Yeats v. Yeats' Estate

• Court: Washington Supreme Court
• Writing for the Court: BRACHTENBACH; WRIGHT
• Citation: Yeats v. Yeats' Estate, 580 P.2d 617, 90 Wn.2d 201 (Wash. 1978)
• Decision Date: 15 June 1978
• Docket Number: No. 45118
• Parties: Agnes M. YEATS, a single woman, Respondent/Cross Appellant, v. The ESTATE of William James W. YEATS, and Jeanie M. Yeats, Individually, and as Executrix of the Estate of William James W. Yeats, Appellants, and Tri-State Memorial Hospital, a Washington Corporation, Respondent/Cross Appellant.

Page 201

90 Wn.2d 201

580 P.2d 617

Agnes M. YEATS, a single woman, Respondent/Cross Appellant, v. The ESTATE of William James W. YEATS, and Jeanie M. Yeats Individually, and as Executrix of the Estate of William James W. Yeats, Appellants and Tri-State Memorial Hospital, a Washington Corporation Respondent/Cross Appellant.

No. 45118.

Supreme Court of Washington,En Banc.

June 15, 1978.

Clinton J. Henderson, Clarkston, for appellant, Estate of William James W. Yeats.

Lloyd L. Pike, Orno C. Shoemaker, Clarkston, for respondent, Agnes M. Yeats.

Charles T. Sharp, Clarkston, for respondent/cross-appellant, Tri-State Memorial Hospital.

BRACHTENBACH, Associate Justice.

The question presented is whether a property settlement agreement, preliminary to a marriage dissolution, disposed of certain insurance policies and other property. Underlying that issue is a policy question as to the specificity required in dealing with such matters in a settlement agreement or a decree of dissolution.

A summary of the facts is necessary. William and Agnes Yeats, married in 1950, filed for dissolution of their marriage in January 1974. Contemporaneously they signed a property settlement agreement. Five months later Mr. Yeats married Jeanie Yeats. He died 6 months later. The plaintiff is the first wife; the defendants are the widow, the estate of Mr. Yeats and his employer, which was joined for reasons discussed later. The parties will be referred to as the first wife, the husband, the widow and the employer.

The first wife contends that insurance policies on the husband's life were not disposed of in the settlement agreement and that she is entitled to a community share of the proceeds on an apportionment theory. She contends that the employer was not entitled to recoup premiums paid on a policy on the husband's life. The court ruled that the settlement agreement did not dispose of the insurance policies and granted summary judgment in favor of the first wife, except as to the former employer. We affirm except for a minor modification of the judgment.

Community property not disposed of in a dissolution is owned thereafter by the former spouses as tenants in common. Chase v. Chase, 74 Wash.2d 253, 444 P.2d 145 (1968); Northwestern Life Ins. Co. v. Perrigo, 47 Wash.2d 291, 287 P.2d 334 (1955). The record reflects that all the policies in issue were community owned.

We first must determine whether there was a genuine issue of a material fact as to whether the property in question was disposed of by the settlement agreement. If so, summary judgment was not appropriate. The function of the court was to determine the intent of the parties and the meaning of the agreement. Absent disputed facts, the construction or legal effect of a contract is determined by the court as a matter of law. On this record, the question was one of law and properly determined by the court in a summary judgment proceeding. Epperly v. Seattle, 65 Wash.2d 777, 399 P.2d 591 (1965).

The next question is whether the court was correct in its interpretation of the agreement, i. e., that the agreement did not dispose of the policies. The pertinent provisions of the agreement, entitled "Separation and Support Agreement" are:

Section 2 Division of Property

With respect to property both real and personal acquired by Husband and Wife during their marriage and owned by them or either of them at the time of their separation, the same has heretofore been equitably divided and apportioned between the parties as set forth in Exhibit "A" attached hereto and they hereby ratify and confirm such division.

Section 6 Support and Maintenance of Wife

Wife accepts the payments specified in and to be made under this Section . . . in lieu of any interest in and to any and all property which Husband now owns or may hereafter acquire . . .

II. INSURANCE:

The Husband shall maintain in effect for the benefit of the Wife life insurance on the life of the Husband in the amount of $10,000.00 naming the Wife as sole beneficiary thereof.

At the time of the execution of the agreement there were nine life insurance policies on the life of the husband in the face amount of $28,000 with a cash surrender value of approximately $1,000. There were three policies on the life of the first wife with a face amount of $7,550 and a cash surrender value of $1,775. In addition, there was a $75,000 policy on the husband's life owned and paid for by the employer which will be discussed later.

None of the policies is mentioned, much less fully described in the settlement agreement. The boilerplate language quoted above was not adequate to dispose of the policies. While one might assume that the parties intended that each receive the policies on his or her life, one cannot learn that from the terms of the agreement. It is pure speculation to determine what the parties intended or what the agreement meant. We hold that there must be sufficient specificity in settlement agreements or decrees of dissolution to identify the assets and their disposition. The requisite specificity is not present here inasmuch as the policies were not even mentioned.

The dissolution of marriage act mandates disposition of the property of the parties. RCW 26.09.050 provides:

In entering a decree of dissolution of marriage . . . the court shall consider, approve . . . the disposition of property and liabilities of the parties.

RCW 26.09.070 encourages written separation contracts by making them binding upon the court. However, subdivision three of that statute leaves final authority in the court if it finds the agreement unfair at the time of its execution. If the court is making the division, RCW 26.09.080 specifically provides that the court shall make a just and equitable division of property, considering the nature and extent of community and separate property.

It is impossible for the court to perform its statutorily mandated duties if it is unaware of the nature and extent of the property. Even a general description of the insurance policies would make known that such assets existed. This is necessary before the court or the parties can consider them in evaluating the dispositive scheme.

In this case the only mention of life insurance in the settlement agreement is that the husband was to maintain a $10,000 policy for the benefit of the wife. There was no way for the judge, in approving the agreement, to know of the existence of 13 policies with a total face value, on both lives, of $110,550.

In summary, we hold that a settlement agreement or decree of dissolution must adequately identify the assets so as to permit the court to approve the agreement or make proper division. At minimum, the documents must put the parties and the court upon notice that the assets exist. This agreement fails in that respect.

Having concluded that the insurance policies were not disposed of, it follows that the first wife and husband became tenants in common as to those community owned policies. What were their respective interests at the time of this partition action? Because of the husband's death prior to the partition action, the policies on his life had ripened into face amount proceeds. The policies on the life of the first wife had only a cash surrender value. The nature of the assets at the time of partition is controlling. See, e. g., Leinweber v. Leinweber, 63 Wash.2d 54, 385 P.2d 556 (1963).

Consequently, the proceeds figure was the correct measuring value with regard to the policies on the life of the deceased husband. However, the policies on the first wife's life were to be divided, based only on their cash surrender value.

Regarding the policies on the life of the husband, the trial court correctly awarded the first wife one half of the proceeds, the controlling figure at the time of the partition action. This was the amount properly due her as a tenant in common.

However, the trial court erroneously awarded the husband's estate the total cash...