Tarrant v. Halliburton

• Court: Court of Appeals for the Fifth Circuit
• Decided: November 27, 1995
• Docket: 95-50234
• Status: Unpublished

Opinion

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT _______________

No. 95-50234 Summary Calendar _______________

CHARLES TARRANT and JESSIE JUANITA TARRANT,

Plaintiffs-Counter- Defendants-Appellants,

VERSUS

HALLIBURTON ENERGY SERVICES RETIREMENT PLANS,

Defendant-Third Party Plaintiff-Counter-Plaintiff,

LARRY TARRANT, et al.,

Third Party Defendants-Appellees,

THOMAS SCOTT TARRANT,

Third Party Defendant- Counter-Plaintiff-Appellee.

_________________________

Appeal from the United States District Court for the Western District of Texas (CA-MO-94-169) _________________________

November 17, 1995

Before GARWOOD, SMITH, and BENAVIDES, Circuit Judges. JERRY E. SMITH, Circuit Judge:*

Charles Tarrant and Jessie Juanita Tarrant appeal a judgment

in favor of Thomas Scott Tarrant (“Thomas”) and Robert Leslie

Tarrant (“Robert”).1 They contend that the district court improp-

erly concluded that Thomas and Robert were the appropriate

beneficiaries of an ERISA2 pension account established by their

father, Bobby Joe Tarrant (“Bobby Joe”). Concluding that Thomas

and Robert are the proper beneficiaries under the ERISA plan, we

affirm.

I.

Bobby Joe died on September 21, 1993, two weeks after

divorcing Dana. Apparently recognizing that his divorce necessi-

tated a change in his will, Bobby Joe had executed a new will two

months earlier, on July 20. Among the provisions of that will was

one declaring his “intention by and through this will not to leave

any of my estate to my son Thomas Scott Tarrant.” He named several

family members, including the appellants and Robert, as the heirs

to his estate.

* Local Rule 47.5.1 provides: "The publication of opinions that have no precedential value and merely decide particular cases on the basis of well- settled principles of law imposes needless expense on the public and burdens on the legal profession." Pursuant to that rule, the court has determined that this opinion should not be published. 1 Robert Leslie Tarrant is a minor and is represented by his mother and guardian, Dana K. Tarrant. 2 “ERISA” is the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq.

2 At the time of his death, Bobby Joe was a participant in the

Halliburton Profit-Sharing and Savings Plan (the Plan”), an ERISA

plan. Bobby Joe had designated Dana as the beneficiary of his Plan

account prior to his divorce. He did not change the designation

after the divorce.

The Plan contains specific provisions determining the

appropriate beneficiary of a Plan account. If a Plan member has

designated his spouse as beneficiary, he may change that designa-

tion only with her consent. If he has designated his spouse as

beneficiary and has subsequently divorced, the designation is void.

If no valid beneficiary exists, the Plan determines the beneficiary

in the following order of preference: (1) the participant’s living

spouse; (2) his child or children; (3) his parents; and (4) his

executor or administrator, or his heirs at law. Thus, under the

terms of the Plan, Thomas and Robert would be the appropriate

beneficiaries of their father’s Plan account.

Following Bobby Joe’s death, the plaintiffs filed this action

in state court seeking a judicial determination of the proper

beneficiaries of his Plan account. The action was removed to

federal court on the basis of federal question jurisdiction. See

28 U.S.C. §§ 1331, 1441. The case was tried by consent before a

magistrate judge, who determined that Thomas and Robert were the

appropriate beneficiaries.

II.

The issue is whether Bobby Joe’s beneficiaries must be

3 determined in accordance with the Plan’s terms. The plaintiffs

contend that we may invoke federal common law to determine that the

proper beneficiaries are Bobby Joe’s heirs at law. At the outset,

we note that a written ERISA plan generally controls the distribu-

tion of plan benefits. See Rodrigue v. Western & Southern Life

Ins. Co.,948 F.2d 969 (5th Cir. 1991); In re HECI Exploration Co.,

862 F.2d 513, 524 (5th Cir. 1988).

The plaintiffs argue as follows: Bobby Joe took the best and

only course legally available to him to change his beneficiaries.

His divorce occurred on September 7, 1993, and was not final until

the time for filing an appeal or motion for new trial expired

thirty days later. TEX. R. CIV. P. 392b. He thus could not alter

his designation of Dana as beneficiary without her permission until

October 7, sixteen days after his death. Bobby Joe was unable to

designate new beneficiaries and, through his will, did all that he

could do to change his designation. The plaintiffs invite us to

rely on federal common law to honor Bobby Joe’s wishes and

designate the heirs to his estate as his beneficiaries under the

Plan.

The plaintiffs rely upon Brandon v. Travelers Ins. Co., 18

F.3d 1321 (5th Cir. 1994), cert. denied, 115 S. Ct. 732 (1995). In

Brandon, the decedent had designated his wife as beneficiary to his

life insurance plan, an ERISA plan. He later divorced her. The

divorce decree provided that the ex-wife gave up any claim to the

life insurance proceeds, but the decedent failed to file a change-

of-beneficiary form required by the plan. Noting that “we ‘look to

4 either the statutory language or, finding no answer there, to

federal common law which, if not clear, may draw guidance from

analogous state law,’” id. at 1325 (quoting from McMillan v.

Parrott, 913 F.2d 310, 311 (6th Cir. 1990)), we relied upon federal

common law, which borrowed from state law, to find that the ex-wife

was not the appropriate beneficiary.

The plaintiffs believe that Brandon should be construed

broadly to allow courts to invoke federal common law even when an

ERISA plan contains clear provisions governing an issue. We need

not address their argument, however. Even if we accepted it, they

could not prevail, as their assertion that Bobby Joe took all

available steps to alter his beneficiaries is incorrect.

Under Texas law, Bobby Joe had the opportunity to designate

new beneficiaries and failed to do so. The execution of his new

will did not alter his beneficiaries, because an employee pension

plan is not part of the estate that passes by will under Texas law.

See Valdez v. Ramirez, 574 S.W.2d 748, 750 (Tex. 1978). As soon as

the divorce decree was issued, Bobby Joe was free to designate new

beneficiaries without Dana’s permission, but he took no action.

Plaintiffs’ contention that Bobby Joe had to wait thirty days

for the decree to become final is incorrect, as Texas law makes a

judgment of divorce valid and enforceable on rendition. See Dunn

v. Dunn, 439 S.W.2d 830 (Tex. 1969); Ex parte Tarpley, 636 S.W.2d

21, 23 (Tex. App.——Eastland 1982, no writ) (holding a “judgment of

divorce, on its rendition, even without any entry, is valid and

enforceable between the parties”); Galbraith v. Galbraith, 619

5 S.W.2d 238, 240 (Tex. App.——Texarkana 1981, no writ) (holding that

“although the written decree was not signed until March 24, 1976,

the divorce was fully effective for all purposes . . . at the time

it was pronounced from the bench”). It was thus possible for Bobby

Joe to designate new beneficiaries on or after September 7, when

the divorce decree was entered. He failed to do so. The proper

beneficiaries are therefore his sons, Thomas and Robert, in

accordance with the Plan’s provisions.

AFFIRMED.