Court Opinion

ID: 34703
Source: CourtListenerOpinion
Date Created: 2010-04-25 19:19:21+00
Date Added: 2024-06-11T09:02:59.301372
License: Public Domain

IN THE UNITED STATES COURT OF APPEALS

                          FOR THE FIFTH CIRCUIT

                             ______________

                              No. 95-31220
                            Summary Calendar
                             ______________

LIFE INVESTORS INSURANCE COMPANY OF AMERICA,
                                          Plaintiff-Appellee,

                                 versus

BARBARA F. MURPHY, Individually and as Administratrix on
behalf of Faydria Larae Murphy Estate; MICHELE L. CATO,
LATONYA CATO,
                                        Defendants-Appellants.

_________________________________________________________________

           Appeal from the United States District Court
               for the Western District of Louisiana
                           (94-CV-2280)
_________________________________________________________________

                             April 30, 1996

Before SMITH, BENAVIDES and DENNIS, Circuit Judges.

PER CURIAM*:

     Defendants-Appellants appeal the district court's grant of

Plaintiff-Appellee Life Investors Insurance Company of America's

("Life Investors") motion for summary judgment and denial of

Defendants-Appellants'      summary   judgment    motion.    Finding   no

ambiguity   in    the   termination   and   notice   provisions   of   the

Certificate of Group Life Insurance and that Life Investors was not

at fault in the failure to notify, we affirm.

     *
        Pursuant to Local Rule 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in Local Rule
47.5.4.
                                       I.

      In 1987, Defendant-Appellant Barbara Murphy ("Mrs. Murphy")

was   solicited    by   her   credit   card   company,    American     Express

("AMEX"), to purchase life insurance for herself and her family.

Mrs. Murphy and her husband, Alford Ray Murphy ("Mr. Murphy"), sent

in an application on April 5, 1987 and later received a Certificate

of Group Life Insurance ("Certificate") from AMEX insuring Mr.

Murphy    for   $50,000.1     The   Murphys   agreed     to   and   authorized

quarterly billing and payment for the life insurance on Mrs.

Murphy's AMEX credit card.

      The Murphys divorced on January 11, 1989.                However, they

agreed to continue the life insurance for their children's benefit,

and Mrs. Murphy continued to pay the premiums after the divorce.

Life Investors purchased the group policy from AMEX in February

1993.

      Mr. Murphy died on June 10, 1994.        When Mrs. Murphy attempted

to collect the death benefits, Life Investors refused to pay

because Mr. Murphy, as an ex-spouse, was no longer covered.2

      1
          The Murphys never received a copy of the actual insurance
policy.
      2
        The provision of the Certificate of Group Insurance
excluding Mr. Murphy states:

      The   insurance of you and your Dependents, if any, who
      are   Covered Persons under the Policy will terminate on
      the   first to occur of the dates listed below:
      . .   . .

      4. for your spouse only:
           (C) the premium due date which next follows the
      first to occur of: (1) the date you die; or (2) the
      date your spouse ceases to be married to you.

                                       2
The Murphys' Certificate did contain a provision by which a former

spouse could continue      coverage.3   However,   the   Murphys   never

applied for the continuation of coverage for Mr. Murphy, and never

notified AMEX or Life Investors that their marriage had terminated.

     Life Investors filed suit for a declaratory judgment to ratify

its determination to deny coverage on Mrs. Murphy's Certificate.

Both sides to the litigation filed motions for summary judgment.

On October 26, 1995, the district court entered a memorandum ruling

granting summary judgment in favor of Life Investors, finding that

Mr. Murphy was not a "Covered Person" under the terms of the

Certificate at the time of his death, so that death benefits were

not owed by Life Investors.    Judgment was entered in favor of Life

Investors that same day.

                                  II.

     We review the district court's summary judgment de novo. Aetna

Casualty & Surety Co. v. Iso-Tex, Inc., 75 F.3d 216, 219 (5th Cir.

     3
         The relevant provision states as follows:

     Continuation of Insurance for Dependents: If the
     Insurance of a Covered Person who is a Dependent of
     yours would terminate:
     . . . .

     2. if the Dependent is your former spouse; due to such
     person no longer being married to you;
     . . . .

     then such person may continue his or her insurance
     under the Policy. The continuation will not be
     automatic and will only occur if, within 31 days of the
     date such person's insurance would otherwise terminate,
     we receive both: (1) a written application to continue
     that person's insurance under the Policy; and (2) the
     required premium.

                                   3
1996). Defendants-Appellants contend that continuation of coverage

provision of the Certificate, while clearly requiring notice, is

ambiguous because it does not provide instructions on how or where

to give notice of the divorce in order to continue coverage for the

divorced spouse.      Such ambiguity, they argue, must be construed in

favor of the insureds.        Borden v. Howard Trucking Co., Inc., 454

So.2d 1081, 1089 (La. 1983).            In the alternative, Defendants-

Appellants    argue    that   because       the   continuation   of   coverage

provision of the Certificate either intentionally or negligently

fails to provide notice instructions or advice, Article 1772 of the

Louisiana Civil Code applies4, so that the notice requirement is

deemed fulfilled and Life Investors must pay the death benefit for

Mr. Murphy.

     Our review of the Certificate reveals no ambiguity in the

notice requirements of the continuation of coverage provision.             As

Defendants-Appellants concede, the provision in question clearly

states that notice by written application must be given within

thirty-one days after divorce in order to continue coverage of the

ex-spouse.    The "Additional Provisions" section of the Certificate

contains a "Notice of Claim" provision which provides the Home

Office address in California for notice to be given by or on behalf

of the claimant.      Thus, we find that the unambiguous language of

     4
         Article 1772 provides:

     A condition is regarded as fulfilled when it is not
     fulfilled because of the fault of a party with an
     interest contrary to the fulfillment.

LA. CIV. CODE ANN. art. 1772.

                                        4
the Certificate provisions provided the Murphys with sufficient

information to notify the insurer of their intent to continue

coverage after their divorce.

     In addition, Article 1772 does not apply in this case.             The

Murphys' failure to notify the insurer after their divorce is not

due to any fault of the insurer, but rather, the Murphys' failure

to read the Certificate.      The Murphys concede that they were not

aware of the notice requirement, and thus never attempted to give

notice to AMEX or Life Investors after they divorced.         Therefore,

we find that the district court properly found that Life Investors

did not do anything to prevent the Murphys from following the

notice requirement in the continuation of coverage provision of the

Certificate.

                                  III.

     For   the   reasons   articulated   above,   the   judgment   of   the

district court is AFFIRMED.

                                   5