Landrum v. Conseco Life Insurance Company et al
Filing
38
ORDER denying 34 Conseco Life Insurance Co.'s Motion for Interpleader. Signed by District Judge Halil S. Ozerden on 09/18/2012 (HM)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
PATRICIA K. LANDRUM
PLAINTIFF/
COUNTER DEFENDANT
v.
Civil Action No. 1:12cv5-HSO-RHW
CONSECO LIFE INSURANCE COMPANY, et al.
DEFENDANT/
COUNTER CLAIMANT/
THIRD PARTY PLAINTIFF
v.
TONEY P. PURVIS, et al.
THIRD PARTY DEFENDANTS
ORDER DENYING DEFENDANT CONSECO LIFE INSURANCE
COMPANY’S MOTION FOR INTERPLEADER
BEFORE THE COURT is Conseco Life Insurance Co.’s Motion for
Interpleader [34]. Plaintiff Patricia K. Landrum has filed a Response [36], and
Conseco a Reply [37]. For the following reasons, the Court is of the opinion that the
Motion should be denied.
I. BACKGROUND
Plaintiff Patricia K. Landrum filed her Complaint [1] on January 9, 2012,
and Amended Complaint [8] on January 11, 2012, asserting state law claims
against Defendants Conseco Life Insurance Company and CNO Financial Group,
Inc., in connection with the alleged wrongful denial of $50,000.00 in proceeds to a
life insurance policy insuring the life of her former husband, John L. Landrum
(“Decedent”). On January 19, 2012, Defendant Conseco filed its Answer and
Defenses, and a Counterclaim/Third-Party Complaint for Interpleader [10], seeking
to deposit the proceeds of the policy into the Registry of the Court, and to have the
Court resolve whether Plaintiff or one of Decedent’s heirs-at-law, Thomas Dwaine
Landrum, Toney Patsy Purvis, Tamela Patrice Jordan, or Ashley Landrum
McKissack (hereinafter “Third-Party Defendants”), are the proper beneficiaries.
Conseco also requests that it be dismissed with prejudice from this suit, and
discharged from all further liability associated with the proceeds. Conseco’s Answer
[10] at p. 13.
Summonses were served on Third-Party Defendants between February 7,
2012, and February 9, 2012, and none have responded. See Summonses [12], [13],
[14], [15]. On March 23, 2012, Plaintiff filed Motions for Default Judgment
[23][24][25][26] against Third-Party Defendants. Those Motions were denied
without prejudice by the Court on June 13, 2012. Order [32] at p. 4. The Court
found that Conseco had not shown that interpleader was appropriate because it had
not supplied sufficient proof that it “is or may be exposed to double or multiple
liability.” Id. at p. 3. Conseco has not moved for any type of default to be entered
on its Third-Party Complaint against Third-Party Defendants. Conseco has now
filed a Motion for Interpleader [34], again arguing that interpleader is appropriate
because it is at risk of double or multiple liability.
II. DISCUSSION
An interpleader action may be characterized as either a “statutory”
interpleader, pursuant to 28 U.S.C. § 1335, or as a “rule” interpleader, pursuant to
FED. R. CIV. P. 22. Conseco’s Motion requests interpleader pursuant both 28 U.S.C.
§ 1335 and FED. R. CIV. P. 22. “An interpleader action typically involves two
2
stages.” Rhoades v. Casey, 196 F. 3d 592, 600 (5th Cir. 1999)(citing 7 CHARLES ALAN
WRIGHT ET AL., FEDERAL PRACTICE AND PROCEDURE § 1714 (3d ed. 2004)). In the
first stage, the district court determines whether the requirements for rule or
statutory interpleader have been satisfied. Id. If the district court finds that the
requirements are met, it then proceeds to resolve the respective rights of the
claimants. Id. “The burden is on the party seeking interpleader to demonstrate
that the requirements are satisfied.” Dunbar v. United States, 502 F.2d 506, 511
(5th Cir. 1974).
As a prerequisite to both “rule” and “statutory” interpleader, the plaintiffstakeholder must demonstrate that it legitimately fears double or multiple claims
directed against a single fund. Airborne Freight Corp. v. United States, 195 F.3d
238, 240 (5th Cir. 1999); Wausau Ins. Cos. v. Gifford, 954 F.2d 1098, 1101 (5th Cir.
1992); 7 CHARLES ALAN WRIGHT ET AL., FEDERAL PRACTICE AND PROCEDURE § 1704
(2d ed. 1986). “[C]laims for interpleader are to be construed liberally and at the
initial stage the threat of multiple and vexatious litigation is sufficient to ground
the claim.” Connecticut v. Gen. Life Ins. Co. v. Wermelinger, No. 96-11144, 114 F.3d
1181, *1 (5th Cir. 1997). However, where “the likelihood of future litigation and
multiple liability is [] remote and speculative,” interpleader is not appropriate. Id.
Conseco contends that it is exposed to multiple liability because Plaintiff, the
primary beneficiary of Decedent’s life insurance policy, is Decedent’s ex-wife, and
she has not presented Conseco with a property settlement agreement evidencing the
3
disposition of property in the divorce. Conseco’s Mem. in Supp. of Mot. for
Interpleader [35] at pp. 2-3. Decedent was granted a divorce from Plaintiff in 1999,
by the Chancery Court of Jackson County, Mississippi, on statutory grounds of
desertion. Final Divorce Decree at p. 2, Ex. A [10-1] to Conseco’s Answer [10]. The
Chancery Court found that Plaintiff’s “actions and conduct during the marriage
clearly constitute wilful [sic], continued and obstinate desertion for the space of one
(1) year as set forth at [Miss. Code Ann. §] 93-5-1(4).” Final Divorce Decree at p. 2,
Ex. A [10-1] to Conseco’s Answer [10].
In support of its Motion for Interpleader [34], Conseco has submitted an
Affidavit of Heirs executed by Decedent’s brother, Dwaine Landrum, as well as
three newspaper articles. In his Affidavit, Dwaine Landrum identifies himself and
Decedent’s three sisters, Toney Patsy Purvis, Tamela Patrice Jordan, and Ashley
Landrum McKissack, as Decedent’s heirs, all of whom are Third-Party Defendants.
Aff. of Dwaine Landrum, Ex. G [10-7] to Conseco’s Answer [10]. Dwaine Landrum
does not state, however, that the heirs are making a claim to the life insurance
proceeds at issue. Id. In fact, Conseco concedes that the heirs have not actually
made claims to the proceeds. Conseco’s Reply [37] at p. 2.
The newspaper articles attached to Conseco’s Motion relate that Decedent
was shot to death in his home, and that his step-grandson has been arrested and
charged with manslaughter in connection with his death. Newspaper Articles, Exs.
2 [35-2], 3 [35-3], and 4 [35-4] to Conseco’s Mem. in Supp. of Mot. for Interpleader
[35]. Conseco does not explain how the manner of Decedent’s death is relevant to
4
its Motion for Interpleader, or to Plaintiff’s claim to the proceeds.
Ultimately, Conseco argues that its “lack of knowledge regarding property
distribution in the divorce, coupled with the Affidavit of Heirs . . . potentially
subjects Conseco Life to multiple liability without knowledge as to the proper
disposition of the insurance proceeds.” Conseco’s Mem. in Supp. of Mot. for
Interpleader [35] at p. 4. In so arguing, Conseco essentially advances the same
argument that the Court rejected when it found interpleader inappropriate in its
June 13, 2012, Order [32]. Nor has Conseco offered any briefing to support its
contention that interpleader is appropriate on grounds that the policy’s beneficiary
designation could be affected by a property settlement agreement.
In conjunction with her Response, Plaintiff submitted a Docket Report from
the Jackson County Chancery Court, which reflects that no property settlement
agreement was filed with that court in connection with the divorce proceedings.
Docket Report, Ex. A [36-3] to Pl.’s Resp. [36]. In its Reply, Conseco does not
address this issue. Given that Plaintiff and Decedent’s divorce was granted on
grounds of Plaintiff’s desertion, it seems unsurprising that there would not have
been a property settlement agreement, since Plaintiff’s whereabouts at the time of
the divorce were apparently unknown. Final Divorce Decree at pp. 1-2, Ex. A [10-1]
to Conseco’s Answer [10]. Conseco cannot sustain its burden of demonstrating the
appropriateness of interpleader based on the absence of a document which the proof
suggests does not exist.
Based on the record before the Court, Conseco has not demonstrated that it
5
has a bona fide fear of conflicting claims to the proceeds. Its argument as to
potential adverse claims by Decedent’s siblings is remote and speculative.
Interpleader is not appropriate, and Conseco should not be dismissed as a party.
III. CONCLUSION
For the foregoing reasons, Conseco’s Motion for Interpleader [34] should be
denied.
IT IS, THEREFORE, ORDERED AND ADJUDGED that, the Motion for
Interpleader [34], filed by Defendant Conseco Life Insurance Company, is
DENIED.
SO ORDERED AND ADJUDGED, this the 18th day of September, 2012.
s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE
6
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?