Tupper v. Roan

• Decision Date: 12 November 2010
• Docket Number: (CC CV0610-0435; CA A136095; SC S057373).
• Citation: 243 P.3d 50,349 Or. 211
• Parties: Heather TUPPER, Petitioner on Review, v. Danette ROAN, Respondent on Review. Danette Roan, Third-Party Plaintiff, v. Alan Claude Tupper, as Personal Representative of the Estate of Jerry Alan Tupper, Deceased, Third-Party Defendant.
• Court: Oregon Supreme Court

243 P.3d 50 349 Or. 211 Heather TUPPER, Petitioner on Review, v. Danette ROAN, Respondent on Review. Danette Roan, Third-Party Plaintiff, v. Alan Claude Tupper, as Personal Representative of the Estate of Jerry Alan Tupper, Deceased, Third-Party Defendant. (CC CV0610-0435; CA A136095; SC S057373). Supreme Court of Oregon, En Banc. Argued and Submitted Jan. 8, 2010. Decided Nov. 12, 2010.

On review from the Court of Appeals.^*

Matthew Whitman, of Cartwright & Associates, Portland, argued the cause and filed the brief for petitioner on review. With him on the brief was James R. Cartwright.

Michael J. Morris, of Bennett, Hartman, Morris & Kaplan LLP, Portland, argued the cause and filed the briefs for respondent on review. With him on the briefs was Heidi K. Brown.

GILLETTE, J.

This is a dispute over the proceeds of a life insurance policy. Plaintiff claimed an interest in the policy proceeds because she had been married to the decedent at one time and, when she and decedent divorced, their dissolution decree required the decedent to maintain a $100,000 life insurance policy naming her beneficiary, as trustee for a child of the marriage. The decedent had not purchased the required policy at the time the dissolution decree became final, but he later did purchase the policy at issue-a $600,000 life insurance policy naming defendant (not plaintiff) as the sole beneficiary. The decedent died while that policy was in force and defendant collected the proceeds. Plaintiff filed the present action against defendant, seeking imposition of a constructive trust on $100,000 of the insurance proceeds and alleging theories of unjust enrichment and "money had and received." On cross motions for summary judgment, the trial court held that $100,000 of the insurance proceeds was subject to a constructive trust. Defendant appealed, and the Court of Appeals reversed, holding that the trial court should instead have awarded summary judgment to defendant. Tupper v. Roan, 227 Or.App. 391, 206 P.3d 237 (2009). We allowed plaintiff's petition for review and now hold that, for the reasons that follow, neither defendant nor plaintiff was entitled to summary judgment. Accordingly, we reverse the decision of the Court of Appeals and the judgment of the trial court, and remand the case for further proceedings.

Plaintiff and the decedent, Jerry Tupper (Tupper), divorced in 2004. The dissolution decree and judgment incorporated the parties' settlement agreement. The decree awarded custody of the couple's child to plaintiff, with visitation rights to Tupper, and required Tupper to pay an amount of child support to plaintiff. In an apparent effort to ensure that each party would have the financial means to support the child in the event of the other party's death, the decree and judgment provided:

"(A) So long as either party has a legal obligation to support any child of the parties, each party shall maintain an insurance policy insuring his or her life in an amount ofnot less than $100,000, naming the other parent as trustee on behalf of any supported child.

"(B) The obligation to maintain this insurance shall continue so long as either party has a duty to pay child support asdecreed by the court, or an arrearage exists for accrued but unpaid support.

"(C) The following provisions relate to procedural aspects of the requirement to maintain insurance:

"(1) During the term of the obligation to maintain insurance each party shall furnish to the other, upon request, a copy of the policy or evidence the proper life insurance is in force with the appropriate beneficiary designation in effect.

"(2) A constructive trust shall be imposed over the proceeds of any insurance owned by either party at the time of either party's death if either party fails to maintain insurance in said amount, or if said insurance is in force but another beneficiary is designated to receive said funds. The trustee shall make distribution as described herein."

Although the life insurance obligation was expressed in terms of "maintaining" rather than "purchasing" the described policy, it appears that Tupper did not own life insurance of any kind at the time of the dissolution. Neither did Tupper purchase life insurance immediately thereafter.

Tupper did obtain life insurance in February 2006, some two years after the dissolution. At that time, he purchased the policy that is at issue in this case-a $600,000 United of Omaha policy naming defendant, who was Tupper's girlfriend, as the sole beneficiary. At the time of that insurance purchase, Tupper and defendant were living together and had started a business that generated only enough income to pay Tupper. According to defendant, the policy was entirely her idea and was obtained through her efforts "as security for my funds advanced [to the business] and my dependency and loss of compensation during our relationship." Tupper, however, was listed as the owner of the policy and the premiums were debited from his personal bank account.

A few months after Tupper purchased the policy, he died in an accident, and United of Omaha distributed the policy proceeds in a lump sum to defendant. When it became apparent that Tupper had no other life insurance and, thus, had died in breach of the insurance requirement in the dissolution decree, plaintiff filed the present action against defendant. In her complaint, plaintiff alleged that (1) Tupper had been party to a dissolution judgment that required him to maintain a $100,000 life insurance policy naming plaintiff as beneficiary (as trustee for the child); (2) the dissolution judgment provided for imposition of a constructive trust on any life insurance policy that Tupper owned when he died, if he died in breach of the life insurance requirement; (3) Tupper had died in breach of that requirement; (4) when he died, Tupper owned a $600,000 life insurance policy that named defendant as the beneficiary; and (5) defendant was aware of Tupper's insurance obligations to plaintiff at the time that the policy was purchased. Plaintiff sought to collect $100,000 from defendant, either by imposing a constructive trust on defendant's insurance proceeds to prevent "unjust enrichment" or as damages payable on a claim for "money had and received."

In her answer to plaintiff's complaint, defendant specifically denied that she had any previous knowledge of Tupper's obligation under the dissolution decree. Defendant also asserted a number of affirmative defenses, including an allegation that Tupper's estate, and not she, was responsible for any liability arising from Tupper's breach of his obligation under the decree.¹

Plaintiff moved for summary judgment, arguing that there was no issue of material fact with respect to the terms in the divorce decree, Tupper's breach, Tupper's ownership of United of Omaha policy, or the constructive trust remedy that the divorce decree provided. Plaintiff acknowledged that, in two cases that involved similar facts,² theCourt of Appeals had decided against imposing constructive trusts on the proceeds of the life insurance policies at issue. She argued,however, that those cases were distinguishable because the dissolution decrees in those cases had not specified that a constructive trust would be imposed on any life insurance policy that the relevant party owned. She claimed that, in her own dissolution decree, the inclusion of a term specifying that remedy gave her an immediate equitable interest in the proceeds of "any" life insurance that Tupper might purchase. She claimed, moreover, that that equitable interest was superior to any attempt on Tupper's part to designate a different beneficiary.

Plaintiff submitted a number of affidavits in support of her motion for summary judgment: (1) her own declaration stating that, in a conversation with defendant that occurred shortly after Tupper died, defendant had acknowledged that she knew about Tupper's life insurance obligation and had told her that Tupper's children³ would be "taken care of"; (2) Tupper's father's declaration stating that, in a conversation between defendant, himself, his wife, and several others that occurred shortly after Tupper's death, defendant had stated that Tupper had wanted $100,000 of the proceeds of the life insurance to go to each of his children; and (3) Tupper's stepmother's declaration, reporting the same conversation.

Defendant opposed plaintiff's motion for summary judgment, arguing that plaintiff was required, and failed, to show that defendant had had notice of Tupper's obligation when the United of Omaha policy was purchased. Defendant also argued that, because she was not a party to the divorce decree, she could not be bound by its terms, including the term that provided for imposition of a constructive trust on any life insurance policy owned by Tupper if he died in breach of the life insurance requirement.

Defendant also moved for summary judgment. She argued that, to succeed on either of her claims, plaintiff must show that she had some legally protected right or interest inthe policy in question. Defendant argued that, because plaintiff had never been named as a beneficiary of the $600,000 United of Omaha policy (and, in fact, the policy had not existed at the time of plaintiff's divorce from Tupper), plaintiff could not make the required showing.

After a hearing, the trial court denied defendant's motion for summary judgment, granted plaintiff's cross-motion with respect to the claim for unjust enrichment, and imposed a constructive trust in plaintiff's favor on $100,000 of the $600,000 that defendant had received from the policy.⁴

As noted, defendant appealed from the trial court's judgment, and the Court of Appeals reversed. The court examined three cases that involved similar attempts by a former spouse to impose a constructive trust on the proceeds of a decedent's life insurance policy after the decedent had died in breach of a legal obligation to maintain life insurance naming the...