### IN THE COURT OF APPEALS OF TENNESSEE AT JACKSON January 26, 2000 S ession
PUBLIC EMPLOYEES BENEFIT SERVICES CORPORATION v. ALANA DIANE PARMINTER, ET AL 

### . A Direct Appeal from the Chancery Court for Shelby County No. 98-1080-3 The Honorable D. J. Alissandratos, Chancellor

No. W2000-01540-COA-R3-CV - Filed March 7, 2001

Admi nistrato r

of employee’s deferred income plan filed a complaint for a declaratory judgment seeking a determination of the proper beneficiary, either employ ee’s widow or employee’s sister entitled to the fund

s after the employ

ee’s death. The

dis pute bas ically involves an interpretationof the plan terms dealing with the method of changing beneficiaries. The trial court awarded the funds to employee’s widow, an employee ’s sister has appealed. We vacate and remand. Tenn.R.App.P. 3; A

ppeal as of Right; Judgm ent of the Chancery

Court is Vacated a

nd Remanded

W. F RANK C RAWFORD , P.J., W.S., delivered the opinion of the court, in which A LAN E. H IGHERS , J. and D AVID R. F ARMER , J., joined. Kathleen N. Gomes, Memphis, For Appellant, Linda Parminter Lane Eugene G. Douglass, Jr., Bartlett, for Appellee, Alana Diane Parminter

OPINION

On November 23, 1998, plai ntiff, Public Empl oyees Be nefit S ervices Corpora tion (herein “PEBSCO”), filed a complaint i n the Chancery

Court of Knox County

against the defendants, Alana Diane P armi nter and Linda Parminter Lane, seeking a declaratory judgment to determine the beneficiary

of a def erred compe nsation plan owned by decedent, Jackie H. Parminter (hereinafter Mr. Parminter). Proceeds of the fund are claimed by both defendants, Alana D iane Parminter, Mr. Parminter’s widow, and Linda Parminter Lane, Mr. Parminter’s sister. A consent order for a change of venue was entered, and the case was transferred to the Chancery Court of Shelby County. After the failure of a non-bindi ng arbitration, a non-jury trial was held on August 17, 2000, and the-2-

chancellor

found that

the widow, Ms. Parminter, was entitled to the proceeds of the fund. Ms. Lane appeals and pre

sents two issues for

review, as state

d in her brief:

1. Whether the Trial

Court erred in

its de cision awarding the proceeds of the deferred compensation plan of Jackie Parminter

held by PEBSCO to Alana Diane Parminter, rather than t o Linda Parminter Lane?

2. Whether the Trial Court erred by not applying the principles of substantial compliance in the enforcement of a change of beneficiary contract? We will consider the issues together.
Since this case was tried by the trial court sitting without a

jury, we review the case de novo upon the record

with a presumption of correctness of the findings of fact by the trial court. U

nless the evidence preponderates against the findings, we must affirm, absent error of law. T.R.A.P. 13(d).

The material facts are not in dispute. In addition to exhibits, filed depositions, and answers to interrogatories, a Stipulation of Facts was filed:

1. Jackie Parminter w

as employed

as a fireman wit

h the City of Memphis. He partici pate d in the deferred compensation plan administeredby Public Emplo yees Bene

fit Servi ce Corporation (“PEBSCO”) which was funded by a voluntar ypayroll deduction from the participant’ s wag es. Each employ ee was free to d

esignate
a beneficiary of the funds in the event of th eir death prior to retirement.

2. Pursuant to Article V of PEBSC O’s written policy

manual, a specific form was provided to participants to change a beneficiary and the prescribed change of

beneficiary form is the only method set out in the pol icy a s a m eans of ch angi ng th e ben efi cia ry. The paragraph reads as follows:

The PARTICIPANT shall have the right to file, with the Administrator, a written Beneficiary or change of Beneficiary

form (sic) desi

gn ating the person or persons who shall receive the benefits payable under this Plan in

the event of the PARTICIPANT’s death. The form fo r this purpose shall be provided by the Administrator

and wi ll have no effect until it is signed, filed with the Administrator by the-3- PARTICIPANT

and accepted by the Ad ministrator. If the PARTICIPAN T dies with out having a bene ficiary

form on file, benefits will be paid to the PA R TICIPANT’s

estate. The PARTICIPANT accepts andacknowledges that he has the burden for executing and filing with th e Adm inistrator a proper beneficiary

designation for

m.
3. Th e f orm referred to therein is the “Deferred Compensation Beneficiary Change Form, APO-776.”

4. PEBSC O admits this written policy accurately

and completely sta tes the man ner o f cha ngin g a be nefi cia ry.
5. An additional document provided by PEBSCO wh ich is in issue is entitle d “P articipation Agreement and Payroll Deduction Au th orization Form.” The state d purpose of said d

ocument is to
c hange the amount of the paycheck deduction for the empl oyee’ s deferred compensation plan. PEBSCO also reco gniz e s a change of beneficiary

if it is noted on said f

orm.
6. Although not set

forth in the policy manua

l, according to

PEBSCO any change of beneficiary must be witnessed to be ef fective. PEBSCO has stated in discovery that it considers the signature of David Willey on the May 29, 1991 Participation A greement and Payroll Deduction Form to be a valid “witness signature”.

7. Each emp loye e is informed of the proper manner of changing beneficiaries in training class when they are hire d.

8. On January 26, 1989, Ja ckie Parminter filled out a “Change of Beneficiary

Form” changin g the be neficiary from his sister, Linda Lane, to Alana D. Weeks, his fiancée. They were married on September

21, 1989 and lived together as man and wife fo r the balance of his life.

9. On May 29, 1991, Jackie Parminter filed a Participa t ion Agreement

and Payroll Deduction Authorization form whic h included
a place for the name of

the beneficiary. Said form reflects Linda Lane
a s beneficiary number 1 and Christine Parminter contingent beneficiary number 2.-4- 10. All parties verify that the form was signed by Mr. Parminter but it is admitted by all the pa rt ies the names of Linda Lance and Christine Parminter and the balance of the handwritten porti

on of said form is not the handwriting of Jackie Parminter.

11. The authorized agent for PEBSC O in Memphis at the tim e in question was David Willey. His whereabouts today are unknown.

12. At all pertinent tim

es, Da vid Willey did not have a computer terminal connecting him to PEBSCO’s records nor did he have acce

ss to the written records in Columbus Ohio.

13. There is presen

tly $128,491.07 in the plan. Although PEB SCO has not interpleaded the funds into court, they have stated the funds will be voluntarily paid out pursuant to a court order. In awarding the proceeds of the fund to Ms. Parminter the trial court stated:

The Court thinks thatit is more persuasive, whenlooking at the totality of th

e facts, that the

decedent did not in

tend to dispossess his wife that he was living together with and that he had very specifically

nam ed a b enef ici ary exclus ively. And the Court therefore finds that according

ly the Court will rende

r a judgment in

favor of the widow in this case.

In 1984, Mr. Parminter began participation in the Deferred Compensation Plan, and signed the ori gina l ap pli cat ion nam ing h is f ath er, H arol d Pa rmi nte r, as his ben efi cia ry. On April 12, 1985, andagain on September 8, 1986, Mr. Parminter executed a Partici p ation Agreeme

nt and Payro

ll Deduction Authorization increasing the amount of his payrol l deduction. On both of these documents

the word “same” appears in the line providedfor the beneficiary name. I t appears clear
on the face of these documents that Mr. Parminter’s intent at that time was to leave the beneficiary
as his father. On Ma

y 28, 1988, Mr

. Parminter execut

ed another “Par

ticipati on Agre ement and Payroll Ded

uction Authorizatio

n Form,” increa

sing his pay

rolldeductions. On the lines provided for names of beneficiaries, Linda C. Lane, Sister, is listed as beneficiary #1, and Christine Parminter, Mother, is listed as the cont ingent benefic

iary. On Janu

ary 26, 1989 , Mr. Parmin t er executed a “Deferred Compensation B enefic iary Form,” changing the name of the beneficiary to Alana D. Weeks, Fr iend, and the cont ingent benefic

iary to L inda Lane, Sis

ter, but made no ch

ange in th e deduction amount. Finally on May 29, 199 1, Mr. Parmi nter executed another “Participation Agreement

and Payroll Deduction Authorization,” marking the form for chang e. He cha nged the amount of his deduction and listed Linda P. Lane, Sister, as the beneficiary , and Christine Parminter, Mother, as contingent beneficiary. Although the rec ord indica tes that these docume nts appear to have been filled out by someone other than Mr. Parminter,his signature appears on each document

. The documents dated Se

ptember 8, 1986 an

d May 28, 1988

are also signed by David F. Willey, as-5-

“enroller,” and the January 26, 1989 document is

signed by D

avid F. Willey, as “wi tness.” The do cum ent dated April 12, 1985 is also signed by Virgil M. Rogers as “enroller .” The original document, dated June 1, 1984 is a poor copy and the signatures are not legible. Ac cording to the deposition testimony of Terri James, PEBSCO employee, the signature s designat ed as “enroller” satisfy PEBSCO’s requirement that a change of benef iciary be witnessed. PEBSCO’s written policy states that in order to change the designation of a beneficiary, the part ici pant

in the plan must “file with the Administrator a written Beneficiary or chang e of Beneficiary

form designating the person or persons wh o shall receive the benefits....” In her deposition, Ms. James testified that PEBSCO recognize

s several way

s to designate a b

eneficiary to the deferred

compensation plan: initially in the original enrollment form, on a change of beneficiary fo rm(if no change is made to the amount of contribution), or on the participation agreement and payroll deduction author

ization. In add

ition PEBSCO’s resp

onses to Ala

na Diane P arminter’s Interroga tories read in pe

rtinent part:
INTERROGATORY NO. 14. Does the “Participation Agreement and Payroll Deduction Authorization” form which Jackie Parminter signe d on May 29, 199 1, contain any language indi

cating that t

h e beneficiary is being changed?
RESPON SE TO I NTERROGATORY NO. 14. Yes. The “Participation Agree ment and Payroll Deduction Auth orization” form signed by Jackie Parminter

on May 29, 1991 indication the primary beneficiary

o f h is deferred compensation account as Linda La ne, Sisterand the contingent beneficiary as Christine Parminter, Mother. The previo us “ Participation Agreement and Payroll Deduction Authorizat ion fo rm” which was signed by Jackie Parminter on January 26, 1989 listed the primary benefici ary of his deferred compensation account as Alana D. Weeks, Friend and the contingent beneficiary as Linda L

ane, Sister.

In construing the Plan documents, we are guided by wel l esta blished rules. In Bradson Mercantile, Inc. v. Crabtree, 1 S.W. 3 rd 648, 652 (1999), the Court said:

The cardinal rule in

the construction o

f contra cts is to ascertain the intent of the parties. West v

. Laminite Plastics Mfg. Co., 674 S.W.2d 31 0 (Tenn.App.1984). If the contract is plain and unambiguous,

the meaning thereof is a question of law, and it is the Court's func tio n to interpret the c ontract as writte

n according to i

ts plain terms. Petty v. Sloan, 197 Tenn. 630, 277 S.W.2d 355 (1955). The language

used in a contrac

t must be taken and unde

rstood in its plain, ordinary, and popular sense. Bob Pearsa ll Motors, Inc. v. Regal Chrysler-Plymouth, Inc., 521 S.W. 2d 578 (Tenn .1975 ). In-6- construing contracts, the words expressing the parties' intentions should be given the usual, natural, and ordinary meaning. Ballard v. North American Life & Cas. Co., 667 S.W.2d 79 (Tenn.App.1983). If the language of a written instrumen t is una mbiguous, the Court must interpret it as written rather than

according to the unexpressed intention of one of the par ties. Sut

ton v. First Nat. Bank of Crossville , 620 S.W.2d 526 (Tenn.App.1981). Courts cannot make contracts for parties but can only enforce the contract which the parties themselves have made. McKee v. Continental Ins. Co., 191 Tenn. 413, 234 S.W.2d 830, 22 A.L.R.2d 980 (1951). Bradson Mercantile, Inc. 1 S.W.3d at 652.

This Court noted in Sun Life Assur. Co. of Canada v. Hicks, 844 S.W.2d 652 (Tenn. Ct. App. 1992) that

Tennessee recognizes the doctrine of substantial compliance with regard to the issue of a change in beneficiary of an insura nce policy. The Court stated: By virtue of its court decisions, Tennessee has ca st its lot as a

“ substantial compliance” state as regards the issue of a c hange i n beneficiary

of an insurance policy. See Cronbach v. Aetna Life Ins. Co. , 153 Tenn. 362, 284 S.W.2d 72 (1926 ). The Cronbach , court, quoting 37 Corpus Juris § 350 with approval, stated in pertinent part the law in this reg

ard as follows:

A mere unexecuted i ntentio n t o change the beneficiary

is not sufficient.... On the princi pl e that equity re ga rds as done that which ought to be done, the courts will give effect to the intention of in sured by holding that the change of beneficiary ha s been accomplishedwhere he has don e all that he could

to comply with the provisions of the policy, as where he sent a proper written

notice or reques

t to the home office of the comp any but was unable to send the policy by reason of circumstances bey ond his control, as where it

has been lost,

or was in the possession of
ano th er person who refused to surrender it or was otherwise inaccessible, o r where he sent both the policy and a proper written notice or req ue st and all that r ema ined to be done were certain formal and ministerial acts on the part of the co mpany, such as the indorsement

of the change of t

he policy, a

nd these acts were either not

done at all or were done after the death of insured. Of co

urse the rule is not appl

icable-7- whereinsured has not done all that he reason ably
cou ld t o me et t he co ndi tio ns o f th e po lic y.
Id . 284 S.W. at 73.
Id. at 844 S.W.2d at 654

. See also Mas sachusetts Mut. Life Ins. Co. v. Henry, 638 S.W.2d 410 (Tenn. Ct. App. 1982). The designation of a beneficiary in a Plan such as in the instant case is anal ogou s to suc h de sign ati on i n an ins uran ce po lic y, an d th e sam e rul es s hou ld a ppl y.
Unde rt he doctrine of substantial compliance, on the form executed May 29, 1991, Mr. Parminter did all that was necessary and required by PEBSCO to

effe ct a chan ge in the ben efi cia ry. In addition, all docum

ents are clear and unambiguous as to their meaning, and therefore, we are required by Tennesse

e law to “interpr

et it as written ra

ther than accor

ding to the une xpressed intention of one of the parties”. Sutton v . Fir st Nat. Bank of Crossvi

lle , 620 S.W.2d 526, 530 (Tenn. Ct. App.19 81) (citin g Nashv ille Electric Supply Company, Inc. v. Kay Industries, 533 S.W.2d 306 (Tenn. C t. A pp. 1975); Petty v. Sloan, 197 Tenn. 630, 277 S.W.2d 355 (1955); Associated

Press v. GGNS, Inc., 48 Tenn. Ct. App. 407, 348 S.W.2d 507 (1961). The expressed intentof Mr. Parminter on the document dated Ma y 29, 1991, wa

s to change the b

eneficiary of his deferred compensation account to Linda Lane, Sister, and t he cont ingent beneficiary to Christine Parminter, Mother.

Acco rdi ngly, the order of the trial court is vacated, and the case is remanded for entry of judgment declaring Linda

Lane as the rightful beneficiary of Mr. Parminter’s deferred compensation plan, and Christine Parminter as the continge

nt beneficiary

. Costs of the appea

l are assessed a

gainst appellee, Alana Diane Parminter.

__________________________________________ W. FRANK CRAWFORD, PRESIDING JUDGE, W. S

.