641 N.E.2d 261 | Ohio Ct. App. | 1994
On April 18, 1984, John D. Mize ("Mize") was employed by National Life Accident Insurance Company ("NLAI"). As an employee of NLAI, Mize was eligible to participate in his employer's group health and accident insurance plan under policy GE6500, which was underwritten by defendant American General Fire Casualty Company ("AGFC"). Mize submitted an enrollment application for coverage under policy GE6500. Mize selected the "family plan," which included a $50,000 benefit payable upon the accidental death of his wife Amma *574 Anim Mize. The enrollment application stated that Mize, the employee-applicant, was his spouse's beneficiary. No one else was designated as a beneficiary of the insurance on his wife's life. The premium for Amma Anim Mize's coverage was paid by Mize through payroll deductions.
On August 25, 1984, Mize murdered his wife. He was tried, convicted and sentenced for her murder. The appeal of his conviction was dismissed as moot in September 1986 after Mize died in prison.
On December 5, 1985, while Mize's appeal was still pending, A. Noel Caliman, administrator of the estate of Amma Anim Mize, contacted John B. Allyn, legal counsel and vice-president of AGFC, regarding the payment of the $50,000 death benefit upon Mize's disqualification pursuant to R.C.
"(A) * * * [N]o person who is convicted of, pleads guilty to, or is found not guilty by reason of insanity of a violation of or complicity in the violation of section
Various options were discussed as a means of resolving the potentially conflicting claims for the $50,000 death benefit.
On January 29, 1986, Caliman and the parents of Amma Anim Mize filed a complaint for declaratory judgment requesting that the trial court declare that they were entitled to the $50,000 death benefit.
On August 24, 1987, Caliman and Amma Anim Mize's parents filed a separate complaint alleging bad faith on the part of AGFC in failing to pay to them the $50,000 death benefit. The case was not consolidated with the declaratory judgment action, and was assigned to a different trial judge. Motions for summary judgment by the parties were overruled. A jury trial commenced July 6, 1992, on the claim of bad faith. At the close of the plaintiffs' case-in-chief, AGFC moved for a directed verdict, which the trial court granted.
The trial court held that under policy GE6500 and R.C.
On August 31, 1992, AGFC filed a motion in the declaratory judgment action, which was pending before another judge, requesting judgment as a matter of law based upon the doctrine of collateral estoppel. AGFC argued that plaintiffs were collaterally estopped from relitigating their right to the $50,000 death benefit because that issue had been litigated in the bad-faith action and had been decided against plaintiffs. The trial court ordered the declaratory judgment action to proceed to a bench trial on November 9, 1992. The trial court held that Amma Anim Mize's parents were entitled to the $50,000 death benefit under policy GE6500. Plaintiffs filed a motion for prejudgment interest, which the trial court overruled. AGFC appealed the trial court's judgment in the case numbered C-930236. Plaintiffs filed a cross-appeal from the denial of their motion for prejudgment interest in case No. C-930260. The appeal and cross-appeal in the declaratory judgment action were consolidated with the appeal in the bad-faith case.
We will first address the three assignments of error raised by Caliman and Amma Anim Mize's parents in their appeal from the trial court's judgment in the bad-faith action. The assignments of error, as set forth by plaintiffs, allege:
"Whether the trial court erred as a matter of law where it failed to find that the parents of Amma Anim Mize have standing to sue, pursuant to plaintiffs-appellants' motion for summary judgment;
"The trial court erred in determining the defendant-appellee's motion for summary judgment where it failed to find that the defendant-appellee engaged in bad faith;
"The trial court erred as a matter of law where it granted a directed verdict at the close of plaintiffs-appellants' case."
Insurance coverage is a matter of contract. See Karabin v.State Auto. Mut. Ins. Co. (1984),
Policy GE6500 provides for the payment of the accidental loss-of-life benefit as follows:
"Payment of Claims: Indemnity for accidental loss of life will be payable in a lump sum to the beneficiary of record."
The enrollment application submitted by Mize stated that Mize, as the employee-applicant, was the beneficiary of the insurance coverage on his spouse, *576 Amma Anim Mize. No other beneficiary was designated for the insurance on his wife's life. Under the payment-of-claims provision of policy GE6500, the $50,000 was payable only to Mize as the beneficiary of record.
The distribution provision of policy GE6500 provides:
"If, at the death of the Insured, there is no surviving beneficiary, the accidental loss of life indemnity shall be payable in one sum to the first surviving class of beneficiaries, otherwise to the estate of the Insured: wife, husband, child or children, father, mother, brothers or sisters."
Plaintiffs argue that the distribution provision, in concert with R.C.
The term "Insured" is defined in the policy of insurance as one whose name appears on a schedule maintained by the insurer. The "Schedule of Insureds" was composed of employees of NLAI who submitted enrollment applications and satisfied the eligibility requirements of the policy. The policy states that the insurer agrees:
"TO INSURE such eligible persons who are identified on the Schedule of Insureds of this policy, herein called the Insured * * *."
The term "Insured" as used in the distribution provision referred to Mize, the employee whose name appeared on the "Schedule of Insureds." The distribution provision served to direct payment of the insurance proceeds in the event that Mize died with no surviving beneficiary.
Pursuant to the terms of policy GE6500, the $50,000 death benefit on the life of Amma Anim Mize was payable solely to Mize, the beneficiary of record. Only Mize had the right to make a claim under the contract of insurance for payment of the death benefit. Mize was disqualified from claiming the death benefit by R.C.
We now turn to the assignments of error raised by AGFC in its appeal from the trial court's entry in the declaratory judgment action which held that Amma Anim Mize's parents were entitled to the $50,000 death benefit under policy GE6500. The assignments of error allege:
"The trial court erred in overruling defendant-appellant's motion for a declaration of policy rights and entry of judgment as a matter of law;
"The trial court erred when it determined that the parents of Amma Anim were beneficiaries under policy GE6500 and entitled to judgment thereunder in the amount of $50,000."
AGFC argues that pursuant to the doctrine of collateral estoppel, the judgment in the bad-faith action bars plaintiffs from relitigating their rights to the $50,000 death benefit in the declaratory judgment action.
Collateral estoppel "precludes the relitigation, in a second action, of an issue that has been actually and necessarily litigated and determined in a prior action which was based on a different cause of action." Whitehead v. Gen. Tel. Co. (1969),
"A point of law or a fact which was actually and directly in issue in the former action, and was there passed upon and determined by a court of competent jurisdiction, may not be drawn in question in a subsequent action between the same parties or their privies. The prior judgment estops a party, or a person in privity with him, from subsequently relitigating the identical issue raised in the prior action." Trautwein v.Sorgenfrei (1979),
As we stated in Monahan v. Eagle Picher Industries, Inc.
(1984),
"In order to assert collateral estoppel successfully, a party must plead and prove the following elements:
"(1) The party against whom estoppel is sought was a party or in privity with a party to the prior action; *578
"(2) There was a final judgment on the merits in the previous case after a full and fair opportunity to litigate the issue;
"(3) The issue must have been admitted or actually tried and decided and must be necessary to the final judgment; and
"(4) The issue must have been identical to the issue involved in the prior suit."
"The main legal thread which runs throughout the determination of the applicability of * * * collateral estoppel, is the necessity of a fair opportunity to fully litigate and to be `heard' in the due process sense." Goodson, supra,
Plaintiffs had a full and fair opportunity to be heard on the issue of whether they were entitled to claim the $50,000 death benefit in the bad-faith action. They presented the same policy of insurance and enrollment application of Mize as evidence in both cases. The trial judge in the bad-faith action held that plaintiffs had no right to claim the death benefit and that, therefore, they could not maintain an action for bad faith on the part of the insurer. The same issue, the plaintiffs' right to claim the death benefit, was involved in the declaratory judgment action. Plaintiffs had a full and fair opportunity to litigate the issue of their right to the $50,000 death benefit in the bad-faith action, which culminated in a final judgment against them. We hold that the doctrine of collateral estoppel barred plaintiffs from relitigating their right to the death benefit in the declaratory judgment action. AGFC's first and second assignments of error are sustained.
The assignment of error raised by plaintiffs in their cross-appeal, alleging that the trial court in the declaratory judgment action erred in failing to award plaintiffs interest "from August 25, 1984, the date of death of Amma Mize," is overruled. We have held that plaintiffs are not entitled to the $50,000 death benefit and, therefore, they are not entitled to interest.
The judgment of the trial court is affirmed in case Nos. C-920602 and C-930260. The judgment of the trial court is reversed in case No. C-930236 and that cause is remanded with instructions to the trial court to enter judgment in favor of AGFC and for any further proceedings consistent with law and this decision.
Judgment accordingly.
SHANNON, P.J., DOAN and GORMAN, JJ., concur.
