The opinion of the court was delivered by: (Judge Conner)
Presently before the court for judgment is the complaint (Doc. 1) against defendants Deborah A. Kneavel, Guidetta A. Kneavel, Mary A. McAllister, and St. Jude Children's Research Hospital. A non-jury trial was held on April 11 and 12, 2012. Pursuant to Rule 52(a) of the Federal Rules of Civil Procedure, the court's findings of fact and conclusions of law are set forth below.
1. On January 10, 2010, plaintiff AAA Life Insurance Company ("AAA") commenced the above-captioned interpleader action, asking this court to determine the proper distribution of $100,000.00 in death benefits payable to the beneficiary of a life insurance policy owned by Clemens Kneavel ("Clemens").*fn1
2. AAA named Clemens' wife Deborah Kneavel ("Deborah"), Clemens' sisters Guidetta Alice Kneavel ("Alice") and Mary McAllister ("McAllister"), and the St. Jude Children's Research Hospital ("St. Jude").
3. McAllister and St. Jude acknowledged prior to trial that they did not assert claims to the policy proceeds.
4. Clemens was born in 1948, and passed away from liver cancer on November 8, 2009. Deborah was born June 9, 1952. Alice was born July 28, 1946.
5. After graduating from high school, Clemens was drafted into the army and served in the Vietnam War.
6. Upon his return from Vietnam, Clemens suffered from a variety of mental health issues, including post-traumatic stress disorder, anger management problems, and substance abuse problems.
7. Due at least in part to his mental health problems, Clemens had difficulty maintaining steady employment after his military service. In the years after his discharge, Clemens was employed only sporadically and did not maintain long-term employment.
8. From the early 1970s through 1988, Clemens lived sporadically with a number of relatives, including his stepmother and Alice.
9. Between 1988 and 2003, with the exception of an 18 month prison sentence from 1996 to 1997, Clemens lived continuously with Alice.
10. During this period, Clemens was substantially financially dependent upon Alice. He received a monthly partial disability benefit from the Veterans Administration, in the amount of a few hundred dollars each month. Clemens would seek increases in his benefits as he was diagnosed with other service-related mental health issues.
11. Recognizing that Alice incurred great expense in supporting Clemens, and that Clemens was unable to provide for himself, Alice and Clemens' stepmother suggested to Alice that a life insurance policy be taken out on Clemens' life, naming Alice as the beneficiary. The purpose of the policy proceeds would be to compensate Alice for her long-term support of Clemens.
12. On April 15, 1995, Alice prepared an application for a AAA life insurance policy in the amount of $100,000.00. This application was signed and dated by Clemens, and named Alice as the sole beneficiary.
13. Under the terms of the policy, Clemens, as the insured life, could "change the beneficiary at any time" unless otherwise restricted by law. (D. Kneavel Ex. 1, at 6). This statement in the policy is the only writing that exists pertaining to Clemens' ability to change the beneficiary.
14. The life insurance policy was purchased as part of an oral agreement between Clemens and Alice. The terms of the agreement were that Clemens would be permitted to live with Alice without paying rent, Alice would pay for and provide necessities and living expenses, and Alice would pay the premiums on the life insurance policy. In exchange for this consideration, Alice would remain the beneficiary of the policy.
15. Shortly after purchasing the policy, Clemens indicated to McAllister that he had "taken out a policy" naming Alice as beneficiary, "and that it was meant for [Alice's] benefit when he was no longer there." Clemens also informed McAllister that Alice was to pay the ...