Rhode Island Supreme Court upholds deceased ex-husband's actions under property settlement agreement
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By
McIntyre Tate LLP
The Rhode Island Supreme Court recently ruled that an ex-husband who named
his sister as custodial trustee of his life insurance policies did not
violate the terms of their property settlement agreement. That agreement
merely stated that his life insurance policy existing at the time of
divorce
must be maintained during the children's minority "for their
benefit." After the divorce became final, the ex-husband requested
that the insurance company list his sister "as custodial trustee
for the benefit of my minor children." Upon his death, the ex-wife
sued on behalf of the children to obtain the insurance proceeds arguing
that 1) the ex-husband did not have authority to name a custodial trustee
other than her and 2) the "sole purpose" of the insurance provision
was to provide "an uninterrupted stream of
child support
payments to" her and that she was intended to control the insurance
proceeds. But absent more detailed language in the agreement requiring
the ex-husband to name the ex-wife as trustee, the Supreme Court found
that the deceased ex-husband's conduct was proper and denied the wife relief.
