American International Life Assurance Co. v. McGillicuddy

Appellate Division of the Supreme Court of New York

American International Life Assurance Co. v. McGillicuddy

307 A.D.2d 228, 763 N.Y.S.2d 269, 2003 N.Y. App. Div. LEXIS 8543

Appellate Division of the Supreme Court of the State of New York·Decided July 31, 2003·Published

Opinion

Order, Supreme Court, New York County (Barbara Kapnick, J.), entered on or about July 26, 2002, which, to the extent appealed from, denied appellant’s motion for summary judgment and granted respondent’s motion directing that the proceeds of the annuity account be released to him as executor, unanimously reversed, on the law, with costs, respondent’s motion denied, and appellant’s motion granted. The Clerk is directed to enter judgment accordingly.

In this interpleader action commenced by American International Life Insurance Company (American), the IAS court granted the motion of the executor, respondent McGillicuddy, to award the proceeds of an annuity created by the decedent, Robbin, to the estate to be added to a residuary trust created for the benefit of the annuitant, appellant Gollin, a nephew of the decedent. Robbin had entered into an annuity contract with American, reserving certain powers, including changing the beneficiary and surrendering the accumulation value. Robbin predeceased Gollin and this action resulted when McGillicuddy sought to surrender the annuity. Since Gollin is clearly a “person entitled to receive payment” pursuant to the annuity (EPTL 13-3.2 [d] [3]), EPTL 13-3.2 prohibits any impairment of [229]*229Gollin’s right to annuity payments by McGillicuddy and the annuity contract could not pass into the estate for any purpose (EPTL 13-3.2 [c]; see Matter of Clotworthy, 294 AD2d 720, 722 [2002]). Although the annuity contract contained restrictions which evidenced Bobbin’s clear intent to deprive Gollin’s access to a lump sum upon her death, it should have been American’s management of the annuity which accomplished that intent, not the actions of the executor. Since the parties have stipulated to interplead the full accumulation value of the annuity contract and there is no way to restore the parties to the status quo ante, Gollin is entitled to receive a lump sum payment, freed from the restrictions which Bobbin had imposed. Concur — Buckley, P.J., Tom, Ellerin, Lerner and Friedman, JJ.

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Order, Supreme Court, New York County (Barbara Kapnick, J.), entered on or about July 26, 2002, which, to the extent appealed from, denied appellant’s motion for summary judgment and granted respondent’s motion directing that the proceeds of the annuity account be released to him as executor, unanimously reversed, on the law, with costs, respondent’s motion denied, and appellant’s motion granted. The Clerk is directed to enter judgment accordingly.

In this interpleader action commenced by American International Life Insurance Company (American), the IAS court granted the motion of the executor, respondent McGillicuddy, to award the proceeds of an annuity created by the decedent, Robbin, to the estate to be added to a residuary trust created for the benefit of the annuitant, appellant Gollin, a nephew of the decedent. Robbin had entered into an annuity contract with American, reserving certain powers, including changing the beneficiary and surrendering the accumulation value. Robbin predeceased Gollin and this action resulted when McGillicuddy sought to surrender the annuity. Since Gollin is clearly a “person entitled to receive payment” pursuant to the annuity (EPTL 13-3.2 [d] [3]), EPTL 13-3.2 prohibits any impairment of [229]*229Gollin’s right to annuity payments by McGillicuddy and the annuity contract could not pass into the estate for any purpose (EPTL 13-3.2 [c]; see Matter of Clotworthy, 294 AD2d 720, 722 [2002]). Although the annuity contract contained restrictions which evidenced Bobbin’s clear intent to deprive Gollin’s access to a lump sum upon her death, it should have been American’s management of the annuity which accomplished that intent, not the actions of the executor. Since the parties have stipulated to interplead the full accumulation value of the annuity contract and there is no way to restore the parties to the status quo ante, Gollin is entitled to receive a lump sum payment, freed from the restrictions which Bobbin had imposed. Concur — Buckley, P.J., Tom, Ellerin, Lerner and Friedman, JJ.

American International Life Assurance Co. v. McGillicuddy, 307 A.D.2d 228, 763 N.Y.S.2d 269, 2003 N.Y. App. Div. LEXIS 8543 (N.Y. Ct. App. 2003).

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307 A.D.2d 228 (American International Life Assurance Co. v. McGillicuddy) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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