David Loppi v. United Investors Life Insurance Co. ( 2015 )

Supreme Court
No. 2013-340-Appeal.
(PC 09-6095)
David Loppi :
v. :
United Investors Life Insurance Co. et al. :
NOTICE: This opinion is subject to formal revision before
publication in the Rhode Island Reporter. Readers are requested to
notify the Opinion Analyst, Supreme Court of Rhode Island, 250
Benefit Street, Providence, Rhode Island 02903, at Telephone 222-
3258 of any typographical or other formal errors in order that
corrections may be made before the opinion is published.
Supreme Court
No. 2013-340-Appeal.
(PC 09-6095)
David Loppi :
v. :
United Investors Life Insurance Co. et al. :
Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
OPINION
Justice Robinson, for the Court. The defendant, Marilyn Loppi,1 appeals from a
declaratory judgment entered in Providence County Superior Court on April 25, 2012, declaring
that she had no right to the proceeds of a life insurance policy of her late husband, Robert Loppi.
This case came before the Supreme Court pursuant to an order directing the parties to appear and
show cause why the issues raised in this appeal should not be summarily decided. After a close
review of the record and careful consideration of the parties’ arguments (both written and oral),
we are satisfied that cause has not been shown and that this appeal may be decided at this time.
For the reasons set forth in this opinion, we affirm the judgment of the Superior Court.
1
The other named defendant, United Investors Life Insurance Co. (United Investors), filed
a “Motion for Leave to File a Counterclaim and Cross-Claim for Interpleader, to Deposit Funds
into the Court Registry and to be Discharged.” The Superior Court issued an order on March 6,
2012, granting the motion filed by United Investors. Thus, after depositing the disputed funds in
the registry of the Superior Court, United Investors ceased to be a party to this action and,
accordingly, is not a party to this appeal.
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I
Facts and Travel
In 2003, Robert Loppi purchased a life insurance policy from United Investors Life
Insurance Co. (United Investors), in which, the parties agree, he initially named his wife,
Marilyn Loppi, as the beneficiary. In 2008, Marilyn2 filed for divorce from Robert. On July 19,
2008, Robert was served with the summons and complaint in that divorce action. However, on
July 17, 2008, before the service of the divorce summons and complaint, Robert had applied
(through a signed written request) to United Investors to change the beneficiary on his life
insurance policy; the new beneficiary was Robert’s uncle, David Loppi, who is the plaintiff in
this action.3
On March 27, 2009, in the course of the divorce proceeding, an interlocutory order was
entered in Family Court ordering that life insurance policies, annuities, and investment policies
be “cashed in forthwith” and that the cash surrender value be divided equally between Robert
and Marilyn. That interlocutory order instructed Robert and Marilyn to “execute any and all
documents as needed to cash in said accounts, inclusive of any and all authorizations necessary
for the attorneys to obtain information or for the policies to be liquidated and/or powers of
attorney so that counsel for the parties may do so for the parties.” However, on May 28, 2009,
before he had complied with that part of the just-referenced interlocutory Family Court order
relating to the cash value of the life insurance policy at issue and before a final judgment was
entered in the divorce action, Robert passed away.
2
Due to the fact that the persons involved in this case share the same last name, we shall
refer to them by their first names. In doing so, we intend no disrespect.
3
It is important to note that the United Investors insurance policy states that changes in
beneficiaries “take effect on the date the request was signed[.]”
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According to the complaint filed by David in Superior Court, after Robert’s death United
Investors declined to pay the life insurance death benefit, the face amount of which was
$375,000, to either David or Marilyn, even though United Investors acknowledged that David
was the named beneficiary. In consequence, on October 21, 2009, David filed the instant action
in Superior Court, seeking a declaratory judgment that he alone was entitled to the life insurance
policy death benefit. On December 1, 2011, Marilyn filed a document which indicated that it
constituted both an objection to David’s complaint seeking a declaratory judgment and a cross-
motion for declaratory judgment. On March 8, 2012, David filed a “Motion to Close Record and
Submit for Decision.”
On April 17, 2012, the hearing justice issued a bench decision. Subsequently, on April
25, 2012, final judgment was entered, granting David’s “Petition for Declaratory Judgment” and
denying Marilyn’s “Cross-Motion for Declaratory Judgment.” The final judgment specifically
stated that David was “entitled to 100% of the policy proceeds” and that Marilyn was “entitled to
no portion of the proceeds of the life insurance policy.” Marilyn filed a timely notice of appeal
on May 11, 2012.
II
Standard of Review
On appeal, Marilyn has opted not to submit a transcript of the April 17, 2012 bench
decision rendered by the hearing justice in this case. We have previously remarked as follows
about a party’s failure to provide this Court with a transcript of what transpired below:
“The deliberate decision to prosecute an appeal without
providing the Court with a transcript of the proceedings in the trial
court is risky business. Unless the appeal is limited to a challenge
to rulings of law that appear sufficiently on the record and the
party accepts the finding of the trial justice as correct, the appeal
must fail.” Adams v. Christie’s, Inc., 880 A.2d 774, 778 (R.I.
-3-
2005) (quoting 731 Airport Associates, LP v. H & M Realty
Associates, LLC, 799 A.2d 279, 282 (R.I. 2002)).
While we remain convinced that our “risky business” admonition is well-founded, we are
satisfied that this particular appeal is the exception to the rule; this case presents us with a pure
question of law which we are able to address sufficiently on the basis of the Superior Court
record before us. See, e.g., In re Estate of Griggs, 63 A.3d 867, 869-70 (R.I. 2013).
Accordingly, we shall apply a de novo standard of review, as we customarily do “[w]hen
reviewing an appeal based on an alleged error of law.” Warwick Sewer Authority v. Carlone, 45
A.3d 493, 498 (R.I. 2012) (internal quotation marks omitted); see Medeiros v. Bankers Trust
Co., 38 A.3d 1112, 1117 (R.I. 2012); see also Ashley v. Kehew, 992 A.2d 983, 987 (R.I. 2010).
III
Analysis
The discrete issue which this Court is tasked with determining on appeal is whether
Marilyn should be entitled to any portion of the life insurance proceeds at issue.
Marilyn contends that she has an ownership and equitable interest in the life insurance
policy, “notwithstanding Robert’s unilateral change of beneficiary.” She posits that the life
insurance policy was marital property and that its proceeds should therefore be subject to
equitable division. Additionally, she avers that, had Robert survived, the change in beneficiary
on the life insurance policy “would certainly have been ruled invalid by the Family Court.”
Moreover, according to Marilyn, the interlocutory Family Court order requiring a fifty-fifty
division of the cash value of the life insurance policy is “akin” to an alimony or support order;
and, on the basis of that predicate, she submits that equity mandates that she be awarded at least
fifty percent of the death benefit. It is her contention that the Superior Court erred when it did
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not give deference to the Family Court’s order concerning the division of the life insurance
policy.
In response, David argues that, at the time of the change in beneficiary, the Family Court
did not have jurisdiction over Robert; David further argues that, at that time, Robert was not
subject to any automatic court orders prohibiting any altering or alienation of marital assets,
since he had not yet been served with the divorce summons and complaint. He further avers that
the divorce action and any interlocutory orders issued by the Family Court during the pendency
of the divorce action abated upon Robert’s death. Accordingly, he contends that, as the named
beneficiary, he is entitled to the entirety of the life insurance death benefit.
This case is by no means one of first impression. In Keidel v. Keidel, 119 R.I. 726, 729,
383 A.2d 264, 266 (1978), this Court held that “it is universally accepted that, divorce being a
personal action, the death of one of the parties before the entry of the final decree thereon abates
the action.” In Keidel, we then proceeded to a discussion of interlocutory orders issued during a
divorce proceeding. Id. at 730-32, 383 A.2d at 266-67. We began our analysis with the fact that
it was (and still is) well settled that the Family Court is a “statutory court of special jurisdiction”
and its authority to act must be derived from statute. Id. at 731, 383 A.2d at 266; see also Rogers
v. Rogers, 98 R.I. 263, 268-69, 201 A.2d 140, 143-44 (1964). Moreover, the Family Court’s
jurisdiction over “real and personal property of the parties is ‘ancillary’ and an ‘adjunct to its
divorce jurisdiction.’” Keidel, 119 R.I. at 731, 383 A.2d at 267 (quoting Rogers, 98 R.I. at 268-
69, 201 A.2d at 143-44). We also noted in our opinion in that case that there was “substantial
authority to the effect that the death of one of the parties abates the entire divorce action,
including all ancillary or interlocutory decrees, orders, etc.” Id. at 730, 383 A.2d at 266.
Ultimately, we looked approvingly upon that “substantial authority” and held that “[a]n
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interlocutory decree to partition real estate, being ancillary to the court’s divorce jurisdiction,
must abate when the divorce action itself abates.” Id. at 730, 732, 383 A.2d at 266, 267.
Several years later, in Centazzo v. Centazzo, 556 A.2d 560 (R.I. 1989), we clarified and
reiterated our holdings in Keidel. We restated that “[i]n accordance with the maxim actio
personalis moritur cum persona, the cause of action of divorce terminates on the death of one of
the parties.”4 Id. at 562 (internal quotation marks omitted). Crucially, we then proceeded to
address the question of whether the Family Court had jurisdiction over property matters in a
divorce action when an interlocutory order involving property distribution had been issued but
one of the spouses died before the final judgment of divorce was issued. Id. We cited Keidel for
the principle that “an interlocutory judgment granting property rights [during a divorce
proceeding] could not be enforced because the judgment’s temporary nature was statutorily
prescribed.” Id. at 563. Accordingly, we held that the abatement of a divorce petition in Family
Court results in the abatement of any “action with respect to the division of property” that is not
encompassed in a final judgment of divorce. Id.
When we apply our clear precedent to the case before us, we come to the inescapable
conclusion that the divorce action in the Family Court abated at the time of Robert’s death and
that any interlocutory orders with respect to the division of property also abated. The instant
case raises the same question that we answered in Keidel and Centazzo; it has been our
consistent holding that, when a divorce action abates due to the death of one of the spouses, so
too do any interlocutory orders with respect to property division. See Centazzo, 556 A.2d at
563; Keidel, 119 R.I. at 732, 383 A.2d at 267. Consequently, the March 27, 2009 Family Court
4
The Latin maxim quoted by the Court in Centazzo v. Centazzo, 556 A.2d 560, 562 (R.I.
1989), may be translated as follows: “A personal action dies with the person.”
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order with respect to the division of the cash value of the life insurance policies held by Marilyn
and Robert abated at the time of Robert’s death, when the divorce action itself abated.
It is further our opinion that Robert was within his rights when he changed the
beneficiary of his life insurance policy on July 17, 2008 because he had not yet been served with
Marilyn’s divorce complaint. General Laws 1956 § 15-5-14.1(f) prohibits changing the
beneficiary of a life insurance policy during the pendency of a divorce action, but that section
does not take effect until service of the divorce complaint on the defendant—who in this case
was Robert. See § 15-5-14.1(a). In the instant case, service of the divorce complaint on Robert
occurred two days after he changed the beneficiary of the life insurance policy at issue.
Moreover, under the terms of the life insurance policy itself, the beneficiary is “as stated in the
application, unless subsequently changed by the Owner.” The policy requires joint action to
change the beneficiary only when there is more than one owner. And the crucial fact is that
Robert is the only listed owner of the policy. Accordingly, his change of beneficiary was within
his rights as the sole policy owner. Therefore, David is the rightful beneficiary of the life
insurance death benefit because Robert was completely within his rights to change the
beneficiary on his life insurance policy at the time that he named David as beneficiary. And, in
view of the ultimate abatement of the divorce action and of any interlocutory orders relative to
the division of property, that change in beneficiary was not altered by anything which transpired
in the Family Court prior to Robert’s death.
Marilyn contends that the Family Court order which required the liquidation of any life
insurance policies and the fifty-fifty split in the cash value of any such policies was “akin” to an
alimony or support order; and, on that basis, she argues that the order did not abate on Robert’s
death. We need not address whether her contention has a valid legal basis since it does not have
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a valid factual basis. After a thorough review of the May 27, 2009 Family Court order
addressing Marilyn and Robert’s life insurance policies, we are convinced that it is not, nor was
it ever intended to be, an order of alimony or support. It is clear on its face that it is an order
dealing with the division of property; the order addresses the sale of real estate and the cashing in
of life insurance policies, annuities, and investment policies, but at no point does it reference
support or alimony. Accordingly, it is our view that Marilyn has advanced no argument which
convinces us that this case is not governed by our clear precedent. Therefore, we hold that the
hearing justice did not err in granting David one hundred percent of the life insurance death
benefit.
IV
Conclusion
For the reasons stated in this opinion, we affirm the judgment of the Superior Court. We
remand the record to that tribunal.
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RHODE ISLAND SUPREME COURT CLERK’S OFFICE
Clerk’s Office Order/Opinion Cover Sheet
TITLE OF CASE: David Loppi v. United Investors Life Insurance Co. et al.
CASE NO: No. 2013-340-C.A.
(PC 09-6095)
COURT: Supreme Court
DATE OPINION FILED: November 16, 2015
JUSTICES: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
WRITTEN BY: Associate Justice William P. Robinson III
SOURCE OF APPEAL: Providence County Superior Court
JUDGE FROM LOWER COURT:
Associate Justice Sarah Taft-Carter
ATTORNEYS ON APPEAL:
For Plaintiff: Timothy J. Dodd, Esq.
For Defendant: Thomas M. Dickinson, Esq.