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Hassoun v. Reliastar Life Insurance Co.

United States District Court, S.D. Florida

January 19, 2018

NAWAL M. HASSOUN, Plaintiff/Counter-Defendant,
v.
RELIASTAR LIFE INSURANCE COMPANY, a Minnesota company, Defendant/Counter-Plaintiff. RELIASTAR LIFE INSURANCE COMPANY, a Minnesota company, Third-Party Plaintiff,
v.
LABEEB HASSOUN, individually, KAYRIA T. HASSOUN, individually, and JAMEEL M. HASSOUN, individually, Third-Party Defendant.

          OMNIBUS ORDER ON MOTIONS FOR SUMMARY JUDGMENT, MOTION FOR DISCHARGE, AND MOTIONS TO STRIKE

          BETH BLOOM UNITED STATES DISTRICT JUDGE

         THIS CAUSE is before the Court upon several motions filed by the parties. Plaintiff Nawal M. Hassoun (“Plaintiff” or “Nawal”)[1] filed initially filed her complaint in state court seeking declaratory judgment. ECF No. [1-2]. Defendant and Third-Party Plaintiff, Reliastar Life Insurance Company (“Reliastar”)[2] timely removed. See ECF No. [1].

         On August 15, 2017, Reliastar filed its operative Second Amended Counterclaim and Third-Party Complaint in Interpleader, interpleading Plaintiff; Labeeb Hassoun (“Labeeb”), now voluntarily dismissed from the action; and the Third Party Defendants Kayria T. Hassoun and Jameel M. Hassoun (“Kayria” and “Jameel, ” together, the “Third Party Defendants”). ECF No. [54] (“Interpleader Complaint”). In the Interpleader Complaint, Reliastar seeks an order requiring Nawal, Labeeb, Kayria, and Jameel to interplead their rights, discharging Reliastar from all liability, awarding Reliastar attorneys' fees, and dismissing it from the action. Id. at 5- 6.

         Plaintiff filed her operative Second Amended Complaint on September 13, 2017 against Reliastar and the Third Party Defendants. ECF No. [64]. Plaintiff's Second Amended Complaint asserts a sole cause of action for declaratory judgment that (1) insurance policy in question was in full force and effect at the time of the insured Walid Hassoun's death; (2) that Walid Hassoun changed the beneficiary under the Policy to the Plaintiff; and (3) that Plaintiff is the beneficiary under the Policy. Plaintiff also seeks an award of attorneys' fees. Id. at 6-7.

         Six motions are currently pending before the Court related to the operative pleadings as follows:

1. Reliastar's Motion for Discharge from Action and Permanent Injunction from Future Claims and Incorporated Memorandum of Law, ECF No. [77];
2. Third-Party Defendants' Motion for Final Summary Judgment, ECF No. [82];
3. Reliastar's Motion for Summary Judgment and Memorandum of Law, ECF No. [84];
4. Plaintiff's Cross-Motion for Summary Judgment, ECF No. [87];
5. Third-Party Defendants' Motion to Strike Statement of Material Facts Pursuant to Local Rule 56.1(a), ECF No. [96];
6. Reliastar's Motion to Strike Declarations of Dr. Mustafa Hamed [D.E. 86-11] and Mahiatab Nayef Cheblac [D.E. 86-12] and Affidavit of Nawal Hassoun [D.E. 86-13], ECF No. [104]

         The parties filed oppositions to each motion, and for all motions except Reliastar's Motion to Strike, ECF. No. [104], the movants each filed replies. All six motions are ripe for review.

         I. FACTUAL BACKGROUND [3]

         A. The Life Insurance Policy

         On January 18, 2016 Walid Hassoun (“Walid” or the “Insured”) passed away in Tripoli, Lebanon, leaving behind a $130, 000 employer-sponsored life insurance policy under the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq. See ECF Nos. [85] ¶ 2; [86] ¶ 14; [86-5], [90-5], and [92-4] (“Death Certificate”); [86-11] ¶ 2; [90] ¶ 14; [92] ¶ 14. The parties agree that the entirety of the insurance policy at issue contains three separate documents: a two page document entitled Schedule of Benefits, a booklet also entitled Schedule of Benefits (“Schedule of Benefits Booklet”), and a handwritten form which appears to memorialize the general terms of the group policy held between Walid's employer, the Law Companies Group, and Reliastar. See ECF Nos. [9-1], [22-1], [54-1], [86-1], [90-1], [92-1] (“Policy”). The Schedule of Benefits Booklet states that the Policyholder and Administrator is the Law Companies Group. Id. [4]

         Under the section entitled “Life Insurance, ” the Policy explains what a beneficiary is, how to change the beneficiary, and to whom the Policy proceeds are paid. The relevant contract terms state in full:

Beneficiary The beneficiary is named to receive the proceeds to be paid at your death. You may name one or more beneficiaries. You cannot name the Policyholder as beneficiary.
You may name, add, or change beneficiaries by written request as described below. You may also choose to name a beneficiary that you cannot change without his or her consent. This is an irrevocable beneficiary.
How do you name, add, or change beneficiaries?
You can name, add, or change beneficiaries by written request if all of these are true:
• Your coverage is in force.
• We have written consent of all irrevocable beneficiaries.
• You have not assigned the ownership of your insurance. The rights of an assignee are described under the Assignment section.
All requests are subject to our approval. A change will take effect as of the date it is signed but will not affect any payment we make or action we take before receiving your notice.
To whom do we pay proceeds?
We pay proceeds to the beneficiary. If there is more than one beneficiary, each receives an equal share, unless you have requested another method in writing. To receive proceeds, a beneficiary must be living on the earlier of the following dates:
• The date we receive proof of your death.
• The 10th day after your death.
If there is no eligible beneficiary or if you did not name one, we pay proceeds to the persons listed below in order. The person must be living on the tenth day after your death:
1. Your spouse.
2. Your children.
3. Your parents.
4. Your estate.

         ECF No. [54-1] at 11 (emphasis in original). The Definitions section defines “written, in writing” as “signed and dated and received at our Home Office in a form we accept.” Id. at 16. The parties dispute whether the Policy requires that changes to a beneficiary require affirmative approval by Reliastar. ECF Nos. [83] ¶ 5-6; [85] ¶ 3; [86] ¶ 2; [90] ¶ 2; [92] ¶ 2; [98] ¶ 4.

         Walid enrolled in the policy in the fall of 1995 using a form entitled “1996 Enrollment Form, ” naming his wife, Chafnaze Chablak, as the primary beneficiary and his brother, Labeeb Hassoun, as the contingent beneficiary. See ECF No. ECF Nos. [9-2], [22-2], [54-2], [86-2], [90-2], and [92-2] at 1 (“1996 Enrollment Form”); see also ECF Nos. [85] ¶ 4; [86] ¶ 7; [90] ¶ 7; [92] ¶ 7; [98] ¶ 7; [101] ¶ 7. The 1996 Enrollment Form is dated October 22, 1995 and bears a signature which reads “Walid Hassoun.” ECF No. [54-2] at 1. The beneficiary form also bears a stamp which indicates it was received by Reliastar on July 18, 1996. Id.

         B. The 2006 Beneficiary Form

         On December 20, 2006, a beneficiary designation form was received by Reliastar (“2006 Beneficiary Form”). ECF No. [52-2], [54-3], [86-3], [90-3], and [92-3]; see also ECF Nos. [85] ¶ 8; [86] ¶ 8; [98] ¶ 8; [101] ¶ 8; [82-1], [83-1], and [86-10], Moerbitz Tr. at 126-27. The 2006 Beneficiary Form named four beneficiaries: Third Party Defendants (Walid's mother and brother) and Amal M. Hassoun and Siam M. Hassoun (two of Walid's sisters, now deceased). ECF No. [54-3] at 1; see also ECF Nos. [85] ¶ 5; [86] ¶ 8; [90] ¶ 8; [92] ¶ 8; [98] ¶ 6. The form is dated November 28, 2006 in Plantation, Florida; bears a signature which is dissimilar to the 1996 Enrollment Form; and is notarized. ECF Nos. [54-3] at 1; [85] ¶ 6; [86] ¶ 2; [98] ¶ 24. The instructions on the form to the insured state: “Type or print legibly in ink. Sign and date the form. Return the original and retain a copy for your records.” ECF No. [54-3] at 1. The directions to the Plan Administrator state: “Send the completed form to the insurance company for approval if any of the following apply: 1) The wording used in the request differs from the examples given on the reverse side; 2) The policy/certificate has been assigned; 3) The previous beneficiary is irrevocable; or 4) The coverage is under an individual policy. . . . For forms that do not require insurance company approval, retain a copy of the approved form with the insured's records.” Id.

         The 2006 Beneficiary Form contains a handwritten notation that Walid was “on wavier, ” meaning that Reliastar had determined he was completely disabled and no longer needed to pay premiums to maintain the Policy. See Moerbitz Tr. at 48, 67-68; [86] ¶ 5; [98] ¶ 5. Moerbitz testified that it is Reliastar's policy to maintain all change of beneficiary forms for insureds that are “on waiver.” See Moerbitz Tr. at 67-68; ECF Nos. [86] ¶ 6 and [101] ¶ 6.[5] By way of letter dated January 8, 2007, Reliastar acknowledged receipt of the 2006 Change of Beneficiary Form. ECF No. [54-4]; see also Moerbitz Tr. at 130-31; ECF Nos. [83] ¶ 4; [85] ¶ 7; [86] ¶ 8; [98] ¶ 8, 25; [101] ¶ 8, 16. Specifically, the letter states: “We have received and processed your request to change the beneficiary of your life insurance coverage.” ECF No. [54-4].

         C. The 2008 Power of Attorney

         On November 22, 2008, Walid granted a power of attorney to Mahitab Nayef Cheblac (also spelled Shablak), his sister-in-law, “in order for [her] to help him with his affairs.” See ECF No. [86-12], Declaration of Mahitab Nayef Cheblac (Nayef Aff.) ¶ 2; id. at 4-8, Nayef Aff. Ex. 1, General Absolute Comprehensive Power of Attorney (Original and Certified Translation) (“Power of Attorney”); see also ECF No. [86] ¶ 11. Nayef avers that she “used to talk to him [Walid] daily and [] used to see him every month so that [she] could help him take care of his needs.” Id. ¶ 2. She states that “[d]ue to his medical condition, he could not move his hands, so he could not use his hands to eat or write. He could not sign documents with a written signature. He told me that his [sic] used his fingerprint or thumbprint to sign documents.” Id.; see also ECF No. [86] ¶ 10. The original, untranslated version of the Power of Attorney bears a mark on each page which appears to be a thumbprint. Id. at 6, 7, 8. Nayef avers that this mark is Walid's thumbprint, and the certified translation of the document ends stating “[t]he mandator Walid Mohamad Hassoun Signs as follows (signature thus).” ECF No. [86-12] ¶ 2.[6]

         D. Walid's Diagnosis

         According to Dr. Mustafa Hamed, Walid's treating physician from 2013 to 2016, Walid was diagnosed with amyotrophic lateral sclerosis (“ALS”) in May of 2013. ECF No. [86-11], Affidavit of Dr. Mustafa Hamed dated November 25, 2017 (“Hamed Aff.”) ¶ 2; id. at 3-4, Hamed Aff. Ex. 1, Neurology Department Report dated May 18, 2016 (“I confirm that my patient Walid Hassoun was affected by amyotrophic lateral sclerosis (ALS).”); see also ECF No. [86] ¶ 9; [90] ¶ 9; [92] ¶ 9. Based on his role as treating physician to Walid, Dr. Hamed opines that “[d]ue to his condition, Walid Hassoun was unable to move his hands and so he could not write or use his hands to eat.” ECF No. [86-11] ¶ 3. Dr. Hamed further avers that Walid told him that because of his condition, Walid used his fingerprint to sign documents. Id. at 3-4, [86-11] Hamed Aff. Ex. 1 (“During the course of his disease he was unable to move his hands (writing, eating), because what [sic] he was using his fingerprint for legal issues”).[7]

         E. The 2013 Beneficiary Form

         In 2013, Walid lived in Tripoli “in his own house” with his mother, this brother, two nurses, and a maid. Nayef Aff., ECF No. [86-12] ¶ 3; Nawal Aff., ECF No. [86-13] ¶ 3; see also ECF No. [86] ¶ 10. On August 24, 2013 Walid traveled to Nayef's home for a weekend visit. Nayef Aff., ECF No. [86-12] ¶ 4; see also ECF No. [86] ¶ 10. Walid brought a blank beneficiary designation form to the visit. While Nayef and Walid were alone in the kitchen and Nayef was helping Walid eat his lunch, Walid told Nayef he wanted to change the beneficiaries under his life insurance policy and instructed Nayef to help him complete the form. ECF No. [86-12] ¶ 4; see also ECF No. [86] ¶ 10. Nayef avers that Walid told her to list Plaintiff and his niece as the beneficiaries. ECF No. [86-12] ¶ 4; see also ECF No. [86] ¶ 10. Nayef filled out the form accordingly. ECF No. [86-12] ¶ 4.

         According to Nayef: “After I filled in the form and listed the beneficiaries, I saw Walid Hassoun place his fingerprint on the beneficiary designation form. He placed the fingerprint on the form in front of me after I filled out the form pursuant to his instructions.” Id. ¶ 6; see also ECF No. [86] ¶ 11. Nayef further states that Walid used his thumbprint because he could not move his arms or hands anymore. ECF No. [86-12] ¶ 6; see also ECF No. [86] ¶ 10.

         After Walid placed his thumbprint on the form, Walid instructed Nayef to send the completed beneficiary form, ECF Nos. [22-3], [54-5], [86-4], [90-4], and [92-4] (“2013 Beneficiary Form”), to the United States via Aramex to Walid's uncle in Florida. ECF No. [86-12] ¶ 7; see also ECF No. [86] ¶ 12. Walid further instructed Nayef to tell the uncle, who also had a power of attorney, to send the forms to Reliastar. ECF No. [86-12] ¶ 4; see also ECF No. [86] ¶ 12. Nayef states that she told Walid's uncle to mail the 2013 Beneficiary Form to Reliastar, and later confirmed with the uncle that he had received the 2013 Beneficiary Form and had forwarded it to the insurance company. Id.; see also ECF No. [86] ¶ 12.[8]

         At some point after August 2013, Nawal traveled to Tripoli, Lebanon. While visiting with Walid, Walid informed Nawal that “he had placed [her] as a beneficiary on his life insurance policy.” Nawal Aff., ECF No. [86-13] ¶ 3. Nawal avers that “[g]iven that he signed the 2013 Beneficiary Form in August of 2013, our meeting had to occur after that date because he told me that he had already made me the beneficiary. I did not know anything else about his policy.” Id. She further states that Walid was “completely disabled due to his medical condition” and that he “could not move his hands or write using his hands, ” and that [h]e used his finger print or thumbprint to sign documents.” Id. ¶ 4.

         On October 16, 2013, Reliastar received the 2013 Beneficiary Form. ECF Nos. [86] ¶ 13; [90] ¶ 13; [92] ¶ 13; [98] ¶ 13; [101] ¶ 13. As described in the Nayef and Nawal Affidavits, the 2013 Beneficiary Form names Plaintiff, Nawal Hassoun, as the beneficiary and Rima Hassoun, Walid's niece (“Rima”), as the contingent beneficiary. ECF No. [54-5]. The 2013 Beneficiary Form also notes that Walid is “on waiver.” Id. The 2013 Beneficiary Form contains identical directions to both the insured and plan administrator as the 2006 Beneficiary Form. Id.

         The 2013 Beneficiary Form was never processed by Reliastar. ECF Nos. [85] ¶ 10; [86] ¶ 13; [92] ¶ 13; [98] ¶ 13; [101] ¶ 13. The form was initially received by the Waiver Department-the wrong department-and was never forwarded to the Policy Service Department for processing due to “human error.” Moerbitz Tr. at 41; see also ECF Nos. [83] ¶ 10; [86] ¶ 13; [101] ¶ 13. Reliastar did not review the form, did not accept or deny the 2013 Beneficiary Form, and instead misfiled it electronically within the Waiver Department's folders on its “WISE” document management and workflow system. ECF Nos. [83] ¶ 10; [86] ¶ 13; [98] ¶ 13; [101] ¶ 13.[9] No acknowledgment letter was ever sent to Walid regarding the 2013 Beneficiary Form. ECF Nos. [85] ¶ 10; [86] ¶ 13; [92] ¶ 13; [101] ¶ 13.

         F. The Claims to the Policy Proceeds

         Walid passed away on January 18, 2016. See Death Certificate, ECF Nos. [85-5], [90-5], [92-5]; see also ECF Nos. [86] ¶ 14; [98] ¶ 14; [101] ¶ 14. On March 7, 2016, Nawal filed a claim with Reliastar for the proceeds from the Policy. ECF Nos. [9-4], [22-4], and [54-6]; see also ECF Nos. [86] ¶ 15 and [101] ¶ 15.

         Reliastar searched its records for the operative beneficiary forms, but was only able to locate the 1996 Enrollment Form. ECF No. [52-1], Affidavit of Mary Moerbitz ¶ 5. As Moerbitz testified, “[t]he Reliastar claim adjuster did not search the WISE [document management] system when reviewing the claim submission. A November 28, 2006 Beneficiary Designation Form and an August 24, 2013 Beneficiary Form were housed on that system and were not located while the competing claims were considered. Instead, the adjuster only checked the Oracle IPM system and imaging systems for change of beneficiary forms, located the 1996 beneficiary designation form and believed in good faith that she had exhausted all sources.” Id. Thus, due to “human error, ” Reliastar located neither the 2006 Beneficiary Form nor the 2013 Beneficiary Form. Id.; see also Moerbitz Tr. at 41; ECF Nos. [86] ¶ 16, 18; [98] ¶ 16; [101] ¶ 16. Instead, Reliastar believed that it received the 2013 Beneficiary Form for the first time as an attachment to Nawal's claim for the Policy proceeds after Walid's death. Since as ...


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