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Hartford Life Insurance Co. v. Pottorff

United States District Court, N.D. New York

April 9, 2014

HARTFORD LIFE INSURANCE COMPANY, Plaintiff,
v.
KEITH POTTORFF, BRANDI BEERS, SCOTT BEERS, and THE PENDING ESTATE OF JANET L. POTTORFF, Defendant.

BRIAN P. DOWNEY, ESQ., PEPPER HAMILTON LLP, Harrisburg, Pennsylvania, Attorneys for Plaintiff.

MEMORANDUM-DECISION AND ORDER

MAE A. D'AGOSTINO, District Judge.

I. INTRODUCTION

Plaintiff Hartford Life Insurance Company ("Hartford") brings this statutory interpleader action pursuant to 28 U.S.C. § 1335 against Defendants Keith Pottorff ("Pottorff"), Brandi Beers and Scott Beers (collectively, "Beers Defendants"), and the Pending Estate of Janet L. Pottorff ("Pottorff Estate"), seeking to resolve potentially competing claims for the proceeds of a life insurance policy issued to Janet L. Pottorff ("Decedent"). See Complaint, Dkt. No. 1. Defendant Pottorff, Decedent's husband and a named beneficiary of Decedent's life insurance proceeds, has been convicted of Decedent's intentional murder. Pursuant to New York's common law slayer rule, Defendant Pottorff is not entitled to receive such proceeds. Currently before the Court is Hartford's renewed motion for default judgment. See Dkt. No. 22. Defendants have not opposed the motion, or otherwise appeared in this action.

II. BACKGROUND

The Court has taken the facts set forth below from Plaintiff's complaint and accompanying exhibits. Janet L. Pottorff was insured by Hartford under policy number GL-677777 ("Policy") for a basic life insurance benefit of $20, 000 ("Life Insurance") and a basic accidental death and dismemberment benefit of $23, 750 ("AD&D"). See Complaint ¶ 1 & Exh. A.

On April 17, 2004, Decedent completed a Beneficiary Designation Form in which she designated Defendants Keith Pottorff, Brandi Beers, and Scott Beers as primary beneficiaries of the Policy. The Beneficiary Designation Form provides that "[p]ayment will be made in equal shares or all to the survivor unless otherwise indicated." Decedent designated 50% of the total benefit amount to her husband Keith Pottorff, 25% of the total benefit amount to her daughter Brandi Beers, and 25% of the total benefit amount to her son Scott Beers. Decedent did not name a contingent beneficiary. See id. ¶ 11 & Exh. B.

On July 20, 2012, Decedent died of asphyxiation from strangulation and/or suffocation; the manner of death was determined to be homicide. See id. ¶ 12 & Exh. C. At the time of the filing of the instant complaint, Defendant Pottorff was awaiting trial for the murder of Decedent. See id. ¶¶ 13-15. On March 7, 2013, Defendant Pottorff was convicted of murder in the second degree. See Appendix (Certificate of Conviction & Disposition).

Pursuant to the Policy,

Life Insurance Benefits and benefits for the loss of life under the Accidental Death and Dismemberment Benefit will be paid in accordance with the life insurance Beneficiary Designation. If no beneficiary is named, or if no named beneficiary survives [Decedent], [Hartford] may, at [Hartford's] option, pay: (1) the executors or administrators of [Decedent's] estate; or (2) all to [Decedent's] surviving Spouse; or (3) if [Decedent's] Spouse does not survive [Decedent], in equal shares to [Decedent's] surviving Children; or (4) if no Child survives [Decedent], in equal shares to [Decedent's] surviving parents.

See Complaint ¶ 17 & Exh. A.

The Beers Defendants have separately signed and submitted claims for benefits under the Policy to Hartford. See id. ¶¶ 18-19 & Exhs. E, F. The Beers Defendants were subsequently paid their respective 25% shares of the benefits. See id. ¶ 20. Hartford believes that there is a question as to who should receive the remaining 50% share of the benefits. See id. ¶¶ 21-23. Hartford concedes that benefits are due and owing under the Policy, but is unable to determine to whom, and in what amounts, the benefits should be paid. See id. ¶ 25. The benefit at issue is in the amount of $21, 875, plus accumulated interest. See id. ¶ 25.

Hartford filed this interpleader action on January 22, 2013, seeking to pay the proceeds of the Life Insurance and AD&D benefits into the court's registry, to enjoin the Defendants from pursuing any further claims concerning the Policy proceeds, and to discharge Hartford from any further liability based upon the Policy. On February 15, 2013, the Court granted Hartford's unopposed motion for leave to deposit funds into the court. See Dkt. No. 7. On February 26, 2013, the Clerk of the Court received two checks from Hartford totaling $21, 945.64.

Following service of the Complaint on Defendant Pottorff and the Beers Defendants, and their respective failures to answer or otherwise respond, the Clerk entered default as to each. See Dkt. No. 10. Thereafter, on April 24, 2013, Hartford made a motion for default judgment pursuant to Fed.R.Civ.P. 55 as to Defendant Pottorff and the Beers Defendants. On October 2, 2013, the Court issued the following text notice: "According to the docket sheet, Defendant Estate of Janet L. Pottorff has not been served with the summons and complaint pursuant FRCP 4. Plaintiff's counsel is to inform the Court on or before October 18, 2013, whether Plaintiff intends to serve or has served the Estate of Janet L. Pottorff[1]." Dkt. No. 15. On the same day, Hartford filed a waiver of service executed by S. Frances Williams as attorney for the Pottorff Estate. See Dkt. No. 16. The Pottorff Estate failed to timely answer or otherwise respond to the Complaint, and the Clerk entered default accordingly. See Dkt. No. 18. On November 27, 2013, Hartford filed a motion for default judgment as to the Pottorff Estate which sought, inter alia, costs and attorneys' fees in the amount of $7, 000. See Dkt. No. 19. In response to certain deficiencies in Hartford's initial ...


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