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

July 6, 2012

PROTECTIVE LIFE INSURANCE COMPANY, PLAINTIFF,
v.
DONALD GERALD DAVIS; RICHARD DOUGLASRISON, DEFENDANTS.



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

MEMORANDUM AND ORDER

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

BACKGROUND

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 ...


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