Principal Life Insurance Company v. The Estate of Sergio Botello Diaz

• Court: District Court, E.D. California
• Decided: September 22, 2023
• Docket: 1:23-cv-00261
• Status: Unknown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 PRINCIPAL LIFE INSURANCE Case No. 1:23-cv-00261-CDB COMPANY, 12 ORDER DENYING PLAINTIFF’S Plaintiff, PETITION TO APPOINT GUADALUPE 13 PANTOJA PEREZ AS GUARDIAN AD v. LITEM FOR S.B. AND M.B. 14 THE ESTATE OF SERGIO BOTELLO 15 DIAZ, et al., (Doc. 14)

16 Defendants. TEN-DAY DEADLINE

18 BACKGROUND 19 On February 17, 2023, Plaintiff Principal Life Insurance Company (“Principal”) filed a 20 complaint-in-interpleader against The Estate of Sergio Botello Diaz (“the Estate”), Rogelio Botello 21 Diaz (“Rogelio” or “the Beneficiary”), Guadalupe Pantoja Perez (“Perez”), Jackelin Botello 22 (“Jackelin”), Deisy Botello (“Deisy”), S.B., and M.B. (Doc. 1). 23 According to the allegations of the complaint, Sergio Diaz (“the Decedent”) was an 24 employee of Grimmway Enterprises, Inc., and was covered by an ERISA-governed employee 25 welfare benefit plan (“the Plan”) managed by Principal. Id. ⁋ 11. The Plan includes coverage for 26 voluntary term life and voluntary accidental death and dismemberment. Id. ⁋⁋ 11-12. 27 The Decedent passed away on September 5, 2021, in Arvin, California, after suffering multiple gunshot wounds in what was deemed to be a homicide. Id. ⁋ 14. As a result of the 1 Decedent’s death, his Plan benefits became payable. The payable benefits under the Plan include 2 $10,000.00 under the group term life benefits, $500,000.00 under the voluntary term life benefits, 3 and $500,000.00 under the accidental death and dismemberment benefits. Id. ⁋ 15. 4 At the time of the Decedent’s death, Rogelio was designated as the primary beneficiary of 5 the Plan benefits. In addition, the Decedent’s group term life policy provides that if he dies while 6 insured, Principal will pay his beneficiary the benefit on the date of the Decedent’s death. Id. at 5. 7 Any benefit due a beneficiary that does not survive the Decedent will be paid in equal shares to the 8 surviving beneficiaries. However, if no beneficiary survives the Decedent or no named beneficiary 9 exists, Principal will make payments in the following order of precedence: (1) The Decedent’s 10 spouse or domestic partner; (2) The Decedent’s children born to him or legally adopted to him; (3) 11 the Decedent’s parents; (4) the Decedent’s brothers and sisters and; (5) if none of the above are 12 applicable, to the executor or administrator of the Decedent’ estate or other persons provided in the 13 group policy. Id. 14 However, the Policy further provides that “if a beneficiary is suspected or charged with your 15 death, the Death Benefit may be withheld until additional information has been received or the trial 16 has been held. If a beneficiary is found guilty of [the Decedent’s] death, such beneficiary may be 17 disqualified from receiving any benefit due. Payment may then be made to any contingent 18 beneficiary or to the executor or administrator of your estate.” Id. 19 Rogelio submitted a claim for the benefits under the Plan just days after the Decedent’s 20 homicide – on September 8, 2021. Id. ⁋ 18. Thereafter, Principal contacted the Arvin Police 21 Department, who confirmed that the Decedent’s death was at that time still under investigation and 22 that no one, including Rogelio, has been cleared as a suspect in the Decedent’s death. Id. ⁋ 22. 23 Principal also contacted Perez, who stated she did not have divorce documents and that divorce 24 documents were not filed prior to or the time of the Decedent’s death, which may implicate 25 community property issues. Id. ⁋ 23. 26 By its complaint, Principal asks the Court to adjudicate the issue of who among the 27 interpleader Defendants are rightly entitled to benefits under the Plan. In addition, Principal asks 1 against Principal, the Plan, or Decedent’s employer for recovery of the benefits. Id. at 7. 2 When the Defendants failed to timely respond to the complaint or otherwise appear, the 3 Court ordered Principal to apply for defaults as to each Defendant. (Doc. 10). Thereafter, Principal 4 filed an application seeking to delay the date by which it must apply for defaults. (Doc. 11). In its 5 application, Principal represented that both Rogelio and Perez had agreed to disclaim any interest 6 in the Plan benefits and an agreement in principle had been reached pursuant to which the 7 Decedent’s four minor children would receive the benefits. Id. p. 2. 8 Principal filed a Motion to Appoint Guardian Ad Litem on August 18, 2023. (Doc. 14). 9 The motion is unopposed and the time to file and opposition has passed. No other party, including 10 Perez, the proposed guardian ad litem, has appeared in this action. 11 STANDARD OF LAW 12 Pursuant to Rule 17 of the Federal Rules of Civil Procedure, a representative of a minor or 13 incompetent person may sue or defend on the minor or incompetent person’s behalf. Fed. R. Civ. 14 P. 17(c). In addition, a court “must appoint a guardian ad litem - or issue another appropriate 15 order - to protect a minor or incompetent person who is unrepresented in an action.” Id. The 16 capacity of an individual to sue is determined “by the law of the individual’s domicile.” Fed. R. 17 Civ. P. 17(b)(1). 18 Under California law, an individual under the age of 18 is a minor, and a minor may bring 19 suit if a guardian conducts the proceedings. Cal. Fam. Code §§ 6502, 6601. The Court may appoint 20 a guardian ad litem to represent the minor’s interests. Cal. Code Civ. P. § 372(a). To evaluate 21 whether to appoint a particular guardian ad litem, the Court must consider whether the minor and 22 the guardian have divergent interests. Cal. Code Civ. P. § 372(b)(1). 23 The appointment of the guardian ad litem is more than a mere formality. United States v. 24 30.64 Acres of Land, More or Less, Situated in Klickitat Cty., State of Wash., 795 F.2d 796, 805 25 (9th Cir. 1986). A Court shall take whatever measures it deems appropriate to protect the interests 26 of the induvial during the litigation. See id. (noting,“[a] guardian ad litem is authorized to act on 27 behalf of his ward and may make all appropriate decisions in the course of specific litigation.”). 1 interests of the person on whose behalf he seeks to litigate.” AT&T Mobility, LLC v. Yeager, 143 2 F. Supp.3d 1042, 1054 (E.D. Cal. 2015) (quoting Whitmore v. Arkansas, 495 U.S. 149, 163-64 3 (1990)). This means that the guardian cannot carry any impermissible conflict of interest with the 4 ward. Courts also consider the candidate’s “experience, objectivity and expertise” or previous 5 relationship with the ward. Id. (citations omitted). 6 Further, the Local Rules of the Eastern District of California provide:

7 (a) Appointment of Representative or Guardian. Upon commencement of an action or upon initial appearance in defense of an action by or on behalf of a minor or 8 incompetent person, the attorney representing the minor or incompetent person 9 shall present (1) appropriate evidence of the appointment of a representative for the minor or incompetent person under state law or (2) a motion for the appointment 10 of a guardian ad litem by the Court, or (3) a showing satisfactory to the Court that no such appointment is necessary to ensure adequate representation of the minor or 11 incompetent person. See Fed. R. Civ. P. 17(c);

12 . . . .

13 (c) Disclosure of Attorney’s Interest. When the minor or incompetent is represented by 14 an attorney, it shall be disclosed to the Court by whom and the terms under which the attorney was employed; whether the attorney became involved in the 15 application at the instance of the party against whom the causes of action are asserted, directly or indirectly; whether the attorney stands in any relationship to 16 that party; and whether the attorney has received or expects to receive any compensation, from whom, and the amount. (E.D. Cal. Local Rule 202). 17

18 The decision to appoint a guardian ad litem “must normally be left to the sound discretion 19 of the trial court.” 30.64 Acres of Land, 795 F.2d at 804. Fit parents are presumed to act in the 20 best interests of their children. Troxel v. Granville, 530 U.S. 57, 66 (2000). However, “if the parent 21 has an actual or potential conflict of interest with [their] child, the parent has no right to control or 22 influence the child’s litigation.” Molesky for J.M. v. Carillo, No. 1:22-cv-1567-ADA-CDB, 2022 23 WL 17584396, *1 (E.D. Cal. Dec. 12, 2022) (quoting Williams v. Super. Ct. of San Diego, 147 Cal. 24 App.4th 36, 50 (2007)). 25 DISCUSSION 26 Principal’s motion asserts that Perez has consented to being the guardian ad litem for S.B. 27 and M.B. Furthermore, Principal represents that Perez has resolved her potential conflicts of interest since she disclaimed her independent stake in the benefits under the Plan. (Doc. 14 ⁋ 17). 1 The Court finds that Principal’s pleadings are insufficient to enable the Court to ascertain 2 independently whether Perez is a suitable guardian ad litem for S.B. and M.B.1 While Principal 3 represents that Perez “has disclaimed her independent stake in the benefits” under the Plan (id.), 4 the Court has received no disclaimer forms or sworn statements by Perez to corroborate counsel’s 5 unsworn assertions. Nor does the Court have information before it as to whether Perez retains 6 any interest in the minor children’s share of benefits. 7 Relatedly, the Court notes that the proposed recipients are the Decedent’s minor children - 8 yet, the Court has no information before it to assess the nature of the relationship, if any, between 9 the children and Perez (the Decedent’s spouse). For instance, Principal has proffered no 10 information as to whether Perez is the mother of any of the four anticipated recipients of the Plan 11 benefits. Such information is necessary to determine whether Perez may have a conflict of 12 interest that bars her from serving as guardian ad litem. 13 Moreover, Perez has submitted no declaration more generally attesting that she is 14 competent, responsible, able, and willing to serve as the guardian ad litem for S.B. and M.B. See 15 Watson v. Cty. Of Santa Clara, 468 F. Supp. 2d 1150, 1155 (N.D. Cal. 2007) (requiring “a written 16 declaration that the proposed guardian ad litem is independent and would act in the best interests 17 of the minors”) (emphasis removed); Johnson v. Johnson, No. 1:19-cv-00105-LJO-SAB, 2019 18 WL 13248650, *2 (E.D. Cal. Jan. 28, 2019) (requiring submission of evidence to demonstrate 19 competency). 20 Furthermore, Principal represents that no one, including the Beneficiary (Rogelio) has 21 been cleared as a suspect in the Decedent’s homicide. (Doc. 1 ⁋ 22). It can also be inferred from 22 Principal’s filing that Perez has either divorced or was in the process of divorcing the Decedent at 23 the time of his passing. Id. ⁋ 23. Although parents are generally appointed as guardian ad litem 24 for the minors they seek to represent, there may be situations where the interests of the minor and 25 the interests of the parent conflict. E.g., Gutierrez v. City of Visalia, 1:21-cv-01700-JLT-HBK, 26 2022 WL 1489479, *2 (E.D. Cal. May 11, 2022). 27 1 Principal did not plead and has not presented the Court with any evidence – whether documentary or testimonial – establishing the ages of S.B. and M.B; thus, the Court is unable to 1 In addition, since Perez, S.B., and M.B. have not appeared in this action, it is unknown 2 | whether they are represented by counsel. Under Local Rule 202(a), the attorney representing the 3 || minor or incompetent person shall present the appropriate evidence of the appointment of 4 | guardian ad litem. The Motion to Appoint Guardian Ad Litem at issue was filed by counsel for 5 | Principal, which presents a possible conflict of interest, notwithstanding Principal’s avowed 6 | stance as a disinterested party. 7 CONCLUSION AND ORDER 8 For the reasons set forth above, Principal’s motion to appoint Perez as guardian ad litem 9 | for S.B. and M.B. is DENIED without prejudice. 10 Principal is ORDERED to file a renewed motion within 10 days of the issuance of this 11 | order. 12 In addition to remedying the deficiencies outlined in this order, the renewed motion must 13 | comply with Local Rule 202. Among other things, the renewed motion must be accompanied by 14 | a written declaration from Perez that sets forth her competency to act on the minors’ behalf, her 15 | familial relationships with the Decedent and his children, and her identification or disavowal of 16 | any conflicts of interest. 17 Failure to comply with this Order may result in the imposition of sanctions, including 18 | financial sanctions and dismissal of the action. 19 | IT IS SO ORDERED. | Dated: _ September 22, 2023 | br Pr 21 UNITED STATES MAGISTRATE JUDGE 22 23 24 25 26 27 28