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Great American Life Insurance Co. v. Tanner

United States District Court, N.D. Mississippi, Oxford Division

February 2, 2018

GREAT AMERICAN LIFE INSURANCE COMPANY PLAINTIFF
v.
AVA MITCHELL TANNER, ALITA MARGARET MITCHELL, and CRAIG J. CHEATHAM DEFENDANTS

          OPINION AND ORDER

          DEBRA M. BROWN UNITED STATES DISTRICT JUDGE

         Before the Court in this interpleader action are Alita Margaret Mitchell and Craig J. Cheatham's motion for summary judgment, Doc. #120; and Ava Mitchell Tanner's motion for summary judgment, Doc. #126.

         I Standard of Review

         Under Rule 56 of the Federal Rules of Civil Procedure, “[s]ummary judgment is proper only when the record demonstrates that no genuine issue of material fact exists and the movant is entitled to judgment as a matter of law.” Luv N' Care Ltd. v. Groupo Rimar, 844 F.3d 442, 447 (5th Cir. 2016). “A factual issue is genuine if the evidence is sufficient for a reasonable jury to return a verdict for the non-moving party and material if its resolution could affect the outcome of the action.” Burton v. Freescale Semiconductor, Inc., 798 F.3d 222, 226 (5th Cir. 2015) (internal quotation marks omitted). “When parties file cross-motions for summary judgment, we review each party's motion independently, viewing the evidence and inferences in the light most favorable to the nonmoving party.” Duval v. N. Assurance Co. of Am., 722 F.3d 300, 303 (5th Cir. 2013) (internal quotation marks omitted).

         In seeking summary judgment, “[t]he moving party bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact.” Nola Spice Designs, L.L.C. v. Haydel Enters., Inc., 783 F.3d 527, 536 (5th Cir. 2015) (internal quotation marks and alterations omitted). If the moving party satisfies this burden, “the non-moving party must go beyond the pleadings and by her own affidavits, or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial.” Id. (internal quotation marks omitted). “Where the nonmoving party bears the burden of proof at trial, the moving party satisfies this initial burden by demonstrating an absence of evidence to support the nonmoving party's case.” Celtic Marine Corp. v. James C. Justice Cos., Inc., 760 F.3d 477, 481 (5th Cir. 2014).

         II Factual Background

         A. Don Mitchell's Family

         Don Mitchell was born May 24, 1934. Doc. #128-1 at ¶ 8. In 1963, Don married Barbara Mitchell. Id. at ¶ 2. Don and Barbara had three daughters - Ava, Phyllis, and Doncie. Id. Doncie died in 1980. Id. In 1984, Don and Barbara divorced. Id. After the divorce, Barbara settled in Florida. Id.

         In 1987, Don married Earlene Cotton White. Id. at ¶ 3. Earlene had two children from a previous marriage - Ronnie and Lisa. Id. Don and Earlene lived in Heth, Arkansas, and remained married until Earlene's death in 2005. Id. After Earlene's death, Don continued to live in Heth. Id. at ¶¶ 3-4.

         In 2007, Ava, who had been medically disabled since 2001, moved to Heth. Id. at ¶ 5. Three years later, in 2010, Don purchased a mobile home for Ava so that she could be closer to him. Id. at ¶ 6.

         In 2011, Don began communicating with Alita Cheatham. Id. at ¶ 8; Doc. #132-5 at 12- 13, 16. Don knew Alita through her deceased husband, Pete Cheatham, who was a boyhood friend of Don, but the two had not spoken in approximately forty years. Doc. #128-1 at ¶ 8; Doc. #132-5 at 10-11. After about a month of communicating by telephone, Don began visiting Alita at her home in Horn Lake, Mississippi. Doc. #132-5 at 16. Sometime later, Alita started visiting Don in Heth. Doc. #132-5 at 18-19. Eventually, Don and Alita began to discuss marriage. Doc. #132-5 at 27; Doc. #132-7 at 30.

         Also in 2011, Don “was diagnosed with COPD and later with pneumonia.” Doc #128-1 at ¶ 10. While Don initially “refused to go to the hospital, ” at some point, he underwent treatment. Id. “During the treatment, the doctors found a spot on his lung, but he refused to allow a test or a biopsy.” Id. Ava was Don's caregiver during these illnesses. Id.

         In early 2012, Don underwent surgery to remove a spot from the side of his head. Id. at ¶ 11. In March 2012, shortly after Don's surgery, Ava traveled to Florida to be with her mother while her mother had knee surgery. Id. Ava returned to Heth in August of that year to find her father's health in a worse condition. Id. In November 2012, Don was diagnosed with stage IV lung cancer and began receiving treatment. Id.

         B. Don's Finances

         Shortly before he was diagnosed with lung cancer, Don had his attorney, Frank Dudeck, prepare a will, trust, and other estate planning documents. Doc. #128-1 at ¶ 12. Ava and her sister Phyllis, who had not seen Don since 1985, were mentioned in Don's will. Id. at ¶¶ 13-14. Although Don had a provision in his trust which left $200, 000 to his great-granddaughters, Bianca and Emma Daily, he never put money in the trust to fund the bequest. Id. at ¶ 15.

         The chemotherapy and radiation treatments took a toll on Don physically and mentally and, in April 2013, he retired after years of working “on a boat on the Mississippi River.” Id. at ¶¶ 7, 17; Doc. #126-45 at 14-15. Because he could no longer keep up with his bills and bank accounts, Don put Ava in charge of his accounts. Doc. #128-1 at ¶ 17. When Don retired, he converted his work group life insurance policy through Prudential to an individual policy. Id. at ¶ 18. Don also moved his 401k account from his work to Regions Bank. Id. With some of the 401k money, Don purchased two annuities from Great American Life Insurance Company. Id. He invested the balance of his 401k money with Cetera, a Regions securities firm. Id. Ava was listed as a beneficiary on the Great American annuities, the Cetera account, and the Prudential policy.[1] Id. at ¶¶ 18, 64.

         According to Ava, sometime after August 2013, “Alita began meddling in [Don's] personal and financial affairs” and Don resented it. Id. at ¶¶ 23-24, 26. Ava asserts that Alita criticized Don for financially helping his adult stepchildren. Id. at ¶ 24. Ava further asserts Alita told her that she wanted to help Don get his financial affairs in order and asked for a copy of his will and burial policy but Don told Ava he did not want Alita to have a copy. Id. at ¶ 25.

         Alita testified during her deposition that she never asked for a copy of Don's will, was not concerned with Don's affairs and did not get involved with them, and only knew about Don's finances what he told her. Doc. #126-45 at 22-25, 35-36, 38, 46; Doc. #126-46 at 59-60; Doc. #126-47 at 107. She also testified that she was not after Don's money and could financially support herself. Doc. #126-45 at 34. According to Alita, when she asked Ava about Don's burial policy at his request, Ava responded, “[D]on't worry about it. When you put him in the ground, let me know.” Doc. #126-46 at 63. Alita contends that Don expressed concern about what Ava was doing with his finances.[2] Doc. #126-45 at 49-50.

         C. Ava's Departure to Florida

         Ava began to consider returning to Florida because her sister Phyllis was scheduled to have surgery on March 19, 2015, and would be unable to take care of their mother while she recovered. Doc. #128-1 at ¶ 28. Ava was “conflicted” because both of her parents needed her help; however, Don encouraged her to go. Id. at ¶ 29. At that time, Don's stepson Ronnie was living with him and could take care of him. Id. Ava and Don had been discussing her mother's need for new dentures, hearing aids, and glasses for several months. Id. at ¶ 32. During these discussions, Don told Ava to get her mother “whatever she needs” and that he would help pay for it. Id.

         On March 4, 2015, Ava left for Florida but called to check on her father almost daily. Id. at ¶ 34. She took with her to Florida two folders containing information about Don's Great American policies, a receipt for his burial policy, and a checkbook. Doc. #132-8 at 29-30. Ava planned to return to Heth and check on her father in June 2015 but, because her mother's health was not improving, stayed longer than she expected. Doc. #128-1 at ¶ 34. That summer, Ava asked Don and Alita if she should return to Heth to help care for Don but they both assured her that was not necessary. Id. at ¶ 35.

         D. Craig Cheatham's Involvement in Don's Finances

         At some point, Don asked Alita's son, Craig Cheatham, for financial planning advice but Craig did not want to get involved because Don had children. Doc. #126-44 at 14, 17-20. Don told Craig that every time he would ask Ava about his finances she would tell him, “it's all right there on the computer, Daddy” but “would never open the computer or unlock it for him to visibly look at it.” Id. at 18. Several months later, Don asked Craig to assist him in locating his trust account but Craig declined. Id. at 19-20. Craig told Don that “he needed to see his trust lawyers.” Id. at 19.

         At some point, Don asked Craig to come to his house and meet with him and, on August 7, 2015, Craig complied. Id. at 20. While at Don's house, Craig and Don discussed Don's desire to marry Alita, Don's children allegedly stealing from him, [3] and Don's concerns about what Ava was doing with his finances. Id. at 24-26, 28-29. Don also asked Craig for help finding his trust account. Id. at 28. Don told Craig that Ava would not give him information on where his trust was located, and would not return the documents he had requested from her or the laptop with the information on it. Id. at 28-29.

         Craig agreed to go with Don the following week to speak with a trust attorney in Little Rock regarding the location of Don's trust. Id. at 29-30. Don also asked Craig to go with him to Regions Bank to get a copy of his bank statements. Id. at 51-52. They went to Regions Bank on August 12, 2015. Id. While there, Don told Craig that his account had less than $18, 000, when in July 2015, he had $58, 000 in his money market account and $8, 000 in his personal account.[4] Id. at 70-74, 103-04. Don was advised that he had active checking accounts in Alabama, Florida, and four in Arkansas. Id. at 73. Don informed bank officials that he had no knowledge of accounts in Alabama and Florida and was only aware of three of the four accounts opened in Arkansas. Id. at 73-75. While at the bank, Don closed all but one of the accounts. Id. at 53-54. Don believed that Ava had forged his name on the other accounts. Id. at 75. Don became so upset that he was physically shaking and had to “sit down on the side of the truck to gather himself.” Id. at 78. Don believed that Ava had ruined him. Id.

         After their meeting on August 12, 2015, Don told Craig that they would have to return to Regions and meet with Scottie Lackland, the branch manager for Regions' West Memphis branches, about his investments. Id. at 91; Doc. #132-12 at 6. This is when Craig learned about the Great American annuities. Doc. #126-44 at 91-92.

         Two days later, on August 14, 2015, Don signed forms revoking Ava's power of attorney and appointing Craig in her place. Doc. #126-2; Doc. #126-3. Don called Dudeck's office to have him prepare such forms. Doc. #126-44 at 84. However, Craig went, without Don, to Dudeck's office to get these documents.[5] Id. After receiving power of attorney, Craig faxed his power of attorney and Ava's revocation to Great American asking them to freeze the accounts until it heard further from him. Id. at 87-88. Craig asked Great American to freeze the accounts because Don “was moving his bank accounts to Mississippi and he had direct deposits going into bank accounts that were being closed out and [they] had to have his direct deposits changed to the new bank accounts and those forms had not shown up for Don to sign.” Id. at 88. Craig also sent Cetera a request to freeze Don's account. Id. at 93.

         On August 17, 2015, Don returned to Regions bank with Alita and Craig. Id. at 93, 101. At that time, Don removed Ava as the beneficiary of the Great American annuities and made Alita the primary beneficiary. Id. at 95; Doc. #132-12 at 22-24; Doc. #126-13. A couple of weeks later, Great American mailed Don a letter asking him to clarify whether Alita should be a co-owner or beneficiary of the policies. Doc. #126-44 at 141-42. In response, the policies were changed at Don's request to name Alita as a co-owner and Craig as the primary beneficiary. Doc. #126-23; Doc. #126-22; Doc. #126-44 at 143. Great American sent Don another letter informing him that Alita could not be a co-owner on the annuities, only a beneficiary. Doc. #126-44 at 143. Therefore, the annuities were amended for a third time to reflect Alita as the primary beneficiary and Craig as a contingent beneficiary. Id.; Doc. #126-30; Doc. #126-31. The last two forms changing the beneficiary were in Craig's handwriting. Doc. #126-47 at 144-45.

         On August 21, 2015, Don signed a form naming Alita and Craig as the beneficiaries of his Prudential policy. Doc. #126-19. The form was filled out by Craig. Doc. #126-44 at 138-139. Three days later, Don signed paperwork designating Alita as the primary beneficiary and Craig as the contingent beneficiary of his Cetera account. Doc. #126-20. Craig was present when the form was filled out by Terry Green, a Financial Consultant with Regions Investment Solutions. #126-44 at 139-40, 145; see Doc. #126-28.

         E. Don and Alita's Marriage and Don's Death

         After leaving Regions Bank on August 17, 2015, Don and Alita were married in a small ceremony. Doc. #126-44 at 102-03; Doc. #121-11. Alita's children and neighbors were in attendance. Doc. #126-44 at 102-03. Ava did not know about the wedding. Doc. #128-1 at ¶ 45.

         After Don and Alita were married, Ava contends that she was unable to speak with her father because Alita changed Don's telephone number and did not give it to her. Id. at ¶ 47. Alita, however, testified that she gave Don's new cell phone number to Ava. Doc. #126-46 at 96-97. According to Alita, she blocked Ava from her cell phone and changed Don's number because Ava would call her late at night with “a bunch of crap, ” and because every time Don talked to Ava he “would be so upset [that] he would take the phone and throw it across the room.” Id. at 94-96.

         On December 1, 2015, Don died at the age of 81. Doc. #128-1 at ¶ 62.

         III Procedural History

         On April 5, 2016, Great American Life Insurance Company filed an interpleader complaint in this Court to determine whether Ava, Alita, Craig, or anyone else, is the proper recipient of the two annuities issued to Don before his death. Doc. #1. On May 27, 2016, Alita and Craig answered the complaint and Alita filed a crossclaim against Ava. Doc. #9. In her crossclaim, Alita alleges that “[w]ithout a legal basis or right, Ava Mitchell Tanner has interfered with Alita Margaret Mitchell's right to the annuity death benefits by submitting a false and scandalous letter to [Great American]” and “[a]s a result of her malicious interference, ” Ava “is liable for the damage Alita Margaret Mitchell has incurred ….” Id. at ¶¶ 5-6.

         On June 9, 2016, Ava answered Great American's complaint and Alita's crossclaim. Doc. #13; Doc. #14. Three weeks later, on June 30, 2016, Ava filed an amended answer to Alita's crossclaim and asserted a crossclaim of her own against Alita and Craig. Doc. #24. Ava's crossclaim alleges:

Alita Cheatham and Craig Cheatham exerted undue influence over Don Mitchell to persuade him to disinherit his daughters, the natural objects of his bounty, and to convey his assets to them. They used undue influence to convert the following property,
Regions Bank CD $150, 000, Prudential Life Insurance policy for $186, 000, Great American Life Insurance annuities for $120, 153.25 and $117, 333.54, Oil Interest of unknown value.

Id. at ¶ 41. On July 18, 2016, Alita and Craig answered Ava's crossclaim. Doc. #30.

         On August 30, 2016, Phyllis Mitchell Fernandez filed a motion seeking “leave to intervene as a plaintiff in the cross claim filed by her sister [Ava] against the current defendants to the cross claim, Alita Cheatham Mitchell and Craig Cheatham.” Doc. #43. The Court denied the motion to intervene because it failed to comply with the Local Rules of this Court. Doc. #138.

         On September 1, 2017, Phyllis renewed her motion to intervene in Ava's crossclaim of undue influence as it relates to the Prudential policy and a trust which owns some mineral interest. Doc. #139.

         On May 15, 2017, Alita and Craig filed a motion for summary judgment.[6] Doc. #120. On May 21, 2017, Ava filed a motion for summary judgment. Doc. #126. The next day, Ava filed a “Supplemental Motion for Summary Judgment by Ava Tanner, ” which, in substance, supplements her May 21 motion for summary judgment with her declaration.[7] Doc. #128; Doc. #28-1.

         On May 30, 2017, Ava filed a response opposing Alita and Craig's motion for summary judgment. Doc. #129. On June 5, 2017, Alita and Craig filed a response opposing Ava's motion for summary judgment.[8] Doc. #132. The next day, Craig and Alita replied in support of their motion. Doc. #134. One week later, Ava replied in support of her motion. Doc. #135.[9] On August 7, 2017, the Court, on ...


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