## United States Court of Appeals
FOR THE EIGHTH CIRCUIT

___________ No. 09-2869

___________ Conseco Life Insurance Company, *

* Plaintiff - Appellee, *

* v. *

* Eric Williams, individually and in his * capacity as executor of the Estate of * Nikki Williams, Deceased, * Appeal from the United States * District Court for the Defendant - Appellant, * Eastern District of Arkansas.

* Ellen Buckley, *

* Defendant - Appellee, *

* Harold Williams, *

* Defendant - Appellant. *

___________ Submitted: June 16, 2010 Filed: September 3, 2010

___________ Before MELLOY, HANSEN, and SMITH, Circuit Judges.

___________ SMITH, Circuit Judge.1 The district court used the name "Ni kki" Williams in its caption. However, it is undisputed that Conseco issued the policy in question to "Niki" Williams. Therefore, we will refer to the insured/deceased by her correct name, Niki Williams.

2 The Honorable Susan Webber Wright, Un ited States District Judge for the Eastern District of Arkansas.

-2- Conseco Life Insurance Company ("Cons eco") issued a life insurance policy ("policy") to Niki Williams 1 ("Niki"), who died followi ng a battle with cancer. Niki's sister, Ellen Buckley, the named benefici ary, and Niki's sons, Eric and Harold Williams (collectively, "appellants"), th e prior beneficiaries, both claimed the proceeds of the policy. Conseco interp led the $100,000 insurance proceeds pending the district court's 2resolution of the dispute. Buckley claimed that she, using a power of attorney, ultimately named herself benefi ciary of the policy at Niki's behest. The appellants denied this and claimed that Bu ckley used undue influence to procure the policy change. Both sides filed cross summary judgment motions. The district court granted Buckley's motion base d on witness affidavits, th e record, and the holding of Primerica Life Ins. Co. v. Watson , 207 S.W.3d 443 (Ark. 2005). The appellants appeal, arguing that the district court abused its discretion in applying the Primerica hearsay exception to allow certain affidavits to come in as evidence to determine Niki's intent and erred in granting summary judgment while material disputed facts remain. For the reasons stated below, we affirm.

I. Background On August 15, 1994, Niki applied for a life insurance policy with Conseco, requesting $100,000 and naming her sons Eric Williams ("Eric") and Harold Williams as primary beneficiaries of the policy. Ni ki subsequently developed breast cancer and underwent treatment from October 2005 through the beginning of March 2006. Following her discharge from the hospital Ni ki lived with Eric until March 28, 2006. On March 28, following a disagreement betweenEric and Niki, Eric returned Niki to the house that she owned with her boyfriend. Niki lived at he r house in April 2006.-3- Sometime in early May, Niki was briefly hospitalized and upon release Niki lived at Buckley's house until Niki's death on June 18, 2006.

Prior to Niki's death, Buckley and Ni ki took several steps ultimately designed to change the beneficiary of Niki's po licy from the appellants to Buckley. First, Buckley asked Niki's insurance agent, Jarvis Thorn, for instructions on how to properly change the beneficiary designation. Conseco subsequently sent Buckley a change in ownership form. Niki, however, allegedly had limited us e of her extremities and could not sign the form. Conseco would not permit the insurance forms to be signed with an "X." On the advice of C onseco, Niki executed a power of attorney (POA) in favor of Buckley. This POA a llowed Buckley to change the ownership of the policy, which then empowered Buckley to change the beneficiary designation of the policy from her nephews to herself.

Niki executed the POA naming Buckley as her attorney-in-fact on May 13, 2006. Buckley's daughter, Sh erita Smith, and Dr. William L. Rutledge witnessed Niki's execution of the POA. Buckley, usi ng this POA, then changed the ownership of the policy from Niki to herself on May 19, 2006. Conseco received the change of ownership form on May 24, 2006, and subsequently appr oved the change in writing. On June 5, 2006, Buckley, as owner of the policy, th en changed the beneficiary designation from the appellants to Buck ley. Conseco received the change-inbeneficiary form on June 7, 2006, and later approved the change.

On June 18, 2006, Niki died. On July 17, 2006, Conseco received a claim from Buckley for the proceeds of the policy. Conseco also received a written demand from the appellants not to pay Buckley the proceeds. By letter dated August 8, 2006, Conseco informed Buckley that the current beneficiary of record on the insurance policy was not valid under Arkansas law, citing Arkansas Code Annotated3 Section 28-68-410 provides in pertinent part:
In a statutory power of attorney, the language granting power with respect to insurance and annuity tran sactions empowers the agent to: . . .
(4) designate the beneficiary of the contract, but an agent may be named a beneficiary of the contract, or an extension, renewal, or substitu te for it, only to the extent the agent was named as a beneficiary under a contract procured by the principal before executing the power of attorney; . . .
(10) change the beneficiary of a contract of insurance or annuity, but the agent may not be designated a beneficiary except to the extent permitted by paragraph (4)[.] . . .

-4- § 28-68-410. 3 Buckley contends Conseco relied upon this statute in error, however, because Buckley did not use he r POA to make herself benefi ciary; rather, she used the POA to change ownership, which is pe rmitted under Arkansas law. Then, as owner, she properly changed the beneficiary.

According to Buckley, before her death Niki expressed to several people her desire to change the policy beneficiary designation from th e appellants to Buckley. In support of her summary judgment motion, Buckley submitted three affidavits—from Robert McGruder, Shelton Pitre, and Thorn—to support Buckley's contention that Niki desired the change in beneficiary.

According to his affidavit, Pitre (Niki' s boyfriend) stated that the appellants "were very neglectful to their mother and had treated her dismissive [sic] for many years." He stated that Buckle y was Niki's only sibling and that Niki told him "that she wanted to name Ellen Buckley as benefi ciary of her life insurance policy and that under no circumstances were her sons, Eric Williams and Harold Williams, to receive any of this money." Pitre also stated that Niki told him thatEric "had become irate and-5- very angry with her because she was notgoing to change her will to make him beneficiary so Eric dropped her off at he r house with her clothes in a garbage bag." Pitre testified that the appellants were notif ied that Niki was near death and yet neither came to see her before she died.

Similarly, McGruder, who represented that he had known Niki for many years, asserted in his affidavit that Niki expre ssly stated to him that she was embarrassed about the way the appellants had treated her for many years. Niki told McGruder that she had tried to live with Eric following her discharge from the hospital in March 2006 but that Eric constantly badgered her to change her will and to sign over all her property to her sons. McGruder stated that he always told Niki not to tell the appellants that she intended to change her policy beneficiary for fear of them becoming angry and retaliating against her. McGruder reported that Niki told him that Eric became irate and very angry about he r not changing her will. McGruder testified that Eric took her in his car over to her house and dropped her off with her clothes in a garbage bag. Finally, McGruder stated thatafter the March 2006 in cident with Eric, Niki called and told him "that she for surewas going to change the beneficiary on her life insurance [policy] to Ellen Buckley."

Thorn's affidavit stated that he recalls having a conversation with Niki in April 2006 and that she requested that her benefi ciary be changed on her policy to Buckley "because her son had given her many problems and did not take care of her." Thorn testified that Niki's voi ce was well known to him and that she sounded alert and intelligent at the time she made the declaration.

The appellants moved for summary j udgment on grounds that the POA does not state that Niki intended, or even knew, that Buckley would acquire Niki's $100,000 insurance proceeds and that absent expre ss intention an agent may not utilize her position for her personal benefit in a substantially gratuitous transfer.-6- Buckley filed a cross motion for summary judgment with the supporting affidavits of Thorn, Pitre, and McGruder attached. Buckley argued that she changed ownership of Niki's policy to herself us ing the POA according to the express wishes of Niki. Once she obtained ownership of th e policy, Buckley contended, she named herself beneficiary of the policy not as an agent of Niki but in her own capacity as owner of the policy, which is not prohibited by law.

The district court granted Buckley's motion for summary judgment finding that—based in part on the affidavits—Niki intended to change the beneficiary and there was no evidence of overr eaching; the appellants faile d to meet Buckley's proof with proof because mere suspicions were not evidence; the appellants' rebuttal was illogical; and there was no eviden ce that Niki was incompetent.

II. Discussion On appeal, the appellants argue that the district court erred in granting summary judgment to Buckley for two primary reasons. First, the appellants contend that the district court abused its discretion by admitting and crediting the affidavits that Thorn, Pitre, and McGruder submitted. The appellants argue that these affidavits are impermissible parol evidence and theref ore not competent evidence to overcome Buckley's presumption of overreaching beyond a reasonable doubt. The appellants seek to distinguish the holding in Primerica , which addressed the issue of whether such parol evidence may be admitted. See 207 SW.3d at 447–48. The parties disagree sharply about the precise meaning of the Primerica holding.

Buckley asserts that the holding of Primerica is directly on point and controlling. Relying upon that holding, Buckley asserts that Niki made statements to many people indicating her intention to ch ange the beneficiary designation from her sons to Buckley, as eviden ced by the admissible affidavits. Buckley contends that the district court properly admitted the statements that Niki made indicating her intention to change her life insurance policy as a hearsay exception pursuant to Primerica

.-7- Second, the appellants argue that disput ed facts remain, making summary judgment improper.

We review summary judgment motions de novo. Johnson v. AT&T Corp. , 422 F.3d 756, 760 (8th Cir. 2005). "Summary judgm ent is proper if the evidence, viewed in the light most favorable to the nonmoving party, demonstrates that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law." Thomas v. Union Pac. R.R. Co. , 308 F.3d 891, 893 (8th Cir. 2002). We "may affirm the district court on any ba sis supported by the record." Id . "We review the admission of evidence for an abuse of discretion. Even if the district court erred in admitting the evidence, we will not reverse if the admission of the evidence was harmless." United States v. Parish , 606 F.3d 480, 487 (8th Cir. 2010) (i nternal quotations and citation omitted).

A. Parol Evidence Ordinarily, the party challenging the validity of an instrument—here, the appellants—is required to pr ove by a preponderance of the evidence that the grantor lacked mental capacity or was unduly infl uenced at the time the instrument was executed. See Looney v. Estate of Wade , 839 S.W.2d 531, 533 (Ark. 1992). In this case, however, both parties agree that Bu ckley has the burden of proving the validity of the policy beneficiary change beyond a reasonable doubt because she procured the making of the instrument and is a beneficiary. See Noland v. Noland , 956 S.W.2d 173, 175 (Ark. 1997) (holding that where the beneficiary procures the making of the instrument and benefits from that proc urement, a rebuttable presumption of undue influence arises which places on the beneficiary the burden of proving beyond a reasonable doubt that the grantor enjoye d both the required mental capacity and freedom of will). The issue we consideris whether Buckley submitted sufficient, unrebutted admissible evidence to meet her burden.4 Rule 801(c) provides that hearsay "is a statement, other than one made by the declarant while testifying at th e trial or hearing, offered inevidence to prove the truth of the matter asserted."

5 Rule 802 provides that "[h]earsay is not admissible except as provided by these rules or by other rules prescribed by the S upreme Court pursuant to statutory authority or by Act of Congress."

6 Arkansas Rule of Evidence Rule 803( 3) provides that the following is not excluded by the hearsay rule, even though th e declarant is available as a witness:
[a] statement of the d eclarant's then existing state of mind, emotion, sensation, or physical condition, su ch as intent, plan, motive, design, mental feeling, pain, and bodily h ealth, but not including a statement of memory or belief to prove the factremembered or believed unless it relates to the execution, revocation, id entification, or terms of declarant's will.

-8- The POA itself does not contain language i ndicating Niki's intentions regarding the beneficiary of her insurance policy. Th erefore, the district court relied on the affidavits the parties submitted, including the three in questi on by Buckley. These three affidavits are undoubtedly parol ev idence and therefore hearsay, which is normally excluded under either the Federal Rules of Evidence 801(c) 4and 802 5 or the Arkansas Rules of Evidence 801(c) and 802, which match th e Federal Rules in substance.

However, this case—decided under Arkansas law—represents an exception to general rule. Some states do require evidence of intent to be in writing if it relates to gifting in contracts, such as the contract in question. See, e.g., Harrison v. Harrison , 105 S.E.2d 214, 218 (Ga. 1958); Fender v. Fender , 329 S.E.2d 430, 431 (S.C. 1985). Arkansas does not. The Arkansas Supreme Court has interprete d Arkansas Rule of Evidence 803(3) 6to allow the admission of witness statements that recall hearing a-9- deceased declarant speaking a bout the deceased's intention to change her insurance policy beneficiary in the future. Primerica , 207 S.W.3d 447–48. These statements are an exception to the hearsay rule and the parol evidence is therefore admissible to prove the truth of the matter asserted and can be used to prove the intent of the unavailable, deceased declarant. Id

.

In Primerica , a husband purchased a life insura nce policy naming his first wife as beneficiary. Id . at 445. When the husband remarried after divorce, he told his second wife that he intended to change the policy to make her the beneficiary. Id . He then attempted to changethe policy but failed. Id . At trial after the husband's death, the court permitted testimony regarding oral statements indicating the husband's intention to change the beneficiary to his second wife. Id . at 447. The Arkansas Supreme Court reviewed this decision and stated that:

"Hearsay" is defined as "a statem ent, other than one made by the declarant while testifying at the tria l or hearing, offered in evidence to prove the truth of the matter asserted." Ark. R. Evid. 801(c). As a rule, hearsay is not admissible except as provided in our rules of evidence. See Ark. R. Evid. 802. Exceptions to this rule are found in Ark. R. Evid. 803 and 804. The exception found in Rule 803( 3) is applicable in this case .

. . . Under Rule 803(3), a declarant's statem ent that he or she intends to do something in the future is admissible to prove the truth of the matter asserted. See Wyles v. State , 357 Ark. 530, 182 S.W.3d 142 (2004); Nicholson v. State , 319 Ark. 566, 892 S.W.2d 507 (1995). Gary's statement to Ronda, "Well, I guess I need to change the beneficiary on my policy, since I'm going to keep you," falls squarely within this exception, as it reflected Gary's inten tion to change the policy. Similarly, the statement that Gary made to his stepson, Chris Bargiel, that he was buying insurance and that Ronda would be the beneficiary, falls within this exception. The trial court di d not err in allowing testimony about these statements.-10- Nor did the trial court err in allo wing Ronda to testify about Gary's conversation to a Primerica representative, in which she heard Gary tell the representative that he was divorcedand remarried, and that he needed to change the beneficiary on his polic y, as well as the spouse rider and child rider. This statement manifest ed Gary's intent to change the beneficiary on his policy and was th erefore admissible under the hearsay exception found in Rule 803(3) . . . .
Finally, the testimony given by Velt on Fulton, Marvin Hughes, Thelma Hare, and Judy Monday, regarding statements that Gary made to them that Ronda would have the proceeds of his life insurance to pay off the debts of his business, was also admissible under Rule 803(3). These statements evidenced Gary's belief th at Ronda was the beneficiary of his life insurance policy and his intention that she be entitled to the proceeds of that policy. Generally speaking, statements of a declarant's belief are not admissible under Rule 803(3), unless the statements relate to the execution, revocation, identification, or terms of the declarant's will. This court has recognized that provis ions in life insurance contracts with reference to beneficiaries or changes in beneficia ries are in the nature of a last will and testament and, theref ore, "are construed in accordance with the rules applicable to the construction of wills." See American Found. Life Ins. Co. v. Wampler , 254 Ark. 983, 986, 497 S.W.2d 656, 658 (1973). As such, the testimony from the foregoing witnesses was properly admitted by the trial court under Rule 803(3).

Id. at 447–48 (emphasis added).

Thus, Primerica holds that in Arkansas, a deceas ed insured's oral statements to several people concerning that insured's futureintentions to change the beneficiary in an insurance contract in favor of a another are admissible to resolv e disputes as to who is the proper beneficiary. The appellant s' argument in their reply brief that Primerica is not relevant because Primerica did not involve a POA is misplaced. The involvement of a POA is not controlling. Th e issue is whether oral statements from an unavailable declarant (Niki) may be considered to dete rmine the proper beneficiary of a life insurance policy. We follow th e Arkansas Supreme Court's precedent that-11- such statements are anexception to the hearsay rule and therefore hold that the district court properly admitted the affidavits that Buckley submitted.

B. Summary Judgment Having concluded that the district court properly admitted the affidavits Buckley submitted we turn to whether the district court properly granted Buckley's summary judgment motion. The appellants ar gue that the district court erred in granting summary judgment for Buckley because Buckley did not establish the absence of undue influence beyond a reasonabl e doubt and that material facts remain in dispute. Buckley asserts in response that she submitted enough proof to demonstrate Niki's intent to change the beneficiary to be entitled to summary judgment and no material facts remain in dispute.

As stated supra , Part II.A, Buckley must overcome a presumption of undue influence by submitting evidence that pr oves a lack of undue influence beyond a reasonable doubt. Buckley submitted three affidavits in support of her motion, including her own, and we hold that eviden ce of Niki's intent contained in these affidavits is not controverted by the appe llants' evidence. Appellants failed to meet proof with proof. See Flentje v. First Nat'l Bank of Wynne , 11 S.W.3d 531 (Ark. 2000) ("When the movant makes a prima faci e showing of entitlement to a summary judgment, the respondent must discard the sh ielding cloak of formal allegations and meet proof with proof by showing a genuine issue as to a material fact.").

Once the moving party has properly supported its motion for summary judgment, the nonmoving party must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp. , 475 U.S. 574, 586 (1986). The nonm oving party may not rest on mere allegations or pleading denials, bu t must "come forward with specific facts showing that there is a genuine issue for trial." Id . at 587 (internal quotations and citation omitted). "Only disputes over facts that might affect the outcome of the suit-12- under the governing law will properly preclude the entry of summary judgment." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248 (1986). "Factual disputes that are irrelevant or unnecessary will not be counted." Id

.
To defeat Buckley's summary judgment motion, the appellants were required to supply some relevant evidence that refuted Buckley's affidavit evidence and warrant a trial on disputed facts. They did not. Th e appellants countered Buckley's affidavits containing specific representations of Niki's intent with Eric's affidavit and a portion of one of Niki's medical records. The me dical record stated that following Niki's March 2006 hospitalization she wished to be discharged to her sons' care and did not want to be "controlled by her sister any longer." Arguably, this provides some evidence that Niki viewed he r sister as controlling but alone does not show that Niki did not competently and voluntarily change the ownership of her insurance policy and subsequently acquiesce in the change of th e policy's beneficiary to Buckley. None of the evidence that the appellants supplied— including the medical record—refute the numerous statements that Niki made which indicated Niki's intent to change the beneficiary designation on her policy.

The appellants argue that Bu ckley's alleged facts are disputed. However, based on our review the only truly "disputed facts" are immaterial to the dispositive issue—whether Niki intended to change th e ownership of her policy and ultimately its beneficiary. For example, Buckley clai ms that the triggering event for the change in beneficiary status was a fight that resu lted in Eric dropping off Niki at Niki's house and refusing to further care for her. Eric states that he dr opped Niki off because he ran out of Family Medical L eave Act time and he could not care for her any longer. Additionally, the appellants refer to what th ey allege to be internal problems with logic and consistency with Buckley's affi davit. However, assuming the appellants' version of everything that they assert, as we must in considering a motion for summary judgment, the appellants still presen t nothing to controvert Niki's statements that she wanted to change the beneficiary of her policy. Nor do the appellants provide-13- evidence of actions on Buckley's part that would constitute undueinfluence, duress or other improper conduct. On the other hand, Buckley submitted affidavits showing her actions were authorized and consistent w ith Niki's stated inte ntions. Therefore, we hold that Buckley rebutted the presumption of undue influence with the affidavits in support of her motion for summary judgment and there are no material facts left in dispute, making summary judgment appropriate.

III. Conclusion Accordingly, we affirm the decision of the district court.

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