NEW YORK LIFE INSURANCE COMPANY v. CRAYTON, ET AL.
Filing
59
MEMORANDUM OPINION AND ORDER signed by CHIEF JUDGE THOMAS D. SCHROEDER on 6/19/2019. Athalia Crayton's Motion for Amended or Additional Findings of Fact or a New Trial (Doc. 57 ) is DENIED. (Daniel, J)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF NORTH CAROLINA
NEW YORK LIFE INSURANCE
COMPANY,
Plaintiff,
v.
ATHALIA CRAYTON; TANEEDA
FERRON,
Defendants.
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1:17-cv-593
MEMORANDUM OPINION AND ORDER
THOMAS D. SCHROEDER, Chief District Judge.
This life insurance interpleader action is before the court
on Defendant Athalia Crayton’s post-trial motion for relief from
the court’s finding that the proper beneficiary of the death
benefit accruing upon the passing of her mother, Joyce Ferron, is
her sister, Defendant Taneeda Ferron.
and
additional
findings
of
fact
under
The motion seeks amended
Federal
Rule
of
Procedure 52(b), or alternatively a new trial under Rule 59.
Civil
For
the reasons set forth below, the motion will be denied.
I.
BACKGROUND
The court entered findings of fact after the bench trial in
this case pursuant to Rule 52(a)(1).
See (Doc. 55 ¶¶ 1–23).
Summarized, those facts are as follows:
Joyce entered into a life insurance contract with Plaintiff
New York Life Insurance Company (“New York Life”) on or about
September 17, 2004.
beneficiary.
(Id. ¶¶ 1–2.)
(Id. ¶ 2.)
She designated Taneeda as the
Through the years, Joyce communicated
with New York Life several times in order to make changes to the
policy,
provide
corrected
personal
information,
and/or
requests; each time, she did so via written letter.
7.)
make
(Id. ¶¶ 5–
From 2010 through late 2016 — except for roughly six months
in mid-2016 — Joyce lived with Taneeda in Columbia, South Carolina.
(Id. ¶ 8.)
health
By late 2016, Joyce suffered from a number of severe
conditions,
including
Stage
osteoarthritis, and hearing loss.
IV
cancer,
(Id. ¶¶ 9, 15.)
glaucoma,
She did not
own a computer or subscribe to an internet service, and her
electronic devices were limited to a “flip phone” and a CapTel
telephone. 1
(Id. ¶ 12.)
On December 19, 2016, through New York Life’s internet portal,
Taneeda was removed as the beneficiary of Joyce’s life insurance
policy and replaced with Athalia.
(Id. ¶ 13.)
Several days later,
on December 23, 2016, Athalia took Joyce to live with her near
High Point, North Carolina.
(Id. ¶ 8.)
When Taneeda received
notice of the beneficiary change, she contacted New York Life to
contest it.
(Id. ¶ 14.)
On January 10, 2017, Joyce passed away
from her cancer, and the insurance policy death benefit became due
in the amount of $25,278.65.
(Id. ¶¶ 15–16.)
1
Athalia and Taneeda
CapTel telephones — designed for people with hearing loss — transcribe
spoken words into text that can be read on a screen. (Doc. 55 ¶ 12.)
2
both claimed entitlement to the proceeds, although they reached
agreement that New York Life should remit $9,852.60 to a funeral
home to cover Joyce’s funeral expenses.
(Id. ¶ 17.)
Life did so, leaving $15,426.05 in proceeds.
New York
(Id. ¶¶ 17–18.)
Faced with conflicting claims to the remaining proceeds, New
York Life filed an interpleader action in this court and deposited
the proceeds with the Clerk of Court, after which the insurer was
dismissed from the case.
(Doc. 16.)
trial on January 10, 2019.
The court conducted a bench
Athalia presented her own testimony,
as well as that of her husband, Robert Crayton, and her brother,
Clifford Thompson, and introduced exhibits.
Athalia’s evidence
included her testimony of observing Joyce using a smartphone on
the day the beneficiary was changed, and Thompson’s testimony that
Joyce told him she changed the beneficiary online.
Taneeda then
presented her own testimony, introduced exhibits, and rested.
Taneeda’s
evidence
included
her
testimony
about
Joyce’s
inexperience with computers and severe health problems, along with
Taneeda’s
observations
of
Joyce
during
the
day
the
policy
beneficiary was changed.
For the reasons explained in the court’s prior opinion, the
court did “not find Athalia Crayton’s evidence — that Joyce Ferron
changed the life insurance policy herself via a smartphone —
credible.”
(Doc. 55 ¶ 29.)
Instead, the court found “Taneeda
Ferron’s evidence — that Joyce Ferron did not make and could not
3
have made the beneficiary change via a smartphone — credible.”
(Id.)
As
a
result,
the
court
found
that
Joyce
had
not
substantially complied with the requirements of North Carolina law
as to changing life insurance beneficiaries.
See Primerica Life
Ins. Co. v. James Massengill & Sons Constr. Co., 712 S.E.2d 670,
678 (N.C. Ct. App. 2011) (“[A]ny changes made to an insurance
policy affecting the beneficiary designation . . . must be made by
the policy owner.
If not, the changes are a legal nullity and of
no force and effect . . . .”); Adams v. Jefferson-Pilot Life Ins.
Co., 558 S.E.2d 504, 509 (N.C. Ct. App. 2002) (noting that it is
enough for a policyholder to “substantially compl[y]” with the
requirement that “only the owner of a life insurance policy may
change the beneficiary,” but that “the policy owner must himself
take affirmative steps to change the beneficiary, substantially
fulfill the actions required on his part to accomplish the change,
[and] must communicate these efforts to an agent of the insurer”).
Therefore, the court found that the insurance proceeds were due to
Taneeda, the original beneficiary, and entered judgment to that
effect on January 15, 2019.
(Doc. 56.)
On February 12, 2019, Athalia timely filed the instant motion
under Rules 52(b) and 59, purporting to identify a number of errors
in the court’s factfinding and reasoning.
4
(Doc. 57.)
Taneeda
responded (Doc. 58), and the motion is now ready for decision. 2
II.
ANALYSIS
A.
Failure to Adhere to Local Rules
Local Civil Rule 7.3(a) requires that “[a]ll motions, unless
made during a hearing or at trial, shall be in writing and shall
be accompanied by a brief except as provided in section (j) of
this rule.
Each motion shall be set out in a separate pleading.”
Section (j) of the rule lists various motions that may be filed
without a separate brief; Athalia’s motion is not one of them.
See Local Rule 7.3(j).
Notwithstanding this rule, Athalia — who
is represented by counsel — filed her motion without a separate
brief.
For this reason alone, her motion will be denied.
See
Wolfe Fin. Inc. v. Rodgers, No. 1:17cv896, 2019 WL 203183, at *17
(M.D.N.C. Jan. 15, 2019) (“[Defendants’] Motion fails to satisfy
the[] requirements [of Local Rule 7.3(a)].
justifies
its
denial.”
(citation
and
This failure alone
footnote
omitted)).
Nevertheless, because it is readily apparent that the substance of
the motion also lacks merit, the court will deny it on that ground
as well, as explained below.
B.
Standards of Review
Pursuant to Rule 52(b), upon a timely motion, “the court may
amend its findings — or make additional findings — and may amend
2
Athalia did not file a reply.
5
the judgment accordingly.”
Fed. R. Civ. P. 52(b).
Rule 52(b)
motions “are not intended merely to relitigate old matters nor are
such motions intended to allow the parties to present the case
under new theories.”
Goodwin v. Cockrell, No. 4:13-cv-199-F, 2015
WL 12851581, at *1 (E.D.N.C. Dec. 30, 2015) (quoting Wahler v.
Countrywide Home Loans Inc., No. 1:05CV349, 2006 WL 3327074, at *1
(W.D.N.C. Nov. 15, 2006)).
“Instead, these motions are intended
to correct manifest errors of law or fact or to present newly
discovered evidence.”
Id. (quoting Wahler, 2006 WL 3327074, at
*1).
Pursuant to Rule 59(a), upon a timely motion after a bench
trial, the court may grant a new trial or “open the judgment if
one has been entered, take additional testimony, amend findings of
fact and conclusions of law or make new ones, and direct the entry
of a new judgment.”
Fed. R. Civ. P. 59(a)(1)(B), (a)(2).
“A
motion for a new trial in a nonjury case or a petition for rehearing
should be based upon manifest error of law or mistake of fact, and
a judgment should not be set aside except for substantial reasons.”
Charles Alan Wright et al., Federal Practice & Procedure § 2804
(3d. ed. 2019); accord United States v. Carolina E. Chem. Co.,
Inc., 639 F. Supp. 1420, 1423–24 (D.S.C. 1986)).
A motion under either rule, then, will not be granted without
a
showing
that
the
court’s
findings
contain
manifest
error.
“Ultimately, the decision on a motion for a new trial rests within
6
the sound discretion of the trial court.”
Carolina, 639 F. Supp.
at 1424.
C.
Merits
Athalia lists seven alleged errors in the court’s prior
findings.
Each will be addressed in turn.
First, Athalia argues that the court failed to address the
testimony of her husband, Robert Crayton, that “he witnessed
Taneeda hand the insurance policy beneficiary change document to
the [sic] Joyce Ferron to look over for review and examine the
policy
beneficiary
change
document
for
fraud
and
improper
actions,” and that Joyce — after reading the document — stated
“Needa, I’m fine with that.”
(Doc. 57 at 2.)
It is unclear from
Robert’s testimony exactly what the document was; Athalia refers
to it as “the insurance policy beneficiary change document” in
briefing, but Robert only referred to it on the stand as “the
policy.”
Whatever the precise nature of the document, Athalia is
incorrect that the court “failed to address” Robert’s testimony,
as the court expressly “d[id] not find Athalia Crayton’s evidence
as to the change in beneficiary credible.”
(Doc. 55 ¶ 20.)
“Athalia Crayton’s evidence,” of course, included not just her own
testimony
but
also
the
testimony
7
of
others
she
offered
into
evidence to support her beneficiary change theory. 3 Moreover, even
if the court were to fully credit Robert’s testimony and find that
Joyce understood from Taneeda’s documentation that a beneficiary
change had been made and stated she was “fine” with it (which it
did not), that evidence would not show that Joyce substantially
complied with the requirements of North Carolina law for making a
beneficiary change.
See, e.g., Adams, 558 S.E.2d at 509 (“[T]he
policy owner must himself take affirmative steps to change the
beneficiary, substantially fulfill the actions required on his
part to accomplish the change, [and] must communicate these efforts
to an agent of the insurer . . . .”).
In any event, it was not
manifest error for the court not to have made an individualized
finding of fact regarding this particular statement in Robert’s
testimony.
Second 4 and third, Athalia argues that the court erroneously
“place[d] the burden of showing a valid beneficiary change on
3
To the extent Athalia means to argue that Robert’s testimony supports
the notion that the beneficiary change was made on a paper document,
that evidence is even less credible, given that the rest of the evidence
in the case supported the proposition that the beneficiary change was
made online.
4
This section of Athalia’s motion is entitled “COURT RELIED ON AN
INCOMPETENCY ‘DEFENSE’ THAT WAS ABANDONED BY DEFENDANT TANEEDA FERRON
PRIOR TO TRIAL.”
(Doc. 57 at 2.)
However, Athalia makes no actual
argument to that effect, which is just as well given that the court
expressly found that Joyce “remained mentally competent” at least
“through December 19, 2016” — the date of the beneficiary change. (Doc.
55 ¶ 11.) The substance of Athalia’s second argument is the same as
that of her third argument: that the court mishandled the burden of
proof.
8
Athalia” instead of Taneeda.
incorrect.
(Doc. 57 at 2–3.)
This too is
The court properly placed on Athalia the prima facie
burden of showing the existence of a contract under which she was
a beneficiary and placed on Taneeda the burden of showing the
illegality of Athalia’s status as beneficiary, as required by North
Carolina law.
See (Doc. 55 ¶ 27 (citing Orthodontic Ctrs. of Am.,
Inc. v. Hanachi, 564 S.E.2d 573, 575 (N.C. Ct. App. 2002); Wells
v. Jefferson Std. Life Ins. Co., 190 S.E. 744, 746 (N.C. 1937);
and Lanier v. E. Life Ins. Co., 54 S.E. 786, 787 (1906))); (id.
¶ 29).
The court’s factual finding that Athalia’s “evidence as to
the change of beneficiary [was not] credible” (id. ¶ 20) does not
show that the court placed the legal burden of establishing the
validity of the beneficiary change on Athalia, as she now argues;
rather, the court first established the facts via credibility
findings
and
then
proceeded
framework to those facts.
to
apply
North
Carolina’s
legal
The application of that framework
resulted in the conclusion that, “[e]ven assuming that Athalia
Crayton made out a prima facie case” as to the existence of a
contract to which she was the beneficiary, “Taneeda Ferron met her
burden of showing the illegality of th[e] beneficiary change.”
(Id. ¶ 29.)
Fourth, Athalia argues that paragraph 19 of the court’s
findings
misstates
relevant
part:
“At
her
testimony.
trial,
Athalia
9
That
paragraph
Crayton
reads,
testified
that
in
on
December 19, 2016, she gave her mother her smartphone and observed
her using it on the internet that morning at Taneeda Ferron’s house
to change the life insurance beneficiary.”
(Id. ¶ 19.)
In her
motion, Athalia claims that her testimony was not that she saw her
mother actually making the change, but that she “was shown a
confirmation page that the beneficiary change had been made.”
(Doc. 57 at 3.)
The court is unable to say with certainty which
of these possibilities is the best interpretation of the relevant
part of Athalia’s testimony, which was as follows:
Q: Are you aware of any changes [your mother] made to the
insurance policy that day?
A: Yes.
Q: And how are you aware of that?
A: I saw it on the screen of the phone.
Either way, however, any perceived need to clarify Athalia’s
testimony on this point is obviated by the fact that “[t]rial
courts do not grant motions to amend when the amendment would be
futile.”
Wright et al., supra, § 2582; see also Ollier v.
Sweetwater Union High Sch. Dist., 858 F. Supp. 2d 1093, 1117 (S.D.
Cal. 2012) (“A motion to amend a court’s factual and legal findings
is properly denied where the proposed additional facts would not
affect the outcome of the case or are immaterial to the court’s
conclusions.”).
testimony
not
Here, the court has already found Athalia’s
to
be
credible,
10
and
therefore
the
proposed
clarification of her statement in paragraph 19 would do her no
good.
Fifth, Athalia argues that the court “overly weighted” the
fact that all Joyce’s previous communications with New York Life
had been in writing in reaching its conclusion that Taneeda met
her burden of showing that Joyce did not substantially comply with
North Carolina law in making the online beneficiary change.
57 at 4.)
(Doc.
However, Athalia provides no reason that the court
should have weighted the evidence differently. “It is the function
of the trial court . . . to weigh evidence,” Barry v. United
States, 501 F.2d 578, 584 (6th Cir. 1974), and a litigant’s bare
assertion that the court should have weighted the evidence more in
her favor falls far short of showing manifest error in the court’s
findings.
Sixth, Athalia argues that the court could not have properly
applied North Carolina contract law here because no party ever
introduced the full life insurance policy — Group Policy No. AA31 — into evidence.
Instead, the parties introduced an insurance
certificate issued Joyce by New York Life (which purported to be
a “summary of the [policy’s] provisions”), as well as Joyce’s
insurance enrollment form. 5
(Taneeda Exs. 1, 7.)
5
However, the
Athalia does not argue that the certificate misrepresents the policy,
nor does she point to any specific part of the policy that should have
been — but was not — considered in the court’s analysis.
11
only provisions of the policy relevant to the dispute in this case
are (1) the identity of the original beneficiary, and (2) New York
Life’s requirements for changing the beneficiary. As to the first,
Athalia admitted that Taneeda was the original beneficiary.
7 ¶ 2.)
(Doc.
As to the second, the court found in Athalia’s favor that
the beneficiary change “appears to have been in compliance with
the change of beneficiary procedures of the policy,” as summarized
in the certificate.
(Doc. 55 ¶ 13.)
There is therefore no basis
for Athalia to argue that the court’s legal conclusions — which
centered on requirements of North Carolina contract law applicable
to all life insurance policies, see (id. ¶ 28) — are manifestly
erroneous merely because neither she nor Taneeda introduced the
full policy into evidence. 6
Seventh,
and
finally,
Athalia
argues
that
the
court’s
findings in footnote 1 of its prior opinion were erroneous.
(id. ¶ 19 n.1).
See
That footnote deals with Athalia’s evidence that
Joyce had granted her power of attorney, which Taneeda disputed.
6
At several points in her motion, Athalia appears to evince some
confusion over the court’s ultimate finding that the beneficiary change
was not validly made despite the court’s finding that the change “appears
to have been in compliance with the change of beneficiary procedures of
the policy.” (Doc. 55 ¶ 13.) The explanation is simple: North Carolina
law sets out certain requirements for making a valid change to a life
insurance beneficiary. (Id. ¶ 28.) New York Life also set out certain
requirements for changing beneficiaries under its particular policy.
(Id. ¶ 13.) The fact that the beneficiary change in this case appears
to have been in compliance with New York Life’s requirements does not
show that it was in compliance with North Carolina’s requirements — and
the court ultimately found that Taneeda met her burden of showing that
it was not.
12
(Id.)
In addressing this factual dispute, the court stated that
it did not need to “determine the legitimacy of the power of
attorney” because Athalia “d[id] not claim, nor did she present
any evidence, that she changed the beneficiary on Joyce Ferron’s
life insurance.”
(Id.)
In briefing, Athalia argues that among
the recordings Taneeda submitted into evidence is a conversation
in which Athalia “stat[ed] to Defendant Ferron that she changed
the beneficiary,” and that she testified on cross examination “that
she does not deny [making] the online changes to Joyce Ferron’s
life insurance.”
(Doc. 57 at 6.)
As an initial matter, both of these assertions appear to be
affirmative misstatements of the record.
As far as the court can
tell from its unaided attempt to parse the oft-unintelligible
conversations contained in the poor-quality audio submitted into
evidence, Athalia actively denied having made changes to her
mother’s life insurance policy.
See (Taneeda Ex. 8 at 6:15–22
(appearing to chronicle Taneeda telling Athalia that she got a
letter
from
information,”
New
to
York
which
Life
saying
Athalia
[unintelligible] anything”)).
Athalia
responded
“changed
“I
didn’t
mommy’s
change
To the extent any intelligible part
of the recording could be construed differently: no party played
the recording at trial, nor pointed the court to any specific part
of it.
“Judges are not like pigs, hunting for truffles buried in
the record.”
Albrechtsen v. Bd. of Regents of Univ. of Wis. Sys.,
13
309
F.3d
433,
436
(7th
Cir.
2002)
(internal
quotation
marks
omitted); see also id. (“Courts are entitled to assistance from
counsel, and an invitation to search without guidance is no more
useful than a litigant’s request to a district court at the summary
judgment stage to paw through the assembled discovery material.”)
As to Athalia’s testimony from the stand, the court does not agree
with
the
motion’s
assertion
that
she
“testified
[on
cross
examination] that she does not deny that she made the online
changes.”
(Doc. 57 at 6.)
In fact, her testimony appears to be
the exact opposite: when opposing counsel asked Athalia on cross
examination whether she had told Taneeda that she did not make the
change, she responded: “It may have happened.
I’m not going to —
I’m not going to deny it.”
In addition, as the court has stated throughout, it did not
find Athalia’s evidence credible.
Thus, even if Athalia was to
uncover some statement buried in the record in which she claims to
have made the beneficiary change herself, that evidence would not
change the court’s conclusions. 7
Like the rest of her arguments,
7
Moreover, although Athalia appears to argue in her motion that she left
open the possibility that she used the power of attorney to make the
beneficiary change, she denied any such use from the stand:
Q: Did you ever exercise your authorities under this power of
attorney?
A: The only time I’ve exercised it [is] if I had to get my mother’s
medical record because I had to get her hospice care when she was
living at my home.
14
then, this final contention fails to provide a basis for the relief
requested in the motion. 8
As a result, the motion will be denied.
III. CONCLUSION
For the reasons stated,
IT IS THEREFORE ORDERED that Athalia Crayton’s Motion for
Amended or Additional Findings of Fact or a New Trial (Doc. 57) is
DENIED.
/ s/ Thomas D. Schroeder
United States District Judge
June 19, 2019
8
At the end of her motion, Athalia makes a one-sentence “alternative[]”
request for a new trial “on the limited issues of Joyce Ferron’s computer
literacy,
capacity
to
make
the
insurance
beneficiary
change
electronically, and whether credible evidence shows Joyce Ferron did in
fact make the beneficiary change.” (Doc. 57 at 9.) Athalia provides
no additional argument for granting this relief, and it will therefore
be denied.
15
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