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Pulliam v. Alfa Insurance Co.

Court of Appeals of Mississippi

January 30, 2018

C.D. PULLIAM APPELLANT
v.
ALFA INSURANCE COMPANY AND ANGELA NANCE APPELLEES

          DATE OF JUDGMENT: 03/24/2016

         CLAY COUNTY CHANCERY COURT HON. KENNETH M. BURNS TRIAL JUDGE:

          ATTORNEY FOR APPELLANT: ROBERTA LYNN HAUGHTON

          ATTORNEYS FOR APPELLEES: RICHARD SHANE MCLAUGHLIN MICHAEL EARL PHILLIPS NICOLE H. MCLAUGHLIN JACOB O. MALATESTA

          BEFORE LEE, C.J., WILSON AND WESTBROOKS, JJ.

          WILSON, JUDGE.

         ¶1. Annie Patterson was the owner and primary beneficiary of a $50, 000 life insurance policy that insured the life of her nephew and ward, Christopher Nance. Annie designated Christopher's biological mother, Angela Nance, as the policy's contingent beneficiary. After Annie died, her father, C.D. Pulliam, attempted to make himself an owner and beneficiary of the policy. When Christopher died about a year later, a dispute arose as to whether C.D. or Angela was entitled to the proceeds of the policy.

         ¶2. The insurer, Alfa Insurance Co., filed an interpleader complaint to resolve the dispute and deposited the proceeds of the policy with the court. C.D. filed counterclaims against Alfa, alleging negligence and other tortious conduct in connection with his attempt to make changes to the policy. The chancery court eventually ruled that (1) Alfa was entitled to interplead all potential claimants under the policy and to be discharged from liability under the policy; (2) C.D.'s counterclaims should be "dismissed as moot"; and (3) Angela was entitled to the proceeds of the policy as its beneficiary. For the reasons that follow, we find no error and affirm as to the first and third issues, but we hold that C.D. permissibly filed counterclaims in this interpleader action and that those counterclaims should not have been "dismissed as moot." Accordingly, we affirm in part and reverse and remand in part for further proceedings consistent with this opinion.

         FACTS AND PROCEDURAL HISTORY

         ¶3. In September 2008, the Clay County Chancery Court appointed Annie Patterson general guardian of her nephew, Christopher Nance, who was then fourteen years old. Christopher's mother, Angela Nance, joined in Annie's petition for the guardianship. In November 2008, Alfa issued a $50, 000 life insurance policy on the life of Christopher. Annie was the owner and primary beneficiary of the policy, and Angela was listed as the contingent beneficiary of the policy. Annie paid all premiums on the policy until her death on April 30, 2013. The policy provides that "upon the death of the owner, ownership and control of the policy . . . shall pass to the estate of the deceased owner."

         ¶4. Annie was survived by her father, C.D. Pulliam, and siblings, Otis Pulliam and Willie Mae Townsend. No estate was ever opened for Annie. In October 2013, C.D. and Otis provided Alfa with an affidavit stating that they and Willie Mae were Annie's heirs. In addition, Otis completed an Alfa "Change of Ownership" form that purported to make Otis the owner of the policy, C.D. the contingent owner, Otis and C.D. the primary beneficiaries, and Willie Mae a contingent beneficiary. C.D. alleges that agents or employees of Alfa filled out the form and documentation and directed them to sign. C.D. also alleges that he paid all premiums on the policy after Annie's death.

         ¶5. Christopher died on November 16, 2014. The record contains a letter dated November 17, 2014, that is addressed to Annie and states as follows: "This is your notification that your recent policy change request has been closed as incomplete." The record is unclear as to what prompted this letter, which is dated only one day after Christopher's death but more than one year after Annie died and C.D. and Otis originally attempted to make changes to the policy. According to Alfa, the original attempted policy change was "closed as incomplete" because, in October 2013, Otis and C.D. had "incorrectly filled out a single owner form" rather than a form for multiple owners. As noted above, however, C.D. alleges that agents/employees of Alfa prepared the forms for him and Otis to sign.

         ¶6. On January 23, 2015, Alfa filed an interpleader complaint in the Clay County Chancery Court "to determine the proper beneficiary or beneficiaries of the . . . policy." Alfa named C.D., Otis, Willie Mae, and Angela as defendants. Alfa stated that C.D. and Otis claimed that they were entitled to the proceeds of the policy as the primary beneficiaries. Alfa also stated that Angela had "not yet filed a claim" but might be entitled to the proceeds, "as she was named the contingent beneficiary by Annie . . . when the policy was purchased." Alfa stated that it had "not been able to determine which of [them was] legally entitled to the proceeds." Alfa also filed a motion, which the court granted, to deposit $50, 578.46 with the court pursuant to Mississippi Rule of Civil Procedure 22.

         ¶7. C.D. filed an answer and countercomplaint against Alfa. C.D. claimed that he was entitled to the proceeds of the policy, and he asserted counterclaims against Alfa for breach of contract, breach of the duty of good faith and fair dealing, negligence, gross negligence, bad faith failure to adjust and pay an insurance claim, tortious breach of contract, and punitive damages. C.D.'s countercomplaint generally alleged, among other things, that he had paid all premiums on the policy after Annie's death, that Alfa's agents or employees had filled out the change-of-ownership forms for him, and that any mistake in making the change of ownership and designation of new beneficiaries was the result of Alfa's tortious conduct. Angela sent a two-page pro se letter to the ...


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