OPINION
In this case, we determine the rights of parties to the proceeds of a $50,000 insurance policy insuring the life of Tommy Neal Holt, now deceased. In a marital dissolution agreement incorporated in a divorce decree, the decedent had agreed to acquire a $100,000 life insurance policy naming his child as beneficiary and his former wife as trustee. At the time of his death, the decedent owned a $40,000 insurance policy naming his child as beneficiary and a $50,000 policy naming his mother, who subsequently died, as beneficiary. After suit was brought before the Probate Court of Davidson County, the trial court entered summary judgment in favor of the appellees and ordered that the proceeds of the $50,000 be paid to the former wife as trustee for the benefit of the child. The Court of Appeals affirmed. For the reasons stated hereinafter, we affirm the judgments of the lower courts.
I. FACTS & PROCEDURAL HISTORY
Tommy Neal Holt (“the Decedent”) and Marilyn Kay Hollingsworth Holt divorced pursuant to a decree entered by the Probate Court for Davidson County on May 8, 1990. At the time of the divorce, the couple had one child, Elliott Nathan Holt, born in June of 1978. The divorce decree incorporated the terms of a marital dissolution agreement between the parties. The parties were given joint custody of Elliott Holt, and Mr. Holt was required to make child support payments. Paragraph XII of the marital dissolution agreement provided as follows:
Life Insurance
The Husband and Wife agree that the Husband shall maintain and keep in full force and effect a life insurance policy in the amount of one hundred thousand dollars ($100,000) to secure his obligations for the payment of child support and other debts as set out in this Agreement. The Husband and Wife agree that the parties’ child, Elliot Nathan Holt, shall be named as the sole and irrevocable beneficiary of the Husband’s one hundred thousand dollar ($100,000) life insurance policy as set out in this Agreement. The Husband and Wife agree that the Wife will be named as Trustee for the benefit of the parties’ minor child. In her capacity as Trustee, the Wife shall be, and is hereby authorized and directed to use the proceeds to provide generally for the child’s health, education and support. The Husband and Wife further agree that any monies in the Wife’s possession as Trustee for the benefit of the parties’ minor child will be given to the parties’ minor child at age twenty five with all proceeds that are remaining in trust for the benefit of the child to be paid over to the child at the child’s twenty fifth birthday.
The Husband and Wife further agree that within thirty days of the entry of the Final Decree of Divorce, the Husband will furnish to the Wife a copy of the policy or policies defined herein, showing the appropriate beneficiary designation as set out in this Agreement. In addition,' the Husband will take whatever steps are necessary to allow the Wife to determine directly from the Husband’s insurance agent whether or not the monthly premiums are being *70 paid in accordance with the terms of the insurance policy or policies listed in this section.
Another clause in the divorce decree 1 stated that the provisions would be “binding upon and inure to the benefit of the parties hereto, their personal representatives, heirs and assigns.” At the .time of the divorce, the Decedent did not own any life insurance.
The record reflects that the Decedent failed to comply with the divorce decree by not procuring a $100,000 life insurance policy listing Elliott Holt as the beneficiary and providing Marilyn Holt with a copy of the policy. In September of 1992, while he and Elliott Holt were apparently living with the Decedent’s mother, Sophie Holt, the Decedent obtained from Old Line Life Insurance Company of America (“Old Line”) a life insurance policy in the amount of $50,000. The Decedent designated his mother, Sophie Holt, as the beneficiary of this policy. In 1995 the Decedent obtained, as a benefit from beginning employment with his new employer, Patter-' son Press, a $40,000 policy on his life. He designated Elliott Holt as the sole beneficiary of this $40,000 policy, and no one was 'listed as trustee.
The Decedent died on January 12, 1996. At that time he was in arrears in making child support payments in the amount of $2,721.09. Less .than one week after the Decedent’s death, Sophia Holt altered her will so that all of her estate was bequeathed to Ms. Vickie Lewis. 2 Following the Decedent’s death, all proceeds of his $40,000 life insurance policy were tendered to Elliott Holt, and this policy is not in controversy in this suit.
In January of 1997, Marilyn Holt and Elliott Holt 3 filed this complaint seeking to enforce the May 8, 1990 final divorce decree. Specifically, the complaint demands that the proceeds of the $50,000 Old Line policy be paid to Marilyn Holt as trustee for the benefit of the Child in accordance with the terms of the divorce decree. Sophia Holt and Old Line were listed as defendants in this action. The trial court dismissed the complaint against Old Line after Old Line interplead the funds.
While this matter was pending before the trial scourt, Sophie Holt died. In addition to bequeathing all of her possessions to Ms. Lewis, Sophie Holt’s will named Ms. Lewis as the administrator ad litem for her estate. Accordingly, Ms. Lewis was substituted for Sophie Holt in this action.
Elliott Holt and Ms. Lewis proceeded to file motions for summary judgment. After considering motions, affidavits, and other documents filed by the parties, the trial judge granted summary judgment in favor of Elliott Holt and ordered that the proceeds of the $50,000 Old Line Policy be transferred to Marilyn Holt as trustee for the use and benefit of Elliott Holt. The trial court reasoned as follows:
Since on 9/8/92, when Tommy Neal Holt applied for the $50,000:00 Life insurance policy (the proceeds of which are the subject of this suit), both Tommy Neal Holt and Elliott Nathan Holt were living with Mr. Holt’s mother (Sophia Holt), and since Tommy Neal Holt had been ordered on May 8th of 1990 to obtain $100,000 in life insurance on his life and to make Elliot Nathan Holt, its beneficiary, the Court draws the inference, both from a logical standpoint and from the maxim of equity that “Equity regards that as done which ought to be done”, that it was the intent of Tommy *71 Neal Holt to comply with the Order of the Court (although he obtained only $50,000.00 of the $100,000.00 insurance that had been ordered, and named his mother, Sophia Holt, as the beneficiary instead of his son (who was still a minor) or his ex-wife) and that he intended that his mother be the beneficiary only as Trustee for the use and benefit of his son, Elliott Nathan Holt; and, that it was his intent to simply substitute his mother in place of his ex-wife as such Trustee; and thus, in effect, creating a constructive trust, for the use and benefit of his son.
On appeal, the Court of Appeals affirmed, finding that the trial court’s decision was consistent with Tennessee case law and equitable principles. From this order, Ms. Lewis appeals.
II. ANALYSIS
It is undisputed that the Decedent breached his obligation under the final divorce decree to maintain a $100,000 life insurance policy listing Marilyn Holt as trustee and Elliott Holt as the beneficiary. Ms. Lewis contends that since the Decedent was not prohibited from purchasing other life insurance policies listing other individuals as beneficiaries, Elliott Holt’s only remedy is an action against the Decedent’s estate. Therefore, Ms. Lewis contends that the trial court should have granted summary judgment to her instead. Elliott Holt responds that the trial court properly found that he was entitled to the proceeds of the $50,000 policy.
A. Standard of Review
In this case, both Elliott Holt and Ms. Lewis moved for summary judgment. On appeal, Ms. Lewis appears to assert both that the trial court erred in granting summary judgment to Elliott Holt and that the trial court should have granted summary judgment to Ms. Lewis. Summary judgment is appropriate if the movant demonstrates that no genuine issues of material fact exist and that the movant is entitled to a judgment as a matter of law. Tenn. R. Civ. P. 56.03. We must take the strongest view of the evidence in favor of the nonmoving party, allowing all reasonable inferences in favor of the nonmovant and discarding all countervailing evidence.
Shadrick v. Coker,
B. Tennessee Law
Tennessee courts have long recognized that “[e]quity regards that as done which in good conscience ought to be done.”
McCann Steel Co. v. Third Nat. Bank,
Judge Cardozo has articulated the rationale supporting the judicial recognition of one equitable device, a constructive trust, as follows:
A constructive trust is the formula through which the conscience of equity finds expression. When property has been acquired in such circumstances that the holder of the legal title may not in good conscience retain the beneficial interest equity converts him into a trustee.
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A court of equity in decreeing a constructive trust is bound by no unyielding formula. The equity of the transaction must shape the measure of relief.
Beatty v. Guggenheim Exploration Co.,
by fraud, actual or constructive, by duress or abuse of confidence, by commission of wrong, or by any form of unconscionable conduct, artifice, concealment, or questionable means,' or who in any way against equity and good conscience, either has obtained or holds the legal title to property which he ought not, in equity and good conscience hold and enjoy.
Rowlett v. Guthrie,
Tennessee courts have utilized equitable grounds to protect persons legally mandated to be listed as beneficiaries of a life insurance policy. As such, it is clear under Tennessee law that an enforceable agreement, such as a marital dissolution agreement, which mandates that an individual be listed as a beneficiary of a life insurance policy existing at the time of the agreement vests in that individual an equitable interest in the designated, policy. In
Goodrich v. Massachusetts Mut. Life Ins. Co.,
The [husband] further agrees to pay the premiums upon and to continue in force a certain policy of insurance on his life, which said policy is in the sum of Five Thousand Dollars ($5,000.00), and to keep said insurance in force in favor of [the wife] as beneficiary thereof. The said policy of insurance shall be kept in force in favor of [the wife] during the period that she shall remain separated from [the husband] and in the event that she obtains a divorce, during the period that she shall remain single thereafter.
Id. at 265: The husband, at the time of the agreement and divorce decree, had in effect a policy insuring his life in the amount of $5*000. Fourteen years after the divorce, the husband changed the beneficiary on the policy so that it listed his son. After changing the beneficiary, the husband died.
In ruling that former wife was entitled to the proceeds of the life insurance policy in question, the Court of Appeals stated as follows:
It is true that where the right to-change the beneficiary has been reserved to the insured by the terms of the insurance policy, the beneficiary named in the policy has a mere expectancy, and has no vested right or interest during the life time of the assured. Page v. Detroit Life Insurance Co.,11 Tenn.App. 417 , at page 424, and cases therein cited.
However, in this case the divorce decree specifically provides that the agreement made, by the parties on September 3, 1932, was by the court ratified, approved and its provisions adopted by the court. These provisions thus become a part of the decree....
The effect of this decree is more than a mere assignment by the insured of his right to change the beneficiary. It was a judicial determination that the insured should have the right to change the beneficiary only in the event that [the former wife] should remarry.
We think the legal consequence of this decree was to give [the former wife] a vested interest in the proceeds of the policy, subject to be divested only by a rightful change of the beneficiary by the insured, and this could be done only in the event the wife should remarry.
In his [sic] view of the case, it cannot be doubted that an attempt by the insured to change the beneficiary without the joinder of the beneficiary cannot affect the rights of the latter.29 Am. Jur. p. 402 , Sec. 493; p. 986, Sec. 1316; Page *73 v. Detroit Life Ins. Co.,11 Tenn.App. 417 .
The following statement in 29 Am. Jur. Sec. 1314 is fully applicable to the case at bar:
“Equities may arise in favor of the beneficiary in a life insurance policy which will deny the insured the right to change the beneficiary, as, for example, the insured, for a valuable consideration, estops himself from changing his designation of the beneficiary.”
There could hardly be a stronger case for the application of this rule than the case under consideration. Certainly if the insured himself were alive in a contest between him and the former wife, he could not be heard to say that he had either assigned a policy or changed the beneficiary. And, his privies can stand on no higher ground than he does. This is true because the rights of both an assignee and a beneficiary are derivatives. (Citations omitted).
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[T]he decree in the divorce case gave the [former wife] a vested right in the policy, as between her and the insured. In violation of the agreement and the decree, the insured has fraudulently attempted to deprive her of the proceeds of the policy by an attempted change of beneficiary. Equity will intervene in such case and declare her beneficiary in the policy.
Goodrich,
The Court of Appeals addressed similar factual circumstances in
Herrington v. Boatright,
In
Dossett by Dossett v. Dossett,
This Court first found that the life insurance policy at issue was the policy to which the divorce decree referred and had an approximate value of $20,000 at the time of the divorce. Id. at 98. Holding that the children were entitled to the proceeds of the insurance policy, the Court reasoned as follows:
Under the stipulated facts of this case, we perceive no significant difference between the provision of the property settlement agreement in Herrington, supra, that the husband “shall keep his life insurance in effect and shall keep Wife as the beneficiary” and that in the divorce decree in the present case where the husband “is required to maintain a $20,000 life insurance policy upon his life and with the minor children of the marriage designated as the beneficiaries of said policy.”
*74 Id. at 99. The Court proceeded to find that the children were entitled to the entire amount of the policy, including the accidental death benefit, since it was part of the same policy. Id. at 99-100.
These cases stand for the proposition that when a life insurance policy exists at the time of the divorce decree, the mandated beneficiary of the divorce decree retains a vested interest in that policy in the event that the obligor spouse does not comply with the terms of the divorce decree. No reported cases in Tennessee, however, address the circumstance in the present case in which no identifiable insurance policy existed at the time of the divorce. 4 In the present case, Ms. Lewis argues that these aforementioned cases are distinguishable. Ms. Lewis contends that since no insurance policy existed at the time of the Decedent’s divorce, there is no evidence of a fraudulent transfer or any other form of abuse of confidence, duress, or the commission of a wrong. Furthermore, Ms. Lewis stresses that the divorce decree did not expressly prohibit the Decedent from obtaining other life insurance policies listing other individuals as beneficiaries. Accordingly, Ms. Lewis asserts that Elliott Holt does not have a vested right in any particular insurance policy and, thus, Elliott Holt is simply an ordinary creditor of the Decedent’s estate. Elliott Holt responds that the principles espoused in such cases as Goodrich, supra, and Dossett, supra, should be extended to the case at hand due to public policy considerations that discourage the violation of contractual agreements and court orders.
C. Other Jurisdictions
Because no case law in Tennessee specifically addresses this issue, we have looked to other jurisdictions for guidance. As in Tennessee, the vast majority of related case law in other jurisdictions involves circumstances in which identifiable life insurance policies existed at the time that the divorce decree was entered.
See generally
Annotation,
In
Equitable Life Assurance Soc’y v. Flaherty,
Applying Florida law, the court ruled that equity compelled a finding that the child was entitled to proceeds of the insurance policy, but only to the extent of $10,-000, the amount specified in the divorce decree. The court found as follows:
The Court agrees that the present case, herein the husband has obviously been ordered to obtain an insurance policy, differs from the many other cases ... wherein a party to divorce has been ordered to maintain an existing policy naming a minor child as beneficiary. *75 However, in view of the intent and purpose of the decree, to-wit: providing security for the support of the minor child, this Court does not find the difference to be significant or distinguishable.
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The Court concludes that, so far as decedent [husband’s] obligation under the stipulation of the divorce decree requiring that he maintain the above-mentioned insurance coverage, he had no power in contemplation of law to name anyone other than his daughter ... as beneficiary to the extent of $10,000.00 in proceeds of the only insurance policy he secured after said divorce decree. [The second wife], as named beneficiary of the policy, thus may claim title to the proceeds of the policy subject to the equitable interest which [the daughter] acquired by virtue of the divorce decree. The designation of [the second wife] as beneficiary of the life insurance proceeds by the insured, [the decedent], pursuant to the terms of said policy, does not defeat the prior order of court requiring that the insured’s minor child be named irrevocable beneficiary of life insurance proceeds to the extent of $10,-000.00. To rule otherwise would defeat the obvious intent of the property settlement and the final divorce decree and would abrogate the power of any Florida court to equitably provide security for the care, custody and maintenance of minor children....
Id. at 615-16. Notably, the court refused to hold the child accountable for her mother’s failure to enforce the divorce decree prior to the decedent’s death, and labeled the named beneficiary’s knowledge of the terms of the divorce decree as “irrelevant” to its analysis. Id. at 615 n. 2.
In
Pernick v. Brandt,
On appeal, the Michigan Court of Appeals contrasted the case with existing Michigan case law precedent “because in this case there was no life insurance policy naming [the former wife] as beneficiary at the time of the divorce. Nor was [the former wife] ever named beneficiary of the policy at issue in this case.”
Id.
at 245. Nevertheless, the Court cited
Flaherty, supra,
and concluded that the divorce decree vested the former wife with “an equitable interest in $50,000 of the proceeds of
any
insurance policy subsequently purchased by [the decedent] on his life.”
Pernick,
Notably, however, the Court ruled that the former wife had an equitable interest in the proceeds of “any” life insurance policy and not necessarily the policy listing the second wife as beneficiary.
Id.
Thus, the Court held that the trial court erred in granting summary disposition to the for
*76
mer wife “without determining to what extent, if any, [the second -wife] also had an interest in the proceeds of the insurance policy, and whether [the former wife’s] equitable interest is superior to any interest held by [the second wife].”
Id.
at 246. Citing
Greenberg v. Greenberg,
A different approach was taken by the Wisconsin Court of Appeals in
Parge v. Parge,
In a split decision, the Court of Appeals affirmed the trial court’s decision granting summary judgment to the named beneficiaries. After citing precedent in which Wisconsin courts had imposed constructive trusts on insurance proceeds in similar cases, the majority reasoned as follows:
Distinguishably, in the case before us, there were no preexisting policies. There was nothing for [the plaintiffs’] right to “vest” in.- More appropriately, [the decedent] could have been cited for contempt for failure to acquire and maintain policies as ordered. The court order to “maintain” insurance gave rise to no right to á constructive trust over subsequently acquired insurance.
To -impose a constructive trust on property transferred to a third party, the identity of the trust fund must be established.... In this case, there were no “funds” or policies in existence at the time of the [divorce] order. There was no transfer to another fund upon which a trust could attach because there was nothing to transfer.
Id. at 219. 6
Although the facts are not directly on point, several other cases from other jurisdictions are also enlightening. In a majority of these decisions, courts have tended to enforce the divorce decree obligation of the deceased former spouse by providing an equitable remedy at the expense of the named beneficiaries.
See, e.g., Rollins v. Metropolitan Life Ins. Co.,
III. CONCLUSION
After carefully considering principles of law as well as principles of equity, we conclude that no significant difference exists between circumstances in which an identifiable life insurance policy existed at the time of the divorce,
e.g., Dossett, supra, Goodrich, supra,
and the circumstances of the present case.
See Flaherty,
We agree with the district court in
Flah-erty
that a contrary ruling would “abrogate the power” of divorce courts in this state.
See Flaherty,
The judgnients of the lower courts granting summary judgment to the appel-lees are affirmed. Costs of the appeal 'are taxed to Ms. Lewis.
ORDER
On April 29, 1999, Appellees Marilyn Kay Hollingsworth Holt and Elliott Nathan Holt timely filed a “Motion to Clarify Judgment,” asking this Court to clarify its April 19, 1999 judgment in this matter to address whether the appellees are entitled to attorney’s fees. It appearing that the Appellees requested an award of attorney’s fees in their brief before this Court and that this Court retains the discretion to award such fees, see Tenn. Code Ann. § 36 — 5—103(c) (Supp. 1998), we hereby remand this cause to the trial court to determine and award a reasonable fee for the Appellees’ attorney’s cost during the appellate stages of this suit. It is ORDERED.
Notes
. The divorce decree incorporating the marital dissolution agreement will be collectively referred to as the "divorce decree" throughout this opinion.
. The record does not indicate Sophia Holt's relationship with Ms. Lewis.
.Throughout this opinion, Marilyn Holt and Elliott Holt will often be referred to collectively as "Elliott Holt.”
. Although we granted permission to appeal in a Tenn. R.App. P. 11 application in January of 1997 to resolve this specific issue, the appeal was subsequently dismissed by the parties.
. The second wife responded that she had already spent $75,000 of the proceeds on expenses related to the decedent's terminal illness.
. The dissenting judge opined that equity dictates that the plaintiffs should prevail due to the unjust enrichment of the named beneficia-ríes in violation of the divorce decree. Id. at 220 (Fine, J., dissenting).