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PROVIDENT INDEM. LIFE INS. CO. v. DURBIN

May 4, 1981

PROVIDENT INDEMNITY LIFE INSURANCE COMPANY
v.
Doris L. DURBIN and David P. Chandler



The opinion of the court was delivered by: MCGLYNN

MEMORANDUM OF DECISION

This interpleader action *fn1" arises from a contest between two individuals, defendant, Doris L. Durbin ("Durbin") and David P. Chandler ("Chandler"), who claim to be beneficiaries of the proceeds payable from a group life insurance policy. The policy was issued by the plaintiff, Provident Indemnity Life Insurance Company ("Provident") to Northampton Township ("Township") for the benefit of Township employees. Presently before the court is Durbin's motion for summary judgment pursuant to Federal Rule of Civil Procedure 56. After careful consideration of the record and the arguments of counsel, I have concluded, for the reasons set forth herein, that Durbin's motion for summary judgment should be granted.

 I.

 In 1974, Delman W. Chandler (hereinafter referred to as "the Insured"), began working as a police officer for Northampton Township. As part of Chandler's employment benefits, the Township provided him with coverage under a group life insurance policy. The premiums under this policy were paid solely by the Township. The Township purchased group life insurance from an insurance company and occasionally the Township would change from one company to another.

 Only high Township executives and supervisors would consider and decide what actions to take with regard to the group insurance. When these officials were contemplating a change in group life insurance carriers, the various Township department heads, such as the Chief of Police, as well as the Township employees, would not be advised of the contemplated action. A change in group insurance carriers required approval of the Board of Supervisors at a formal meeting.

 The Township was responsible for the entire administration of the group life insurance policy. Enrollment cards and any forms for changes in an employee's policy would have to be obtained by the employee from the Township and then returned to the Township. The Township would then forward the information to the insurance company. In 1976, the Township purchased group life insurance from Provident. At that time, the Insured was provided with a Provident enrollment card by the Township. On that card, the Insured designated defendant, Chandler, his adopted son, as the sole beneficiary of this group insurance. The Township renewed this insurance with Provident through June 30, 1979 and as of this date, the coverage for the Insured was in the amount of $ 37,000.

 
Please have the attached cards filled out entirely by all permanent, full time employees. This insurance will cover our life insurance, LTD & AD&D.
 
All forms MUST be returned no later than Friday, June 8, 1979 to my office.
 
Thank you.

 There was no other information provided to the department heads concerning the group life insurance. No effective date was stated on the memorandum. In fact, on the date of the distribution of the memorandum and the Bankers Life cards, it was not possible to provide an effective date because the Township Board of Supervisors had not met and passed the required resolution to effectuate the change.

 Police Chief, William J. Feeney ("Feeney"), distributed the Bankers Life cards to his personnel (including the Insured) with his own memorandum on June 7, 1979, which stated:

 
Please fill out entirely the attached card and return to my office no later than June 8, 1979.

 On June 7, 1979, the Insured filled out the Bankers Life card, putting his mother, Doris L. Durbin and his adopted son, David P. Chandler, in that order, as intended beneficiaries of the group life insurance policy (See Exhibit A). The enrollment card together with the memorandum from Chief Feeney was all of the information provided to the Insured. The card completed by the Insured had no effective date, but the date of execution by the Insured was June 7, 1979. In addition, the name "Bankers Life" was not prominently displayed nor was the expressed purpose of the card indicated, except that it was identified as "Group Enrollment Card" in relatively small print at the very bottom. Upon the return of the Insured's card, Chief Feeney forwarded it to the Township Manager. Just two weeks later, on June 22, 1979, the Insured died of a heart attack. Five days after his ...


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