## F I L E D United States Court of Appeals Tenth Circuit 

### AUG 31 1998 

### PATRICK FISHER Clerk PUBLISH
UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

METROPOLITAN LIFE INSURANCE COMPANY,

Plaintiff,

v. SHIRLEY BUSH,

Defendant-Cross Claimant-Appellant,

v. PHYLLIS BREMER; SHIRLEY GUTHRIE; and VICTORIA VAN HEIDEN, Defendants-Cross Claim Defendants-Appellees. No. 97-1172

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO (D.C. No. 96-WY-2344-AJ)

John R. Riley of Montgomery Little & McGrew, P.C., Englewood, Colorado, for Defendant-Appellant.2

Robert G. Hoghaug, Denver, Colorado, for Defendants -Appellees.

Before ANDERSON , EBEL , and HENRY , Circuit Judges.

HENRY , Circuit Judge.

Shirley Bush appeals the district court’s order granting summary judgment against her and in favor of the appellees Phyllis B remer, Shirley Guthrie, and Victoria Van Heiden. The court rejected Ms. Bush’s claim that she was the sole beneficiary of a life insurance policy issued to he r friend Patricia Moore and concluded that Ms. Bush, Ms. Bremer, Ms. Guthrie, and Ms. Van Heiden were each entitled to twenty-five percent of the policy’s proceeds. See Metropolitan Life Ins. Co. v. Bremer , 955 F. Supp. 1283 (D. Colo. 1997). We exercise jurisdiction under 28 U.S.C. § 1291 and affirm.

I. BACKGROUND Metropolitan Life Insurance Company filed this case as an interpleader action seeking a declaratory judgment regarding ent itlement to proceeds of a $52,000 life insurance policy that it had issued th rough the Federal Employees Group Life Insurance Program for Patricia Moore. After Metropolitan Life3

deposited the proceeds of the policy, the district court dismissed it from the case. Ms. Moore worked at the Federal Aviation Administration’s (FAA’s) Denver Flight Service Station in Englewood, Colorad o. After contracting lung cancer, Ms. Moore, who had no immediate family, exe cuted the two designation of beneficiary forms that are at issue here. First , on June 2, 1995, she executed a form naming Ms. Bush as the sole beneficiary of the Metropolitan Life policy. The FAA’s regional office in Renton, Washington rec eived that form on June 19, 1995. On June 20, 1995, Ms. Moore executed a secon d designation of beneficiary form. The second form named four of Ms. Moore’s fr iends as co-beneficiaries: Ms. Bush, Phyllis Bremer, Shirley Guthrie, and Vict oria Van Heiden, each of them to receive twenty-five percent of the proceeds

. Ms. Moore executed this second designation of benef iciary form at her home. Two people signed the form as witnesses: Te ala Sparks, the administrative officer at the Denver Flight Service Station, and another FAA employee. Ms. Sparks was responsible for providing employees with information about benefits, including life insurance policies. Ms. Moore died at 1:00 a.m. on June 21, 1995. On the same day, Ms. Sparks faxed and mailed the June 20, 1995 designati on of beneficiary form to the FAA’s regional office in Renton, Washington. The r egional office received the1 In the district court proceedings, Ms. Bush asserte d that even though

Ms. Sparks faxed the June 20, 1995 designation of b eneficiary form to the Renton office on the day that Ms. Moore died, she did not do so until some time after 1:00 a.m. (the hour of Ms. Moore’s death). See Aplt’s App. at 103-06. The appellees have not disputed this contention. As a result, our discussion is premised on the parties’ agreement that the Renton office received neither the faxed copy nor the original of the June 20, 1995 de signation of beneficiary form until after Ms. Moore’s death. 4 original form on June 23, 1995. 1 After Ms. Moore’s death, Ms. Bush claimed all of th e proceeds of the life insurance policy under the designation of beneficia ry form that Ms. Moore had executed on June 2, 1995. Ms. Bremer, Ms. Guthrie and Ms. Van Heiden each claimed twenty five percent of the proceeds pursuan t to the form executed on June 20, 1995. The Office of Federal Employees Gr oup Life Insurance (OFEGLI) initially indicated that the June 20, 1995 form was not valid because Ms. Moore’s “employing office” had not received it prior to her death. See Aplt’s App. at 51. However, the OFEGLI subsequently sought guidance from the United States Office of Personnel Management (OPM). OPM c oncluded that the FAA’s Denver Flight Service Station in Englewood, Colorad o could be considered Ms. Moore’s “employing office,” as that term is used in5 U.S.C. § 8705 and accompanying regulations. OPM relied on Fair v. Moore , 397 A. 2d 976 (D.C. Ct. App. 1979), a case in which the court held thatthe term “employing office” was broad enough to include the personnel office of the agency in which the5

insured worked. See Aplt’s App. at 54. OFEGLI informed the parties th at, in the event that they could not reach a settlement, i t would take the position that OPM’s determination should control and that, as a r esult, the proceeds of Ms. Moore’s policy should be distributed in accordance with the June 20, 1995 designation of beneficiary form. In the district court proceedings, the parties file d cross-motions for summary judgment. The district court granted summary judgment in favor of Ms. Bremer, Ms. Guthrie, and Ms. Van Heiden. In support of its decision, the court noted that Ms. Sparks was the administrative office r responsible for personnel matters at the Denver Flight Service Station where Ms. Moore worked. Because it was a routine practice for FAA employees to subm it forms concerning benefits to personnel officers at their place of employment and to rely on those local personnel officers to transmit the forms to the reg ional benefits office, the court said, Ms. Moore had completed all of the requiremen ts for changing the beneficiaries of her life insurance policy prior to her death. Even though the applicable statute and regulation required receipt of the designation of beneficiary form by the decedent’s “employing office” prior to her death, see 5 U.S.C. § 8705; 5 C.F.R. § 870.104 (1995), the court conclude d that the determination of OPM and OFEGLI that Ms. Sparks was “an extension” o f the FAA’s regional office in Renton, Washington was “reasonable and should be upheld.” See2 In its order granting summary judgment to the appel lees, the district

court characterized Ms. Sparks as a “representative ” of the Denver Flight Service Station. See Aplt’s App. at 125. Under the district court’s re asoning, receipt of the designation of beneficiary form by a representative of Ms. Moore’s “employing office” constituted receipt by her “empl oying office,” as required by § 8705, even though the document was delivered to Ms. Sparks at Ms. Moore’s home. Ms. Bush has not challenged this reasoning o n appeal, and, as a result, we will not consider it. 6 Metropolitan Life , 955 F. Supp. at 1288. As a result, the court stated, the designation of beneficiary form signed by Ms. Spark s on June 20, 1995 was valid.

II. DISCUSSION In reviewing the grant or denial of summary judgment, we apply the same standard as the district court under Fed. R. Civ. P . 56 and consider legal questions de novo. Seymore v. Shawver & Sons, Inc. , 111 F.3d 794, 797 (10th Cir.), cert denied , 118 S. Ct. 342 (1997); MacDonald v. Eastern Wyoming Mental Health
Center , 941 F.2d 1115, 1117-18 (10th Cir. 1991). Summaryjudgment is warranted if the evidence shows that there is no ge nuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Seymore , 111 F.3d at 797. In this appeal, we must resolve the legal question of whether the Denver Flight Service Station where Ms. Moore worked at th e time of her death was her “employing office” under the applicable statute and regulation. 2 We begin by7

considering the applicable provisions of the Federa l Employees Group Life Insurance Act (FEGLIA), 5 U.S.C. §§ 8701-16. FEGLIA establishes a life insurance program for federal employees. See Dean v. Johnson , 881 F.2d 948 (10th Cir. 1989) . Section 8705 of FEGLIA provides for the payment of proceeds of life insurance policies and establishes requirements for designating beneficiaries:

The amount of group life insurance . . . in force o n an employee at the date of his death shall be paid, on the establishment of a valid claim, to the person or pe rsons surviving at the date of his death, in the followin g order of precedence: First, to the beneficiary or beneficiaries designat ed by the employee in a signed and witnessed writing received before death in the employing office . . . . [A] designation, change, or cancellation of beneficiary

. . . not so executed and filed has no force or effect. 5 U.S.C. § 8705(a) (emphasis added). Several of our sister circuits have discussed the l egislative history underlying § 8705. See, e.g. , Ward v. Stratton , 988 F.2d 65, 67 (8th Cir. 1993); O’Neal v. Gonzalez , 839 F.2d 1437, 1440 (11th Cir. 1988). Congress a dded the last sentence quoted above (“[A] designation . . . not so executed . . . .”) in 1966. Prior to that amendment, courts often attempted to discern the insured’s “manifest intent” in deciding who was the proper beneficiary. In determining this “manifest intent,” some of these courts did not require stric t compliance with the statute if8

some other evidence established that the insured intended to designate a particular person as a beneficiary. For example, in Sears v. Austin , 292 F.2d 690 (9th Cir. 1961), the Ninth Circuit held that the designation of a beneficiary in a holographic will was sufficient to entitle the desi gnated beneficiary to the proceeds of a FEGLIA policy. The 1966 amendment fo reclosed such inquiries into manifest intent:

The equities in Sears may have prompted the court of appeals to disregard the civil service regulation a nd the general intent of the statute in order to comply wi th the insured’s wishes, but the precedent established in that case could, if generally followed, result in administrative difficulties for the Civil Service Commission and the insurance companies and, more important, seriously delay paying insurance benefit s to survivors of Federal employees. “To clarify Congres s’ intent, [the 1966 amendment to section 8705] rewrit es section 4 to state clearly that the order of preced ence set out in that section shall prevail over any extraneo us document designating a beneficiary unless the designation has been properly received in the emplo ying office or by the Civil Service Commission.” Ward , 988 F.2d at 67 (quoting S. Rep. No. 1064, 89th Co ng., 2d Sess. 2 (1966), reprinted in 2 U.S.C.C.A.N. 2070, 2071). Following the 1966 amendment, a number of courts have rejected claims for the proceeds of federal employees’ life insuran ce policies brought by individuals seeking to recover by means of some doc ument that did not meet the requirements of § 8705. See, e.g. , Ward , 988 F.2d at 66-68 (rejecting claim of3 Section 870.104 was amended and renumbered in 1997. The new

regulation defines “employing office” as “the agenc y office or retirement system 9 insured’s wife based on a letter that had not been filed with the employing agency and concluding that the beneficiary named in the fo rm that had been filed was entitled to the proceeds); O’Neal , 839 F.2d at 1439-40 (11th Cir. 1988) (concluding that insured’s designation of his aunt, which complied with the statute, could not be modified by contractual agree ment that he had with his girlfriend to name her as the beneficiary). These courts have strictly construed the statutory requirements for designating beneficiaries. See Brewer v. Zawrotny , 978 F.2d 1204, 1206 n.2 (10th Cir. 1992) (adopting strict construction of the Servicemen’s Group Life Insurance Act, 38 U.S.C. §§ 1965-1979, and citing cases adopting strict construction of FEGLIA). Although § 8705 provides that only those beneficiar ies designated in a form “received before death in the employing office” are entitled to the proceeds of FEGLIA policies, the statute does not define the te rm “employing office.” However, at the time of Ms. Moore’s death, an accompanying regulation, supplied the following definition:

Employing office means the office of the agency or retirement system to which jurisdiction and responsibility for life insurance actions have been delegated. 5 C.F.R. § 870.104 (1995). 3office that has responsibility for life insurance actions.” See 5 C.F.R. § 870.101

(1998). With regard to the question at issue here- -whether the Denver Flight Service Station is Ms. Moore’s “employing office”-- this amendment does not affect our analysis. 10 In this appeal, Ms. Bush argues that the FAA’s Denv er Flight Service Station in Englewood, Colorado was not Ms. Moore’s “employing office” because it is the FAA’s regional office in Renton, Washingt on that has “jurisdiction and responsibility for life insurance actions.” See 5 C.F.R. § 870.104 (1995). Citing decisions concluding that the statutory requirement s for designating beneficiaries under 5 U.S.C. § 8705 should be strictly construed and that the intent of the decedent may not be invoked to excuse a failure to comply with these requirements, Ms. Bush argues that Ms. Moore’s “emp loying office” did not receive the June 20, 1995 designation of beneficiary form prior to her death, and that, as a result, the prior designation of benefic iary form should control. In the district court proceedings, Ms. Bush cited aNovember 3, 1995, letter from the Acting Air Manager of the Denver Flight Se rvice Station in support of her contention that the FAA’s regional office in Re nton was Ms. Moore’s “employing office.” See Aplt’s App at 41, 56-57. That letter describes th e Washington office as “[o]ur regional benefits office.” Id. at 56. Ms. Bush also contended that the fact that Ms. Sparks sent the d esignation of beneficiary form to the Renton office after receiving it indicated t hat the Renton office was Ms.11

Moore’s “employing office.” See id. at 42 (“There is no reason to provide the change in beneficiary information to Renton unless Renton is the office where life insurance actions [have] been delegated.”). In herappellate brief, Ms. Bush adds that the Denver Flight Service Station cannot be co nsidered an “extension” of the Renton office, because § 8705 and the accompanying regulations do not mention the concept of an “extension” of an “employing offi ce.” Aplt’s Opening Br. at 9. We agree with Ms. Bush that the applicable regulati ons do not discuss the concept of an “extension” of an “employing office.” Moreover, if such a concept were to be broadly applied, many government offices could be regarded as extensions of other offices, undermining statutory and regulatory requirements for filing documents in particular locations. Neverthe less, we are persuaded in this case that the Denver Flight Service Station, where Ms. Moore actually worked, may be considered her “employing office” under 5 U. S.C. § 8705 and 5 C.F.R. §
870.104 In support of this conclusion, we note that althoug h § 870.104 states that an employing office is one with “jurisdiction and resp onsibility for life insurance actions,” it explains neither what constitutes a “l ife insurance action” nor what kind of “jurisdiction and responsibility” an office must exercise over these actions in order to meet the definition of an “employing of fice.” Although this definition might refer to responsibility for determining the e xistence and scope of life4 The record before us does not contain an explanatio n of the duties

and responsibilities of the various offices of the FAA as to life insurance matters. Thus, we are unable to determine precisely what res ponsibilities are vested in personnel officers at the Denver Flight Service Station and what responsibilities are vested in other offices–like the regional offic e in Renton, Washington. Nevertheless, in light of the instructions for fili ng given in the designation of beneficiary form itself, we need not determine prec isely what responsibilities are vested in each office in order to resolve this case

. 12 insurance coverage and the identification of partic ular beneficiaries, we can discern no reason from the terms of the regulation why “jurisdiction and responsibility for life insurance actions” might no t also refer to the responsibility to perform various ministerial acts–like distributi ng information and forms to employees and collecting required forms once employ ees have reviewed and executed them. 4 Moreover, the wording of the designation of benefi ciary form that Ms. Moore signed undermines Ms. Bush’s argument for a l imited definition of “employing office.” The form contains a section on the reverse side that is entitled “Where to File the Completed Form.” The first sentence of that section states, “If insured as an employee, file the form with the agency in which employed .” Aplt’s App. at 81 (emphasis added). The form d oes not mention any requirement for filing with a regional office or wi th an office with “jurisdiction and responsibility for life insurance actions.” See 5 C.F.R. § 870.104 (1995). Thus, an employee like Ms. Moore who wanted to chan ge the beneficiaries of a13

life insurance policy could reasonably read the for m as directing her to file it with the personnel officer at the office where she was s tationed. In light of this provision of the designation of be neficiary form, we view this case as analogous to those cases holding that when the government reasonably construes an ambiguous statutory or regu latory term in a form that it provides to a citizen, the citizen should not be pe nalized by relying on the government’s interpretation of the term. For example, in Shamsi v. I.N.S. , 998 F.2d 761 (9th Cir. 1993), the court reversed the de cision of the Board of Immigration Appeals dismissing an administrative ap peal as untimely. The Board had dismissed the appeal because the appellant had not filed the notice of appeal with the Office of the Immigration Judge within the required time period. In reversing this decision, the Ninth Circuit observedthat the notice of appeal form provided to the appellant had directed him to file the notice with the Immigration and Naturalization Service rather than with the Off ice of the Immigration Judge. The court said that “[t]he potential appellant who is furnished these instructions is justified in concluding that he or she need only fi le a notice of appeal with the INS office, where the fees are paid.” Shamsi , 998 F.2d at 762. Similarly, in Huang v. I.N.S. , 47 F.3d 615, 616-18 (3d Cir. 1995), a preprinted form stated that parties seeking to appe al an order of an immigration judge would be allowed a certain period of time to file a notice of appeal. The14

Third Circuit rejected the Board of Immigration App eals’ conclusion that a rule establishing an earlier deadline for filing the not ice of appeal should control. The court reasoned that although the rule was ambiguous , “[t]he agency cannot advise participants in its process to read an ambiguous ru le one way and, after they have acted, subject them to a more stringent requirement.” Huang , 47 F.3d at 617 (footnote omitted); see also Vlaicu v. I.N.S. , 998 F.2d 758, 760 (9th Cir. 1993) (concluding that “if a party is ‘misled by the word s or conduct of the court,’ an appellate tribunal may have jurisdiction to hear an otherwise untimely appeal”) (quoting Hernandez-Rivera v. I.N.S. , 630 F.2d 1352, 1355 (9th Cir. 1980)). Those decisions are applicable to the instant case. Here, as we have noted, the designation of beneficiary form directs employe es to file the form “with the agency in which employed.” See Aplt’s App. at 81. The form provides no indication that the designation of beneficiary will not be effective when received by the office where the employee performs his or he r day-to-day duties but instead will only be effective when the employer tr ansfers the form to some central office. In light of the ambiguity of the t erm “employing office” in § 8705 and accompanying regulations, we conclude that employees reading the designation of beneficiary form may properly rely o n the instructions given as to where to file the form (by filing it “with the agency in which employed”). To impose a more limited definition of the term “emplo ying office,” as Ms. Bush15

now urges us to do, would allow the government to m islead employees about the requirements for changing beneficiaries. Such a re sult would be particularly detrimental to employees who are terminally ill and may have very little time to designate or change beneficiaries before dying, as was the case with Ms. Moore. We find additional support for this conclusion in Fair v. Moore , 397 A.2d 976, 978 (D.C. Ct. App. 1979). In Fair , an employee of the Narcotics Treatment Administration of the District of Columbia Departme nt of Human Resources executed a change of beneficiary form at the agency ’s personnel office. The form designated his sister as the beneficiary. The empl oyee committed suicide two days later, and the designation of beneficiary form was not transmitted to the District of Columbia Accounting Office (the central office of the District of Columbia government) until three days after the sui cide. The District of Columbia Court of Appeals addressedthe issue of whether the term “‘employing office,’ as used in § 8705(a), includes a personnel office of a District of Columbia agency, rather than being li mited to the payroll office of District Accounting.” Fair , 397 A.2d at 978. The court concluded that “secti on 8705(a) is satisfied when, as here, an employee leaves with his agency’s personnel office a properly executed and witnessed official form supplied him by the government for the purpose of beneficiary designation.” Id. The court reasoned that this construction was consistent withthe purpose of the statute--”to16

avoid the administrative difficulties and delay in disbursing benefits resulting from conflicting claims, under the group program, arising out of private, designating documents not in official possession at the time of death.” Id. “This statutory purpose,” it added, “ is hardly fostered by a requirement that administrative processing to a central office must win a race with death. ” Id. (emphasis added). Although Fair does not discuss the definition of “employing offi ce” in C.F.R. § 870.104 (1995), its reasoning is applicabl e here. Just as the employee in Fair , Ms. Moore delivered a signed and witnessed design ation of beneficiary form to the responsible official from the office in whic h she worked. In these circumstances, we do not believe that giving effectto the June 20, 1995 form will engender the kind of “administrative difficulties a nd delay . . . arising out of private, designating documents,” see id. , that Congress sought to eliminate in enacting § 8705.

III. CONCLUSION For the reasons set forth above, the decision of th e district court granting summary judgment in favor of the appellees Phyllis Bremer, Shirley Guthrie, and Victoria Van Heiden is affirmed.