Price v. Teaford, No. S0908-04 CnC (Norton, J., Mar. 23, 2005)

[The text of this Vermont trial court opinion is unofficial. It has been 

reformatted from the original. The accuracy of the text and the 

accompanying data included in the Vermont trial court opinion database is 

not guaranteed.] 

STATE OF VERMONT SUPERIOR COURT 

Chittenden County, ss.: Docket No.S0908-04 CnC 

PRICE 

v. 

TEAFORD 

ENTRY 

 Lucille Price, Executrix of the Estate of Gregory Price, has appealed 

the Order of the Grand Isle Probate Court1

 dated July 21, 2004. That order 

awarded the appellee, Susan Marie Teaford, guardian of Emily Price, 

$50,000 as a result of the decedent’s obligation under a separation 

agreement to maintain a life insurance policy to benefit his children. Price 

argues on appeal that the Probate Court misinterpreted the terms of the 

separation agreement. Both parties have moved for summary judgment. 

 

1

This case concerns a Chittenden County estate but was transferred to 

Grand Isle Probate Court for this claim after Judge Susan Fowler recused herself. 
 “[T]he superior court has ‘appellate jurisdiction of matters originally 

within the jurisdiction of the probate court,’ 12 V.S.A. § 2553, and sits as a 

higher court of probate, considering the case anew as if no prior proceeding 

had occurred in the probate court.” In re J.C., 169 Vt. 139, 143 (1999) 

(citing Whitton v. Scott, 120 Vt. 452, 457-58 (1958)). Where the appellant

does not request a jury, questions contained in the appellant’s statement of 

questions shall be tried to the court. V.R.C.P. 72(d). 

 Summary judgment is granted “if the pleadings, depositions, 

answers to interrogatories, and admissions on file, together with the 

affidavits, if any . . . show that there is no genuine issue as to any material 

fact and that any party is entitled to judgment as a matter of law.” V.R.C.P. 

56(c)(3). In determining whether a genuine issue of fact exists, the 

nonmoving party receives the benefit of all reasonable doubts and 

inferences. Robertson v. Mylan Labs., Inc., 2004 VT 15, ¶ 15. Allegations 

to the contrary must be supported by specific facts sufficient to create a 

genuine issue of material fact. Id. 

 

FACTS

 The following facts are undisputed. Gregory Price married Susan 

Teaford on November 20, 1976. Two children were born of the marriage: 

Andrew on September 5, 1980, and Emily on February 14, 1985. Emily 

has mild to moderate mental retardation and cannot live independently. 

Susan is her guardian. 

 Gregory and Susan were divorced in Virginia on October 24, 1988. 

A separation agreement between the parties governed the terms of the 

divorce and included the following paragraph 8(d) to provide that: 
The Husband shall maintain a policy of life insurance insuring him 

and shall name the children of the parties as beneficiary and shall 

keep such policy in full force and effect until his obligation herein 

to support the children of the parties shall cease. The amount of 

said insurance shall be no less than One Hundred Thousand 

Dollars.

This provision was added in its final form through an addendum. The 

addendum also modified paragraph 5 of the agreement to change the terms 

for child support to individually allocated payments of $250 for each child, 

which ceased when the child became independent or reached the age of 

majority. 

 Subsequently, Gregory married Lucille Freeman Price and moved to 

Vermont. In 1998 when Andrew attained majority, Gregory, under the 

terms of the divorce agreement, ceased to make child support payments for 

Andrew. At that point, Gregory also changed his life insurance policy so 

that at the time of his death the named co-beneficiaries were Lucille and 

Susan (as guardian for Emily). Gregory never sought to modify his 

separation agreement through a court order and had no court approval for 

the change in his life insurance policy. Gregory and Lucille divorced on 

January 21, 2003. Gregory died on February 5, 2003. Upon Gregory’s 

death, their divorce became final. At the time of Gregory’s death, Emily 

had not attained the age of majority. 

 

DISCUSSION 

 

 The question for this appeal is what, if any, effect does the 1988 

divorce agreement have on the changes Gregory made to his life insurance 

beneficiaries. Susan, on behalf of Emily, argues that the divorce agreement 

required Gregory to maintain the entire life insurance policy for the sole 

benefit of the children, and he was not free, short of a court order, to 

modify it before Emily reached the age of majority. Lucille argues that the 
life insurance provision must be read within the child support scheme, and 

that each child had separate, proportional rights to the policy, which 

divested with each one when they turned 18. Under Susan’s proffered 

interpretation, the divorce agreement would nullify Gregory’s change of 

beneficiaries and requires Lucille as executrix to turn over to Emily the 

other half of Gregory’s policy. Under Lucille’s, the divorce agreement 

would have no effect as the present disposition has already given Emily her 

50% interest. 

 In examining the divorce agreement, the probate court below found 

that the life insurance provision was unambiguous. The court read the 

provision to require Gregory to maintain a policy of at least $100,000, for 

the sole benefit of his children until Gregory’s obligation to support any of 

the children ceased. The court noted that Gregory made no attempt to seek 

an order from family court allowing him to modify his life insurance. Forte 

v. Forte, 143 Vt. 518, 521 (1983) (parties cannot unilaterally modify 

support orders). Thus, it concluded that Gregory’s modification of 

beneficiaries was a violation of the agreement, and Emily was entitled to 

the full $100,000 in life insurance benefits in accordance with the 

separation agreement. It ordered Lucille to return her half of the policy to 

Emily. 

 

 On appeal, Lucille does not entirely dispute the probate court’s 

interpretation. She admits that, when read alone, the language of the life 

insurance provision does not divide the right to receive benefits between 

the children and does not explicitly allow for modification of the policy 

before both children are 18. Instead, Lucille urges the court to interpret the 

life insurance provision as part of a larger child support arrangement. This 

argument has some support from Vermont contract law and other 

jurisdictions that have faced similar factual situations. 
 The central problem to this case is how to interpret paragraph 8(d) of 

the divorce agreement. Both sides offer differing interpretation. As parties 

to a divorce Gregory and Susan were permitted to negotiate for themselves 

the terms of their marriage dissolution. Duke v. Duke, 140 Vt. 543, 546 

(1982). Their agreement will be honored under the ordinary rules of 

contract, and where the language is clear, the parties are bound by the 

common meaning of the words used in their agreement. Id. Looking at the 

circumstances of the agreement and the agreement as a whole are critical to 

understanding the intent and function of the individual provisions. Rogers 

v. Wells, 174 Vt. 492, 494 (2002); Isbrandtsen v. North Branch Corp., 150 

Vt. 575, 579 (1988). 

 The facts are that under paragraph 8(d) Gregory agreed to carry 

$100,000 in life insurance for the benefit of his children. This obligation 

ceased when they reached the age of majority and was payable to them 

directly—rather than their mother or some other trustee. The nature of the 

provision was such that if Gregory had died one month later, neither child 

would have been eligible for the benefit. Given this transitory and limited 

nature, the parties did not intend to make this benefit a property settlement 

but rather intended it as a means to protect the children’s support in the 

event that Gregory should die before his support obligations to them ended. 

See, e.g., Metropolitan Life Ins. Co. v. Woodham, 1995 WL 429259, at *7 

(E.D. Mich 1995) (discussing In re Monreal Estate, 375 N.W.2d 329 (Mich. 

1985)); Estate of Comiskey v. Cominskey, 465 N.E.2d 653, 657 (Ill. App. 

1984); Beberfall v. Beberfall, 195 N.W.2d 625, 627 (Wis. 1972); see also 

Knowles v. Thompson, 166 Vt. 414, 418–21 (1997). 

 Hence, the provision at issue is not a separate property right but 

rather a function of the parties’ child support arrangement. The right that 

Emily seeks to enforce in this present action is an equitable one that is 

dependent on the child support arrangement and the purpose of the life 

insurance provision. In re Schwass, 467 N.E.2d 957, 960 (Ill. App. 1984). 
The child support arrangement was evenly divided between the two 

children. When Andrew reached 18, Gregory ended his payments but 

continued Emily’s. The purpose of the life insurance provision was to 

protect Emily and Andrew’s child support payments. The fact that Andrew 

turned 18 terminated his right to child support and any need to protect 

them. Therefore, any right he might have had to the life insurance money 

ended. 

 Contrary to the probate court’s conclusion, Emily did not absorb this 

right to Andrew’s share. While the provision does not say what should be 

done with Andrew’s rights, it is presumed to have reverted back to Gregory 

as it is ultimately his property. See J. Michalik, Annot. Divorce: Provision 

in Decree That One Party Obtain or Maintain Life Insurance for Benefit of 

Other Party or Child, 59 A.L.R.3d 9, at § 14[d] (1974, 2002 Supp.). As a 

result, Gregory was free to name another beneficiary without consulting the 

court as control over that half of the policy was his. 

 As to Susan’s remaining arguments, her analogy to child support has 

some appeal but lacks any legal foundation. She relies in part on Jones v. 

Harrison, a Virginia case that created a constructive trust for children when 

their father failed to continue a life insurance policy in conformance with 

the divorce agreement. 458 S.E.2d 766 (Va. 1995). That case is 

distinguishable from the present situation because it involved a life 

insurance provision without a termination date. Id. at 769. The Virginia 

court interpreted this obligation to extend indefinitely and the issue 

revolved around the nature of the children’s interest in the father’s estate 

based on their permanent right to claim his life insurance. Id. at 770. In 

contrast, Gregory’s obligation had a termination date and this date changed 

the nature of his obligation from a permanent one, akin to a property 

settlement, to a temporary one that vested rights in his children to the extent 

that the provision intended. In other words, the requirement that Gregory 

maintain a life insurance policy for the benefit of children was not itself a 
separate property but rather one that secured his child support payments in 

the event of death. 

 Finally, the court in Riser noted that a different result may be 

warranted where extrinsic evidence demonstrates an intention to treat the 

children differently due to the children’s unequal needs during their 

respective minorities. Riser v. Riser, 501 P.2d 1069, 1072 (Wash. App. 

1972). Here, Susan argues that Emily’s mild to moderate mental 

retardation is sufficient reason to not assume that the life insurance 

proceeds should be divided equally or allow Gregory to take unilateral 

action in changing the beneficiaries. While Andrew and Emily were both 

minors, however, the proceeds would have been split half and half as they 

children were co-beneficiaries. Furthermore, the children were allocated 

equal amounts of child support while they were both minors. There is no 

evidence that the divorce agreement made any distinction between the two 

or intended to allocate a greater amount to Emily because of her greater 

needs. Emily may well have greater financial needs as an adult, but the life 

insurance provision was not the vehicle that the parties intended to provide 

for that. 

 

ORDER

 Accordingly, summary judgment is granted in favor of Lucille Price, 

Executrix of the Estate of Gregory Price. The probate court ruling is 

reversed. The claim of Susan Teaford, guardian of Emily Price, in the 

amount of $50,000 is denied. 

 Dated at Burlington, Vermont this ____ day of March, 2005. 

 
__________________________ 

Presiding Judge