          United States Court of Appeals
                       For the First Circuit


No. 16-1737

    DAMARIS MALDONADO-VIÑAS; JUAN CARLOS IGLESIAS-MALDONADO;
               and JOSÉ CARLOS IGLESIAS-MALDONADO,

                       Plaintiffs, Appellees,

                                 v.

              NATIONAL WESTERN LIFE INSURANCE COMPANY,

                       Defendant, Appellant.


          APPEAL FROM THE UNITED STATES DISTRICT COURT
                 FOR THE DISTRICT OF PUERTO RICO

       [Hon. Camille L. Vélez-Rivé, U.S. Magistrate Judge]


                               Before

                   Torruella, Lipez, and Barron,
                          Circuit Judges.


     Salvador J. Antonetti-Stutts, with whom Carla García-Benítez,
Alejandro J. García-Carballo, and O'Neill & Borges, LLC were on
brief, for appellant.
     José A. Hernández-Mayoral, for appellees.



                           June 29, 2017
            TORRUELLA, Circuit Judge.         Defendant-appellant National

Western Life Insurance Co. ("National Western") appeals from a

judgment    in   favor    of         Plaintiffs     Damaris     Maldonado-Viñas

("Maldonado"), Juan Carlos Iglesias Maldonado, and José Carlos

Iglesias Maldonado (collectively, "Plaintiffs") that invalidated

two life insurance annuity policies. National Western argues that:

(1) the beneficiary of the two annuities was a necessary party

under Fed. R. Civ. P. 19, even though National Western had already

paid him; (2) one annuity policy was not void even though the

application was not executed in accordance with National Western's

internal policies; and (3) the second annuity policy was not void

under Puerto Rico law solely because it was processed by an

insurance   agent   who   was    not     licensed    by   the   Office   of   the

Commissioner of Insurance of the Commonwealth of Puerto Rico.

            We vacate the judgment and remand for further findings

concerning the necessity of joining the beneficiary under Rule 19.

                                I.    BACKGROUND

A.   Factual Background

            At the time of his death on November 2, 2011, Carlos

Iglesias-Álvarez ("Carlos"1 or "the decedent") had been married to

Maldonado for about twenty-two years.                Plaintiffs Juan Carlos



1 We use "Carlos" to distinguish the decedent from his brother,
Francisco Iglesias-Álvarez, who we call "Francisco" for the same
reason. We mean no disrespect to either.



                                        -2-
Iglesias Maldonado and José Carlos Iglesias Maldonado are the

children of Maldonado and Carlos.       Plaintiffs are Carlos's legal

heirs.

             This case primarily concerns defects in the execution of

two life insurance annuity policies which Carlos purchased through

National Western.      On April 30, 2011, Carlos purchased a life

insurance policy through National Western ("Annuity No. 1").      Two

days later, on May 2, 2011, Carlos purchased a second policy.     Due

to issues with the execution of that policy, it was cancelled by

National Western and reissued ("Annuity No. 2").          Under both

policies, Carlos named his brother, Francisco Iglesias-Álvarez

("Francisco") as the sole beneficiary.

             Carlos paid $1,467,500 each, a total of $2,935,000, for

the annuities. Both policies contained defects in their execution.

The agent who issued Annuity No. 1 on National Western's behalf

was not licensed by Puerto Rico Office of the Commissioner of

Insurance.     Annuity No. 2 was not executed in accordance with

National Western's internal policies.         Despite these defects,

National Western issued the two policies on April 30, 2011 and

June 7, 2011.

             After Carlos's death on November 2, 2011, Francisco

mailed a claim form to National Western seeking benefits from

Annuity No. 2.     National Western informed Francisco that he was

also the beneficiary of Annuity No. 1 and that he needed to submit


                                  -3-
a second claim form and some additional information.                   Francisco

mailed the requested information on February 9, 2012.                  National

Western   paid   Francisco    the   benefits      from   the       annuities    on

February 23, 2012 and March 13, 2012.

           On April 24, 2015, three years after National Western

had paid Francisco the benefits from the annuities and more than

a year after Plaintiffs sued National Western, Francisco submitted

a document in which he claimed to be "Francisco J. Iglesias," the

owner of Annuity No. 2, and attempted to ratify the policy.                    All

communications were between Francisco's residence in Spain and

Western National's office in Texas.

B.   Procedural History

           Plaintiffs sued National Western in the U.S. District

Court for the District of Puerto Rico on March 11, 2014, seeking

a declaration that the policies were void and a return of the

premiums paid by Carlos.      On May 12, 2014, National Western filed

a motion to dismiss because Plaintiffs failed to join a necessary

party, Francisco.      The district court issued an Opinion and Order

denying that motion on November 10, 2014.          Shortly after, National

Western   answered      the   complaint     and      filed     a    motion     for

reconsideration, which the district court also denied.

           On December 16, 2015, the parties filed motions for

summary judgment.      On March 31, 2016, a magistrate judge granted

Plaintiffs'   motion    for   summary     judgment    and    denied     National


                                    -4-
Western's motion.    National Western's motion for reconsideration

was denied on May 5, 2016.    National Western timely appealed.

                             II.    ANALYSIS

           Federal Rule of Civil Procedure 19(a), "Persons Required

to Be Joined if Feasible," states:

      (1) Required Party. A person who is subject to service
      of process and whose joinder will not deprive the court
      of subject-matter jurisdiction must be joined as a party
      if:

        (A) in that person's absence, the court cannot accord
        complete relief among existing parties; or

        (B) that person claims an interest relating to the
        subject of the action and is so situated that
        disposing of the action in the person's absence may:

           (i) as a practical matter impair or impede the
           person's ability to protect the interest; or

           (ii) leave an existing party subject to a
           substantial risk of incurring double, multiple, or
           otherwise inconsistent obligations because of the
           interest.

If a court determines that a person must be joined if feasible, it

then must determine whether doing so is actually feasible under

Rule 19(b).   "If a person who is required to be joined if feasible

cannot be joined, the court must determine whether, in equity and

good conscience, the action should proceed among the existing

parties or should be dismissed."      Fed. R. Civ. P. 19(b).

           The   district   court    ruled     that   Francisco   was   not

"required to be joined if feasible"2 under Rule 19(a), and so it


2   Parties who are "required to be joined if feasible" are still


                                    -5-
did not analyze whether it would be feasible to join him under

Rule 19(b). We review both Rule 19(a) and Rule 19(b) determinations

under an abuse of discretion standard.        Picciotto v. Cont'l Cas.

Co., 512 F.3d 9, 14-15 (1st Cir. 2008).         Thus, we will reverse

"only if 'the district court makes an error of law or relies

significantly on an improper factor, omits a significant factor,

or makes a clear error of judgment in weighing the relevant

factors.'"     Jiménez v. Rodríguez-Pagán, 597 F.3d 18, 24 (1st Cir.

2010) (quoting Picciotto, 512 F.3d at 15).

             Relying on Delgado v. Plaza Las Américas, Inc., 139 F.3d

1 (1st Cir. 1998), the district court ruled that even though

National Western "would certainly have paid out double on the

annuities" if two different courts reached different conclusions

about whether the policies were void, that would not subject it to

double obligations.    In Delgado, a woman sued a shopping center in

state court after she was raped on the shopping center's premises.

Id. at 2.     Separately, her father brought a diversity action in

federal court seeking damages for the emotional pain he suffered

as a result of his daughter's rape.     Id.   The district court ruled

that the daughter must be joined if feasible under Rule 19(a)



sometimes called "necessary," even though Rule 19 no longer uses
the term "necessary," Picciotto v. Cont'l Cas. Co., 512 F.3d 9, 15
n.10 (1st Cir. 2008), and they are not literally necessary because
suits may continue without such parties if doing so would be
equitable under Rule 19(b). See id. at 15.



                                  -6-
because otherwise the shopping center might face inconsistent

obligations.   Id.    It reasoned that the shopping center might be

found liable to the father in the federal action, but not to the

daughter in the state action, or vice versa, even though the

father's claims were derivative of the daughter's.         Id. at 3.     We

reversed, reasoning that:

       where two suits arising from the same incident involve
       different causes of action, defendants are not faced
       with the potential for double liability because
       separate suits have different consequences and
       different measures of damages . . . [and] the mere
       possibility of inconsistent results in separate
       actions does not make the plaintiff in each action a
       necessary party to the other.

Id.

           Rule 19(a)(1)(B)(ii) requires the joinder of a person if

feasible   where     that   unjoined     person's   interest   creates    a

substantial risk that an existing party will be subject to double

or multiple obligations.      There was no such risk in Delgado for a

very simple reason:     even if the absent daughter had been joined,

the shopping center may well have been liable to both the father

and the daughter.      The shopping center's complaint was that it

might be liable to one or the other, when logically it should only

be liable to both or neither.     The fact that the case was divided,

however, could never result in it owing obligations to more parties

than it ever would in a single action. Thus, the absent daughter's




                                   -7-
interest   could   not   increase   the   shopping   center's   potential

liability from the incident as a whole.

           Here, however, Francisco's interest might do just that.

In a single action, the policies could never be void as to

Plaintiffs -- thus obliging National Western return the premiums

-- but not void as to Francisco -- thus obliging National Western

to pay him benefits.     But where, as here, Francisco is not a party,

National Western may well be subject to both obligations.            The

issue is not that two courts may reach inconsistent conclusions,

it is that by reaching those conclusions, National Western may be

subject to double obligations.

           The district court, however, reasoned that National

Western might be unable to recover from Francisco even if the

policies were void because Francisco "could possibly assert a

defense that but for National Western's negligence, the annuities

would have remained valid." If National Western could never obtain

a return of the benefits it paid to Francisco even if the policies

are void, then it would not, in fact, be subject to double

obligations.     Rather, it would owe an obligation to Plaintiffs

because the policies were void, but it would be unable to collect

from Francisco because of its own negligence, an entirely different

theory, and one that could apply in either a consolidated or a

separate case.




                                    -8-
          Neither the district court nor Plaintiffs, however, cite

any authority to support the district court's assertion.3   We have

not found any Puerto Rico case directly on point, but "[a]s a

general rule, if an insurer pays a loss as a result of fraud or a

mistake as to facts which would have been a sufficient defense in

an action by the insured upon the policy, the money so paid may be

recovered."     Steven Plitt, et al., 16 Couch on Ins. § 226:50 (3d

ed. 2017); see also id. § 226:80 (collecting cases allowing

recovery of benefits mistakenly paid to incorrect parties); Glover

v. Metro. Life Ins. Co., 664 F.2d 1101, 1103 (8th Cir. 1981)

(requiring party mistakenly paid as beneficiary to return payment,

even though insurance company had constructive knowledge that

another party might have been the true beneficiary when it made

the payment).     Francisco's alternative defenses are therefore no

sure thing, and he would almost certainly argue that the policies

are not void in any separate action.     In addition, although the

district court found that the policies were void, there remains a



3  National Western argues that, under P.R. Laws Ann. Tit. 31,
§ 3514, Francisco must return any benefits he received if the
policies are void. P.R. Laws Ann. Tit. 31, § 3514 states that
"[w]hen the nullity of an obligation has been declared, the
contracting parties shall restore to each other the things which
have been the object of the contract."        Although a vested
beneficiary has "personal rights stemming from the contract,"
however, the beneficiary is "not a party to the contract."
Fernández Vda. de Alonso v. Cruz Batiz, No. CE-90-842, 128 D.P.R.
493, Slip op. at 4 (P.R. June 6, 1991). P.R. Laws Ann. Tit. 31,
§ 3514 therefore seems inapplicable.



                                 -9-
"substantial risk" that a different court would decide otherwise,

and so subject National Western to "double . . . obligations."

Fed. R. Civ. P. 19(a)(1)(B)(ii).

             "[I]t is the object of courts to prevent the payment of

any debt twice over."         Harris v. Balk, 198 U.S. 215, 226 (1905).

Rule 19(a)(1)(B)(ii)'s preference for the joinder of parties in

order   to   avoid   double    or   multiple   obligations   furthers   that

purpose.     Because, as the district court recognized, National

Western might have to "pa[y] out double on the annuities," and

there is a substantial risk that this would occur if Francisco was

not joined, Francisco was a person required to be joined if

feasible under Rule 19(a).4

             Because Francisco was a person required to be joined if

feasible under Rule 19(a), and the parties agree that he could not

feasibly be joined because the district court lacked personal

jurisdiction     over    him,       the   district   court    should    have

"determine[d] whether, in equity and good conscience, the action

should [have] proceed[ed] among the existing parties or should



4 In factually analogous circumstances, the Sixth Circuit has also
held that a third party, who had already been paid by the
defendant, was a required party under Rule 19(a), although it did
so because it reasoned that a court could not otherwise afford
complete relief among the parties. Soberay Mach. & Equip. Co. v.
MRF Ltd., 181 F.3d 759, 764 (6th Cir. 1999). Specifically, the
Sixth Circuit found that if the defendant was liable to the
plaintiff, the defendant "would [be] required to seek relief
against [the absent party]." Id.



                                      -10-
[have been] dismissed."     Fed. R. Civ. P. 19(b).        The district

court, however, never reached this step.

          The parties' briefs contain some discussion of the Rule

19(b) analysis.     We grant deference to a district court's Rule

19(b) determinations, however, Picciotto, 512 F.3d at 14-15, and

the decision is ultimately an equitable one, "steeped in pragmatic

considerations."    B. Fernández & Hnos, Inc. v. Kellogg USA, Inc.,

516 F.3d 18, 23 (1st Cir. 2008) (quoting In re Olympic Mills Corp.,

477 F.3d 1, 9 (1st Cir. 2007)).     Here, the district court has not

exercised its discretion.    Nor has it made findings on important

issues such as whether another court in Texas, Spain, or elsewhere

could   obtain    jurisdiction   over   both   National   Western    and

Francisco, and so provide Plaintiffs with an adequate remedy in

another forum.    We therefore decline to reach the Rule 19(b) issue

in the first instance.

                          III.   CONCLUSION

          Because Francisco was a person required to be joined if

feasible under Rule 19(a), we vacate the district court's judgment

and remand to the district court to determine whether it is

nevertheless equitable for the case to proceed without him.         Each

party is to bear its own costs.

          VACATED and REMANDED.




                                 -11-
