IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

HARTFORD LIFE AND ANNUITY

INSURANCE COMPANY,

Plaintiff,

v.

ANNE FARRIS, HONGJIAO HU, and

NATALIA NEBEL,

Defendants.

Case No. 12 C 1320

Hon. Harry D. Leinenweber

MEMORANDUM OPINION AND ORDER

Before the Court are Cross-Motions for Summary Judgment. For

the reasons stated herein, Defendant Natalia Nebel’s Motion for

Summary Judgment [ECF No. 49] is granted and Defendant Hongjiao

Hu’s Motion for Summary Judgment [ECF No. 55] is denied.

I. BACKGROUND

This interpleader case seeks to determine the proper

beneficiary of a life insurance policy. The material facts are not

in dispute – the parties agree on the background and many of the

specifics, and all of the facts in Defendant Nebel’s Rule 56.1

Statement of Facts are deemed admitted because Defendant Hu did not

respond to the numbered paragraphs in Nebel’s Statement. See,

Local Rule 56.1(b)(3)(C). 

Thomas Walkowiak (“Walkowiak”), the insured, married Defendant

Natalia Nebel (“Nebel”) in May 1989. In 1996, Walkowiak bought a
life insurance policy (the “Policy”) from Hartford Life and Annuity

Insurance Company and designated Nebel as the primary beneficiary. 

He financed the purchase with marital funds from a joint checking

account he shared with Nebel. Thereafter, Nebel paid the premiums

using funds from the joint account. After she and Walkowiak

separated in early 2008, Nebel continued to pay the premiums from

the joint account. Although Walkowiak stopped depositing money

into the joint account later that year, Nebel continued to transfer

money from her personal account into the joint account so that she

could keep paying the premiums. 

Even though he and Nebel were separated, Walkowiak relied on

Nebel for financial help. Nebel lent Walkowiak thousands of

dollars so that Walkowiak could purchase expensive prescription

medications and meet other obligations. On one occasion in 2011,

Walkowiak removed a significant amount of money (probably several

thousand dollars, but the record does not specify) from the joint

account without Nebel’s permission. But despite the breakdown of

the marriage and apparent transgressions of any remaining trust,

Walkowiak told Nebel on multiple occasions that she remained the

Policy’s beneficiary. In a May 2010 e-mail to Nebel, Walkowiak

affirmed “I will always try my hardest to help and support you

until I die, and then you will get the life insurance.” Contrary

to this and similar assurances, Walkowiak removed Nebel as the

Policy’s primary beneficiary and replaced her with Defendants

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Hongjiao Hu (“Hu”) (his business partner and paramour) and Anne

Farris (his sister) (“Farris”) in September 2011, without notifying

Nebel. 

Nebel filed for divorce in December 2011. While attempting to

finalize the dissolution, Walkowiak represented to Nebel and her

attorney that Nebel would remain the beneficiary of the Policy. 

Walkowiak even listed the Policy as a marital asset to be

distributed in the divorce. But the divorce was never finalized,

as Walkowiak committed suicide on December 30, 2011. Expecting

that she would receive the life insurance proceeds, Nebel organized

and financed Walkowiak’s cremation, memorial service, reception

following the service, and obituary. On her own dime, she traveled

to Massachusetts to dispose of the ashes in the manner Walkowiak

had requested. 

When Nebel attempted to obtain the insurance proceeds, she was

surprised to learn that she was no longer a beneficiary under the

Policy. She contested payment of the Policy’s proceeds to Hu and

Farris, and Hartford initiated this interpleader action. Nebel and

Hu have filed cross motions for summary judgment. 

II. JURISDICTION

Defendant Farris is a citizen of Florida, and Defendant Nebel

is a citizen of Illinois. Because there are at least two claimants

with diverse citizenships and the amount in controversy exceeds

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$500.00, the Court has jurisdiction over this interpleader case

pursuant to 28 U.S.C. § 1335. 

III. LEGAL STANDARD

Summary judgment is appropriate “if the movant shows that

there is no genuine dispute as to any material fact and the movant

is entitled to judgment as a matter of law.” FED. R. CIV. P. 56(a).

The Court construes all facts and draws all reasonable inferences

in favor of the non-moving party. Ricci v. DeStefano, 557 U.S.

557, 586 (2009).

IV. ANALYSIS

Nebel contends that she acquired a vested interest in the

Policy’s proceeds by paying the Policy premiums. Because Nebel is

a vested beneficiary, she argues, Walkowiak could not remove her as

a beneficiary without her consent. 

“A beneficiary’s right to the proceeds of a life insurance

policy normally does not vest until the insured dies.” Perkins v.

Stuemke, 585 N.E.2d 1125, 1127 (Ill. App. Ct. 1992). However,

Illinois law recognizes that someone other than a named beneficiary

can acquire equitable rights in an insurance policy. Columbian

Circle v. Mudra, 132 N.E. 213, 214 (Ill. 1921) (explaining that an

agreement between the insured and the person paying the premiums

that the latter will receive a beneficial interest in insurance

proceeds can “deprive[] [the insured] of the right to change the

beneficiary without [the other’s] consent”). 

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A plaintiff can prove her equitable interest in the proceeds

of a life insurance policy by establishing the four elements of

promissory estoppel: (1) an unambiguous promise; (2) reliance on

such promise by the promisee; (3) the promisor expects and foresees

such reliance; and (4) the promisee relies on the promise to his

injury. Cullen Distributing, Inc. v. Petty, 517 N.E.2d 733, 737

(Ill. App. Ct. 1987). Given the “‘paramount’ right of property

owners while they are alive to dispose of their belongings

(including the proceeds of life insurance policies) as they see

fit,” Illinois law requires that each element be established by

clear and convincing evidence. Davis v. Combes, 294 F.3d 931, 936-

37 (7th Cir. 2002). 

Nebel swears by affidavit that she paid the policy’s premiums

using non-marital funds after the separation and that Walkowiak

assured her on multiple occasions that she would remain the

policy’s beneficiary. In a May 2010 e-mail, for example, Walkowiak

wrote to Nebel “I will always try my hardest to help and support

you until I die, and then you will get the life insurance.” ECF

No. 53, Ex. B. Hu does not suggest any foul play with the e-mail

but asks the Court to “carefully scrutinize[]” it because e-mails

“can be easily modified.” ECF No. 56 at 7. The Court recognizes

that Walkowiak “is dead and thus cannot counter the surviving

party’s version of the relevant events.” Davis, 294 F.3d at 937. 

Nonetheless, the e-mail contains sufficient guarantees of

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trustworthiness because it is consistent with the rest of the

evidence submitted in this case, including Nebel’s affidavit and

copies of checks used to pay the Policy’s premiums. In addition,

Nebel’s affidavit mentions that Walkowiak offered similar

assurances on other occasions. This evidence demonstrates clearly

and convincingly that Walkowiak promised unambiguously that Nebel

would remain the Policy’s beneficiary. First Nat. Bank of Cicero

v. Sylvester, 554 N.E.2d 1063, 1070 (Ill. App. Ct. 1990) (promise

need not be express and “may be inferred from conduct and words”). 

And because the assurances constitute verbal acts, they are not

hearsay. 

As to the remaining elements, Nebel showcased her reliance on

Walkowiak’s promises when she continued to pay the Policy’s

premiums using her own money even after she and Walkowiak had

separated and Walkowiak had lost his job. Nebel also spent

thousands of dollars on Walkowiak’s funeral and related expenses. 

This reliance was foreseeable, as well: Walkowiak lacked the funds

to pay the Policy premiums, and it is common knowledge that an

insurance policy will lapse if the premiums go unpaid. Walkowiak’s

assurances that Nebel would receive the Policy proceeds would have

been meaningless if he did not expect Nebel to pay the premiums. 

Finally, Nebel suffered financial injury by paying the premiums and

the funeral expenses. Therefore, the record provides clear and

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convincing evidence that all four elements of promissory estoppel

are satisfied. 

Because Nebel’s rights as the Policy’s beneficiary vested,

Walkowiak could not remove her as a beneficiary without her

consent, which she did not give. Therefore, the Court imposes a

constructive trust on the Policy’s proceeds in her favor. Because

the Court resolves the Motions on this issue, it need not address

other grounds raised in the Motions. 

V. CONCLUSION

For the reasons stated herein, the Motion for Summary Judgment

as to [ECF No. 49] Defendant Natalia Nebel is granted. The Policy

proceeds shall be paid to Defendant Natalia Nebel. Defendant

Hongjiao Hu’s Motion for Summary Judgment [ECF No. 55] is denied. 

IT IS SO ORDERED.

Harry D. Leinenweber, Judge

United States District Court

Date:6/19/2014

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