Saint Calle v. Prudential Ins. Co., 90 Civ. 0045 (MBM).

• Decision Date: 22 February 1993
• Docket Number: No. 90 Civ. 0045 (MBM).,90 Civ. 0045 (MBM).
• Citation: 815 F. Supp. 679
• Parties: Juliette B. SAINT CALLE and Raymond Basili, Plaintiffs, v. PRUDENTIAL INSURANCE COMPANY OF AMERICA and John Hancock Variable Life Insurance Company, Defendants.
• Court: U.S. District Court — Southern District of New York

815 F. Supp. 679

Juliette B. SAINT CALLE and Raymond Basili, Plaintiffs, v. PRUDENTIAL INSURANCE COMPANY OF AMERICA and John Hancock Variable Life Insurance Company, Defendants.

No. 90 Civ. 0045 (MBM).

United States District Court, S.D. New York.

February 22, 1993.

COPYRIGHT MATERIAL OMITTED

Vincent Anzalone, Anzalone & Leschins, Bronx, NY, for plaintiffs.

Edward D. Greenberg, Robert A. Santucci, Schwartz & Greenberg, New York City, for defendant Prudential Ins. Co. of America.

Richard R. Lutz, Joan B. Gross, Townley & Updike, New York City, for defendant John Hancock Variable Life Ins. Co.

OPINION AND ORDER

MUKASEY, District Judge.

Plaintiffs seek to recover life insurance proceeds of five policies issued by defendants to an insured who plaintiffs allege died in a car accident in Haiti. Jurisdiction is based on diversity of citizenship. 28 U.S.C. § 1332.

Defendants dispute that the insured is dead and move for a summary judgment that plaintiffs may not collect proceeds from the policies now. Alternatively, defendants allege that the insured misrepresented material facts in the applications for two policies, and cross-claim to rescind those two policies. Defendants move also for summary judgment as to plaintiffs' claims for certain accidental death benefits and for punitive damages.

For the reasons stated below, defendant John Hancock's motions are granted, and it is dismissed from these proceedings. Defendant Prudential's motions are granted in part and denied in part, as described below.

I.

Plaintiffs began this action in December 1989 to recover life insurance proceeds from five policies issued by defendants to Jean B. Saint Calle as the insured. Plaintiff Saint Calle, the insured's wife, and plaintiff Basili, a creditor of the insured, are each New York residents. (Am.Compl. ¶¶ 1, 2) Defendant Prudential is an insurance company headquartered in Newark, New Jersey. (Am. Compl. ¶ 5) Defendant John Hancock is an insurance company headquartered in Boston, Massachusetts. (Am.Compl. ¶ 6)

The policies at issue are in face amount greater than $1 million:

                Policy No.             Company             Face Amount              Date Issued
                VL 689777            John Hancock            $260,000             March 3, 1987
                72 741 770           Prudential              $ 30,000             September 4, 1987
                72 741 282           Prudential              $260,000             November 20, 1987
                72 785 430           Prudential              $250,000             June 13, 1988
                72 860 691           Prudential              $351,000             February 6, 1989
                

The $260,000 Prudential policy contains an Accidental Death Benefit of an additional $260,000. (Greenberg Aff. Ex. C)

The beneficiaries of the $30,000 Prudential policy are creditors of the insured, including plaintiff Basili. (Anzalone Aff. ¶ 5) The sole beneficiary of the other four policies is plaintiff Saint Calle, the insured's wife. (Anzalone Aff. ¶ 4)

Both plaintiff Saint Calle and the insured were born in Haiti, but the insured had not returned to Haiti for 15 years prior to his disappearance. (Saint Calle Aff. ¶ 6) Plaintiff Saint Calle met the insured in early 1982; they had lived together since January 1985. (Id. ¶ 2) They had a daughter, born in June 1983, and a son, born in June 1987. (Id. ¶ 4) The insured owned and managed a vacuum cleaner distributorship which employed 25 salespersons. (Id. ¶ 5) He held substantial assets, including a home, certain business property, and the policies described above. (Id. ¶ 5) At the time of his disappearance, he was 25 years old. (Gross Aff. Ex. A)

On or about January 6, 1989, the insured's family vacationed in Haiti for four days. (Saint Calle Aff. ¶ 6) After they returned from Haiti, on January 21, 1989, plaintiff Saint Calle and the insured were married. (Id. ¶ 4)

On February 11, 1989 the insured returned to Haiti "for the purpose of locating his natural mother ... and bringing her back to the United States." (Id. ¶ 7)¹ The insured was scheduled to return on the night of February 14, 1989. (Id.) Plaintiff Saint Calle and her two children drove to the airport to meet the insured's return flight, but he did not arrive. (Id. ¶ 8)

After several fruitless telephone calls, plaintiff Saint Calle flew to Haiti on February 16 to try to find the insured. (Id. ¶ 9) She went first to the rental car company the insured had used, and found that he had picked up a rental car, but had not returned it. (Id. ¶ 10) She went to the hotel where the insured had checked in, but he had neither slept in his room nor checked out. (Id. ¶ 11). With the help of the police, plaintiff Saint Calle and the manager of the rental car company eventually found the insured's rental car in Saint Marc. (Id. ¶ 13) As plaintiff Saint Calle described the accident,

it seemed obvious that the car had skidded for about a quarter of a mile and flipped over into the embankment on the side of the road and completely burned.

The car itself was upside down. Not only were the plants and trees along the road hit by the car, but some of the trees by the top of the road were burned as well.

(Id.)

Plaintiff Saint Calle went to the hospitals in Saint Marc and Port-au-Prince, but found no clue to the whereabouts of the insured. (Id. ¶ 17) She contacted the morgue, the prison, the department of motor vehicles, and a lawyer; she filed a report of a missing person with the police; and she placed a lost person announcement on the radio — all to no avail. (Id. ¶¶ 17-18) Finally, plaintiff Saint Calle recovered the insured's handbag from the hotel — but not his wallet, passport, or green card — and left Haiti on February 20. (Id. ¶ 20)

According to plaintiff Saint Calle, "the only reason that the insured would not return would be that something unnatural happened to him. I saw the condition of Jean's rental car firsthand. It is beyond reason that anyone could have survived such an accident." (Id. ¶ 25) Plaintiff Saint Calle attests that the insured "was a big believer in life insurance and the security of his family," and, as evidence of this belief, notes that the $351,000 Prudential policy was nearly equal in face value to the $350,000 mortgages on the insured's properties. (Id. ¶ 27)

Following the insured's disappearance, plaintiff Saint Calle experienced financial difficulties which forced her to close the insured's business within six months after he disappeared. (Id. ¶ 36) Without the business's income, she was unable to meet the mortgage payments on the insured's properties, and foreclosure actions were commenced. (Id. ¶ 37) On October 5, 1990, several months after she filed this suit, plaintiff Saint Calle filed a petition for bankruptcy under Chapter 7 of the United States Bankruptcy Code. (Id. ¶ 39, Ex. B)

Defendants dispute whether there is proof that the insured actually died. (Def. Prudential Reply at 4-5, 10; Def. John Hancock Mem. at 1) They point out that there is no record of the insured's death.² Defendant Prudential calls plaintiffs' assertion that the insured died "self-serving and patently absurd" and argues that "in addition to the issue of plaintiff's credibility, there are many plausible explanations for the disappearance of a man in financial difficulty, one of which is the insurance proceeds in excess of one million dollars." (Def. Prudential Reply at 5) Defendant Prudential argues that "there is no evidence which indicates that the Insured has died," that "plaintiff Juliette St. Calle's dramatic hearsay filled affidavit ... has no probative value whatsoever," and that "certainly, plaintiff Juliette St. Calle's statements cannot provide a basis for relief." (Id. at 5-6, 10)

Fed.R.Civ.P. 56(c) requires a summary judgment if the evidence demonstrates 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." Anderson v. Liberty Lobby Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986). In determining whether there is a genuine issue of material fact, a court must resolve all ambiguities, and draw all inferences, against the moving party. See United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 993, 8 L.Ed.2d 176 (1962) (per curiam); Donahue v. Windsor Locks Bd. of Fire Comm'rs, 834 F.2d 54, 57 (2d Cir.1987).

However, the mere existence of disputed factual issues is insufficient to defeat a motion for summary judgment. Knight v. United States Fire Ins. Co., 804 F.2d 9, 11-12 (2d Cir.1986), cert. denied, 480 U.S. 932, 107 S.Ct. 1570, 94 L.Ed.2d 762 (1987). The disputed issues of fact must be "material to the outcome of the litigation," id. at 11, and must be backed by evidence that would allow "a rational trier of fact to find for the nonmoving party." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986). The non-movant "must do more than simply show that there is some metaphysical doubt as to the material facts." Id. With respect to materiality, "substantive law will identify which facts are material. Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Anderson, 477 U.S. at 248, 106 S.Ct. at 2510.

II.

There is nothing but rhetoric behind Prudential's argument that "as a matter of law, plaintiffs' allegations do not raise a triable issue of fact...." (Def. Prudential Reply at 5) Prudential both oversimplifies the novel and complex fact issues in this case, and mischaracterizes the New York cases and statutes which describe the rules for determining whether or not a person has died.

In general, when a person dies, a court may apportion rights which depend upon that person's death. However, such a court faces a quandary when a person disappears, but death is uncertain.

Plaintiffs argue that a fact issue exists as to...