Lincoln National Life Insurance Company v. Onsager et al

Filing 47

ORDER: The court finds in favor of Alfred Wittine. The Clerk of Court is directed to enter judgment for Alfred Wittine and against James Onsager. The Clerk of Court is also directed to release the funds to Wittine within fourteen days of the date of this Order. Signed by Chief Judge Linda R Reade on 6/26/2015. (pac)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF IOWA
EASTERN DIVISION

LINCOLN NATIONAL LIFE
INSURANCE COMPANY,
Plaintiff,
vs.

ORDER

JAMES E. ONSAGER and
ALFRED J. WITTINE,
Defendants.
--------------------------------------------------JAMES E. ONSAGER,
Cross claimant,
vs.
ALFRED J. WITTINE,
Cross defendant.
--------------------------------------------------JAMES E. ONSAGER,
Counter claimant,
vs.
LINCOLN NATIONAL LIFE
INSURANCE COMPANY,
Counter defendant.
--------------------------------------------------ALFRED J. WITTINE,
Counter claimant,
vs.

No. 13-CV-1030-LRR

LINCOLN NATIONAL LIFE
INSURANCE COMPANY,
Counter defendant.
____________________

I.

TABLE OF CONTENTS
INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

II.

RELEVANT PROCEDURAL HISTORY. . . . . . . . . . . . . . . . . . . . . . . . . 2

III.

FACTUAL BACKGROUND. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
A.
B.

IV.

ANALYSIS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
A.

B.
C.
V.

Parties.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Overview of the Dispute. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Mistake. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.
Applicable Law.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.
Application. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Scrivener’s Error.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Unjust Enrichment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

CONCLUSION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
I. INTRODUCTION
This matter is before the court following a bench trial on Defendant, Cross Claimant

and Counter Claimant James E. Onsager and Defendant and Counter Claimant Alfred J.
Wittine’s claims to the proceeds of an annuity policy. For the reasons explained below,
the court concludes that Wittine is entitled to the proceeds of the annuity policy.
II. RELEVANT PROCEDURAL HISTORY
On October 2, 2013, Lincoln National Life Insurance Company (“Lincoln
National”) filed a Complaint (docket no. 2). Lincoln National stated that “[t]his is an
action for interpleader under Federal Rule of Civil Procedure 22, and for related
declaratory and injunctive relief, regarding competing claims to the death benefit of an
annuity contract issued by Lincoln.” Complaint ¶ 1. On November 11, 2013, Onsager

2

filed an “Answer, Counterclaim and Cross Claim” (“Onsager Answer”) (docket no. 9).
On December 2, 2013, Lincoln National filed an “Answer to Counterclaim” (“Lincoln
National Answer”) (docket no. 12). On December 9, 2013, Wittine filed an “Answer to
Complaint, Answer to Onsager’s Cross-Claim, Counterclaim and Cross-Claim” (“Wittine
Answer”) (docket no. 13). On December 17, 2013, Lincoln National filed an “Answer
to Counterclaim of Defendant Wittine” (“Lincoln National Second Answer”) (docket no.
14). On December 18, 2013, Onsager filed an “Answer to Cross Claim” (“Onsager
Second Answer”) (docket no. 15). On September 10, 2014, Lincoln National filed a
“Stipulation for Order to Deposit Funds and for Discharge” (docket no. 19).

On

September 24, 2014, the court ordered Lincoln National to deposit $632,122.02 “with the
Clerk for placement in an interest-bearing account pending a final order directing
distribution to the Defendants as their interests are determined by the court. . . . Upon the
Clerk’s receipt of such funds, Lincoln National shall be wholly and completely discharged
and absolved from any further liability.” September 24, 2014 Order (docket no. 22) at 3.
On September 29, 2014, Lincoln National deposited $632,122.02 with the Clerk and the
claims against Lincoln National were dismissed pursuant to the court’s September 24, 2014
Order.
On March 5, 2015, the court ruled that as a result of Wittine’s failure to comply
with the Trial Management Order (docket no. 17), Wittine would not be allowed to present
exhibits or documents, that he would only be permitted to call one witness and that the
facts as set forth in the proposed final pretrial order were deemed true and correct.1 See
March 5, 2015 Order on the Final Pretrial Conference (“Order on FPTC”) (docket no.

1

Counsel for Wittine indicated that they had no additional exhibits or witnesses,
aside from Alfred Wittine, and did not object to the contents of the facts as set forth in the
proposed final pretrial order.
3

28). Additionally, counsel for Wittine was held in contempt.2 March 5, 2015 Contempt
Order (docket no. 30). On April 9, 2015, the court held a bench trial. See April 9, 2015
Minute Entry (docket no. 44). On April 21, 2015, Onsager filed a post-trial brief. See
Onsager Brief (docket no. 45). On April 21, 2015, Wittine filed a post-trial brief. See
Wittine Brief (docket no. 46).
III. FACTUAL BACKGROUND
The Final Pretrial Order (docket no. 34) contains a stipulation of facts. See Final
Pretrial Order at 2-4. However, Wittine did not participate in the preparation of the
proposed final pretrial order and, therefore, did not agree to stipulate to the facts as
presented by Onsager. As a consequence for failing to participate in pretrial preparations
as directed by the Trial Management Order, the court ruled that the proposed stipulated
facts would be accepted as true and considered by the court in deciding the case. See
Order on FPTC; Final Pretrial Order (docket no. 34) at 2-4. In light of that ruling, the
facts are as follows:
A. Parties
Lincoln National is an Indiana corporation with its principal place of business in
Pennsylvania. At all times material to this claim, Lincoln National has been authorized
to engage in the business of insurance in the state of Iowa. Onsager is a citizen and
resident of Iowa. Wittine is also a citizen and resident of Iowa.
B. Overview of the Dispute
The dispute in this case arises over the proceeds of an annuity purchased by
Ambrose Hoeger. Both Wittine and Onsager had personal relationships with Hoeger.
Wittine and his wife, Marian, were close friends with Hoeger and Hoeger’s wife, Dorothy,
for more than twenty years. Wittine testified that he thought of Hoeger like a father and

2

The court did not impose a monetary sanction on counsel for Wittine. See March
5, 2015 Contempt Order at 4.
4

Wittine’s children treated the Hoegers as grandparents. The Wittines and Hoegers had
weekly dinners and traveled together. By 2006, however, Wittine was spending more time
outside the state of Iowa and did not see Hoeger as often. In 2002, Onsager met Hoeger
when Onsager’s mother began attending an adult daycare at which Hoeger volunteered.
As Hoeger’s health declined, Onsager became a caretaker for Hoeger and the two became
close friends.
On April 8, 1993, Lincoln National issued a Flexible Premium Deferred Variable
Annuity (“Annuity”) to Hoeger. Hoeger was the owner and annuitant of the Annuity.
Hoeger’s wife, Dorothy, was originally listed as the beneficiary of the Annuity. On
November 8, 2001, Hoeger changed the beneficiary to Stonehill Benevolent Foundation.
On January 7, 2003, Hoeger changed the beneficiary to Divine Word College. On
February 23, 2004, Hoeger changed the beneficiary to include multiple beneficiaries,
designating fifty percent to Divine Word College and fifty percent to Alfred and Marian
Wittine. On May 5, 2006, Hoeger executed a Change of Ownership and of Beneficiary,
designating Onsager as a joint owner of the Annuity. See Trial Ex. 24. On the Change
of Ownership and Beneficiary form, Alfred Wittine is listed as the sole beneficiary. See
id. at 2. On May 23, 2006, Lincoln National sent Hoeger and Onsager a Beneficiary
Acknowledgment form, which states that Wittine was the primary beneficiary of the
Annuity. The Beneficiary Acknowledgment form directs Onsager and Hoeger to return
the form if any corrections are needed. On May 23, 2006, Hoeger made changes to his
will and trust. He made Onsager the executor of his will, with Wittine to serve as the
executor in the event that Onsager could not. May 23, 2006 Will Ambrose A. Hoeger,
Trial Ex. 7 at 2. Hoeger changed his trust to provide that $40,000 of the principal amount
would go to Wittine, with the balance designated for Onsager. May 23, 2006 Amended
Trust Agreement Ambrose A. Hoeger, Trial Ex. 9 at 2. In the event that Hoeger survived
Onsager, the balance of the trust would pass to Wittine. Id. On January 25, 2008, Hoeger

5

made additional changes to his will and trust that excluded Wittine, but did not change his
beneficiary designation for the Annuity. See Codicil to Law Will and Testament of
Ambrose A. Hoeger, Trial Ex. 8; First Amendment to Amended and Restated Declaration
of Trust, Trial Ex. 10.
On September 17, 2011, Hoeger passed away. Upon his death, Onsager filed a
claim with Lincoln National for the proceeds of the Annuity. On October 25, 2012,
Lincoln National sent a letter to Onsager and Wittine informing them that under the terms
of the Annuity, the proceeds would be paid to the listed beneficiary, Wittine. Lincoln
National stated that it was aware of Onsager’s competing claim for the proceeds and could
commence court proceedings to determine the rightful owner if the parties were unable to
resolve the issue.
As established at trial, the competing claims for the Annuity proceeds arose as a
result of a meeting that took place on May 5, 2006 between Hoeger, Onsager and Bart
Timmerman, a Wells Fargo financial advisor who had worked with Hoeger since 2004.
At that meeting, Hoeger expressed his desire to name Onsager a joint owner of the
Annuity. Timmerman testified that he filled out the Change of Ownership form. See id.
The first page contains Hoeger and Onsager’s information. The third page of the Change
of Ownership form contains Hoeger, Onsager and Timmerman’s signatures. See id. at 3.
On the second page of the Change of Ownership form, Wittine is listed in the beneficiary
designation section. Id. at 2. At trial, Onsager testified that he had no recollection of
seeing Wittine’s name on the second page, and Timmerman testified that he did not write
Wittine’s name on the policy. Both Onsager and Timmerman testified that listing Wittine
as the beneficiary was not discussed at the meeting.
Onsager and Wittine dispute whether Hoeger intended to make Wittine the
beneficiary of the Annuity. Onsager claims that Hoeger intended for the Annuity proceeds
to pass to Onsager in the event of Hoeger’s death. Timmerman testified that Hoeger

6

wanted the Annuity proceeds to go to Onsager and that is the reason Hoeger made Onsager
a joint owner. Timmerman believed that in the event of Hoeger’s death, the Annuity
would pass to Onsager regardless of whether there was a listed beneficiary because
Onsager was a joint owner. Timmerman testified that at the May 5, 2006 meeting, he
advised Hoeger that listing Onsager as a joint owner would result in Onsager retaining the
Annuity. However, the language of the Annuity clearly contradicts that interpretation.
The Annuity provides in several different places that the proceeds will be paid to
the beneficiary upon the death of the annuitant. Article 2 of the Annuity states that “[on]
receipt of due proof of death of the Annuitant before a choice is made to receive proceeds
under an Annuity Payment Option, [Lincoln National] will pay to the Beneficiary a Death
Benefit . . . .” Annuity at 9. Article 3 of the Annuity specifies that “[t]he Beneficiary for
this Contract will receive proceeds on the death of the Annuitant.”

Id. at 10.

Additionally, a rider attached to the Annuity states that the annuity will be paid out as
follows: “Upon the death of a non-annuitant owner, the proceeds shall be paid to any
surviving joint or contingent owner. . . . If the decedent owner or joint owner is also the
annuitant, then the death will be treated as death of the annuitant subject to the provisions
of this Contract regarding death of the annuitant.” Id. at 17. Therefore, the terms of the
Annuity require the proceeds of the Annuity to be paid to the beneficiary when the
annuitant dies. The existence of a joint owner is irrelevant. Here, Hoeger was the owner
and annuitant, while Onsager was a non-annuitant owner and Wittine was the beneficiary.
IV. ANALYSIS
Onsager argues that the court can reform the Annuity based on mistake and because
there was a scrivener’s error. He also argues that the court should reform the Annuity
because Wittine’s recovery of the proceeds would amount to unjust enrichment. Wittine
argues that the court cannot reform the Annuity because there was no mutual mistake and,
therefore, the court should uphold the terms of the Annuity and award him the proceeds.

7

The court will first consider whether it can reform the contract based on mistake. Next,
the court will consider whether it can reform the contract based on a scrivener’s error.
Finally, the court will consider the issue of unjust enrichment.
A. Mistake
Onsager argues that the court should reform the Annuity because there was “a
mistake in expression caused by a mistake in an underlying assumption.” Onsager Brief
at 10. Wittine argues that the court cannot reform the Annuity because there was, at most,
a unilateral mistake “which is not ordinarily grounds for reformation.” Wittine Brief at
4. Wittine also argues that the court may not consider extrinsic evidence of Hoeger’s
intent because the language of the contract is “plain, certain, and unambiguous.” Id. at
5.
1.

Applicable law

“Iowa law permits reformation of a written agreement that fails to reflect the ‘true
agreement’ between the parties.” Peak v. Adams, 799 N.W.2d 535, 545 (Iowa 2011).
Before a court can reform a contract, there must be “a definite intention or agreement on
which the minds of the parties had met” that “preexisted the instrument in question.” Id.
A court cannot reform a contract unless there was “a preliminary or prior agreement,
either written or verbal, between the parties, furnishing the basis for rectification or to
which the instrument can be conformed.” Id. (quoting 66 Am.Jur.2d Reformation of
Instruments § 4, at 529 (1973)). “Where a writing that evidences or embodies an
agreement in whole or in part fails to express the agreement because of a mistake of both
parties as to the contents or effect of the writing, the court may at the request of a party
reform the writing to express the agreement.” Nichols v. City of Evansdale, 687 N.W.2d
562, 571 (Iowa 2004) (quoting Restatement (Second) of Contracts § 155) (internal
quotation marks omitted).

8

“A mistake is a belief that is not in accord with the facts.” Id. at 570 (quoting
Restatement (Second) of Contracts § 151 (1981)) (internal quotation marks omitted).
Mistakes involving contracts “can be made in the formation,
integration, or performance of a contract.” Pathology
Consultants v. Gratton, 343 N.W.2d 428, 437 (Iowa 1984).
Mistake in expression, or integration, occurs when the parties
reach an agreement but fail to accurately express it in writing.
Mistakes in the formation of contracts include mistakes in an
underlying assumption concerning matters relevant to the
decision to enter into a contract. In this category of mistake,
the agreement was reached and expressed correctly, yet based
on a false assumption.
State, Dept. of Human Servs. ex rel. Palmer v. Unisys Corp., 637 N.W.2d 142, 151 (Iowa
2001) (internal citations omitted); see also Nichols, 687 N.W.2d at 570. “The nature of
the mistake in expression, or those instances where mistake in assumption relates to
expression, is . . . compatible with the concept of reformation. When the understanding
of the parties was not correctly expressed in the written contract, equity exists to reform
the contract to properly express the intent of the parties.” Unisys, 637 N.W.2d at 151
(internal citations omitted). However, “a unilateral mistake by one party will not release
that party from its obligation under the contract absent fraud, misrepresentation, or other
misconduct.” Id. at 150.3
2.

Application

Onsager argues that the court should reform the Annuity and award the proceeds
to him because there was a “mistake in expression caused by a mistake in an underlying

3

The court recognizes that the Annuity differs slightly from a typical contractual
agreement. However, the parties have not pointed to any authority suggesting that annuity
contracts are treated differently with regard to the doctrine of mistake and the court has
found none. See e.g., Poulos v. Weatherwax, 2007 WL 4463973, at *5 (Mich. Ct. App.
Dec. 20, 2007) (unpublished decision) (finding that an annuity could not be reformed in
the absence of mutual mistake under Michigan law).
9

assumption.” Onsager Brief at 10. This mistake resulted in Onsager being listed as a
joint owner of the Annuity, despite Hoeger’s alleged intent to ensure that Onsager would
control the Annuity after Hoeger’s death. Id. Wittine argues that there was not a mutual
mistake and, therefore, the court cannot reform the Annuity. Wittine Brief at 4-5.
The parties to the Annuity are Lincoln National and Hoeger. Onsager’s argument
that the court can reform the contract based on a unilateral mistake is unsupported by Iowa
law. Onsager cites Unisys for the proposition that reformation is available when the
parties make “a mistake in a basic assumption” when entering a contract and that it makes
no difference “whether the mistake was unilateral or mutual.” Onsager Brief at 11 (citing
Unisys, 637 N.W.2d at 151).
A mistake in an underlying assumption concerns “matters relevant to the decision
to enter into a contract” and includes situations where “the agreement was reached and
expressed correctly, yet based on a false assumption.” Unisys, 637 N.W.2d at 151. This
mistake can be corrected by a court even if it is a unilateral mistake because “the operative
mistake is the belief of the parties that the contract correctly expresses the agreement.”
Id. The mistake at issue in Unisys was miscalculated capitation rates that “the parties
intended . . . to accurately reflect the actual cost experience.” Id. at 153. As a result,
both parties believed that the contract contained rates reflecting the true cost, when in fact
there had been a miscalculation resulting in incorrect rates—the mistake was mutual.
In stating that “it normally makes no difference if the mistake is mutual or
unilateral,” the Iowa Supreme Court relied on a treatise that described the doctrine of
mistake in the context of “performance and related problems.” See id. at 151 (citing
George E. Palmer, The Law of Restitution § 14.4, at 157-58, 161 (1978 & Supp. 1984)
(“An undifferentiated approach to problems of mistake sometimes leads courts to say that
the mistake must be mutual in order to support restitution for mistake in performance.
Whatever truth there may be in the statement as applied to relief for mistake in basic

10

assumptions, mutuality should not be necessary when a payment of money is due to a
mistake in performance.” (footnote omitted))). The treatise explains the nuances of
mistake in a variety of different scenarios, including mistakes in expression and mistakes
in performance. However, it does not support the theory that a court can always reform
a contract regardless of whether the mistake is unilateral or mutual when there is a mistake
in expression, a proposition contradicted by Iowa law.
Here, Lincoln National did not have a pre-existing belief that was mistakenly
expressed in the Annuity. Rather, Timmerman mistakenly believed that if Hoeger made
Onsager a joint owner of the Annuity, Onsager would receive the proceeds from the
Annuity. Timmerman testified that Hoeger intended for Onsager to receive the proceeds
of the Annuity and that Timmerman, Onsager and Hoeger thought that designating Onsager
as a joint owner would effectuate that intent. Therefore, any mistake was between Hoeger
and two non-contracting parties. As the Iowa Supreme Court made clear in Peak v.
Adams, courts can only reform a contract when “a written agreement . . . fails to reflect
the true agreement between the parties.” Peak, 799 N.W.2d at 545 (internal quotation
marks omitted). Additionally, Unisys states that “a unilateral mistake by one party will
not release that party from its obligation under the contract absent fraud,
misrepresentation, or other misconduct.” Unisys, 637 N.W.2d at 150. Despite Onsager’s
contentions, he has failed to identify a mutual mistake in the instant action. Lincoln
National sent a letter to Hoeger and Onsager confirming that Wittine was the designated
beneficiary. There is no evidence suggesting that Lincoln National thought the proceeds
would go to Onsager in the event of Hoeger’s death. Instead, the terms of the Annuity are
clear that in the event of Hoeger’s death, the proceeds of the Annuity will be paid to
Wittine. Therefore, due to the absence of a mutual mistake, the court is unable to reform
the contract based on the argument that there was a mistake in an underlying assumption.

11

Moreover, even if the court had the power to reform the Annuity, it would not.
The “party who seeks reformation, claiming a contract does not reflect the real agreement
between the parties, has the burden of establishing this contention by clear, satisfactory,
and convincing proof.” Bennett v. Susie, 674 N.W.2d 684, 2003 WL 23219944, at *2
(Iowa Ct. App. Nov. 26, 2003). “Requiring a high standard of proof helps ensure that a
court granting reformation is merely changing the terms of a written document to reflect
the agreement of the parties and not making a new agreement for them.” Id.
Here, both Onsager and Wittine presented evidence of their strong relationships
with Hoeger. Both parties played a significant role in Hoeger’s life and he, at various
times, included both men in his will, trust and the Annuity. Onsager argues that by
removing Wittine from his will and trust in 2008, Hoeger clearly wanted to ensure that
Wittine received nothing upon Hoeger’s death. However, any evidence of Hoeger’s intent
after May 5, 2006 is of little relevance, as the court may only consider evidence of the
parties’ intent prior to entering into the agreement. See Pillsbury Co., Inc. v. Wells Dairy,
Inc., 752 N.W.2d 430, 436 (Iowa 2008) (“The cardinal rule of contract interpretation is
to determine what the intent of the parties was at the time they entered into the contract.”).
Moreover, there are various reasons why someone might remove someone from a will or
trust, including the fact that the person was provided for through other means—such as an
annuity. Timmerman testified that Hoeger wanted Onsager to receive the proceeds of the
Annuity. Although this is strong evidence, it does not explain the presence of Wittine’s
name on the Annuity as the sole beneficiary. Furthermore, it does not explain why neither
Hoeger nor Onsager took steps to remove Wittine’s name as the listed beneficiary of the
Annuity upon receiving the Beneficiary Acknowledgment form from Lincoln National.
Hoeger had changed beneficiaries on the Annuity in the past. However, Hoeger never
made someone a joint owner prior to designating Onsager the joint owner.

12

Although neither party presented evidence at trial about why Hoeger might have
wanted to make Onsager a joint owner while keeping a named beneficiary on the Annuity,
there are benefits to being a joint owner as opposed to a beneficiary. See Douglas Burdick
Deposition, Court’s Exhibit 1 at 11-12. A joint owner can make changes to an annuity,
including changing the listed beneficiary or choosing to make withdrawals and begin
receiving payments. Id. at 12, 15-20 (stating that a joint owner “shares in the rights of an
owner, they can do anything that an owner can do . . .”). Therefore, it is plausible that
Hoeger may have intended to make Onsager a joint owner so that he could control the
Annuity even while Hoeger was still alive. This control gave Onsager the ability to make
changes to the Annuity up until Hoeger’s death. Onsager became a joint owner of the
Annuity in May 2006. Hoeger passed away in September 2011. Until that point, Onsager
was free to make changes to the Annuity, including changing the beneficiary or authorizing
payments. The fact that Onsager did not exercise control as an owner may indicate a
general misunderstanding as to the terms of the Annuity or the rights of a joint owner of
an annuity, but it does not persuade the court that Hoeger intended for Wittine to be
entirely removed from the Annuity.
Onsager also argues that Hoeger’s changes to his will and trust show that Hoeger
intended to exclude Wittine from his estate. However, the timing of the changes to
Hoeger’s will and trust does not support a finding that in May 2006 Hoeger wanted to
completely exclude Wittine. Hoeger made changes to his will and trust on May 23, 2006.4
See May 23, 2006 Will Ambrose A. Hoeger, Trial Ex. 7; May 23, 2006 Amended Trust

4

Hoeger made subsequent changes to his will and trust in 2008 and removed
Wittine. See January 25, 2008 First Codicil to Will of Ambrose A. Hoeger, Trial Ex. 8;
January 25, 2008 First Amendment to Trust Agreement of Ambrose A. Hoeger, Trial Ex.
10. However, the court sees little relevance in the changes Hoeger made in 2008, nearly
two years after Hoeger changed his will, trust and Annuity in 2006. Furthermore, the
Annuity itself was not changed after May of 2006.
13

Agreement Ambrose A. Hoeger, Trial Ex. 9. Onsager and Hoeger executed the Annuity
Change of Ownership form on May 5, 2006, making Onsager a joint owner of the
Annuity. Change of Ownership, Trial Ex. 24. Lincoln National sent the Beneficiary
Acknowledgment on May 23, 2006, confirming with Hoeger and Onsager that Wittine was
the listed beneficiary. Therefore, events taking place in May 2006 best represent Hoeger’s
intent with regard to his estate. On May 23, 2006, Hoeger designated Onsager as the
executor of his will. However, he designated Wittine as the executor in the event Onsager
was unwilling or unable to act as executor. See May 23, 2006 Will Ambrose A. Hoeger
at 2. Also on May 23, 2006, Hoeger changed his trust to provide for $40,000 to go to
Wittine and his wife and the balance of the trust to be paid to Onsager. Based on events
that occurred in May 2006, it is evident that Hoeger did not intend to completely remove
Wittine from his estate. If anything, Hoeger wanted Onsager to have control over certain
aspects of his estate and to receive a portion of it upon Hoeger’s death. In sum, the
evidence does not rise to the required level of “clear and convincing” for the court to
justify reformation of the Annuity.
B. Scrivener’s Error
Onsager argues that the court may reform the contract based on a unilateral mistake
because the designation of Wittine as the beneficiary was a scrivener’s error. See Onsager
Brief at 10. “[T]he requirement of mutuality of mistake does not apply to a mistake of a
scrivener in reducing an agreement to writing.” Koehn v. Koehn Bros. Farms, LLC, 856
N.W.2d 3, 2014 WL 4230200, at *11 (Iowa Ct. App. Aug. 27, 2014) (unpublished table
decision) (quoting Gouge v. McNamara, 586 N.W.2d 710, 713 (Iowa Ct. App. 1998))
(internal quotation marks omitted) (alteration in original). “[A] scrivener’s error presents
a narrow and demanding exception to the general rule that a court is not permitted to
rewrite a document or add terms not included by the parties.” Tiger Fibers, LLC v. Aspen
Specialty Ins. Co., 594 F. Supp. 2d 630, 641 (E.D. Va. 2009) (applying Virginia law, but

14

noting that it is a generally accepted principle). A scrivener’s error is defined as “[a]n
error resulting from a minor mistake or inadvertence, [especially] in writing or copying
something on the record, and not from judicial reasoning or determination.” Black’s Law
Dictionary, 7th ed. at 562 (stating the definition for “clerical error,” under which
scrivener’s error is included as a related term). These types of errors include typing
incorrect numbers or misspelling words. Id.
Onsager alleges that designating Wittine as a beneficiary was a mere scrivener’s
error. However, the testimony at trial does not support that contention. Rather, the
testimony supports only the contention that no one is sure what happened with respect to
the beneficiary designation. Timmerman testified that he did not write in the beneficiary
designation and states that the parties at the May 5, 2006 meeting intended for the
beneficiary designation to be left blank. Onsager testified that he had no recollection of
the beneficiary designation being discussed during the May 5, 2006 meeting when he was
added as a joint owner to the Annuity. Onsager argues that based on this evidence, the
court should treat the existence of the beneficiary designation as a mere scrivener’s error
and reform the Annuity.
The purported error, however, is not a scrivener’s error. See, e.g., Jongma v.
Grand Pork, Inc., 776 N.W.2d 886, 2009 WL 3381518, at *5 (Iowa Ct. App. Oct. 21,
2009) (unpublished table decision) (noting that a warranty deed reserving rights for “the
grantees” was clearly a scrivener’s error based on the terms in the deed). A mere
scrivener’s error here would be akin to spelling a party’s name wrong, or writing the
wrong date.

A scrivener’s error does not explain how someone whose name was

supposedly neither discussed at the May 5, 2006 meeting nor meant to be listed on the
Annuity came to occupy the sole beneficiary position in the Annuity.
Even assuming that the parties mistakenly designated Wittine as a beneficiary at the
May 5, 2006 meeting, the fact remains that Lincoln National sent beneficiary designation

15

confirmation letters to both Hoeger and Onsager in the weeks following the May 5, 2006
meeting.

The beneficiary designation confirmation letters state that Wittine is the

designated beneficiary for the Annuity and direct Hoeger or Onsager to respond to Lincoln
National if the beneficiary designation is incorrect. See Trial Exhibit 29. The court finds
that this evidence does not support finding that the beneficiary designation was a mere
scrivener’s error.

Accordingly, the court cannot reform the Annuity based on the

argument that Wittine’s inclusion as the sole beneficiary of the Annuity was due to a
unilateral mistake constituting a scrivener’s error.
C. Unjust Enrichment
Onsager argues that awarding the Annuity proceeds to Wittine “would amount to
an unjust enrichment and windfall to Wittine.” Onsager Brief at 15. “The doctrine of
unjust enrichment is based on the principle that a party should not be permitted to be
unjustly enriched at the expense of another.” Unisys, 637 N.W.2d at 154. “It . . . may
serve as an independent ground for restitution in the absence of mistake, wrongdoing, or
breach of contract.” Stukas v. Muller, 699 N.W.2d 685, No. 04-1230, at *1 (Iowa Ct.
App. May 25, 2008) (unpublished table decision). The elements of recovery for unjust
enrichment are: “(1) defendant was enriched by the receipt of a benefit; (2) the enrichment
was at the expense of the plaintiff; and (3) it is unjust to allow the defendant to retain the
benefit under these circumstances.” Unisys, 637 N.W.2d at 154-55. The doctrine of
unjust enrichment is not limited to benefits “conferred directly by the plaintiff . . . . The
critical inquiry is that the benefit received be at the expense of the plaintiff.” Id. at 155.
However, “[g]enerally the existence of a contract precludes the application of the doctrine
of unjust enrichment.” Johnson v. Dodgen, 451 N.W.2d 168, 175 (Iowa 1990); see also
Smith v. Harrison, 325 N.W.2d 92, 94 (Iowa 1982) (stating that any benefits received by
a party pursuant to a contract cannot be unjust enrichment unless there first exist grounds
for setting aside the contract); Brinkmann v. St. Paul Fire & Marine Ins. Co., 723 N.W.2d

16

449, 2006 WL 1750491, at *2 (Iowa Ct. App. June 28, 2006) (unpublished table decision)
(finding that “there can be no recovery under a claim of unjust enrichment” when a
contract governs the parties’ relationship).
Onsager argues that allowing Wittine to receive the proceeds from the Annuity
would amount to unjust enrichment. The parties do not dispute that Wittine was listed as
the beneficiary of the Annuity. Under the express terms of the Annuity, the proceeds will
be paid to the beneficiary upon death of the annuitant. See Trial Ex. 26 at 17. Onsager
has failed to demonstrate grounds for the court to set aside the Annuity. Therefore, unjust
enrichment is inapplicable and Onsager’s claim necessarily fails.
V. CONCLUSION
In light of the foregoing, the court finds in favor of Alfred Wittine. The Clerk of
Court is DIRECTED to enter judgment for Alfred Wittine and against James Onsager.
The Clerk of Court is also DIRECTED to release the funds to Wittine within fourteen
days of the date of this Order.
IT IS SO ORDERED.
DATED this 26th day of June, 2015.

17