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Parties Involved:
Douglas C. Dean
Appellee
Edna Dean
Appellee
Mary Ann Dean
Appellant
Maurice Dean
Appellee
Denise E. Johnson
Appellee
United Services Automobile Association
Appellee
United States of America
Appellee

Document Text:

PUBLISH 

UNITED STATES COURT OF APPEALS 

FOR THE TENTH CIRCUIT 

MARY ANN DEAN, ) 

) 

Plaintiff/Counter-Defendant/) 

Appellant, ) 

) 

FIL.ED 

United States Court of Appeals 

Tenth c:-~+ 

AUG. 9 1989 

ROBERT L. HOECKER 

Clerk 

v. ) No. 87-2787 

DENISE E. JOHNSON, DOUGLAS C. 

DEAN, MAURICE DEAN, EDNA DEAN, 

UNITED SERVICES AUTOMOBILE 

ASSOCIATION, and UNITED STATES 

OF AMERICA, 

) 

) 

) 

) 

) 

) 

. ) 

Defendants/Counter-Claimants/) 

Appellees. ) 

Appeal from the United States District Court 

For the District of New Mexico 

D.C. No. 87-368M 

Submitted on the Briefs: 

Joseph William Reichert, Albuquerque, New Mexico, for Plaintiff/ 

Counter-Defendant/Appellant. 

G. Richard. Mantlo, Albuquerque, New Mexico, for Defendants/ 

Counter-Claimants/Appellees. 

-Before MOORE, ANDERSON, and BRORBY, Circuit Judges. 

MOORE, Circuit Judge. 

Appellate Case: 87-2787 Document: 01019835667 Date Filed: 08/09/1989 Page: 1 
The single issue in this appeal is whether an insured's 

chang~ of designated beneficiary under a Federal Employees' Group 

Life Insurance Policy (FEGLI) takes precedence over· a state court 

order prohibiting a change of designated beneficiary. We affirm 

the district court's finding federal law controls this issue. 

Mary Ann Dean instituted this action for a declaratory 

-:.judgment- that ·she is·"entitled ··to·the pt'.oceeds of her deceased 

husband's FEGLI policy although he had filed a change of 

designated beneficiary with his employer prior to his death. To 

support her position, Ms. Dean cited a prior interlocutory order 

issued by a domestic relations judge in her state divorce action 

which, she claimed, nullified the filed change of beneficiary 

form. The order prohibited the parties from changing the names of 

any beneficiaries under any of the couple's insurance policies and 

ordered them to undo any changes made since their separation. 

While the order remained in effect, Chester Dean changed the 

designated beneficiary of the policy. 

The following year, Mr. Dean died in an automobile accident. 

Ms. Dean claimed the proceeds of the FEGLI policy,· contending the 

Federal Employees' Group Life Insurance Act, 5 u.s.c. §§ 8701-

8716, (FEGLIA) does not preempt valid state court orders in 

divorce proceedings. Alternatively, since the premiums had been 

paid out of community property, she maintained she should be 

entitled to the proceeds. 

We agree with the district court that FEGLIA and its 

accompanying regulations establish a preemptive scheme for group 

life insurance policies for federal employees. This case is 

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Appellate Case: 87-2787 Document: 01019835667 Date Filed: 08/09/1989 Page: 2 
similar to one recently decided in the Eleventh Circuit. In 

O'Neal v. Gonzalez, 839 F.2d 1437 (11th Cir. 1988), two insured 

federal employees agreed to name each other as beneficiary of 

their respective FEGLI policies as a means of ensuring that the 

mortgage to their jointly owned house would continue to be paid. 

Subsequently, without informing the other, one of the parties 

,,.·changed.,the designated.;,benef iciary.,.;naming ;,.an aunt- notwithstanding 

their contract. Upon the death of the insured, decedent's aunt 

and plaintiff claimed the proceeds. Despite the harshness of the 

result, the Eleventh Circuit found§ 8705(a) 1 and corresponding 

regulation, 5 C.F.R. 870.901 (1986) 2 , precluded Ms. O'Neal's 

claiming all of the proceeds. Citing Metropolitan Life Ins. 

Co. v. Mcshan, 577 F. Supp. 165 (N.D. Cal. 1983), and Knowles v. 

Metropolitan Life Ins. Co., 514 F •. Supp. 515 (N.D. _Ga. 198i), the 

Eleventh Circuit concluded the language and intent of FEGLIA are 

1section 8705(a) states in part: 

The amount of group life insurance and group 

accidental death insurance in force on an employ~e at 

the date of his death shall be paid, on the 

establishment of a valid claim, to the person or persons 

surviving at the date of his death .... For this 

purpose, a designation, change, or cancellation of 

beneficiary in a will or other document not so executed 

and filed has no force or effect. 

2section 870.901 states in part: 

(a) A designation of beneficiary shall be in 

writing, signed, and witnessed, and received in the 

employing office •••• 

. . . . (e) A change of beneficiary may be made at any 

time and without the knowledge or consent of the 

previous beneficiary. This right cannot be waived or 

restricted. 

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Appellate Case: 87-2787 Document: 01019835667 Date Filed: 08/09/1989 Page: 3 
clear. "This language indicates that Congress intended to 

establish, for reasons of administrative convenience and for the 

benefit of designated beneficiaries, an inflexible rule that the 

beneficiary designated in accordance with the statute would 

receive the policy proceeds, regardless of other documents or the 

equities in a particular case." 839 F.2d at 1440. 3 

,,. No- .facts. or., o.ir.cumstances. distinguish .. this· case from the 

cited precedent despite Ms. Dean's arguments to the contrary. The 

state domestic relations court order ostensibly restricts the 

federal insured's right to designate a beneficiary and thus cannot 

be valid under FEGLIA. 4 No other circumstances of payment can 

override this principle. We therefore AFFIRM the order of the 

district court granting summary judgment in favor of decedent's 

parents and children. 

3The court also cited S. Rep. No. 1064, 89th Cong., 2d Sess. 2, 

reprinted in 1966 U.S. Code Cong. & Admin. News 2070, 2071. 

4we do not imply, however, Mr. Dean could not have been subjected 

to the contempt powers of the domestic court during his lifetime. 

That court's power to alter federal law is the only question we 

decide in this case. 

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Appellate Case: 87-2787 Document: 01019835667 Date Filed: 08/09/1989 Page: 4