Title: Girard v. Pardun
Citation: 318 N.W.2d 137
Docket Number: 13433
State: south-dakota
Issuer: south-dakota Supreme Court
Date: April 14, 1982

318 N.W.2d 137 (1982) Marjorie E. GIRARD, individually and as special administrator of the Estate of Paul R. Girard, Plaintiff and Appellant, v. Verna M. PARDUN, f/k/a Verna M. Girard, Defendant and Appellee. No. 13433. Supreme Court of South Dakota. Considered On Briefs February 23, 1982. Decided April 14, 1982. *138 Peter J. Horner of Christopherson, Bailin &amp; Anderson, Sioux Falls, for plaintiff and appellant. Michael B. Crew, Sioux Falls, for defendant and appellee. FOSHEIM, Justice. This appeal involves a contest over the proceeds of a life insurance policy. Paul Girard and Verna Pardun, appellee, were married on February 26, 1954. In April of 1957 Mr. Girard designated Verna the beneficiary of his life insurance policy, which he held as an employee of the United States Postal Service. Paul and Verna were divorced on April 30, 1975, and on September 4, 1976, Paul married Marjorie Girard, appellant. That marriage existed when Paul died on June 7, 1980. At the time of death, Verna remained the designated beneficiary on the life insurance policy. Paul's widow brought this action for the insurance proceeds against Verna Pardun and the Metropolitan Life Insurance Company. Metropolitan was dismissed as a party when it deposited the insurance proceeds with the Clerk of Courts. Both parties moved for summary judgment. The motion of Verna Pardun was granted. We affirm. The issue is whether Verna Pardun contracted away her interest as beneficiary on Paul Girard's life insurance policy when she entered into a "Stipulation and Agreement" with Paul Girard in anticipation of their divorce. While appellant concedes the Stipulation and Agreement does not specifically mention Paul Girard's life insurance policy, she contends that the language of the agreement clearly indicates an intent that appellee relinquish any and all rights to the life insurance policy. The agreement provides: "That this ... is to be considered strictly as a Stipulation and Agreement settling all the rights and duties of the respective parties, their property, support and alimony." And the agreement specifically stipulates that: "the defendant shall keep in force and effect all presently existing hospitalization insurance," and that the parties will "execute any and all papers or instruments in writing if, as, and when such execution shall be necessary, in order to effectuate the expressed conditions hereof." Findings were waived by operation of law, but the divorce judgment approved, adopted and incorporated the stipulation and agreement by reference. The issue before us is one of first impression in this state. The general rule is found in 5 Couch on Insurance 2d § 29:4 (emphasis added). That general rule was applied in Mullenax v. National Reserve Life Ins. Co., 29 Colo.App. 418, 485 P.2d 137 (1971), to determine the effect of a separation agreement on the right of the divorced wife of the deceased to recover as the named beneficiary on the deceased's life insurance policy. The separation agreement stated, in part: "The wife hereby conveys, signs and sets over unto the husband all of her right, title and interest in and to any and all other property presently standing in the name of the husband[.]" Id. 485 P.2d at 138. The Mullenax court held: Id. 485 P.2d at 139-140 (emphasis added). The Iowa Supreme Court reached the same conclusion as Mullenax on facts essentially the same as in the case before us. Lynch v. Bogenrief, 237 N.W.2d 793 (Iowa 1976). The Iowa court first noted that the general rule is that divorce does not affect a beneficiary designation and that jurisdictions holding to the contrary are "in stark contrast to the great weight of authority." Id. at 798. The Iowa court examined the provisions of the divorce decree to determine its effect on the former wife's right to collect death benefits as named beneficiary. Holding in favor of the former wife, the Lynch court stated: Id. (Citations omitted.) The Lynch court stated that a contrary holding should only be reached after the long-range policy issues inherent in this type of case are resolved by the Legislature against the named beneficiary. The policy reasons were well stated in Nunn v. Equitable Life Assur. Society, etc., 272 N.W.2d 780 (N.D.1979). In Nunn, the plaintiff, surviving spouse and personal representative of the estate of her deceased husband, appealed from the trial court's summary judgment which awarded the deceased's former wife, as named beneficiary, the proceeds on the deceased's life insurance. The Nunn court affirmed and approved this language: Id. at 781-82, (citation omitted). As in Nunn, Paul Girard knew Vera Pardun was the named beneficiary on his life insurance policy; it was in his power to change that designation. He chose not to do so even though time and opportunity permitted. If this court were to interpret blanket divorce agreement phrases, as we find here, to reach the deceased's life insurance policy, we would find ourselves in the quagmire envisioned in Nunn. We agree with the general rule expressed in Couch and applied in Mullenax and Lynch. The clear import of the Stipulation and Agreement is that the parties settled all their property rights by such agreement. But, as a beneficiary, appellee had no property rights in Mr. Girard's life insurance policy to settle, she only had an expectancy. Mullenax, supra. This expectancy could only be contracted away by reference to the life insurance policy in the Stipulation and Agreement and we decline to rewrite divorce stipulations and agreements to contain such a reference. The summary judgment is affirmed. All the Justices concur.