United Farm Bureau Family Life Ins. Co. v. Fultz
| Decision Date | 25 April 1978 |
| Docket Number | No. 1-277A25,1-277A25 |
| Citation | 375 N.E.2d 601,176 Ind.App. 217 |
| Parties | UNITED FARM BUREAU FAMILY LIFE INSURANCE COMPANY, Defendant-Appellant, v. Chris FULTZ, Robert Fultz, Jr., John Ray Fultz, Leon Fultz, C. Thomas Cone, Guardian ad litem of Robert Fultz, Jr., and John Ray Fultz, Plaintiffs and Cross Defendants-Appellees. |
| Court | Indiana Appellate Court |
E. Edward Dunsmore, Knightstown, James R. White, R. Clark Allen, New Castle, for plaintiffs and cross defendants-appellees.
Thomas L. Clagg, Fort Wayne, William M. Evans, Indianapolis, for Association of Indiana Legal Reserve Life Ins. Companies, amicus curiae; Bose, McKinney & Evans, Indianapolis, of counsel.
Defendant-appellant United Farm Bureau Family Life Insurance Company (Farm Bureau) appeals from a judgment in favor of plaintiff-appellee Chris Fultz (Chris), who was awarded punitive damages in an action to recover benefits under an insurance policy.
Robert Fultz (Robert), the husband of Chris Fultz, was insured under a $30,000 ten year decreasing term life insurance policy, which had been issued by Farm Bureau. On July 5, 1973, at approximately 2:00 a.m., Robert was mysteriously shot and killed as he slept on the sofa in the front room of the Before Farm Bureau had acted upon her application for the proceeds, Chris, who said that she had been sleeping in the bedroom when she was awakened by the shot that killed Robert, was, nevertheless, indicted and tried for Robert's murder. When her trial ended in acquittal in November, 1973, Chris again sought to collect the proceeds of Robert's life insurance policy.
trailer in which he and Chris were living. After Robert's funeral, Chris, who was the beneficiary of Robert's Farm Bureau life insurance policy, sought to collect the proceeds of that policy.
Farm Bureau, upon the advice of its counsel, told Chris, in effect, that her acquittal of the criminal charge was not dispositive of the issue of the proper beneficiary to receive the proceeds of the life insurance policy. Farm Bureau explained to Chris that Robert had designated his estate, which included Robert's three sons, Robert, Jr., John, and Leon, to be an alternate beneficiary of the life insurance policy, if for some reason Chris was not eligible to be a beneficiary under the policy. Farm Bureau told Chris that it could not pay the proceeds of the policy to her as long as the possibility existed that she was an ineligible beneficiary and that Robert's estate was the proper beneficiary of the policy.
On January 28, 1974, Chris brought an action against Farm Bureau to recover the proceeds of the insurance policy and to recover punitive damages for, as Chris alleged, Farm Bureau's bad faith refusal to pay her the proceeds of the policy after she had been acquitted of Robert's murder. In its answer Farm Bureau tendered the face amount of the policy to the court, and requested that Robert's estate and Robert's statutory heirs, Robert Fultz, Jr., John Ray Fultz, and Leon Fultz be made cross party defendants; and, pursuant to Ind. Rules of Procedure, Trial Rule 22, Farm Bureau sought interpleader so that Chris and Robert's estate could litigate the issue of which beneficiary was eligible to receive the proceeds of the life insurance policy. Interpleader was granted, but neither the personal representative of the estate nor Leon Fultz made appearances in the action. A guardian ad litem 1 appeared in the action to represent the interest of Robert, Jr. and John. Farm Bureau was not permitted to withdraw from the action even though it had tendered the face amount of the policy for the reason that certain issues concerning punitive damages and the payment of additional interest were raised in Chris' complaint.
Farm Bureau made a motion to dismiss the portion of Chris' complaint which sought punitive damages contending the complaint failed to state a claim upon which punitive damages could have been awarded. Chris sought to amend her complaint and was permitted to do so in order to include specific allegations of fraudulent, malicious, and oppressive activity on the part of Farm Bureau. Farm Bureau filed a motion to strike paragraph II of Chris' amended complaint alleging that it was insufficient to raise the question of fraudulent activity on the part of Farm Bureau. The court sustained Farm Bureau's motion to strike.
By motion Chris requested the court to reconsider its ruling on Farm Bureau's motion to strike paragraph II of Chris' amended complaint. The court reconsidered and changed its prior ruling by overruling Farm Bureau's motion to strike paragraph II of Chris' amended complaint. Farm Bureau again moved for dismissal, pursuant to Ind. Rules of Procedure, Trial Rule 12(B)(6). A hearing was held and Farm Bureau's motion was denied.
A trial by jury was held on August 30, 1976. At the close of Chris' evidence Farm The jury found for Chris and awarded her actual damages of $20,784 plus 8% interest and punitive damages of $15,000. The trial court entered judgment in accordance with the jury's verdict and ordered Farm Bureau to pay the costs of the action and to pay for the services (including attorney fees) of the guardian ad litem for Robert Fultz, Jr. and John Ray Fultz who had been brought into the action by Farm Bureau's request for interpleader.
Bureau filed a motion for judgment on the evidence, seeking to have the question of punitive damages removed from the jury's consideration. Such motion was overruled. Farm Bureau renewed its motion for judgment on the evidence at the close of all the evidence, and, again, such motion was overruled.
The issues raised for our consideration are as follows:
(1) Whether the court erred in reinstating paragraph II of Chris' amended complaint, such reinstatement in substance allowing the issue of punitive damages to be tried.
(2) Whether the court erred in overruling Farm Bureau's motion to dismiss and thereby keeping Farm Bureau in the case even though the policy proceeds and some interest in the amount of $21,245.58 had been paid into the court, all of the persons who might have a claim or interest in the proceeds of the policy allegedly had been joined as parties, and Farm Bureau allegedly had no further interest in the cause.
(3) Whether the court erred in overruling Farm Bureau's motion for judgment on the evidence when it was renewed at the close of all the evidence for the reason that there was no evidence that Farm Bureau had been guilty of willful, malicious, oppressive or grossly fraudulent conduct, evidencing a wanton disregard of the rights of others or heedless disregard of the consequences.
(4) Whether the court erred in overruling the objection of Farm Bureau and permitting a witness to testify as to the net worth of Farm Bureau, the objection being made on the ground that there was no evidence with respect to the subject of punitive damages.
(5) Whether the court erred in refusing to give Farm Bureau's tendered Instructions No. 2, 3 and 6, which would have removed the issue of punitive damages from the jury.
(6) Whether the court erred in refusing to give Farm Bureau's tendered Instructions No. 4 and 8 and giving in their place the court's own Instruction No. 8, which, although it contained the same elements as those found in Instruction 4 and 8 tendered by Farm Bureau, also instructed the jury that Farm Bureau had the burden of proving that Chris had wrongfully and intentionally killed Robert.
(7) Whether the court erred in giving Plaintiff's Instruction No. 5, over objection, the instruction allowing the jury to award interest from the date of the claim made until the present, at 8% per year, the objection being that there is no statutory authority for payment of such interest.
(8) Whether the verdict as to computation and allowance of 8% interest from the date of claim, and allowance of punitive damages, was supported by sufficient evidence, and whether the verdict was contrary to law in that the damages were excessive.
(9) Whether the court erred in ordering Farm Bureau to pay, as costs of this action, the sum of $1,600 to the guardian ad litem for his services in representing Robert Fultz, Jr. and John Ray Fultz, the minor children of Robert and Chris Fultz.
Farm Bureau contends that the trial court erred in reinstating the request for punitive damages contained in paragraph II of Chris' amended complaint upon Chris' motion to reconsider Farm Bureau's motion to strike. In reinstating paragraph II of Chris' amended complaint the trial court pointed out that an allegation in a complaint which adequately notifies the other party of the plaintiff's claim for relief is sufficient to withstand a motion to dismiss or a motion to strike under Ind. Rules of Procedure, Trial Rule 12. In McCarthy v. McCarthy (1971), 150 Ind.App. 640, 276 N.E.2d 891, 895, this court stated the following:
Our Supreme Court in State v. Rankin (1...
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