Opinion
No. KNL-CV-06-4005578
April 7, 2009
MEMORANDUIVI OF DECISION
FACTS
The decedent, Bruce Johnson, divorced in 1999. As part of the property settlement in the divorce, he contracted to "keep in full force [his] current life insurance polices and name [his] minor children as beneficiaries until the youngest child reaches the age of 18." At the time of the divorce, the decedent was an employee at Foxwoods Resort Casino. As part of his benefits package with Foxwoods, the decedent was included in a group life insurance plan issued to Foxwoods by The Hartford. This policy provided the decedent coverage equal to one year of his current salary, $39,708.56. Additional coverage was available at his own expense, but the decedent purchased no supplemental coverage. After the divorce, the decedent removed his ex-wife as the policy's beneficiary and substituted his brother, Marshall Johnson.
In 2002, Foxwoods changed insurance providers from the Hartford to Unum. The benefits available to the decedent under Unum were similar to those under The Hartford policy including the availability of supplemental coverage at the decedent's expense. Effective January 1, 2003, the decedent added, at his own expense, the available supplemental insurance provided in the Unum policy. This rider provided additional coverage at a rate of two times the employee's salary at his time of death, which was $25,604.80. In 2003, the decedent changed the beneficiaries listed in the policy to his other brother, Paul Johnson.
In 2004, the decedent left employment with Foxwoods and was placed on long-term disability. As he was no longer an employee, Foxwoods stopped paying the premiums for the basic group policy and it expired. However, coverage under the supplemental policy remained in effect because the decedent had received a premium waiver for that coverage. The decedent died on December 27, 2004 and had $52,000 in life insurance available with Unum under the supplemental coverage purchased by the decedent in 2003.
On January 26, 2006, Unum filed a complaint against the defendant, the administrator of the decedent's estate, seeking interpleader and permission to pay the insurance proceeds, minus costs, to the court and to extricate itself from any further liability. Unum's request for interpleader and reduction for costs was eventually granted and Unum deposited the remaining $45,944.20 of the policy proceeds with the court. The decedent's ex-wife and children, as well as the decedent's brother, the named beneficiary of the Unum policy, have all filed statements of claim in the interpleader. The parties have also both filed motions for summary judgment supported by appropriate memoranda and affidavits.
DISCUSSION
In their memoranda, the decedent's ex-wife and children argue that the provision of the property settlement agreement that calls for the decedent to maintain his "current" life insurance policy for the benefit of the children referred to the policy provided by Foxwoods as a benefit of employment, and that it is of no significance that Foxwoods changed providers in 2002. Whether the policy is provided though Unum or The Hartford, they argue that the settlement agreement captured whatever policy was available through Foxwoods regardless of the provider. They also argue the children took a vested interest in the insurance policy and that any increases in that policy above its 1999 levels are rightfully those of the children even if the increases were part of supplemental policies paid for by the defendant because those policies were also available for purchase in 1999.
In his memorandum, the decedent's brother, the named beneficiary of the Unum policy, argues that he alone is entitled to the proceeds of the policy because the phrase "current policy" in the property settlement included only those policies in existence at the time of the divorce in 1999. Further, he argues that the only coverage available at the time of the decedent's death was the supplemental coverage that the decedent purchased after the divorce in 2003. Finally, he argues that the policy levels under the Unum plan were in excess of those available in the 1999 plan and that anything above the 1999 coverage amount should not be considered part of the 1999 property settlement agreement.
"Summary judgment is a method of resolving litigation when pleadings, affidavits, and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law . . . The motion for summary judgment is designed to eliminate the delay and expense of litigating an issue when there is no real issue to be tried." (Citations omitted.) Wilson v. New Haven, 213 Conn. 277, 279, 567 A.2d 829 (1989). "However, since litigants ordinarily have a constitutional right to have issues of fact decided by a jury . . . the moving party for summary judgment is held to a strict standard . . . of demonstrating his entitlement to summary judgment." (Citation omitted; internal quotation marks omitted.) Kakadelis v. DeFabritis, 191 Conn. 276, 282, 464 A.2d 57 (1983).
"Where a judgment incorporates a separation agreement, the judgment and agreement should be construed in accordance with the laws applied to any contract . . . Where the language of the contract is clear and unambiguous, the contract is to be given effect according to its terms . . . Although ordinarily the question of contract interpretation, being a question of the parties' intent, is a question of fact . . . where there is definitive contract language, the determination of what the parties intended by their contractual commitments is a question of law . . . The court's determination as to whether a contract is ambiguous is a question of law . . ."
"A contract is unambiguous when its language is clear and conveys a definite and precise intent . . . The court will not torture words to impart ambiguity . . . where ordinary meaning leaves no room for ambiguity Moreover, the mere fact that the parties advance different interpretations of the language in question does not necessitate a conclusion that the language is ambiguous . . .
"In contrast, a contract is ambiguous if the intent of the parties is not clear and certain from the language of the contract itself. Any ambiguity in a contract must emanate from the language used by the parties . . . The contract must be viewed in its entirety, with each provision read in light of the other provisions . . . and every provision must be given effect if it is possible to do so." (Internal quotation marks omitted.) Russell v. Russell, 95 Conn.App. 219, 221-22, 895 A.2d 862 (2006). "When the language of a contract is ambiguous, the determination of the parties' intent is a question of fact . . ." Ramirez v. Health Net of Northeast, Inc., 285 Conn. 1, 13, 938 A.2d 576 (2008).
In the present case, the parties dispute the meaning of the property settlement's clause concerning the continued provision of life insurance naming the minor children as beneficiaries. The property clause itself is brief and rather short on detail, providing only that "[t]he parties shall keep in full force and effect their current life insurance policies and shall name the minor children as beneficiaries until the youngest child reaches the age of 18." The clause is silent as to which policies this entails, the identity of the insurance provider, what level of coverage is required and what results from any increase or decrease in the policy's value from its 1999 level. Also, assuming that the clause refers to employer-provided insurance, the policy is silent as to whether that clause pertains to all employer-provided insurance, or only the insurance available to the decedent at the time of the divorce in 1999. Taken as a whole, the property settlement agreement indicates that the parties intended to provide for their minor children and provide them some life insurance benefits. The contours of that agreement, however, were ambiguous. As such, the court cannot determine how the insurance proceeds should be distributed without delving into the intent of the parties to the settlement agreement, which would require a factual analysis that is beyond the scope of summary judgment.
The present case stands on different footing from other Connecticut cases that have addressed the issue of the disbursement of life insurance benefits pursuant to a property settlement agreement. In Kulmacz v. New York Life Ins. Co., 39 Conn.Sup. 470, 466 A.2d 808 (1983), the court held that where a property settlement expressly ordered that the decedent maintain a specific insurance policy for the benefit of his children, the fact that he had changed beneficiaries in violation of that order did not preclude the court from ordering that the insurance provider pay the children directly rather than forcing the children to sue the estate. In that case, there were none of the concerns regarding contractual ambiguity that make summary judgment inappropriate in this case. There, the policy was specifically defined both in terms of provider and coverage and the only issue was whether the court could compel direct payment as an equitable remedy. Id., n. 3, 472.
In Hunter v. Hunter, 41 Conn.Sup. 289, 294, 570 A.2d 246 (1989), the court held that the children of the decedent had a vested interest in life insurance proceeds under a property settlement agreement that provided: "All group life insurance provided by the present or any future employer of the defendant shall name the children as beneficiaries until the children attain the age of eighteen." The life insurance clause in that case, while not the paragon of clarity, at least provided, in unambiguous language, that the children were to be named the beneficiary of any and all group life insurance policies provided by the decedent's employer, regardless of the insurance provider or employer. Also, in that case the court's decision in favor of the children was not at the summary judgment stage, but after a trial before a judge trial referee and upon appeal to the Superior Court after the court had made findings of fact with regard to the meaning of the contract.
In Cannata v. Cannata, Superior Court, judicial district of Middlesex, Docket No. 59965 (June 26, 1992, Austin, J.), the court held that summary judgment in favor of the decedent's children in a life insurance dispute was appropriate and applied a constructive trust on the proceeds of the policy because the children obtained a vested interest in the policy from the time the property settlement was entered into. However, in that case the property settlement explicitly stated exactly how much insurance was required and from what sources it would come. Id. In the present case, the property settlement fails to provide a dollar amount or any statement regarding the source of the insurance or the effect of any increase in coverage over the level that was available in 1999.
When faced with a similar problem as presented in the present case, the Texas Court of Appeals held that summary judgment was inappropriate where a property settlement provided for life insurance coverage, but failed to specify the levels of coverage that were to be maintained. Welker v. Welker, 683 S.W.2d 211 (Tex.App. 1985). In that case, the court held that because the property settlement agreement was ambiguous as to whether the children were entitled to $5000 of a larger policy, or whether they were entitled to the entire policy, was a question of material fact and summary judgment was inappropriate. Id., 213.
In the present case, because the clause of the property settlement agreement pertaining to life insurance is ambiguous and presents a question of fact as to what level of insurance coverage the decedent's children are entitled, summary judgment is inappropriate and both motions are denied.