Life Insurance Co. of North America v. Ortiz
United States Court of Appeals for the Ninth Circuit
535 F.3d 990 (2008)
Police officer Gerry Ortiz named his wife Gloria Ortiz (defendant) as sole beneficiary on his life-insurance policy with Life Insurance Company of North America (plaintiff), and they later divorced; their marital settlement agreement stated the divorce did not automatically cancel a spouse's beneficiary rights on the other's life-insurance policy, and Gerry's own attorney afterward reminded him to separately change the beneficiary designation. Gerry remarried Graciela Ortiz (defendant) in May 2005 and was killed in the line of duty the following month, still with Gloria named as beneficiary; Life Insurance Co. interpleaded the roughly $500,000 in benefits, and Graciela argued the divorce terminated Gloria's interest. The district court agreed and awarded the proceeds to Gerry's estate for intestate distribution to Graciela and his two children; Gloria appealed.
Whether a marital settlement agreement extinguishes a spouse's expectancy interest as a named beneficiary on a life-insurance policy or a will if it is not clear from the text of the agreement that such beneficiary status was contemplated and intentionally waived.