In re Couture

166 N.H. 101

89 A.3d 541

IN RE ESTATE OF Lucien COUTURE

No. 2012-850

Supreme Court of New Hampshire.

Argued: November 14, 2013

Opinion Issued: February 21, 2014

McNeill, Taylor & Gallo, P.A., of Dover (R. Peter Taylor on the brief and orally), for the petitioner.

Wing & Weintraub, P.C., of Milford (David C. Wing on the brief and orally), for the respondent.

CONBOY, J.

The respondent, Hellen Couture, appeals an order of the 7th Circuit Court—Dover Probate Division (Cassavechia, J.), which granted the petition of the petitioner, Thomas Couture, the adult son of the decedent, Lucien Couture, to impose a constructive trust, for the benefit of the decedent's heirs, over certain life insurance proceeds paid to the respondent upon the decedent's death. We affirm and remand.

I. Background

The parties either do not dispute, or the record establishes, the following facts. The petition for a constructive trust is grounded upon the claim that the respondent, the decedent's wife, through fraud, deceit, and misrepresentation, induced the decedent to marry her after she gave birth to a daughter whom she claimed was his. The $140,000 life insurance proceeds were paid equally to the respondent and to the daughter pursuant to the decedent's beneficiary designation. The petitioner sought a constructive trust over only the respondent's portion of the insurance proceeds, which were placed in escrow when the petition was filed.

The respondent and the decedent married in September 2003, a few days after the child was born. The child's birth certificate lists the decedent as her father. Although the decedent had had a vasectomy many years before the respondent's pregnancy, he did not question whether the child was his biological child. Nor did he seek medical confirmation or further evaluation as to whether he could have fathered the child.

Following their marriage, the decedent, the respondent, and the child did not live together as a family. Instead, the decedent lived in Rochester, and the respondent and the child lived together in Somersworth. Unbeknownst to the decedent, the respondent had a concurrent relationship with John Tamara. The trial court found the relationship was "more likely than not" a marriage. The respondent and Tamara continued their relationship throughout the respondent's marriage to the decedent.

In December 2005, the decedent designated the respondent and the child as his beneficiaries of a death benefit payable under an employer-provided life insurance policy. In October or November 2007, Tamara, the respondent, and her daughter moved to Hawaii. The respondent and her daughter returned to New Hampshire in 2008 and lived with the decedent for approximately one month. In August 2008, the decedent filed a petition to divorce the respondent. On January 7, 2009, only days before the final divorce hearing was scheduled to occur, the decedent committed suicide. He died intestate. Pursuant to the subject beneficiary designation form, fifty percent of the death benefit was paid to the respondent and fifty percent was paid to the child.

In February 2009, the decedent's sister brought the petition for a constructive trust. When it was determined that the sister lacked standing, the court allowed the petitioner to be substituted as a party. In November 2011, the respondent moved to dismiss the petition on the grounds that the trial court lacked subject matter jurisdiction to impose a constructive trust on her share of the life insurance proceeds, and that the instant claim was not yet justiciable. The trial court denied the motion, and the case proceeded to trial.

Based upon the evidence at trial, the trial court found that the petitioner had established by clear and convincing evidence that the respondent wrongfully induced the decedent to marry her, even though she was already married to Tamara, "or at least in a more intimate marriage-like relationship with him." The trial court further found that the decedent provided life insurance death benefits to the respondent that "were spousal-based," and that it would be unconscionable for her to retain them "given her bad faith, deceit and misrepresentations." The trial court decided that if the respondent were allowed to retain the proceeds, she would be unjustly enriched. Accordingly, the court imposed a constructive trust on the respondent's share of the life insurance proceeds. The trial court denied the respondent's subsequent motion for reconsideration, and this appeal followed.

II. Analysis

Our standard of review of a probate division decision is determined by statute: "The findings of fact of the judge of probate are final unless they are so plainly erroneous that such findings could not be reasonably made." RSA 567–A:4 (2007). Consequently, we will not disturb the probate division's decree unless it is unsupported by the evidence or plainly erroneous as a matter of law. See In re Angel N., 141 N.H. 158, 161, 679 A.2d 1136 (1996).

A. Standing

The respondent first argues that the petitioner lacks "standing" in the instant dispute, even though he is one of the decedent's heirs, and even though she concedes in her brief that "[i]n the event that the constructive trust is upheld," the life insurance proceeds will be "award[ed] ... to the Estate." "In evaluating whether a party has standing to sue, we focus on whether the party suffered a legal injury against which the law was designed to protect." Libertarian Party of N.H. v. Sec'y of State, 158 N.H. 194, 195, 965 A.2d 1078 (2008) (quotation omitted). Here, the petitioner has standing to seek a constructive trust because, as one of the decedent's heirs, he has a direct legal or equitable interest in the decedent's estate. See RSA 561:1 (2007); cf. In re Estate of Kelly, 130 N.H. 773, 778, 547 A.2d 284 (1988) ("[A] will contestant must generally have some direct legal or equitable interest in the decedent's estate" to have standing in an action challenging a will's validity.).

We disagree with the respondent's argument that the petitioner lacks standing because, she, as the decedent's surviving spouse, will be the ultimate recipient of the life insurance proceeds pursuant to the intestate succession statute. See RSA 561:1. As the trial court correctly observed, upon imposition of the constructive trust, the respondent merely holds the life insurance proceeds "as constructive trustee for the benefit of [the decedent's] heirs."

We similarly reject the respondent's contention that the petitioner "has no legal or equitable rights at stake in the life insurance proceeds" because he is not the decedent's named beneficiary. Her reliance upon the beneficiary form is mistaken. Because the proceeds have already been distributed according to the beneficiary form, the fact that the petitioner is not named as a beneficiary is immaterial, and does not divest him of standing to pursue a constructive trust on the respondent's share of those proceeds.

B. Jurisdiction

The respondent next asserts that this case falls within the exclusive jurisdiction of federal courts pursuant to the Employee Retirement Income Security Act of 1974 (ERISA), see 29 U.S.C. §§ 1001 et seq. (2006 & Supp.2012). Although there is no dispute that the life insurance plan at issue is an ERISA-covered benefit plan, the respondent is mistaken in her assertion that federal courts have exclusive jurisdiction over this petition for a constructive trust.

ERISA's jurisdictional provision states: "Except for actions under subsection (a)(1)(B) of this section, the district courts of the United States shall have exclusive jurisdiction of civil actions under this subchapter brought by the Secretary or by a participant, beneficiary, fiduciary, or any person referred to in § 1021(f)(1) of this title." 29 U.S.C. § 1132(e)(1) (2006). Section 1021(f)(1) refers to: (1) the Pension Benefit Guaranty Corporation; (2) plan participants; (3) plan beneficiaries; (4) employers; and (5) labor organizations. 29 U.S.C. § 1021(f)(1) (Supp.2012). As we explain below, this is not a "civil action under [ERISA]." 29 U.S.C. § 1132(e)(1). However, even if it were, the exclusive jurisdiction provision does not apply because the petitioner is not a person to whom section 1021(f)(1) refers. The respondent's reliance upon Appeal of A & J Beverage Distribution, 163 N.H. 228, 37 A.3d 371 (2012), is misplaced. In that case, the petitioner was a plan participant. See Appeal of A & J Beverage Distribution, 163 N.H. at 230, 235, 37 A.3d 371.

C. ERISA Preemption

1. Express Preemption

Alternatively, the respondent contends that the petitioner's state law constructive trust claim is preempted by a section of ERISA, which provides that ERISA "supersede[s] any and all State laws insofar as they may now or hereafter relate to any employee benefit plan" described in the statute. 29 U.S.C. § 1144(a) (2006) ; see Appeal of A & J Beverage Distribution, 163 N.H. at 232, 37 A.3d 371. As we explained in Appeal of A & J Beverage Distribution, 163 N.H. at 232, 37 A.3d 371, "[e]arly interpretations of this language by the United States Supreme Court relied heavily upon textual analysis and a dictionary definition of ‘relate to’ and led to the conclusion that ERISA preemption was ‘conspicuous for its breadth.’ " (Quotation omitted.) Thus, in Ingersoll–Rand Co. v. McClendon, 498 U.S. 133, 139, 111 S.Ct. 478, 112 L.Ed.2d 474 (1990), the Court held that "[a] law ‘relates to’ an employee benefit plan, ... if it has a connection with or reference to such a plan." (Quotation omitted.)

Relying upon those early interpretations of ERISA preemption, the respondent argues that the petitioner's claim is preempted because it "is a claim against death benefits from a life insurance policy pursuant to an employee welfare benefit plan." (Quotation omitted.) However, as we also explained in Appeal of A & J Beverage Distribution, 163 N.H. at 232, 37 A.3d 371, the Supreme Court has since "abandon[ed] strict textualism in favor of a more nuanced...