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Arizona: Beneficiary Disputes and Interpleader Under Arizona Law

Arizona revokes a former spouse's designation on divorce, and a federal judge in Phoenix applied that rule to a common law marriage that ended without any decree. Its slayer statute lets a civil court decide without a conviction, but silence alone is not proof.

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On this page
  1. Divorce revokes, even without a decree
  2. The slayer statute: preponderance, but real evidence
  3. Decisions
  4. Elsewhere on this site
  5. Related guides

Divorce revokes, even without a decree

A.R.S. § 14-2804 follows the uniform probate code. Divorce or annulment revokes a revocable disposition to the former spouse “Except as provided by the express terms of a governing instrument, a court order or a contract relating to the division of the marital estate made between a divorced couple before or after the marriage, divorce or annulment.”1

MetLife v. Lynch shows how far a federal court was willing to carry the rule. The insured, who lived in the Navajo Nation, had named his son in 1995. In 1999 he changed the designation to a woman he described on the form as his “spouse common law.” After his death she filed a claim describing herself as his “former spouse.” There was no divorce decree, because there had never been a marriage certificate.2

The court held that either way she lost:

  • If the common law marriage was valid, its end revoked her designation. “The language of that statute indicates the clear intent that life insurance benefits to the spouse end with the end of the marriage.” The court added: “Lynch cannot now claim not to be divorced from Decedent simply to obtain the plan benefits.”
  • If the insured was still married to someone else, calling her his common law spouse was a material misrepresentation that made the update unenforceable.

“Because the beneficiary designation to Lynch is not enforceable in either scenario, the Court must give effect to the prior beneficiary designation at the time of Decedent’s death,” which named the son.2 The plan stated that the law of the participant’s state of residence governed, so the court applied Arizona law.

The slayer statute: preponderance, but real evidence

A.R.S. § 14-2803 bars a person who “feloniously and intentionally kills the decedent.” A final conviction is conclusive. Without one, the court decides “under the preponderance of evidence standard” whether the person would be found criminally accountable.3

In Prudential v. Thomas, the insured’s widow was the named beneficiary of his group life coverage. Investigators had found no evidence of foul play, and the manner of death was undetermined. A relative who claimed part of the benefit relied almost entirely on the widow’s refusal to answer interrogatories on Fifth Amendment grounds. The court noted that “no Arizona court has held this invocation alone to be sufficient evidence for a finder of fact to conclude that the invoking party “feloniously and intentionally” killed a decedent.” It held that “the non-moving party must adduce some evidence other than the invocation of the Fifth Amendment to create a genuine dispute that a party may be held criminally accountable for the decedent’s death, and thus, survive summary judgment.”4 Summary judgment went to the widow and to the insured’s children.

Plan type matters

Both Arizona cases involved employer group coverage, and in both the court applied Arizona law: in Lynch because the plan chose the law of the participant's state, and in Thomas without any dispute over the governing law. Where ERISA or a federal program governs and the plan does not adopt state law, the outcome can differ. See federal programs.

Decisions

Metropolitan Life Ins. Co. v. Lynch (D. Ariz. 2021)

  • No. CV-19-08056-PCT-JJT, Doc. 52
  • Judge John J. Tuchi
  • Decided Mar. 23, 2021
Facts
An employee's son was named in 1995. A 1999 update named a woman the insured called his common law spouse. She later claimed as his former spouse, and then said they had not been married.
Holding
Her designation was unenforceable whether the common law marriage was valid and ended (§ 14-2804) or invalid (material misrepresentation). Judgment for the son for $135,869.86 plus interest.
Why it matters
A claimant who held herself out as a spouse could not escape the revocation statute by changing positions once the statute worked against her.

Opinion: GovInfo.

Prudential Ins. Co. of America v. Thomas (D. Ariz. 2018)

  • No. CV-16-08171-PCT-JJT, Doc. 97
  • Judge John J. Tuchi
  • Decided July 26, 2018
Facts
A $90,000 group term life benefit named the insured's wife as primary beneficiary and his children as contingent beneficiaries. Another relative argued the wife was barred by the slayer statute.
Holding
With no independent evidence, the court would not draw an adverse inference from the wife's Fifth Amendment invocation. Summary judgment for the wife and the children; the slayer statute did not apply.
Why it matters
The party invoking the slayer statute carries the burden, and an investigation that found no foul play is hard to overcome with silence alone.

Opinion: GovInfo.

Elsewhere on this site

  • Prudential v. Vagotis (D. Ariz.), a challenge to a change of beneficiary made shortly before the death, is discussed in change of beneficiary disputes.
  • Thrivent v. Bressler (D. Ariz. 2017), a capacity and undue influence dispute, is summarized in the decisions library.

Footnotes

  1. Ariz. Rev. Stat. § 14-2804(A). Arizona Legislature. ↩

  2. Metropolitan Life Ins. Co. v. Lynch, No. CV-19-08056-PCT-JJT, Doc. 52, slip op. at 2–6 (D. Ariz. Mar. 23, 2021). GovInfo. ↩ ↩2

  3. Ariz. Rev. Stat. § 14-2803(A), (F). Arizona Legislature. ↩

  4. Prudential Ins. Co. of America v. Thomas, No. CV-16-08171-PCT-JJT, Doc. 97, slip op. at 4–7 (D. Ariz. July 26, 2018). GovInfo. ↩