Court Opinion

ID: 4748019
Source: CourtListenerOpinion
Date Created: 2021-08-12 17:42:31.488349+00
Date Added: 2024-06-11T08:08:37.567877
License: Public Domain

*204¶1
Kato, C.J.
— Lon Freeberg opened an American Funds Individual Retirement Account (IRA) and named his children as beneficiaries. In 1995, he wanted to change the beneficiary to his wife, Margie Freeberg. But the paperwork was never completed and his children remained as beneficiaries. The court determined Mr. Freeberg substantially complied with the requirements to change his beneficiary to his wife. His children appeal. We affirm.
¶2 In 1982, Mr. Freeberg opened an IRA with Edward Jones. A single man at that time, he named his children as beneficiaries.
¶3 In 1984, Lon and Margie Freeberg were married. In 1995, the couple had new wills prepared by an attorney who told them that in order to put their estate planning into effect, they needed to change the beneficiaries on their respective IRAs.
¶4 Ms. Freeberg stated the couple instructed their Edward Jones agent to change the beneficiaries removing their respective children in favor of each other. She remembered signing some type of paperwork.
¶5 Peggy Byers, an employee with Edward Jones at that time, indicated she was present when the Freebergs came to change their beneficiaries. She said Mr. Freeberg directed the office to change his beneficiary to Ms. Freeberg on all of his investments, including his IRA. She could not explain why the change had not been made on the IRA. But she knew it was Mr. Freeberg’s intent to have his wife as the beneficiary of his IRA.
¶6 Mr. Freeberg died in 2001. In his will, he left $125,000 to each of his children. Each would get $25,000 in cash and the remaining $100,000 would then be paid to them at ages 30, 35, 40. The remainder of Mr. Freeberg’s property was to go to his wife.
¶7 In 2004, when Ms. Freeberg went to transfer some funds from the IRA, she learned the beneficiaries had never been changed.
*205f8 Ms. Freeberg filed a motion to distribute the IRA. The children responded by filing a petition for dispute resolution. As of December 31, 2003, the IRA was valued at $125,116.29.
¶9 The court concluded it was Mr. Freeberg’s intent to change the beneficiary on his IRA from his children to his wife. It found he did everything reasonably possible to make the change and substantially complied with the requirements to do so. The court ordered that Ms. Freeberg be designated the beneficiary of the IRA. The children appeal.
¶10 The court entered findings of fact and conclusions of law which ordered Ms. Freeberg be designated the beneficiary of the IRA account. We review findings of fact and conclusions of law for an abuse of discretion. Scott v. Trans-System, Inc., 148 Wn.2d 701, 707-08, 64 P.3d 1 (2003). But our review is limited to determining whether the findings are supported by substantial evidence in the record and, if so, whether the conclusions of law are supported by those findings. Id. at 708.
¶11 Here, the findings of fact are not disputed. They are thus verities on appeal. In re Estate of Jones, 152 Wn.2d 1, 8, 93 P.3d 147 (2004). The sole issue is whether the findings support the court’s conclusion Ms. Freeberg should be designated the beneficiary of the IRA.
¶12 Washington permits courts, acting in equity, to enforce attempted changes in beneficiaries. Rice v. Life Ins. Co., 25 Wn. App. 479, 482, 609 P.2d 1387, review denied, 93 Wn.2d 1027 (1980); Allen v. Abrahamson, 12 Wn. App. 103, 105, 529 P.2d 469 (1974).
The general rule in this jurisdiction and elsewhere as to attempted changes of beneficiaries on an insurance policy is that courts of equity will give effect to the intention of the insured when the insured has substantially complied with the provisions of the policy regarding that change.
Allen, 12 Wn. App. at 105. Substantial compliance requires that the insured has manifested an intent to change ben*206eficiaries and done everything reasonably possible to make that change. Id.
¶13 In Allen, the insured had named his girl friend as the beneficiary on his life insurance policy. Id. at 104. When the relationship ended, Mr. Allen decided to change the beneficiary to his parents. Id. The policy required written notification of the change. He gave his parents the insurance certificates and said he was going to make the change, but he did not notify the insurance company of this intent. Id. He was killed six weeks after giving the certificates to his parents. Id. The court determined Mr. Allen did not even attempt to comply with the policy requirement of written notification of change of beneficiary so his former girl friend was still the beneficiary under the policy.
¶14 In Rice, the insured named his wife as the beneficiary. After their divorce, he named his mother and siblings as the beneficiaries. Rice, 25 Wn. App. at 480. He later became engaged and decided to name his fiance as beneficiary. Id. at 481. He filled out a form that was received by the insurance company’s custodian of beneficiary records. The insured was killed in a car accident three days later. Id. The court upheld the change of beneficiary because it found the insured’s intent was to change the beneficiary. Id. at 481-82.
¶15 In Sun Life Assurance Co. v. Sutter, 1 Wn.2d 285, 287-89, 95 P.2d 1014 (1939), the insured changed the beneficiary from his mother, who had died, to a friend. He wrote a letter indicating his intent, but failed to sign it. Id. at 289. The insurance company contacted the insured’s employer, who in turn contacted the insured and sent him a change of beneficiary form. The insured died without returning the form. Id. at 290. When he died, the letters from his employer and the change of beneficiary form were found in his personal effects. Id. The court upheld and enforced the attempted change in beneficiary, finding the unsigned letter to the insurance company was indeed written and sent to the insurer by the insured and constituted compli*207anee with policy requirements for a change in beneficiary. Id. at 292.
¶16 The situation here is more like Rice and Sutter, than Allen. Mr. Freeberg orally indicated a request to change the beneficiary. He went to Edward Jones where he funded his IRA to change the beneficiary. He had also asked to change the beneficiary on his other investments. An employee there remembered this and could not explain why the change was made on the investments but not the IRA. In these circumstances, Mr. Freeberg substantially complied with the requirements to change the beneficiary. The court properly designated Ms. Freeberg as the beneficiary of the IRA.
¶17 Affirmed.
Brown, J., concurs.