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TROWBRIDGE v. PRUDENTIAL INS. CO. OF AMERICA

January 12, 1971

Grace W. TROWBRIDGE, Plaintiff,
v.
The PRUDENTIAL INSURANCE COMPANY OF AMERICA, Defendant. Barbara T. Montgelas, Barbara T. Corbett and Daphne M. Cochran, Additional Defendants


Croake, District Judge.


The opinion of the court was delivered by: CROAKE

MEMORANDUM (January 12, 1971)

CROAKE, District Judge.

 This court has before it four motions in the above matter. Jurisdiction exists pursuant to 28 U.S.C. § 1332. The facts of the case are as follows.

 I

 On September 15, 1936, the Prudential Insurance Company of America ("Prudential") issued two single premium life insurance policies in the amount of $50,000 each on the life of Arthur L. Trowbridge. Barbara J. Trowbridge, daughter of the insured, was named as the beneficiary of one policy. She has since married, and her name is now Barbara T. Montgelas. Marjorie A. Nicholas, another daughter of the insured, was named as beneficiary of the second policy. She predeceased Authur Trowbridge, and Barbara Corbett (her sole surviving child) became the beneficiary under the second policy.

 Both policies contained a clause entitled PROVISIONS AS TO OWNERSHIP OF THE POLICY which provided in part that "all legal incidents of ownership in the policy" were to belong to Barbara J. Trowbridge, her executors, administrators, or assigns in the instance of the first policy and to Marjorie A. Nicholas, her executors, administrators, or assigns in the instance of the second policy. Each policy further provided that the beneficiary could be changed "only with the written consent of all the beneficiaries under the policy." (Emphasis added.)

 On December 16, 1968, Arthur Trowbridge wrote to Prudential requesting that it change the policies so as to name his wife, Grace Trowbridge, as beneficiary on both. Eleven days later, on December 27, 1968, Prudential so endorsed the policies, and Trowbridge was informed that his wife would receive the proceeds therefrom upon his death.

 It is now conceded by all parties to the action that this change was in error. Under the terms of the policies, Barbara Montgelas and Barbara Corbett were the beneficiaries, and all rights vis-a-vis a change in beneficiaries were reserved exclusively to them. However, this error was unnoticed at the time of its commission and, despite the now admitted invalidity of the change in beneficiaries, Arthur Trowbridge died on March 7, 1969, believing that his wife would receive the proceeds of the two policies.

 On October 22, 1969, Grace Trowbridge commenced this action against Prudential in the Southern District of New York. Shortly thereafter, Prudential countered with two interpleader actions in the United States District Court, District of Connecticut, by which it sought to interplead Barbara Montgelas, Barbara Corbett, and Daphne Cochran with Grace Trowbridge. (Daphne Cochran is the daughter of Barbara Montgelas and, as such, is a contingent beneficiary on the first policy.) Montgelas, Corbett, and Cochran (hereinafter referred to as the "additional defendants") represent the class of persons who could possibly take as beneficiaries or contingent beneficiaries under the two policies. By its Connecticut action, Prudential also sought to stay the instant action in the Southern District of New York.

 In deciding upon these matters, Chief Judge William Timbers of the United States District Court, District of Connecticut, declared, "The court is confronted with a dilemma -- raised by counsel acting in utmost good faith on behalf of their respective clients -- the resolution of which would appear to be dictated more by common sense than by the books." Prudential Life Insurance Company of America v. Grace Trowbridge et al., 313 F. Supp. 428 (1970). However, rather than decide on the merits, he instructed the parties to proceed in the Southern District of New York, and ordered the Connecticut action held in abeyance.

 Proceed in the Southern District the parties did, and this court now has before it four motions. The first is made by Prudential pursuant to Rule 22 of the Federal Rules of Civil Procedure. By it, Prudential seeks to interplead the additional defendants with Grace Trowbridge to protect itself against double liability. Second, plaintiff Grace Trowbridge has moved for summary judgment against Prudential, claiming an amount equal to the proceeds of the insurance policies issued on the life of her husband. She does not base her demand for recovery directly on the insurance policies themselves, but claims instead that she is entitled to recover either in tort for negligent misrepresentations by Prudential or, in the alternative, on contract estoppel grounds. The third motion is one by the additional defendants for summary judgment against Prudential on the insurance policy itself. And last, the court has before it several motions for attorney's fees.

 All motions for attorney's fees are denied at this time without prejudice. The court's rulings on the other motions are as follows.

 II

 The motion of the Prudential Life Insurance Company of America for ...


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