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DeCoursey v. American General Life Insurance Co.

United States District Court, W.D. Missouri, Western Division

January 27, 2015

SUSAN P. DECOURSEY, Plaintiff,
v.
AMERICAN GENERAL LIFE INSURANCE COMPANY, Defendant

For Susan P. Decoursey, Plaintiff: Antwaun L. Smith, Kansas City, MO USA; Kesia Smith, Smith Law Office LLC, Kansas City, MO USA.

For American General Life Insurance Company, Defendant: Edward M. Holt, LEAD ATTORNEY; PRO HAC VICE, Jeffrey M. Grantham, Maynard Cooper & Gale PC, Birmingham, AL USA; Gardiner B. Davis, LEAD ATTORNEY, Spencer Fane Britt & Browne LLP, Kansas City, MO USA; Janine McKinnon McAdory, LEAD ATTORNEY; PRO HAC VICE, Birmingham, AL USA.

For American General Life Insurance Company, Counter Claimant: Edward M. Holt, LEAD ATTORNEY; PRO HAC VICE, Jeffrey M. Grantham, Maynard Cooper & Gale PC, Birmingham, AL USA; Gardiner B. Davis, LEAD ATTORNEY, Spencer Fane Britt & Browne LLP, Kansas City, MO USA; Janine McKinnon McAdory, LEAD ATTORNEY; PRO HAC VICE, Birmingham, AL USA.

For Susan P. Decoursey, Counter Defendant: Antwaun L. Smith, Kansas City, MO USA; Kesia Smith, Smith Law Office LLC, Kansas City, MO USA.

ORDER

GARY A. FENNER, UNITED STATES DISTRICT JUDGE.

Presently before the Court is Defendant American General Life Insurance Company's (" Defendant") Motion for Summary Judgment. (Doc. # 33). Plaintiff Susan P. DeCoursey (" Plaintiff") opposes. (Doc. # 42). For the reasons stated below, Defendant's Motion for Summary Judgment is GRANTED in part and DENIED in part.

DISCUSSION

I. FACTS

Defendant's predecessor, Franklin Life Insurance Company (" Franklin"), sold Plaintiff's husband a life insurance policy (the " Policy"). (April 29, 2013, Letter from American General Life Insurance Company to DeCoursey (" April 29 Letter"), 1). Plaintiff was the beneficiary under the Policy, and the Policy was issued for a face value of $250, 000. (Id.) . Plaintiff's husband made several monthly premium payments pursuant to the Policy. (Id. at 2). He made one premium payment on February 6, 1986, two premium payments on February 24, 1986, one premium payment on March 4, 1986, one premium payment on April 2, 1986, one premium payment on May 1, 1986, and a final premium payment on June 2, 1986. (Id.) . At this time, Plaintiff and her husband resided in Missouri. (Deposition of Susan DeCoursey (" DeCoursey Depo.") 8:3-5).

On August 9, 1986, Plaintiff's husband and son were killed in a car accident. (Id. at 6:20-21; 13:3-5). Plaintiff hired an attorney and filed a claim on the Policy shortly after her husband's death. (Id. at 9:5-14). Franklin denied her claim, alleging the Policy had lapsed. (Id. at 9:15-21). Plaintiff was informed of Franklin's denial shortly thereafter. (Id. at 9:22-10:5). Plaintiff did not file a lawsuit against Franklin or make any further inquiries at that point. (Id. at 10:22-11:13).

In June of 2011, Defendant began a review effort to determine if there were deceased insureds whose policies had not been paid out. (April 29 Letter, 2). The Policy was reviewed. (Deposition of Ann Henderson (" Henderson Depo.") 15:14-16:11). During the review, Defendant reviewed the DMF sheet which is a printout containing information on old unsettled claims. (Deposition of Louise Stith 18:21-19:2). The DMF sheet indicated that the Policy did not lapse until November 7, 1986. (Id. at 25:24-26:14). As a result, Defendant sent Plaintiff a letter on December 22, 2012, informing her that she may be entitled to benefits under the policy. (December 22, 2012, Letter from American General Life Insurance Company to DeCoursey (" December 22 Letter")). On January 24, 2013, Defendant paid Plaintiff $250, 000, the face value of the Policy. (January 24, 2013, Letter from American General Life Insurance Company to DeCoursey (" January 24 Letter")).

Plaintiff then asked Defendant to pay interest on the Policy proceeds at the statutory rate from the date she originally filed a claim until the date the Policy was paid. (DeCoursey Depo. 38:2-11). Defendant refused to pay interest, so on January 29, 2013, Plaintiff filed a complaint with the Department of Insurance. (Id. at 44:10-19). After learning of the complaint, Defendant began investigating the Policy further and reviewed many records. (Henderson Depo. 16:22-17:8, 14:13-23). One of the records Defendant discovered was a termination log that indicated that the Policy was only paid through July 1, 1986, after which the policy lapsed and was terminated. (Id. at 22:12-22). Another record was the purged money file, which also indicated that the policy was only paid through July 1, 1986, and thus terminated on August 1, 1986, after the grace period expired. (Deposition of Christina Wools 43:2-18). As a result, Defendant determined that the Policy was not actually payable and had been paid out in error. (Henderson Depo. 16:6-11). However, Defendant offered to allow Plaintiff to keep the $250, 000 and give her an additional $25, 000 to settle the claim. (April 29 Letter, 3).

On October 25, 2013, Plaintiff filed a Petition in the Circuit Court for Jackson County, Missouri. (Petition). Defendant thereafter removed Plaintiff's Petition to this Court. (Notice of Removal). Plaintiff raised seven counts against Defendant: vexatious refusal to pay, unpaid statutory interest, breach of contract, fraudulent representation, negligent misrepresentation, breach of the covenant of good faith and fair dealing, and unjust enrichment. ( See generally Petition). Defendant filed a two count counterclaim against Plaintiff for monies had and received and unjust enrichment. ( See generally Answer). On April 15, 2014, this Court granted Defendant's Motion ...


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