Walsh v. Woods

• Decision Date: 16 October 2006
• Docket Number: No. 4163.,4163.
• Court: South Carolina Court of Appeals
• Parties: Frances WALSH, as personal representative of the estate of Jerome Walsh, deceased, and in her individual capacity, Appellant, v. Joyce K. WOODS, f/k/a Joyce K. Walsh, Respondent.

638 S.E.2d 85

Frances WALSH, as personal representative of the estate of Jerome Walsh, deceased, and in her individual capacity, Appellant, v. Joyce K. WOODS, f/k/a Joyce K. Walsh, Respondent.

No. 4163.

Court of Appeals of South Carolina.

Heard May 11, 2006.

Decided October 16, 2006.

Rehearing Denied December 18, 2006.

Russell H. Putnam, Jr., of Hinesville, GA, for Appellant.

John S. Nichols and Kelli Lister Sullivan, of Columbia, for Respondent.

CURETON, A.J.:

Frances Walsh (Wife II), individually and in her capacity as personal representative of the estate of her deceased husband, Jerome J. Walsh (Husband), brought this action against Husband's former wife, Joyce K. Woods (Wife I), seeking relief pertaining to the disposition of surviving spouse benefits (SSB) made available through Husband's retirement plan. Wife II appeals the trial court's order granting Wife I's motion for summary judgment. We affirm.

FACTS

We note at the commencement that although some changes and additions have been made, the facts largely mirror those in Walsh v. Woods, 358 S.C. 259, 594 S.E.2d 548 (Ct.App.2004), rev'd Walsh v. Woods, Mem. Op. No. 2005-MO-043 (S.C.Sup.Ct. filed Sept. 19, 2005). Husband married Wife I in 1957, and they separated in 1970. Although Husband and Wife I lived apart, they remained married for twenty years after their separation. In 1980, Husband met Wife II and they began dating. In 1989, after forty years of employment at E.I. du Pont de Nemours & Co. (DuPont), Husband retired. During his tenure at DuPont, Husband participated in a joint and survivor annuity plan governed by the Employee Retirement Income Security Act (ERISA). When he retired, Husband signed a Post Retirement Company-Paid Survivor Benefits and Spouse Benefit Option designating Wife I, to whom he was still married, as the beneficiary of his SSB plan in the event he predeceased her.

On August 24, 1990, Husband and Wife I divorced. Incident to the divorce, they entered into an agreement which the family court approved, adopted, and incorporated into the divorce decree. The decree provided, in relevant part:

[T]he parties shall sign whatever documents or other paperwork that is necessary to enforce this Agreement. I find that the parties have further agreed that each shall retain what ... retirement plans, pension plans ... etc., that he or she has in his or her possession. If the wife is required to sign any papers concerning the husband's retirement or benefit options from DuPont of Westinghouse, then she shall sign those.

Husband never presented Wife I with any documents to sign regarding his retirement plan, and neither party obtained a Qualified Domestic Relations Order (QDRO) during Husband's lifetime.

On May 31, 1991, Husband wrote DuPont a letter informing the company that he had divorced Wife I and that his "ex-wife has waived any claim to my pensions ... and this has been documented as part of the divorce decree." The letter further stated Husband wished to change his beneficiary to Wife II. In 1994, Husband and Wife II married. On November 30, 1994, Husband again wrote DuPont. Apparently, Husband believed his first letter to DuPont sufficed to change the beneficiary of his plan's SSB from Wife I to Wife II. Accordingly, his second letter advised DuPont he wished to change the beneficiary from Frances Dudley to Frances Dudley Walsh, inasmuch as he had married Wife II. Further, the letter stated "[i]f this letter does not suffice [to change the beneficiary], please send me the necessary paperwork to have my wife eligible for ... spouse benefits." Despite the two letters to DuPont, the change Husband requested was never made legally effective.

On January 27, 1996, Husband died. His will named Wife II as the sole beneficiary and the personal representative of his estate. After Husband's death, DuPont began paying benefits to Wife I. In 1997, Wife II filed suit against DuPont, which was removed to federal court, seeking a judicial determination that the SSB should be paid to her rather than Wife I. DuPont successfully moved for summary judgment on the grounds no QDRO existed terminating Wife I's right to receive benefits at the time of Husband's retirement.

Wife II then contacted John W. Harte, the attorney who represented Husband in his divorce from Wife I, and requested he prepare and submit a QDRO to DuPont. Harte prepared the QDRO, then contacted Vickie Johnson, the attorney who represented Wife I in the divorce action, and requested she obtain Wife I's signature on the document. Wife I did not sign the QDRO, but authorized Johnson to sign it on her behalf. Wife I noted on the document, however, that she authorized her signature under protest and out of concern she would be held in contempt of court if she refused to sign.

After Harte submitted the QDRO to DuPont, he received a letter from the company advising him that the document was not valid because it did not comply with the mandates of the Internal Revenue Code. Further, the letter stated that "[a] QDRO cannot be entered after the death of the participant. A participant must be a living person. There was no QDRO in effect at the participant's death that awarded any benefits to an alternate payee. Therefore, there are no benefits payable pursuant to a QDRO." In addition, DuPont's letter advised that even if the document had been prepared at some point after his retirement, but prior to Husband's death, it would nonetheless be ineffective to divest Wife I of her SSB because Wife I owned those benefits which vested upon Husband's retirement.

When DuPont refused to pay the SSB to Wife II, she commenced an action to recover all monies past, present and future paid to Wife I. Her suit, filed in the Court of Common Pleas for Richland County, was subsequently removed to the United State District Court for the District of South Carolina. DuPont then successfully moved for summary judgment.

On December 18, 2000, Wife II filed the instant action against Wife I seeking recovery under the following seven legal and equitable theories: (1) unjust enrichment; (2) "law of the case;" (3) res judicata; (4) collateral estoppel; (5) breach of contract; (6) bad faith breach of contract; and (7) conversion. Wife I answered, denying Wife II was entitled to the relief sought in her complaint, and asserted as defenses: (1) expiration of the statute of limitations; (2) failure to state a claim upon which relief can be granted; (3) laches; and (4) res judicata.

The parties filed cross motions for summary judgment. Wife I argued, inter alia, that all of Wife II's causes of action failed because the SSB vested in Wife I in 1989, at the time of Husband's retirement, and could not now be divested. Wife I further asserted the applicable statute of limitations barred Wife II's claims. In support of her cross motion, Wife II asserted no genuine issues of material fact existed that Wife I had waived her rights to the benefits in the divorce proceeding. In addition, Wife II asserted that the trial court could enforce the property settlement agreement by requiring Wife I to disgorge herself of all SSB payments she had received in the past and will receive in the future by transferring the payments to Wife II.

The trial court, relying on Hopkins v. AT & T, 105 F.3d 153, 157 (4th Cir.1997), granted Wife I's motion for summary judgment. Under Hopkins, the trial court reasoned that (1) SSB vests in a plan participant's current spouse on the date the participant retires, whether or not spouses are married at the time the participant dies, and (2) surviving spouse benefits may not be paid to a spouse who marries a participant after the participant's retirement. The trial court expressly determined the holding in Hopkins was determinative of the entire case and, therefore, declined to address Wife I's other grounds for summary judgment and further declined to reach Wife II's cross motion for summary judgment.

Wife II appealed, and this court reversed, finding the trial court erred in determining Hopkins was dispositive of all of the issues on appeal because given the facts, the case of Estate of Altobelli v. International Business Machines Corporation, 77 F.3d 78 (4th Cir. 1996), also applied. Further, we found the trial court erred in reasoning that ERISA governed the disposition of all of Wife II's legal and equitable claims. Wife I petitioned for rehearing on the grounds that the statute of limitations barred Wife II's claims. We withdrew our opinion reversing the trial court's grant of summary judgment and affirmed the trial court based on the statute of limitations. The Supreme Court reversed, finding the statute of limitations did not bar Wife II's claims and remanded the case to this court to determine whether the trial court erred in granting summary judgment to Wife I.

STANDARD OF REVIEW

When reviewing the grant of a summary judgment motion, appellate courts apply the same standard which governs the trial court under Rule 56(c), SCRCP, which states that summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Rule 56(c), SCRCP; Helms Realty, Inc. v. Gibson-Wall Co., 363 S.C. 334, 340, 611 S.E.2d 485, 488 (2005). On appeal from an order granting summary judgment, the appellate court will review all ambiguities, conclusions, and inferences arising in and from the evidence in a light most favorable to the non-moving party below. Willis v. Wu, 362 S.C. 146, 150-51, 607 S.E.2d 63, 65 (2004); see also, Schmidt v. Courtney, 357 S.C. 310, 316-17, 592 S.E.2d 326, 330 (Ct.App.2003) (stating all ambiguities, conclusions, and inferences arising from the evidence must be construed most strongly against the moving party).

Summary judgment is not appropriate when further inquiry into the facts of the case is desirable to clarify the application of the law. Gadson v. Hembree, 364 S.C. 316, 320, 613 S.E.2d 533, 535...