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OM Financial Life Insurance Co. v. Vang

March 18, 2009


The opinion of the court was delivered by: Anthony W. Ishii Chief United States District Judge


This is an action in interpleader by plaintiff OM Financial Life Insurance Company ("OM Financial") to settle claims to the proceeds of a life insurance policy on decedent Chou Vang ('Decedent"). The claimants to the proceeds of the insurance policy are Gnia P. Vang, Decedent's father (hereinafter, "Vang"), and Pa Kou Xiong, Decedent's wife (hereinafter, "Xiong"). In the instant motion, Xiong seeks summary judgment as to only the community property portion of the insurance proceeds. The court has diversity jurisdiction in this interpleader action pursuant to 28 U.S.C. § 1332. Venue is proper in this court.


The parties do not dispute that Decedent and Xiong were married on March 6, 2006. Xiong alleges that the insurance policy covering Decedent was issued on June 20, 2006. Xiong's motion for partial summary judgment does not allege the type of insurance policy, beneficiary(ies), or terms of premium payment. In the complaint in interpleader, OM Financial alleges that the insurance policy as originally taken out names Xiong as the primary beneficiary and Decedent's children with Xiong as the contingent beneficiaries. Doc. # 1 at ¶9. The interpleader complaint also alleges that sometime between January 10, 2008, and January 17, 2008, the primary beneficiary was changed to Vang and the contingent beneficiary was changed to Sao Lee, Decedent's mother. Doc. # 1 at ¶ 11. There is a dispute as to the authenticity of the request to change the beneficiaries.

It is undisputed that Xiong and Decedent were having marital difficulties as of the time of the accident causing Decedent's death. The extent of the marital difficulties and the legal status of the marriage at the time of Decedent's death is in dispute. The court understands that it is Vang's contention that the extent of estrangement between Decedent and Xiong was such that the couple were legally separated. Xiong contends she and Decedent were not legally separated. The parties agree that Decedent died on January 25, 2008, following a single vehicle accident.

OM Financial filed this action in interpleader on August 14, 2008. Funds representing the proceeds of the life insurance policy were deposited with the court on the same date. Xiong filed her answer on September 11, 2008. Xiong's answer cross-claims against Vang and counter-claims against OM Financial. On October 9, 2008, Vang filed his answer and counter-claims against OM Financial. The instant motion for partial summary judgment was filed by Xiong on December 30, 2008. Opposition to Xiong's motion for summary judgment was filed by Vang on January 5, 2009, and a further opposition was filed on January 19, 2009. OM financial filed an opposition to Xiong's motion on January 20, 2009. On January 25, 2009, Xiong filed a first amended cross-claim against Vang. The matter was taken under submission as of February 2, 2009.


Summary judgment is appropriate when it is demonstrated that there exists no genuine issue as to any material fact, and that the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970); Poller v. Columbia Broadcast System, 368 U.S. 464, 467 (1962); Jung v. FMC Corp., 755 F.2d 708, 710 (9th Cir. 1985); Loehr v. Ventura County Community College Dist., 743 F.2d 1310, 1313 (9th Cir. 1984).

Under summary judgment practice, the moving party always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any," which it believes demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Although the party moving for summary judgment always has the initial responsibility of informing the court, the nature of the responsibility varies "depending on whether the legal issues are ones on which the movant or the non-movant would bear the burden of proof at trial." Cecala v. Newman, 532 F.Supp.2d 1118, 1132-1133 (D. Ariz. 2007). When the moving party has the burden of proof at trial, that party must carry its initial burden at summary judgment by presenting evidence affirmatively showing, for all essential elements of its case, that no reasonable jury could find for the non-moving party. United States v. Four Parcels of Real Property, 941 F.2d 1428, 1438 (11th Cir.1991) (en banc); Calderone v. United States, 799 F.2d 254, 259 (6th Cir. 1986); see also E.E.O.C. v. Union Independiente De La Autoridad De Acueductos Y Alcantarillados De Puerto Rico, 279 F.3d 49, 55 (1st Cir. 2002) (stating that if "party moving for summary judgment bears the burden of proof on an issue, he cannot prevail unless the evidence that he provides on that issue is conclusive.")

If the moving party meets its initial responsibility, the burden then shifts to the opposing party to establish that a genuine issue as to any material fact actually does exist. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); First Nat'l Bank of Arizona v. Cities Serv. Co., 391 U.S. 253, 288-89 (1968); Ruffin v. County of Los Angeles, 607 F.2d 1276, 1280 (9th Cir. 1979). In attempting to establish the existence of this factual dispute, the opposing party may not rely upon the mere allegations or denials of its pleadings, but is required to tender evidence of specific facts in the form of affidavits, and/or admissible discovery material, in support of its contention that the dispute exists. Rule 56(e); Matsushita, 475 U.S. at 586 n.11; First Nat'l Bank, 391 U.S. at 289; Strong v. France, 474 F.2d 747, 749 (9th Cir. 1973). The opposing party must demonstrate that the fact in contention is material, i.e., a fact that might affect the outcome of the suit under the governing law, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987), and that the dispute is genuine, i.e., the evidence is such that a reasonable jury could return a verdict for the nonmoving party, Anderson, 477 U.S. 248-49; Wool v. Tandem Computers, Inc., 818 F.2d 1433, 1436 (9th Cir. 1987).

In the endeavor to establish the existence of a factual dispute, the opposing party need not establish a material issue of fact conclusively in its favor. It is sufficient that "the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial." First Nat'l Bank, 391 U.S. at 290; T.W. Elec. Serv., 809 F.2d at 631. Thus, the "purpose of summary judgment is to 'pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial.'" Matsushita, 475 U.S. at 587 (quoting Fed. R. Civ. P. 56(e) advisory committee's note on 1963 amendments); International Union of Bricklayers v. Martin Jaska, Inc., 752 F.2d 1401, 1405 (9th Cir. 1985).


In the instant motion Xiong seeks summary judgment on her third cross-claim against Vang as set forth in her "Amended Answer to Complaint-in-interpleader, Cross Claim and Request for Jury Trial. Doc. # 22 at 8. In her third cross claim, Xiong alleges that Decedent and Xiong were married on March 10, 2006, and the life insurance policy at issue was applied for on May 19, 2006. Xiong alleges that the policy was purchased entirely with community property funds. Xiong alleges that, although she and Decedent sometimes lived apart, there was never an intent to end their marriage up to and including the date of the accident. Xiong alleges that all of the premiums on the insurance policy were paid using community property funds. Xiong contends that, because she and Decedent were never legally separated, Decedent was not entitled to name Vang as sole primary beneficiary and that Xiong is entitled to a community property share, or fifty percent, of the proceeds of the policy separate and apart from any other claims asserted by any party in this action. See, id.

"[P]roperty acquired during a legal marriage is strongly presumed to be community property and that presumption is fundamental to the community property system." In re Marriage of Nuell, 23 Cal.App.4th 730, 734 (2nd Dist. 1994). On the other hand, "[t]he earnings and accumulations of a spouse [. . .] while living separate and apart from the other spouse, are the separate property of the spouse." Cal. Fam. Code § 711; In re Marriage of Norviel, 102 Cal.App.4th 1152, 1158 n.1 (6th Dist. 2002). In the context of term life insurance,*fn1 the proceeds of a life insurance policy are fully community property where community funds were used to pay the premium that covered the period of time during which the insured died. Estate of Logan v. Logan, 191 Cal.App.3d 319, 325 (1st Dist. 1987). ...

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