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Primerica Life Insurance Co. v. Coleman

United States District Court, M.D. Pennsylvania

October 29, 2017




         I. Introduction

         This is an interpleader action filed by Primerica Life Insurance Company, which invites us to resolve a dispute between two brothers, Joshua and Christopher Coleman, rival claimants to the proceeds of the insurance policy of an insured decedent, their father Gerald Coleman. The case comes before us for consideration of the following three motions: (1) a motion for summary judgment, or default judgment, filed by the plaintiff, Primerica, against the two interpleader defendants (Doc. 19); (2) a motion for summary judgment filed by interpleader defendant Joshua Coleman against the remaining interpleader defendant, Christopher Coleman, who has not responded to the lawsuit in any fashion (Doc. 22); and (3) a motion filed by Primerica which seeks the dismissal of a counter-claim filed against it by defendant and cross-claim plaintiff Joshua Coleman. (Doc. 9). For the reasons set forth below, it is recommended that all of these motions be granted.

         II. Statement of Facts and of The Case

         The factual background of this dispute can be simply stated: On October 2, 1987, Gerald C. Coleman submitted an Application for Life Insurance to Primerica's corporate predecessor Massachusetts Indemnity and Life Insurance Company (“MILICO”), to insure his life in the face amount of $90, 000.00. (Doc. 1, ¶¶ 7-9, Doc. 6, ¶¶ 7-9). Coleman was then issued policy number 0412525313 insuring his Coleman's life in the amount of $90, 000.00, pursuant to the terms of this insurance policy. (Doc. 1, ¶ 10 and Exhibit “B”).

         When this policy was first issued, the principal beneficiary of the coverage insuring Gerald Coleman's life was his wife, Amy Coleman, and the contingent beneficiaries were the children of their marriage. (Id., ¶ 11.) On June 24, 2011, Gerald Coleman submitted a Policy Change Application to Primerica seeking to change the principal beneficiary under the Policy from his wife to his two sons, Defendants Christopher G. Coleman and Joshua J. Coleman, and to delete the contingent beneficiary. (Id., ¶ 12.) In a July 13, 2011 letter to Gerald Coleman, Primerica confirmed these changes as of June 24, 2011. (Id., ¶ 13.)

         Some four years later, on October 26, 2015, Gerald Coleman submitted a signed letter to Primerica, which sought to designate his son Joshua Coleman as the sole principal beneficiary of the coverage insuring his life under the Policy. (Id., ¶ 14.) On October 27, 2015, Primerica confirmed in writing this change of beneficiary, effective as of October 26, 2015 and further confirmed that no contingent beneficiary of that coverage had been designated. (Id., ¶ 15.)

         Six months later, on May 1, 2016, Gerald Coleman died in Pennsylvania. (Id., ¶ 16.) With the apparent written consent of both Joshua and Christopher Coleman, the $90, 000.00 benefit payable under the policy at the time of Gerald Coleman's death was subsequently reduced by $1, 900.00 for his funeral expenses, leaving a remaining balance of the benefits payable under the policy of $88, 100.00, plus any applicable interest. (Id., ¶¶ 17-19.)

         Primerica then received two competing claims for these policy proceeds from Coleman's children, Joshua and Christopher Coleman. On June 1, 2016, Joshua Coleman, the last beneficiary designated by Gerald Coleman, submitted a formal claim to Primerica for the Remaining Benefit under the policy. (Id., ¶ 24.) At approximately the same time, on May 31, 2016, Primerica received a letter dated May 24, 2016 from Christopher Coleman challenging Joshua Coleman's designation as the sole beneficiary of the Remaining Benefit under this policy. (Id., ¶ 20.) Christopher Coleman's letter alleged that Gerald Coleman actually intended to make him, and not Joshua Coleman, the sole beneficiary of the death benefit payable under the Policy and stated the Christopher Coleman was “overwhelmingly concerned that [Joshua Coleman had] forged [Gerald Coleman's] signature for change [sic] of beneficiary….” (Id., ¶ 22.) Christopher Coleman requested in this May 24, 2016 letter that he be “returned as beneficiary” of the Remaining Benefit “the way it was supposed to be.” (Id., ¶ 23.)

         Presented with these competing demands for the policy proceeds, Primerica followed the course expressly authorized by law and commenced this action on December 7, 2016 naming the competing Coleman brothers as defendants and seeking interpleader relief pursuant to Fed.R.Civ.P. 22. (Doc. 1.) Christopher and Joshua Coleman both received copies of this interpleader complaint and signed waiver forms indicating that they both understood that they needed to respond to the complaint within 60 days, and if they failed to respond default might be entered against them. (Docs. 7 and 8.) Joshua Coleman then promptly answered the interpleader complaint and filed a cross-claim against his brother, Christopher Coleman, alleging that he was entitled to judgment in his favor on this insurance policy since he was the last named beneficiary on the policy. (Doc. 6.) Joshua Coleman also lodged a counter-claim against Primerica, alleging that Primerica should not have followed the course permitted by law and filed this interpleader action but rather should simply have paid the policy proceeds directly to him.

         For his part, Christopher Coleman has done nothing. He has not responded to Primerica's interpleader complaint. He has not addressed Joshua Coleman's cross-claim. He has not submitted his own cross-claim asserting any rights to these policy proceeds. Nor has he chosen to advance and attempt to prove any of the factual allegations which he initially made in his May 2016 correspondence to Primerica. Christopher Coleman's complete inaction, in turn, has led Primerica to request, and receive, a clerks' entry of default against Christopher Coleman. (Docs. 15 and 16.)

         It is against this backdrop that Primerica and Joshua Coleman both seek summary judgment, or default judgment, against the unresponsive defendant, Christopher Coleman. (Docs. 19 and 22.) Primerica, in turn, has moved to dismiss the counter-claim lodged against it by Joshua Coleman, arguing that it cannot be held liable for following a procedure expressly authorized by law and filing an interpleader complaint to resolve the merits of these competing claims. (Doc. 9.)

         For the reasons set forth below, we recommend that all of these motions be granted.

         III. Discussion

         A. Primerica and Joshua Coleman Are Entitled to Judgment in Their ...

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