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Protective Life Insurance Company v. Donald Gerald Davis; Richard Douglasrison


July 6, 2012


The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge


Plaintiff Protective Life Insurance Company ("Plaintiff") initiated this interpleader action against Defendants Donald Gerald Davis ("Davis") and Richard Douglas Rison ("Rison") on August 27, 2010. Presently before the Court is Rison's Motion for Summary Judgment ("Motion"). For the following reasons, Rison's Motion is DENIED.*fn1


Davis and Rison both claim to be the beneficiary of a $500,000 life insurance policy ("Policy") issued by Plaintiff to Cynthia Davis ("Decedent"), who was Rison's mother and Davis's wife. Prior to the spring of 2010, Davis was listed as the Policy beneficiary. However, just a few weeks prior to Decedent's death, on approximately April 27, 2010, a Service Request Form was submitted to Plaintiff, changing the Policy beneficiary to Rison. Rison thus claims he should receive the proceeds of Decedent's policy to the exclusion of anyone else. Davis contends to the contrary that Decedent only changed the beneficiary on her Policy from Davis to Rison on the condition that Rison would return the proceeds to Decedent or Davis, or give up his beneficiary status at some point in the future, namely, after the Decedent and Davis filed for bankruptcy relief, so that the Policy proceeds, among other assets, could essentially be hidden from the bankruptcy estate. Some background facts are thus necessary to understand the parties' current dispute.

According to Davis, in 2009, Davis and Decedent fell behind on their mortgage. Deposition of Donald Gerald Davis ("Davis Dep."), 10:11-11:25. In June of 2009, Decedent was diagnosed with ovarian cancer. Id., 20:12-14. Davis was also later diagnosed with colon cancer. Id., 51:23-52:4. Mounting medical bills purportedly added to the couple's money troubles. Id., 57:25-58:12; Deposition of Richard Douglas Rison ("Rison Dep."), 29:9-17, 60:19-61:7, 68:22-70:13.

Decedent allegedly thereafter expressed concern about losing the couple's home. Davis Dep., 69:9-71:5. Accordingly, as Davis testified in his deposition, the couple hatched a plan to transfer their assets to third parties who would return those assets to the couple once any potential bankruptcy proceedings were completed. Davis Dep., 66:25-68:7.

Plaintiff was eventually hospitalized in the spring of 2010, first from March 20 through April 20, and then from April 21 through April 27. On March, 25, 2010, while in the hospital, the above-mentioned Service Request Form was submitted to Plaintiff, changing the beneficiary under the Policy to Rison. According to Rison, Decedent signed the beneficiary change form "knowingly, voluntarily and with the requisite mental capacity." Rison's Separate Statement of Undisputed Material Facts ("Rison's SSUMF"), Nos. 2, 4.

More specifically, Rison claims that during Decedent's March hospital stay, she called her half-sister, Judy Stiedl ("Stiedl"), and asked that she come visit. Deposition of Judith Stiedl ("Stiedl Dep."), 76:10-18. Stiedl, who lives in Alaska, arrived shortly thereafter. Id., 88:23-89:2. Upon her arrival, Decedent informed Stiedl that doctors had told her to "get her affairs in order." Id., 103:5-20. Decedent then indicated she had previously filled out forms to change her life insurance beneficiary from Davis back to Rison. Id., 103:23-104:7. When Decedent realized that she had never received a confirmation that any such Policy changes were actually made, however, Decedent determined it necessary to find out who was "on [her] life insurance." Id., 102:15-103:2.

Decedent thus asked Stiedl to call Rison and ask him to bring to the hospital the "little metal box" in which Decedent's life insurance information was contained. Id., 108:12-22. Rison did as asked and, the following morning, Decedent asked Stiedl to call Plaintiff to identify the beneficiary listed on the Policy. Id., 108:22-25; 109:17-111:9. After being informed Davis was the beneficiary, Stiedl requested that Plaintiff fax a beneficiary change form to Decedent. Id., 111:7-11.

Upon receiving that form, which was the above-mentioned Service Request Form, Decedent instructed Stiedl as to how it should be completed. Id., 100:3-102:14. Decedent purportedly signed the form changing her beneficiary to Rison and dictated a cover letter to be included. Id., 113:19-114:4. The Service Request Form was faxed back to Plaintiff on March 25, after which Decedent received a confirmation from Plaintiff that her beneficiary had in fact been updated. Id., 113:22-24; Declaration of Stephen T. Doge ("Hodge Decl."), ¶ 4, Exh. C.

According to the deposition testimony of Rison and Stiedl, Decedent was alert, clear and coherent during this time. Rison Dep., 95:10-11, 109:22-110:5; Stiedl Dep., 154:13-25. Hospital records further indicate Plaintiff was awake, alert and oriented. Hodge Decl., ¶ 5, Exh. D. In addition, friends who visited Decedent also found her to be mentally clear, alert and coherent. Declaration of Cindy Castle, ¶ 5; Declaration of Ricky M. Grimshaw, ¶ 4; Declaration of William Douglas Rison, ¶ 4.

Davis, however, paints a different picture of Decedent's mental and physical state at the time the beneficiary change form was submitted.

According to Davis, Decedent's "reactions were slow and the ability to understand things said to her were slowed and affected." Davis's Response to Rison's SSUMF, No. 4 (citing Davis Dep., 24:14-19; 25:1-20; 35:18-36:11; 88:23-89:6; 89:19-90:11; 96:18-97:22; 100:1-15). In addition, Davis "observed problems with [Decedent's] memory and understanding and responding to questions with confusion and conversation problems." Id. Davis also witnessed what he believed to be Decedent's "periods of incoherency and shouting out odd comments on occasions." Id.

Davis likewise has his own take on the events underlying Decedent's decision to change her Policy beneficiary. According to Davis, he only discovered Decedent had changed her beneficiary when he opened the confirmation received from Plaintiff in the mail. Rison Dep., 124:12-18; Stiedl Dep., 117:15-17; Davis Dep., 79:17-81:6. Davis eventually asked Decedent why she made the change to her Policy, and she responded that she still intended to file bankruptcy and thus intended to put the assets, including the Policy, into Rison's name for a temporary period to end upon the completion of any bankruptcy proceedings. Davis Dep., 79:17-81:6.

Davis further contends that, both before and after Decedent's death, he and Rison engaged in several discussions with respect to the Policy and other assets. For example, Davis recalls a conversation in which Davis indicated he believed Rison was designated as the Policy beneficiary only to protect any proceeds from being included in the bankruptcy estate. Davis Dep., 81:20-82:14. Rison purportedly said nothing, shook his head from side to side, and walked away. Id. In addition, in another conversation, Rison purportedly indicated that "if [Davis] want[ed] any of his money, he need[ed] to just be quiet." Rison Dep., 140:19-143:12.

Given the above record, Protective was unable to determine whether the Policy proceeds are payable to Davis or Rison. Plaintiff thus deposited those benefits with the Court and filed its Complaint in Interpleader asking the Court to resolve the parties' dispute. Plaintiff has since been discharged from this action. On February 23, 2012, Rison moved for summary judgment, arguing Davis cannot prove Decedent changed her beneficiary as the result of any fraud or undue influence or attributable to Decedent's lack of mental capacity. Given the factual disputes presently before the Court, Rison's Motion is DENIED.*fn2


The Federal Rules of Civil Procedure provide for summary judgment when "materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations..., admissions interrogatory answers, or other materials" "show[] that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a), (c). One of the principal purposes of Rule 56 is to dispose of factually unsupported claims or defenses. Celotex Corp. v. Catrett, 477 U.S. 317, 323-324 (1986).

Rule 56 also allows a court to grant summary adjudication on part of a claim or defense. See Fed. R. Civ. P. 56(a) ("A party may move for summary judgment, identifying each claim or defense-or the part of each claim or defense--on which summary judgment is sought."); see also Allstate Ins. Co. v. Madan, 889 F. Supp. 374, 378-79 (C.D. Cal. 1995); France Stone Co., Inc. v. Charter Township of Monroe, 790 F. Supp. 707, 710 (E.D. Mich. 1992).

The standard that applies to a motion for summary adjudication is the same as that which applies to a motion for summary judgment. See Fed. R. Civ. P. 56(a), (c); Mora v. ChemTronics, 16 F. Supp. 2d. 1192, 1200 (S.D. Cal. 1998).

[A] party seeking summary judgment 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, 477 U.S. at 323 (quoting Rule 56(c)).

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, 585-87 (1986); First Nat'l Bank v. Cities Serv. Co., 391 U.S. 253, 288-89 (1968).

In attempting to establish the existence of this factual dispute, the opposing party must tender evidence of specific facts in the form of affidavits, and/or admissible discovery material, in support of its contention that the dispute exists. Fed. R. Civ. P. 56(c). 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, 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 v. Liberty Lobby, Inc., 477 U.S. 242, 248, 251-52 (1986); Owens v. Local No. 169, Assoc. of Western Pulp and Paper Workers, 971 F.2d 347, 355 (9th Cir. 1987). Stated another way, "before the evidence is left to the jury, there is a preliminary question for the judge, not whether there is literally no evidence, but whether there is any upon which a jury could properly proceed to find a verdict for the party producing it, upon whom the onus of proof is imposed." Anderson, 477 U.S. at 251 (quoting Schuylkill and Dauphin Improvement Co. v. Munson, 81 U.S. 442, 448 (1871)). As the Supreme Court explained, "[w]hen the moving party has carried its burden under Rule 56(c)), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts ....

Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no 'genuine issue for trial.'" Matsushita, 475 U.S. at 586-87.

In resolving a summary judgment motion, the evidence of the opposing party is to be believed, and all reasonable inferences that may be drawn from the facts placed before the court must be drawn in favor of the opposing party. Anderson, 477 U.S. at 255. Nevertheless, inferences are not drawn out of the air, and it is the opposing party's obligation to produce a factual predicate from which the inference may be drawn. Richards v. Nielsen Freight Lines, 602 F. Supp. 1224, 1244-45 (E.D. Cal. 1985), aff'd, 810 F.2d 898 (9th Cir. 1987).


Rison moves for summary judgment on the grounds that he is the person named as beneficiary on the Policy, and Davis is unable to show any fraud, lack of capacity or undue influence affected Decedent's decision to change the beneficiary from Davis to Rison. Rison believes Decedent acted of her own free will in making the above Policy change. Moreover, Rison argues there is no evidence in the record to indicate Decedent lacked her decision-making faculties or that Rison acted in any way to influence his mother's decision. In fact, according to Rison, "his only 'involvement' in th[e] process was to bring the 'little metal box' containing his mother's insurance information to her at the hospital - which was pursuant to his mother's request." Motion, 8:24-26.

Davis disputes Rison's characterization of the above events and argues that the issue of capacity is not relevant to whether Decedent was fraudulently induced or unduly influenced to change the beneficiary on her Policy. To the contrary, Davis believes that the real issue in this case is why Decedent changed her Policy beneficiary in the first place. According to Davis, Decedent made the change as part of the couple's plan to protect their assets from being included in their anticipated bankruptcy estate. Pursuant to this theory, Davis believes Rison is holding several assets, including the Policy proceeds if released to him, in a constructive or resulting trust for Davis. Davis seems to be arguing, therefore, that Rison deceived or defrauded Decedent into believing that if she transferred her assets to Rison, Rison would hold them for Davis and give those assets back at an appropriate time. Rison and Seidel both purportedly exercised undue influence over Decedent to convince her to proceed with those transfers. Finally, Davis indicates that Decedent may have been all the more susceptible to the efforts of Rison and Stiedl given her weakened mental state at the time.

As is clear from the Court's above recitation of the facts, the parties hotly contest the reasons underlying Decedent's decision to change her beneficiary from Davis to Rison. Rison incorrectly attempts to cast a number of Davis's facts, namely those pertaining to the financial woes of Davis and Decedent and their plans to avoid including Decedent's assets in a future bankruptcy estate, as irrelevant, which they are not. Moreover, Rison himself admits those facts are disputed.

See, e.g., Rison's Response to Davis's SSUMF, No. 4 ("Defendant Rison disputes that Cynthia Davis changed the beneficiary on the Policy to her son as part of a plan for the Davis's to file bankruptcy, and then have everything returned to them after the bankruptcy was completed."). The disputed facts going to those issues, which will ultimately turn on witness credibility, are not only material, they could prove to be dispositive. Accordingly, summary judgment in this case is entirely inappropriate. Rison's Motion is DENIED.


For the reasons just stated, Rison's Motion for Summary Judgment (ECF No. 21), Rison's Objections to Evidence (ECF No. 33) and Davis's Objections to Evidence (ECF No. 25) are DENIED.


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