UBS Financial v. Brescia, et al.

(quotation formatting

omitted). So, despite the estate's game attempts to distinguish

these cases--and whatever the equitable appeal of its suggestion

that Toni Ann would "want [her] assets to be inherited by family

members or loved ones, instead of [her]ex-spouse[]"--this court

must award the IRAs to Glen.

I. Applicable legal standard

Summary judgment is appropriate where "the movant shows that

there is no genuine dispute as to any material fact and the

movant is entitled to judgment as a matter of law." Fed. R. Civ.

P. 56(a). A dispute is "genuine" if it could reasonably be

resolved in either party's favor at trial, and "material" if it

could sway the outcome under applicable law. See Estrada v.

Rhode Island,

594 F.3d 56, 62

(1st Cir. 2010) . In analyzing a

summary judgment motion, the court "views all facts and draws all

reasonable inferences in the light most favorable to the

non-moving" parties.

On cross-motions for summary judgment,

"the court must consider each motion separately, drawing

inferences against each movant in turn." Merchants Ins. Co. of

3 N.H., Inc. v. U.S. Fid. & Guar. Co.,

143 F.3d 5, 7

(1st Cir.

1998) (quotation marks omitted).

II. Background

The underlying facts are more or less undisputed. Glen and

Toni Ann were married in 1999. During the marriage, Toni Ann

opened two IRA accounts with UBS, executing, for each account, an

"IRA Application and Adoption Agreement" with UBS.2 In relevant

part, each agreement (a) identified Glen as the "First Primary

Beneficiary , " (b) did not identify any "Second Primary

Beneficiary," or contingent beneficiaries, and (c) acknowledged

that "any interest in this IRA that is not effectively disposed

of by the beneficiary designation I make in this Application or

any subsequent beneficiary designation will be paid to my

surviving spouse and if no surviving spouse to my estate."

In 2006, Glen and Toni Ann filed for divorce with the

then-Salem Family Division of the Rockingham County Superior

Court. Their marriage produced no children. The divorce was

granted when the court approved a "Final Decree on Petition for

Divorce or Legal Separation" executed and submitted by the

parties in August 2006. While the form provided boxes and blanks

2The accounts were not part of any employee benefit or pension plan so as to bring them within the provisions of the Employee Retirement Income Security Act,

29 U.S.C. § 1001

et seq.

4 to complete for the division of various marital assets, many of

the blanks had been marked "see attached," an apparent reference

to a "list of the division of property" appended to the form, and

also signed by each of the parties. In relevant part, this list

stated, "IRA - Each keep their own."

On the same day they submitted the form divorce decree, the

parties also executed the "Release Agreement" mentioned above.

This document states, in pertinent part, that the parties

are not represented by Counsel, and they have agreed that they desire and intend to divide their assets independently and without legal assistance. Husband and Wife drafted an instrument to make a final and complete settlement of all matters relating to the interests of each with respect to current assets and liabilities . . . .

Heretofore [sic], at this time the Husband and the Wife hereby w a i v e [], renounce [], and relinguish[] unto each other, their respective heirs, executors, administrators and assigns forever, in law or in eguity, all and any interest of any kind or character which either may have or may hereafter acguire in or to any real or personal property of the other and whether now owned or hereafter acguired by either.

Toni Ann died in a car accident nearly six years later, on

May 5, 2012. Her estate has since come forward with a "Last Will

and Testament," which she purportedly executed on April 23, 2012,

just 12 days prior to her death.3 This instrument leaves (with

3While the version of this instrument filed with this court bears Toni Ann's purported signature, as well as those of two witnesses to her attestation, Glen says he "believes it was never executed by [her] and suspects that her signature was forged

5 one exception not relevant here) "everything I own. House, cars,

bank accounts, IRAs, investments etc." to one Joseph Addario,

whom the instrument identifies as Toni Ann's "Domestic Partner, "

and also names as the executor of the estate. Toni Ann had no

children at the time of her death.

As noted at the outset, Toni Ann had not changed the

beneficiary designation in favor of Glen on either of the IRAs at

any point. At the time UBS deposited the contents of the IRAs

into this court, see note 1, supra, they contained a total of

$149,379.32.

Ill. Analysis

As the New Hampshire Supreme Court has held, a

"beneficiary's interest in [a life insurance] policy does not

rise to the level of a vested property interest unless the

insured is somehow prohibited from changing the beneficiary

after her decease." Nevertheless, in ruling on the parties' motions for summary judgment, the court has simply assumed that the "Last Will and Testament" is authentic--!.e ., it is a document drafted, if not signed, by Toni Ann, see Fed. R. Evid. 901--without regard to whether it satisfies the requisites of a valid will under New Hampshire law. As Glen points out, the court need not decide that question to resolve this dispute between him and the estate over the IRAs. In any event, this court almost certainly lacks jurisdiction to determine the validity of the purported will. See Marshall v. Marshall,

547 U.S. 293, 311

(2006) ("the probate exception reserves to state probate courts the probate or annulment of a will and the administration of a decedent's estate").

6 designated in the policy." Dubois,

135 N.H. at 58

. This is so,

the court explained, because "the insured may change the

designated beneficiary at any time, provided that the insured has

not contracted away this right." Id . Accordingly, as noted

above, "a divorce decree or stipulation which merely releases all

claims of one party to the property of the other does not, in the

insurance policy context, destroy the beneficiary status of the

first party, because the beneficiary interest is not a vested

property right." I d . at 59. As also noted above, the New

Hampshire Supreme Court has applied these very same principles in

the IRA context, see Tremaine,

, and the parties

agree that these principles apply in this case.

The estate argues that, despite its name, the parties'

"Release Agreement" did more than merely "release all claims of

one party to the property of the other." In fact, the estate

maintains, the agreement--together with the contemporaneous

divorce decree--"expressed the parties' mutual intent to

renounce, extinguish and revoke their existing and anticipatory

interests in either party's retirement accounts." The

interpretation of the agreement and the decree are questions of

law for the court. See Birch Broad., Inc. v. Capitol Broad.

Corp.,

161 N.H. 192, 196

(2010); Tremaine,

7 As the New Hampshire Supreme Court held in Tremaine, "a

divorce decree must unambiguously evidence an intent to remove a

beneficiary in order to effectively alter an original designation

under an IRA contract."

(quotation marks and

bracketing omitted; emphasis added). The court ruled there that

the language of the parties' stipulated divorce decree--"[e]ach

party is awarded any interest in any pension, retirement, 401k,

IRA or other retirement account that each one may have and as

shown on her or his respective Financial Affidavit, free and

clear of any right, title, interest, or claim of the other"--did

not suffice. I d . at 674-76. "While it may be that the

stipulation of the parties in the decree was intended to

terminate the [ex-spouse's] beneficiary interest in the IRA," the

court allowed, "the language could be interpreted to mean that

[the ex-spouse] was to retain her interest. Accordingly, the

divorce decree fails to unambiguously change the beneficiary

designation." I d . at 67 6.

The language of the parties' agreement in this case likewise

fails to unambiguously demonstrate their intent to remove Glen as

a beneficiary of Toni Ann's IRAs. Indeed, the relevant

provisions of the agreement here are nearly identical to those in

Tremaine in both the purported allocation and the purported

8 relinquishment of the parties' rights to the IRAs. Here, the

"division of property" states, "IRA - Each keep their own," while

the stipulation in Tremaine stated, "[e]ach party is awarded any

interest in any pension, retirement, 401k, IRA or other

retirement account that each one may have." Here, the "Release

Agreement" states that each divorcing spouse "hereby waives,

renounces, and relinquishes . . . all and any interest of any

kind or character which either may have or may hereafter acquire

in or to any real or personal property of the other," while the

stipulation in Tremaine awarded each spouse "any interest" in his

or her own IRA "free and clear of any right, title, interest, or

claim of the other." Tremaine, then, is controlling here.

In arguing to the contrary, the estate relies on what it

calls the "far more encompassing and specific" language of the

agreements between Toni Ann and Glen. In relevant part, however,

that language is no more "encompassing" or "specific" than the

language in Tremaine, under which, again, "[e]ach party [was]

awarded any interest in any . . . IRA . . . each one may have

. . . , free and clear of any right, title, interest or claim of

the other." (emphases added). If--as the New Hampshire Supreme

Court ruled--such language fails to "unambiguously evidence an

intent to remove a beneficiary in order to effectively alter

[the] original designation under [the] IRA contract[s ],"

146 N.H. 9 at 675

, then the language here fails at that task as well. Cf.

Dubois,

135 N.H. at 57

(ruling that divorce stipulation requiring

husband to "'make his children the beneficiaries of his insurance

policies' . . . contracted away his right to name anyone else

[the] beneficiary" and therefore voided his subsequent

designation of a subsequent wife).

In any event, the estate's focus on the breadth of the

"Release Agreement"--including its expressed intention "to make a

final and complete settlement of all matters relating to the

interests and obligations of each with respect to current assets

and liabilities"--is misplaced. Again, "a divorce decree or

stipulation which merely releases all claims of one party to the

property of the other does not . . . destroy the beneficiary

status of the first party, because the beneficiary status is not

a vested property right." I d . at 59 (emphasis added) . The

simple designation of a beneficiary--which is all that ever

happened here--"never bestow[s] a vested property interest in the

policy."

It follows that Glen's "[b]eing a beneficiary was

not a 'property right, ' the result of an 'obligation . . . ,' a

'right,' or a 'claim' which was waived and relinquished by the

property settlement agreement," i d . (quotation formatting

altered), whatever the breadth of its waiver language.

10 The estate argues that "[w]hile the Dubois decision

distinguishes a beneficiary's expectancy interests from a vested

property right, [Glen] and Toni Ann did not." This is so, the

estate argues, "given the identification of the couples' [sic]

IRA[s] as 'property'" in the "division of property" attachment to

their stipulated divorce decree. But this argument--that a

divorce decree should be read to incorporate the parties'

misunderstanding of a legal term so as to embrace their

beneficiary interests when the term, properly understood, does

not--has been squarely rejected by the New Hampshire Supreme

Court. See Est. of Frederick v. Frederick,

141 N.H. 530, 532-33

(1996). There, the estate of the decedent ex-spouse argued that

a provision in the parties' divorce decree to "'release each

other from any and all obligations incurred during the marriage'

. . . when viewed in light of the context of the entire

agreement, revealed the decedent's intent to change her

beneficiary designation." I d . at 532 (ellipse by the court

omitted). Rejecting this argument, the court stated that it

"fail[ed] to see how the word 'obligations' can be read to

include the designation of a beneficiary, as there was no

requirement, legal or otherwise, that the decedent name or

continue the [ex-spouse] as beneficiary."

11 Likewise, as just discussed, the designation of a

beneficiary does not convey any property right, so the term

"property" cannot be read to include each party's status as a

beneficiary of the other's IRAs. This conclusion holds,

moreover, despite the fact that the parties here included "IRAs"

(without specifying further) on the "division of property"--after

all, the divorce stipulation in Tremaine specifically awarded

each spouse "any interest in any . . . IRA . . . that each one

may have," but the court nevertheless found this inadequate to

unambiguously effect the ex-spouses' removal as each other's

beneficiaries, as already discussed. The estate's claim, once

again, runs headlong into Tremaine.

As the New Hampshire Supreme Court instructed in Dubois,

removing an ex-spouse as a beneficiary requires the "effort to

change [the] beneficiary on a policy after the divorce or include

an explicit waiver or relinquishment of the beneficiary interest

in the divorce decree." I d . at 60 (quotation formatting

altered). Here, Toni Ann never changed the beneficiary of either

of her IRAs in the nearly six years that passed between her

divorce from Glen and her death, and, as just discussed at

length, nothing in the divorce stipulation, nor the

contemporaneous "Release Agreement," amounts to the "explicit

12 waiver or relinquishment of [Glen's] beneficiary interest"

contemplated by the controlling case law.

Indeed, "a divorce decree may only change a beneficiary

designation when it expressly states that the parties intend such

a result." Frederick,

141 N.H. at 532

(emphasis added). The

stipulated decree, and the contemporaneous release agreement,

contain no such express statement--and the provisions that award

each divorcing spouse his or her own IRAs, and release each

divorcing spouse's claim to the other's property, are simply not

an effective substitute, as the New Hampshire Supreme Court has

held. See Tremaine,

146 N.H. at 676

Finally, controlling New Hampshire case law also dooms the

estate's claim for reformation of the divorce stipulation and

release agreement "to correct a mistake to express the parties'

true intent." Under New Hampshire law, "reformation will only be

granted where the evidence is clear and convincing that (1) there

was an actual agreement between the parties, (2) there was an

agreement to put the agreement in writing and (3) there is a

variance between the prior agreement and the writing." Dubois,

(quoting Erin Foods Servs., Inc. v. 688 Props.,

119 N.H. 232

(1979) (formatting altered)).

Here, for the reasons just discussed at length, the

stipulation and release do not show the requisite "actual

13 agreement," i.e., that Glen and Toni Ann "agreed to forever

forfeit [Glen's] beneficiary interest" in Toni Ann's IRAs.

While the estate points to the provision in Toni Ann's purported

will that lists her IRAs among the property she wanted left to

Addario,4 this fails to support the reformation claim, for at

least two reasons.

First, in evaluating such a claim, "[t]he intent of the

parties is generally examined as of the time of contracting."

Yet the purported will was not drafted until nearly 6 years

after the divorce stipulation and release agreement. Second,

whatever the purported will says about Toni Ann's intent at any

point, it says little if anything about the intent she and Glen

shared in coming up with the stipulation and decree. And shared,

rather than unilateral, intent is what determines the existence

of an enforceable agreement (which, of course, requires a meeting

of the minds as to the relevant terms). See, e.g.. In re Sanborn

4The estate also relies on the purported will as "extrinsic evidence" supporting its interpretation of the release agreement. This argument stumbles out of the gate. A court may consider extrinsic evidence in interpreting an agreement only if the agreement is ambiguous or incomplete. See, e.g., Richey v. Leighton,

137 N.H. 661, 663

(1993). If, however, the "Release Agreement" is indeed ambiguous or silent as to whether it changes the beneficiary designation then, a fortiori, it fails to "unambiguously change the beneficiary designation" as required by New Hampshire law. Tremaine,

146 N.H. at 676

. In any event, for the reasons discussed infra, a document that Toni Ann drafted in 2012 says next to nothing about the intent she and Glen shared in coming up with the divorce stipulation and release in 2006.

14 Reg'1 Sch. Dist.,

133 N.H. 513, 518

(1990). Indeed, in Dubois,

the New Hampshire Supreme Court rejected a claim to reform the

divorce decree so that it divested the ex-spouse of her status as

a beneficiary of the decedent's life insurance policy, ruling

that the proffered evidence to that effect--a letter written by

the decedent four years after the entry of the decree that

referenced the policy but "stated that he felt no need to provide

for [the ex-spouse] in his will"--failed to "support a conclusion

that the [ex-spouse's] beneficiary interest was forfeited by

mutual agreement."

. Here, likewise, no rational

finder of fact could accept the purported will as clear and

convincing evidence that Glen and Toni Ann agreed to forever

forfeit his interest as a beneficiary in her IRAs at the time

they signed the stipulation and release agreement.5

So Glen remains the beneficiary of the IRAs. While, as the

estate suggests, this result may be contrary to what Toni Ann

5In support of its reformation argument, the estate also relies on a New Hampshire statute (and similar statutes in many other states) providing that a "divorce or annulment revokes any disposition of property made by [a] trust to the former spouse" of a grantor who has reserved the power to alter, amend, revoke, or terminate the provisions of the trust.

N.H. Rev. Stat. Ann. § 551:13

, III. But Toni Ann's IRAs were not held in a trust for Glen's benefit, so this statute does not apply (as the estate seems to acknowledge in invoking the "policy interest" allegedly embodied in the statute rather than its actual effect). To the contrary. New Hampshire follows the common-law rule that "divorce alone does not revoke an individual's status as a contractually designated beneficiary." Tremaine,

15 intended prior to her death--at least insofar as that intent is

accurately reflected by her purported will--one of the reasons

the New Hampshire Supreme Court has given for its rule demanding

the unambiguous removal of a beneficiary is to "avoid[]

speculating about what the parties may have intended" in the

guise of attempting to construe "an ambiguity in [a] divorce

decree." Dubois,