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Relative Had Standing To Assert Slayer Statute And Declaration Regarding Rights To Insurance Proceeds Over Victim’s Estate

In Lawrence v. Bailey, a son killed his parents with a sledge hammer. No. 01-19-00799-CV, 2021 Tex. App. LEXIS 4716 (Tex. App.—Houston [1st Dist.] June 15, 2021, no pet. history). The son was a named beneficiary of the father’s life insurance policy. The insurance company filed an interpleader action regarding the life insurance proceeds. The trial court awarded those to the father’s estate, and the father’s brother then filed a motion for new trial. The brother alleged that under the slayer statute, that he was entitled to the proceeds. The trial court denied the motion, and the brother appealed.

The court of appeals first held that the brother had standing to seek a declaration regarding the ownership of the insurance proceeds. The court noted that the brother argued:

Under the Texas Slayer Statute, a beneficiary of a life insurance policy or contract forfeits the beneficiary’s interest in the policy or contract if the beneficiary is a principal or an accomplice in willfully bringing about the death of the insured.” See Tex. Ins. Code. § 1103.151. He pointed out that, “[i]f there is no contingent beneficiary entitled to receive the proceeds of a life insurance policy or contract, the nearest relative of the insured is entitled to receive the proceeds.” Id. § 1103.152(c).

Id. The agreed that based on the fact that the brother was the closest relative to the father, that he had standing assert a claim for the proceeds. The court also disagreed with the estate representative’s argument that the brother did not have standing until the criminal case against the son was concluded, the court held that “the administrator fails to recognize that the Slayer Statute does not require that any criminal case relating to whether the beneficiary wilfully brought about the insured’s death be resolved before the wilfulness determination is made. See id. §§ 1103.151, 1103.152; see also In Re Estate of Stafford, 244 S.W.3d 368, 370 (Tex. App.—Beaumont 2008, no pet.) (“Section 1103.151 does not require a ‘final conviction’ before a beneficiary forfeits his rights to the [insurance] proceeds.”).” Id. The court also held that the brother had standing even though an heirship proceeding in probate court (which would determine the father’s relatives) was not completed. That was not a prerequisite under the Slayer statute. The court then ruled that the trial court erred in denying the brother’s motion for new trial because he was denied due process as he was not given notice of the trial court’s hearing on the father’s dispositive motion. The trial court’s order was reversed.

© 2022 Winstead PC.National Law Review, Volume XI, Number 232
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About this Author

David Johnson Financial Institution lLtigation Winstead Law Firm Fort Worth Texas
Managing Shareholder - Fort Worth

David maintains an active trial and appellate practice and has consistently worked on financial institution litigation matters throughout his career. David is the primary author of the Texas Fiduciary Litigator blog, which reports on legal cases and issues impacting the fiduciary field in Texas. 

David's financial institution experience includes (but is not limited to): breach of contract, foreclosure litigation, lender liability, receivership and injunction remedies upon default, non-recourse and other real estate lending, class...

817.420.8223
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