On appeal from Superior Court, Chancery Division, Essex County.
Allcorn, Seidman and Botter. The opinion of the court was delivered by Seidman, J.A.D.
[166 NJSuper Page 310] This appeal raises the issues of whether
an insured, now deceased, made an effective change of beneficiary on certain life insurance policies owned by him, and, if he did, whether the trial judge correctly determined that the former named beneficiary, the insured's purported wife, was nevertheless "equitably" entitled to one-half of the proceeds.
Between 1959 and 1975, Metropolitan Life Insurance Company issued three policies insuring the life of Hercules Jenkins. The named beneficiary in each was Evelyn Jenkins, whom Jenkins had married in 1957. The policies were in the respective amounts of $5,000, $25,000 and $3,000. It appears from affidavits and a deposition on file (the matter having been decided by the trial judge on a motion for summary judgment) that Evelyn Jenkins had previously been married and had not obtained a divorce when she married decedent.
In April 1976 they separated as the result of domestic problems, and Jenkins retained an attorney, who filed an annulment action in June of that year. He also sought the attorney's assistance in changing the beneficiaries named in the policies. On forms supplied by the insurance company Jenkins requested that the beneficiary on the $5,000 policy be changed to Bryan Haynes, his nephew, and, on the $25,000 policy, to his sister Lois Kelly. He apparently also requested a change of beneficiary in the third policy to his stepdaughter, Sandra Boyd. The latter policy is not directly involved in this appeal. The change of beneficiary forms were sent to the insurance company on June 23, 1976, together with "declaration of loss of policy" forms. The insured explained in the latter that the policies were not in Jenkins' possession because Mrs. Jenkins had "removed policy from my home without authorization," placed them in a bank vault and refused to return them despite "numerous telephone calls and personal requests," and duplicate policies were requested.
On July 8, 1976 the insurance company sent a letter to Mrs. Jenkins advising her of the insured's desire to "exercise his rights" under the policies, which he could not
forward to the company because they were not available to him. She was further notified that, in view of the insured's request,
Admittedly, Mrs. Jenkins received the letter and did not return the policies. Decedent died on August 5, 1976. Thereafter, Mrs. Jenkins called the insurance company and told one of its employees that she had not responded "because I was going to bury my husband."
Bryan Haynes and Lois Kelly sued Metropolitan Life Insurance Company, demanding payment of the proceeds of the two policies. Mrs. Jenkins was joined as a party defendant. The insurance company filed a cross claim and counterclaim seeking an order directing Bryan Haynes, Lois Kelly, Evelyn Jenkins and Sandra Boyd to interplead their respective claims to the proceeds of the policies, and authorizing it to pay the face amounts of the policies into court. Mrs. Jenkins filed a crossclaim, alleging therein that she had "made substantial payments of premiums * * * in consideration of the aforementioned policies," and that there had been no effective change of beneficiary prior to the insured's death. She sought payment of the proceeds or, in the alternative, the imposition of an equitable lien on the proceeds for premiums she had paid. Sandra Boyd did not enter an appearance in the proceedings below.
Thereafter, following a hearing on plaintiffs' motion for summary judgment and on an order directing the contestants to show cause why the face amount of the $3,000 policy should not be paid to Sandra Boyd if Bryan Haynes and Lois Kelly prevailed on their policies, the trial judge entered a judgment that, in pertinent part, divided ...