United States District Court, E.D. Pennsylvania
STACY POWER and AL B. HILL, as Receiver for Credit Nation Capital, LLC, Plaintiffs,
ERIE FAMILY LIFE INSURANCE COMPANY, Defendant.
EDUARDO C. ROBRENO, J.
Stacy Power (“Power”) is the owner of a life
insurance policy (“the policy”) that Erie Family
Life Insurance Company (“Erie”) issued to Stephen
Creighton (“Creighton” or “the
insured”). At some point in the past, Creighton sold
his interest in the policy to Credit Nation Capital, LLC
(“Credit Nation”). Power bought the policy as an
investment from Credit Nation, and named the Power Living
Trust as the beneficiary.
policy terminated when Power did not make timely premium
payments. Power claims that the termination was in breach of
the terms of the policy. He also claims that the termination
was improper based on principles of promissory estoppel and
equity. He seeks reinstatement of the policy.
Al Hill (“Hill”) is the court-appointed receiver
of Credit Nation. Hill also seeks reinstatement of the
part, Erie seeks declaratory judgment that the policy was
properly terminated, and that Erie is not required to
reinstate the policy.
before the Court are Plaintiffs' Motion for Partial
Summary Judgment, and Erie's Motion for Summary Judgment.
For the reasons set forth below, the Court will grant
Erie's Motion for Summary Judgment as to Power's
claims, dismiss Hill's claims for lack of standing, and
deny Erie's counterclaim for declaratory judgment as
2005, Erie issued to Creighton a life insurance policy on his
life. ECF No. 48 Ex. A. In 2015, the policy was bought by
James Torchia and Marc Celello, with both owners listed as
beneficiaries. See ECF No. 47 Ex. A-2; ECF No. 48 Ex. C.
Torchia and Celello listed the same address in Woodstock,
Georgia (the “Georgia address”). ECF No. 47 Ex.
A-2. Erie mailed a confirmation of the change of ownership to
Torchia at the Georgia address, stating that “[t]he
payor has been changed to James Torchia.” Id.
Ex. C. The payor address is where the owner wants to receive
January 2016, Power bought the policy from Torchia and
Celello via their company Credit Nation Capital, LLC. ECF No.
47 Exs. A-4, C, D; ECF No. 48 Ex. D. The change of ownership
form identified Power's address as the same Georgia
address as Torchia and Celello, and the form listed Power
Living Trust as the sole beneficiary, with an address in
Yonges Island, South Carolina (the “South Carolina
address”). ECF No. 47 Ex. A-4. Erie mailed a
confirmation of the change of ownership and beneficiary to
Power at the Georgia address. ECF No. 48 Ex. D.
purchase agreement between Power and Credit Nation made Power
responsible for all future premium payments, while Credit
Nation would retain the file for management purposes. ECF No.
47 Ex. B-1. However, pursuant to an oral agreement (not
otherwise described by the parties), Credit Nation agreed to
pay the premiums on the policy for the first four years.
Id. Ex. C at 21, 29, 31-32. Credit Nation made
payment that kept the policy in force until March 2017.
April 2016, Credit Nation was placed into receivership under
a receivership order issued by the United States District
Court for the Northern District of Georgia for alleged
fraudulent investment schemes. See SEC v. Torchia,
922 F.3d 1307, 1312 (11 Cir. 2019). Hill was appointed as the
receiver ECF No. 47 Ex. B-4.
became concerned about his investment after hearing rumors of
problems with Credit Nation. In May 2016, Power placed a call
to Erie and “requested that the payor address remain
the same [Georgia address] but that the owner address be
updated” to Power's address the South Carolina
address. ECF No. 47 Ex. A-8, C at 51-52. According to Power,
but disputed by Erie, Power also asked Erie's agent to
contact him “in case anything was to happen” to
the policy, and the agent told Power that “nothing
would happen to the policy without [Power] being
notified.” ECF No. 48-2 ¶ 14. After Power's
phone call, Erie sent a letter to Power at the South Carolina
address confirming “a change of address was processed
on [the] policy.” ECF No. 48 Ex. J.
Credit Nation had been placed in receivership, Hill became
the administrator of the policy, and was tasked with
disposing of the assets in which Credit Nation had an
interest. Id. Hill offered to Power the same terms
provided in the receivership order for retaining ownership of
the policy. ECF No. 47 Ex. B-5, C. If Power accepted the
terms, Power would be responsible for all future premium
21, 2016, Power accepted the terms and mailed the acceptance
form to Hill. ECF No. 48 Ex. I. On June 26, 2016, Credit
Nation emailed Power stating that it had received the
acceptance letter and payment required by the receivership
order. ECF No. 47 Exs. B-6, E (Power's admission that he
received the email). The email told Power to “be sure
to update [Erie] with your name and address as the premium
payor on record. You will want to make sure you receive any
and all correspondence from [Erie] regarding your policy. The
current paid-to-date on your policy is: 03/24/2017.”
the email's express instruction, Power did not request
Erie to change the address of the payor from the Georgia
address to the South Carolina address. ECF No. 47 Ex. C.
February and April of 2017, Erie sent notices to Power at the
payor address on file--the Georgia address--stating that a
premium payment was due under the policy. ECF No. 47 Exs.
A-10, A-11, A-12. Power apparently did not receive these
notices and did not pay the premium on time. Consequently, at
the end of the grace period, the policy terminated according
to its terms. ECF No. 47 Exs. D, F.
end of June 2017, Power called Erie to make a payment but was
informed that the policy had terminated. ECF No. 48 Ex. R.
Furthermore, because an additional, non-policy “easy
reinstatement” period had run, Erie required a
reinstatement application. Id.; ECF No. 48 Ex. Q.