Weber v. The Lincoln National Life Insurance Company
Filing
29
OPINION & ORDER that Weber's Motion to Dismiss is GRANTED as to Melissa Oliver's claim concerning the life insurance, which claim is dismissed with prejudice, and is GRANTED as to Melissa Oliver's claims against the silver bars and $50,000 cash, which claims are dismissed without prejudice. Signed by District Judge Robert G. Doumar on 10/1/2013 and filed 10/2/2013. (rsim, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
FILED
NORFOLK DIVISION
CnJ -2 ?(
CLERK, US. DISTRICT COURT
NORFOLK, VA
JANINE PERRY WEBER,
Plaintiff
CIVIL NO. 2:13cv31
THE LINCOLN NATIONAL LIFE
INSURANCE COMPANY
(dba Lincoln Financial Group),
and
MELISSA OLIVER,
Defendants.
OPINION & ORDER
This matter comes before the Court upon Janine Perry Weber's ("Weber") Motion to
Dismiss "Counterclaim" of Melissa Sue Dancy Oliver Pursuant to F.R.C.P. Rules 12(B)(1) and
12(B)(6) ("Motion to Dismiss"), filed May 3, 2103. ECF No. 22. The counterclaim of Melissa
Sue Dancy Oliver ("Oliver") asks that the Court find fraudulent certain transfers, namely a
change of beneficiary status in a life insurance policy and a different claim of fraudulent
transfers of silver bars and cash from her husband to her mother-in-law, Weber. ECF No. 16.
Weber asks that the Court dismiss the counterclaim filed by Oliver on grounds of lack of
jurisdiction and failure to slate a claim upon which relief could be granted under applicable
Virginia law. For the reasons set forth in this Order, the Motion to Dismiss is GRANTED as to
Melissa Oliver's claim concerning the life insurance policy, which claim is dismissed with
prejudice, and GRANTED as to Melissa Oliver's claims to the silver bars and cash, which
claims are dismissed without prejudice by virtue of lack ofjurisdiction.
I.
PROCEDURAL HISTORY
On January 18, 2013, Weber filed a Complaint against Lincoln National Life Insurance
Company ("Lincoln"). ECF No. 1. On February 15, 2013, Lincoln filed an Answer, Motion to
Join Party on Counterclaim, and Counterclaim in Interpleader.
ECF's No. 5 and 7.
Subsequently the Court entered an order granting Lincoln's Motion for Joinder on March 4,
2013, adding Oliver as a party to the proceedings. ECF No. 13. On April 12, 2013, Oliver filed
an Answer to Counterclaim and Interpleader and a Counterclaim of her own ("Oliver's
Counterclaim"). ECF No. 16. On May 3, 2013, Weber then filed her Motion to Dismiss. ECF
No. 22. Oral argument was heard on the Motion to Dismiss on October 1, 2013.
II.
STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(1) permits a defendant to move for dismissal of a
claim due to the Court's lack of subject matter jurisdiction. Federal courts may exercise "only
the jurisdiction authorized them by the United States Constitution and by Federal statute."
Bowles v. Russell, 551 U.S. 205, 127 S.Ct. 2360 (2007). Accordingly, the Court must "presume
that a case lies outside of its limited jurisdiction unless and until jurisdiction is shown to be
proper." United States v. Poole, 531 F.3d 263, 274 (4th Cir. 2008). Plaintiff bears the burden of
proving that this Court has subject matter jurisdiction. Richmond, Fredericksburg & Potomac
R.R. Co. v. United States, 945 F.2d 765, 768 (4th Cir. 1991).
Rule 12(b)(6) permits a defendant to move for dismissal of a claim for failure to state a
claim upon which relief can be granted. "Importantly, a Rule 12(b)(6) motion does not resolve
contests surrounding the facts, the merits of a claim, or the applicability of defenses."
Republican Party v. Martin, 980 F.2d 943, 952 (4th Cir. 1992). Consequently, a Rule 12(b)(6)
motion should only be granted if, after accepting all well pleaded allegations in the plaintiff's
complaint as true and drawing all reasonable factual inferences from those facts in the plaintiffs
2
favor, it appears certain that the plaintiff cannot prove any set of facts in support of his claim
entitling him to relief. See Id.
III.
FACTUAL BACKGROUND
Given the standard for reviewing a Rule 12(b)(6) motion, the Court will accept Oliver's
factual allegations as true for the purposes of this Order. The following alleged facts are drawn
from Oliver's pleadings and are not accepted as true for any purpose beyond the Court's present
ruling on Weber's Motion to Dismiss.
According to the allegations John Patten Oliver, Jr. ("Decedent") and Melissa Oliver
were married in July, 1998. On or about October 14, 2005, they met with their family financial
advisor, Thomas Hill, CPA ("Hill"). The couple had recently purchased their home in Farmville,
Virginia, and some land in Kentucky. As part of their family financial planning, the parties
decided to purchase life insurance on each other. Hill, during a joint meeting with the couple,
completed the application for the policy at issue in this case for Decedent. The application was
submitted to Lincoln by Hill and life insurance policy #T201125038 was issued naming
Decedent as the insured and listing Oliver as the beneficiary. Since the issuance of the policy
and until Decedent's death, all premiums for said policy were paid for with marital assets of
Husband and Wife out of their joint bank account.
During 2010, the couple purchased silver bars, valued at $10,000, as an investment.
Throughout the marriage Decedent also kept large sums of cash underneath their bed in the
marital home.
Also according to the allegations, the couple began experiencing marital discord in the
spring of 2012. They had discussed the possibility of separating and both acknowledged that the
possibility of divorce was imminent. In the months leading up to Decedent's death he had
multiple conversations with his mother, Weber, regarding the fact that a separation and divorce
was likely. Decedent also informed Weber that he was changing the beneficiary designation on
the Lincoln life insurance policy.
On or about July 3, 2012, Decedent removed the cash underneath the couple's bed and
gave it to Weber. The total amount of cash was around $50,000. Decedent also gave the silver
bars to Weber, valued at $10,000. Weber gave no consideration for the gifts.
On July 10, 2012, without Oliver's knowledge or consent, Decedent submitted a "Life
Beneficiary Name Change" form to Lincoln, requesting that the beneficiary of the policy be
changed from Oliver to Weber. Weber gave no consideration for the transfer. On or about July
12, Decedent placed an order for a shotgun from an on-line gun shop, which he received on July
19. On July 20 Lincoln issued a letter to Decedent confirming receipt of his request to change
the beneficiary of the policy to Weber. Decedent died from a self-inflicted gunshot wound that
same day, dying intestate.
The allegations further assert that during the weeks preceding Decedent's death Oliver
had spent the workweeks in New York on business and had been shuttling back and forth to
Farmville via train. At the time of Decedent's death the couple was still living in the marital
residence in Farmville. Oliver did not have any knowledge of or consent to the transfers in
question. Weber, however, did have knowledge at the time of the transfers that Oliver had no
knowledge of the transfers and that they were made in order to divest Oliver of her interest in the
life insurance policy, the silver bars, and the cash.
Following Decedent's death both Oliver and Weber made requests to Lincoln for
disbursement of the life insurance proceeds, totaling $500,000. Due to the conflicting claims and
the potential for double liability, Lincoln refused to disburse the proceeds to either party, leading
to the current proceeding.
IV.
DISCUSSION1
A.
Rule 12(b)(1) Dismissal for Lack of Subject Matter Jurisdiction
Weber first asks that Oliver's Counterclaim be dismissed because the Court lacks
jurisdiction over the claims. Mot. to Dismiss, ECF No. 22. Oliver asserts that the counterclaims
are compulsory, and as a result the Court has ancillary jurisdiction. Oliver's Countercl. at 7,
ECF No. 16. In the alternative, if the Court finds that the counterclaims are not compulsory but
rather permissive, Oliver asserts that there is an independent jurisdictional base via diversity
jurisdiction. Id. at 8. The Court finds that it has jurisdiction as to the insurance policy claim but
not as to the claims concerning the silver bars or the cash.
1.
Subject Matter Jurisdiction as to the Insurance Policy
The Court has jurisdiction over the original claim concerning the insurance policy
through diversity jurisdiction pursuant to 28 U.S.C. § 1332(a)(1).
There is diversity of
citizenship: Weber is a resident of North Carolina, Lincoln is a resident of Indiana, and Oliver is
a resident of Virginia.2 The amount in controversy as to the insurance policy is $500,000 plus
interest that has accrued while Lincoln has refrained from disbursing the funds.
Weber's original claim is that, as a result of the July 10 "Life Beneficiary Name Change"
transfer request, she is entitled to the proceeds of the life insurance policy. Oliver's claim is that
the July 10 transfer request was fraudulent and divested her of her interest in the policy.
Therefore, regardless of whether Oliver's Counterclaim was properly styled as a counterclaim or
1 Before discussing the Rule 12(b)(1) and Rule 12(b)(6) issues, the Court notes that there is some
disagreement between the parties as to whether Oliver's Counterclaim should more properly be labeled as a crossclaim. As will be discussed later in this opinion, it is not necessary for the purposes of this Opinion to determine
which label is proper as the outcome would be the same either way.
2 There is also some disagreement among the parties as to how Oliver should properly be classified as a
party. Her classification might be relevant for purposes of determining diversity of citizenship and whether her
counterclaim should properly be set forth as a cross-claim. It is not necessary; for purposes of this Opinion to
determine whether she has been properly classified. Regardless of her classification there is diversity of citizenship,
and the subject matter jurisdiction analysis is also not affected by whether hercounterclaim should be set forth as a
cross-claim.
whether it should have been set forth as a cross-claim, the Court has jurisdiction. If it is properly
set forth as a counterclaim, as asserted by Oliver, it is a compulsory counterclaim since it arises
out of the same transaction or occurrence that is the subject matter of the original claim. Fed. R.
Civ. P. 13(a). If it would be proper to set forth the claim as a cross-claim, as asserted by Weber,
the Court would still have jurisdiction because, again, it arises out of the same transaction or
occurrence. Fed. R. Civ. P. 13(g).
Weber further asserts that if Oliver's Counterclaim were to be heard that Decedent's
estate would be a necessary party. PL's Reply Mem. in Supp. of PL's Mot. to Dismiss at 2-3,
ECF No. 25. If Decedent's estate were joined as a party there would no longer be complete
diversity of citizenship since Decedent was a resident of Virginia along with Oliver and they
would be opposing parties. However, it is not the case that Decedent's estate is a necessary party
as to the life insurance policy transfer. Pursuant to Rule 19(a):
(1) Required Party. A person who is subject to service of process and whose
joinder will not deprive the court of subject-matter jurisdiction must bejoined as a
party if:
(A) in that person's absence, the court cannot accord complete relief
among existing parties; or
(B) that person claims an interest relating to the subject of the action and is
so situated that disposing of the action in the person's absence may:
(i) as a practical matter impair or impede the person's ability to
protect the interest; or
(ii) leave an existing party subject to a substantial risk of incurring
double, multiple, or otherwise inconsistent obligations because of
the interest.
Fed. R. Civ. P. 19(a)(1).
Here, Decedent's estate is not necessary in order for the Court to
"accord complete relief per subparagraph (A). Lincoln does not contest that it is liable to either
Oliver or Weber, who arc the only two parties who might receive funds from the life insurance
policy.
Those ftinds would pass directly to Oliver or Weber, leaving Decedent's estate
ultimately unaffected either way.3 Therefore, complete relief can be accomplished among the
existing parties.
2.
Subject Matter Jurisdiction as to the Silver Bars and Cash
The Court does not have jurisdiction over Oliver's claims as to the silver bars or the
$50,000 in cash. The Court would have jurisdiction if the claims were either valid compulsory
counterclaims or cross-claims, both of which require that the claims arise from the same
transaction or occurrence that is the subject matter of the original claim. See Fed. R. Civ. P.
13(a), (g). If they do not arise out of the same transaction or occurrence, then the claims would
need to be permissive counterclaims with their own jurisdictional base. See Painter v. Harvey,
863 F.2d 329, 331 (4th Cir. 1988). The claims as to the silver bars and cash do not provide the
Court with any of those grounds for jurisdiction.
a.
The Claims do not Arise Out ofthe Same Transaction or Occurrence
There are four inquiries to determine whether a claim arises from the same transaction or
occurrence as the complaint:
(1) Are the issues of fact and law raised in the claim and counterclaim largely the
same? (2) Would res judicata bar a subsequent suit on the parly's counterclaim,
absent the compulsory counterclaim rule? (3) Will substantially the same
evidence support or refute the claim as well as the counterclaim? and (4) Is there
any logical relationship between the claim and counterclaim?
Id. (Citing Sue &Sam Mfg. Co. v. B-L-S Const. Co., 538 F.2d 1048 (4th Cir.1976)).4 The
common thread running through all four tests is whether or not there is "evidentiary similarity."
3 Additionally, Decedent's estate would not face any further liability. If the transfer of beneficiary status
was not fraudulent, then clearlyOliver would have no further claim against the estate as to the life insurance policy.
If the transfer was fraudulent, then by Virginia law (as will be discussed infra) Weber had notice of the fraudulent
nature of the transaction, leaving her with no claim against the estate either.
4 While Painter was concerned with the transaction or occurrence test as applied to compulsory
counterclaims, the test is the same as applied to cross-claims. See Kirkcaldy v. Richmond County Bd. ofEduc, 212
F.R.D. 289, 295-296 (M.D.N.C. 2002) (Citing Painter, 863 F.2d at 331).
Id.
Here, the original claim is based on the July 10 transfer of beneficiary status for the life
insurance policy. The claims concerning the silver bars and cash are based on the allegedly
fraudulent conveyance of July 3.
Those are two different transactions that would require
different evidence for proof. For example, for each transaction Oliver would have to show that,
on that particular day, Weber had either actual knowledge or inquiry notice of Decedent's
fraudulent intent as to that day's transactions. See Bank of Commerce v. Rosemary & Thyme,
Inc., 239 S.E.2d 909, 912 (Va. 1978) (Finding that grantee must have notice of grantor's
fraudulent intent). Because the claims as to the silver bars and cash do not share "evidentiary
similarity" they do not arise from the same transaction or occurrence as the original claim.
Therefore, they cannot be considered compulsory counterclaims or cross-claims.
b.
The Claims Have no Independent Jurisdictional Base
If Oliver's Counterclaim were properly set forth as a cross-claim then the jurisdictional
inquiry would end there since the Rules do not allow for cross-claims unless they arise out of the
same transaction or occurrence.
See Fed. R. Civ. P. 13(g).
However, even if Oliver's
Counterclaim were properly set forth as a counterclaim, this Court would still lack jurisdiction.
If the counterclaims do not arise from the same transaction or occurrence (and therefore are not
compulsory) a court may still have jurisdiction if they are permissible counterclaims. Fed. R.
Civ. P. 13(b). Permissible counterclaims require a jurisdictional base that is independent from
the original claim. Painter, 863 F.2d at 331.
Since the claims are alleged to be founded in Virginia Code §§ 55-80 and 20-107.3,5 that
5 § 20-107.3 concerns equitable distribution, which is only available after a granting of divorce. See
Mayers v. Mayers, 15 Va. App. 587, 590 (1993) ("It is equally clear 'that no decree of equitable distribution can be
made before the parties are divorced.' Parra v. Parra, 1 Va.App. 118, 124, 336 S.E.2d 157, 160 (1985) (interpreting
Code § 20-107.3(A)). Thus, '[t]he court's equitable distribution jurisdiction begins 'upon' the granting of the
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jurisdictional base must be diversity as opposed to federal question jurisdiction. This Court does
not generally adjudicate matters concerning domestic differences and would not exercise
permissible jurisdiction in this matter. Moreover, the alleged amounts in controversy for the two
potential permissive counterclaims are $10,000 for the silver bars and $50,000 for the cash. Both
claim amounts, whether considered separately or in aggregate, fail to surpass the $75,000 amount
required for diversity jurisdiction in 28 U.S.C. § 1332(a)(1). Because permissive counterclaims
require independent jurisdictional bases and the claims as to the silver bars and the cash do not
satisfy the amount-in-controversy requirement, there is no jurisdiction. See 6 Wright and
Miller, Federal Practice and Procedure, § 1423.
Additionally, even if the amount-in-controversy requirement were met, the inclusion of
the claims would divest the proceedings of diversity of citizenship. Unlike with the claim
concerning the life insurance policy, the claims as to the silver bars and cash do implicate the
interests of Decedent's estate. If in fact those two transactions were fraudulent, the voiding of
them would mean that ownership of the bars and cash would revert to Decedent's estate. Any
claim that Oliver might have to the bars or cash would be by virtue of her taking from
Decedent's estate via intestacy, subject to claims from other creditors. Alternatively, if the Court
were to entertain Oliver's theory of equitable distribution then she would again only receive any
portion of the bars or cash through Decedent (and by extension his estate). Either way, it is clear
that the interests of Decedent's estate are implicated by those claims, making the estate a
necessary party. As noted above, inclusion of Decedent's estate would destroy diversity of
citizenship by virtue of Oliver sharing the same Virginia residency because her claim would be
against the Decedent's estate.
divorce.' Id. at 125, 336 S.E.2d at 161."). However, Virginia courts have used § 20-107.3 as a guide to determine
what type of property might be defined as "marital property" and therefore owed to a spouse under § 55-80. See,
e.g., Buchanan v. Buchanan, 266 Va. 207, 212 (2003).
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It is clear that a state court is better able to deal with domestic matters such as this. The
claims for the silver bars and $50,000 cash are dismissed without prejudice.
B.
Rule 12(b)(6) Motion to Dismiss for Failure to State a Claim
Weber next asks the Court to dismiss Oliver's Counterclaim pursuant to Rule 12(b)(6)
because the counterclaim fails to state a claim upon which relief can be granted under Virginia
law. Mot. to Dismiss, ECF No. 22. Since the Court does not have jurisdiction over the claims to
the silver bars and cash it will only consider the Rule 12(b)(6) motion with regard to the life
insurance beneficiary transfer. Oliver's response is that her claim arises under § 55-80 of the
Code of Virginia.6 Oliver would have a partial claim concerning the transfer of rights under the
policy. The claim, however, would be limited to the cash surrender value of the policy at the
time of the transfer of any rights. After hearing oral argument on this motion it appears that the
life insurance policy in question did not have any cash surrender value. Therefore, Oliver has
failed to state a claim upon which relief might be granted.
1.
Fraudulent Conveyance Law in Virginia
The relevant statute concerning fraudulent conveyance is § 55-80 of the Virginia Code,
which reads:
Every gift, conveyance, assignment or transfer of, or charge upon, any estate, real
or personal, every suit commenced or decree, judgment or execution suffered or
obtained and every bond or other writing given with intent to delay, hinder or
defraud creditors, purchasers or other persons of or from what they are or may be
lawfully entitled to shall, as to such creditors, purchasers or other persons, their
representatives or assigns, be void. This section shall not affect the title of a
purchaser for valuable consideration, unless it appear that he had notice of the
fraudulent intent of his immediate grantor or of the fraud rendering void the title
of such grantor.
Va. Code Ann. § 55-80 (West 2013).
6 As noted in the previous footnote, § 20-107.3 provides guidance as to what property might be owed a
spouse under § 55-80.
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In Fox RestAssociates, L.P. v. Little the Supreme Court of Virginia provided the standard
for how to establish fraudulent intent under § 55-80:
In a suit to set aside a fraudulent conveyance, proof of the fraudulent intent must
be "clear, cogent and convincing." Hutcheson v. Savings Bank ofRichmond, 129
Va. 281, 289, 105 S.E. 677, 680 (1921). Fraud may be proved not only by direct
evidence, but also by circumstantial evidence. Id. In fact, "[bjecause of the
difficulty of establishing 'actual intent,' evidence of fraud may be, and generally
must be, circumstantial." In re: Porter, 37 B.R. 56, 63 (Bankr. E.D. Va.1984).
Virginia courts have consequently relied upon presumptions of fraud, known as
"badges of fraud," which consist of facts and circumstances that establish a prima
facie case of fraudulent conveyance. See, e.g., Hutcheson, 129 Va. at 291, 105
S.E. at 681. The badges of fraud include:
(1) retention of an interest in the transferred property by the
transferor; (2) transfer between family members for allegedly
antecedent debt; (3) pursuit of the transferor or threat of litigation
by his creditors at the time of the transfer; (4) lack of or gross
inadequacy of consideration for the conveyance; (5) retention or
possession of the property by transferor; and (6) fraudulent
incurrence of indebtedness after the conveyance.
In re: Porter, 37 B.R. at 63 (citing Hutcheson, 129 Va. at 291, 105 S.E. at 681).
Once a party has introduced evidence to establish a badge of fraud, a prima facie
case of fraudulent conveyance is established. Temple v. Jones, Son & Co., 179
Va. 286, 298, 19 S.E.2d 57, 62 (1942). Once this is done, "the burden shifts, and
the defendant must establish the bona fides of the transaction." First National
BankofBluefieldv. Pressley, 176 Va. 25, 28, 10 S.E.2d 526, 527 (1940).
Notably, a familial relationship between the transferor and the transferee is not
itself a badge of fraud. Fowlkes v. Tucker, 164 Va. 507, 514, 180 S.E. 302, 305
(1935). But "transactions between husband and wife must be closely scrutinized,
to see that they are fair and honest and not mere contrivances resorted to for the
purpose of placing the husband's property beyond the reach of his creditors." Id.
at 511, 180 S.E. at 303 (emphasis added). In such cases, "only slight evidence is
required to shift the burden of showing its bonafides." Id. at 514, 180 S.E. at 305
(emphasis added).
Finally, in Hutcheson, we stated:
In order to avoid a conveyance, it is not necessary tp prove that
the grantee had positive knowledge of the grantor's fraudulent
intent. It is sufficient to prove that the grantee had knowledge of
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facts and circumstances which were naturally and justly calculated
to excite suspicion in the mind of persons of ordinary care and
prudence, and which would naturally prompt him to pause and
inquire before consummating the transaction, and that such inquiry
would have necessarily led to a discovery of the facts from which
the law imputes fraud to the grantor.
Id. at 291,105 S.E. at 680-81.
Fox RestAssocs., L.P. v. Little, 282 Va. 277, 284-85 (2011).
Virginia case law is clear that a spouse may qualify as an "other person" under § 55-80
when separation or divorce is contemplated. Buchanan, 266 Va. at 212. It is not necessary that
the enforcement mechanism under § 55-80 (i.e. a divorce proceeding) be available at the time of
the fraudulent conveyance. Id. at 213. Buchanan also states that marital property, as defined by
§ 20-107.3, is generally property that a spouse may have a right to under § 55-80. See Id.
As to whether or not an insurance policy can constitute marital property, it appears that it
can if marital assets were used to pay the premiums, regardless of whether the policy was
separate property originally. See Driskill v. Driskill, 2003 Va. Cir LEXIS 380 (Norfolk Cir. May
29, 2003) ("By making premium payments during the marriage, the life insurance policies
changed from separate property to marital property.").
However, while life insurance policies may constitute property in the context of § 20-
107.3, under Virginia case law they do not constitute property under § 55-80. In Coulter v.
Willard the Supreme Court of Virginia clearly found that "in Virginia a life insurance policy
before it has matured, and which has no cash surrender value, is not property in contemplation of
sections 5184 and 5185 [current sections 55-80 and 55-81, respectively] of the Code." 156 Va.
79, 83 (1931) (citing Stigler's Ex'x v. Stigler, 77 Va. 163 (1883), Boisseau v. Bass, 100 Va. 207
(1902), and White v. Pacific Mutual Life Ins. Co., 150 Va. 849 (1928)). The only amounts which
may be attached under § 55-80 are any premiums paid while debtor was insolvent or any cash
12
surrender value of a policy. White v. Pacific, 150 Va. at 862.
2.
Oliver's Claims as to the Life Insurance Policy Under Virginia Law
Oliver's Counterclaim asserts that the July 10, 2013 transfer of beneficiary status from
Oliver to Weber was a fraudulent conveyance under § 55-80 and divested Oliver of her interest
in the policy. Br. in Opp'n to PL's Mot. to Dismiss at 15, ECF No. 24. Oliver may be correct in
that under Virginia law life insurance policies that have had the premiums paid out of marital
assets may be marital property under § 20-107.3. Oliver is also correct in that § 20-107.3
appears to provide guidance as to what a spouse might be entitled to under § 55-80. However,
Coalter clearly states that an un-matured life insurance policy is not property under § 55-80
except in so far as premiums were paid while debtor was insolvent or there is a cash surrender
value of the policy.
Oliver attempts to distinguish Coalter by saying that the court in that case was only
concerned with "a creditor pursuing a contract claim against a decedent's survivors" as opposed
to this case where the creditor possesses a marital interest in the life insurance policy. Br. in
Opp'n to PL's Mot. to Dismiss at 15, ECF No. 24. Oliver appears to pull this distinction out of
thin air. Nothing in Coalter seems to limit its holding to non-marital creditors. Additionally,
nothing in the case law determining that a spouse can be an "other person" for purposes of § 5580 speaks towards making such a distinction. The Court finds no problem with the assertion that
Oliver might be an "other person." The issue is that the Supreme Court of Virginia determined
in Coalter that, without making any distinction between "creditors" or "other persons," the
benefits of an unmatured life insurance policy are not property under § 55-80.
It is not within this Court's power to change or add to what the Supreme Court of
Virginia has determined to be the law in Virginia. Therefore, if the transfer was fraudulent, in so
far as Oliver is concerned she would have a claim as to any cash surrender value of the policy if
13
she and her husband were not insolvent. Since after oral argument it appears that there was no
cash surrender value of the policy, Oliver is left with no claim as to the life insurance policy.
Therefore, Oliver has not stated a claim upon which relief might be granted under Virginia law
and that claim is dismissed with prejudice.
V.
CONCLUSION
For the reasons set forth in this Opinion, Weber's Motion to Dismiss is GRANTED as to
Melissa Oliver's claim concerning the life insurance, which claim is dismissed with prejudice,
and is GRANTED as to Melissa Oliver's claims against the silver bars and $50,000 cash, which
claims are dismissed without prejudice.
The Clerk is DIRECTED to forward a copy of this Order to all Counsel of Record.
IT IS SO ORDERED.
'hv0s
UNITED STATES DISTRICT JUDGE
Norfolk, VA
October / ,2013
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