told her it was hers for her and the children and she should get the insurance as there was 'nothing else to do.' Later in December, 1967, when she asked about the insurance he stated to her the insurance was just like it was, that he had never made any change in it and if he did he would let her know. He never did let her know of any change.

3. Juanita had a community interest in the proceeds because there was no disposition of the policy at the time of the divorce.

4. There was a genuine issue of material fact as to whether she was the donee of the policy, or, alternatively, whether decedent's action showed she was in fact the beneficiary.

5. The record showed that Clifford had never changed the beneficiary to anyone after the divorce.

In addition to the facts established by the record, that we have heretofore recited, it appears that the policy represented term insurance. It had no cash surrender value and the insurance policy was not assignable. Neither did it have any loan, paid-up or extended insurance value. It had no monetary value at the time of the divorce. The insured alone had the right to change the beneficiary.

We overrule appellants' points of error and affirm the judgment of the trial court in awarding the proceeds to Minerva as the widow of Clifford.

Juanita was never the widow of Clifford and she was never a designated beneficiary within the meaning of the quoted Federal statute. This statute is controlling. Congress clearly intended to distinguish in its terminology between the named 'beneficiary' and the automatic provisions referring to the widow as being entitled to the proceeds if no beneficiary were named. The insurance policy having been made available to Federal employees by Federal legislation the construction of the statute is a question of Federal law. Sears v. Austin, 292 F.2d 690 (Ct.App.9th Cir.).

The statute prior to its amendment in 1966 provided in the order of precedence for payment that payment would be made first 'to the beneficiary or beneficiaries as the employee may have Designated by a writing received in the employing office.' There was an administrative regulation and policy provision that provided in substance that for there to be a 'designated beneficiary' the insured should secure the proper form to be executed from the U.S. Civil Service Commission. It was also provided that 'to be valid your Designation or Change of beneficiary must be in writing, Signed and witnesses and received by the Commission.' The certificate issued to the employee contained the above information.

With the above state of the statute, policy and regulation, in 1961 a case came before the United States Court of Appeals for the Ninth Circuit in which no witnessed writing designating a beneficiary...