J-A05011-15


NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37

ESTATE OF: STEPHEN T. GALLAGHER,          :     IN THE SUPERIOR COURT OF
DECEASED                                  :          PENNSYLVANIA
                                          :
                                          :
APPEAL OF: JOSEPH A. HALLMAN              :         No. 1125 EDA 2014

                   Appeal from the Decree March 5, 2014
            In the Court of Common Pleas of Philadelphia County
             Orphans’ Court at No(s): O.C. No. 891 DE OF 2011


BEFORE: GANTMAN, P.J., SHOGAN, J., and ALLEN, J.

MEMORANDUM BY GANTMAN, P.J.:                          FILED JULY 23, 2015

      Appellant, Joseph A. Hallman, appeals from the decree entered in the

Philadelphia County Court of Common Pleas, which granted summary

judgment in favor of Appellees Michael J. Gallagher, Jr., Administrator of the

Estate of Stephen T. Gallagher, Joann P. Gallagher, and Michael J. Gallagher,

Sr. (collectively “Gallagher Appellees”), and denied Appellant’s cross-claim

against Appellee Aetna Life Insurance Company (“Aetna”).        We affirm in

part, reverse in part, and remand for further proceedings.

      The relevant facts and procedural history of this case are as follows.

In April 2003, the University of Pennsylvania (“Penn”) contracted with Aetna

to provide group life insurance coverage to Penn employees.       Stephen T.

Gallagher (“Decedent”) became a Penn employee in September 2003 and

purchased two Aetna life insurance policies through the Penn Health &

Welfare Program group coverage plan, GP-811778 (“Plan”).            The Plan
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provided in relevant part as follows:

         Beneficiaries

         You may name or change your beneficiary by filing [a]
         written request at your Employer’s headquarters or at
         Aetna’s Home Office. Ask your Employer for the Forms.
         The naming or any change will take effect as of the date
         you execute the request. Aetna will be fully discharged of
         its duties as to any payment made by it before your
         request is received at its Home Office.

         Any amount payable to a beneficiary will be paid to those
         you name. Unless you state to the contrary, if more than
         one beneficiary is named, they will share on equal terms.

                                  *      *    *

         If no named beneficiary survives you or if no beneficiary
         has been named, payment will be made as follows to those
         who survive you:

          Your spouse, if any.
          If there is no spouse, in equal shares to your children.
          If there is no spouse or child, to your parents, equally or
           to the survivor.
          If there is no spouse, child, or parent, in equal shares to
           your brothers and sisters.
          If none of the above survives, to your executors or
           administrators.

(Exhibit 10 of the Gallagher Appellees’ Motion for Summary Judgment, filed

4/25/13; R.R. at 192b-193b). ADP, Inc. administered the Plan and its online

database, Enterprise.

      Decedent and Appellant were in a relationship and began to live

together in early 2005.    In May 2005, they executed a lease addendum

which added Appellant to Decedent’s lease.          Decedent and Appellant

subsequently moved into a house they jointly owned and took out a

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mortgage.    They registered as same-sex domestic partners with Penn on

January 26, 2006.        At some point following that registration, Decedent

added Appellant as a dependent under Decedent’s medical insurance.

      Decedent and Appellant separated in late 2008 or early 2009, at which

point Appellant moved out of their jointly-owned home. Appellant continued

to stay in touch with Decedent after the separation. For example, Appellant

states he cared for Decedent’s dogs while Decedent was on an international

business trip and drove Decedent home from the hospital after Decedent

had outpatient surgery. On December 3, 2008, however, Decedent removed

Appellant from Decedent’s medical insurance coverage. On that same date,

Decedent    also    electronically   added   Appellee   Joann   Gallagher   as   his

contingent life insurance beneficiary under the Plan.           Decedent made no

change to his primary life insurance beneficiary at that time. Decedent died

on May 27, 2011.

      Upon Decedent’s death, Appellant became sole owner of the jointly-

owned house subject to a substantial mortgage. Decedent’s life insurance

policies were payable at a combined value of $354,000.00. Aetna received

information from ADP identifying Appellant as Decedent’s primary life

insurance beneficiary.     On May 31, 2011, Aetna received separate death

claims from Appellant and from Decedent’s brother, Appellee Michael J.

Gallagher, Jr.     On June 24, 2011, Appellee Michael Gallagher, Jr., in his

capacity as administrator of Decedent’s estate, filed a petition for citation


                                        -3-
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against Appellant and Aetna, which sought an award to the estate of the

benefits under Decedent’s life insurance policies. The Orphans’ court initially

denied the petition on July 6, 2011.      Appellee Michael Gallagher, Jr. filed

exceptions on July 26, 2011. On July 29, 2011 the court vacated the July 6,

2011 decree and issued a citation directing Appellant and Aetna to show

cause why the court should not grant the relief requested in the petition for

citation.

      On September 20, 2011, Aetna filed a petition for interpleader of the

proceeds of Decedent’s life insurance benefits. Appellant filed a motion for

summary judgment on March 30, 2012. Appellee Michael Gallagher, Jr. filed

a petition for leave to file a substituted petition for citation on April 4, 2012.

On July 17, 2012, the court denied Appellant’s summary judgment motion,

granted Appellee Michael Gallagher, Jr.’s request to file a substituted

petition, and denied Aetna’s interpleader petition. The Gallagher Appellees

filed an amended petition for citation on July 31, 2012.1        On August 21,

2012, Appellant filed an answer and a cross-claim against Aetna for failure

to pay out Decedent’s life insurance benefits to Appellant.

      The Gallagher Appellees filed a motion for summary judgment against


1
  Decedent’s parents, Appellees Joann P. Gallagher and Michael J. Gallagher,
Sr., joined in the amended petition. The petition sought the award of
Decedent’s life insurance benefits to his parents as default beneficiaries
under the Plan, or to Appellee Joann Gallagher individually.          In the
alternative, the petition sought to impose a constructive trust on any
benefits paid to Appellant to preserve the benefits during the litigation, so
the benefits could be transferred to Decedent’s parents.
                                      -4-
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Appellant on April 25, 2013.    On April 26, 2013, Appellant filed a cross-

motion for summary judgment against the Gallagher Appellees, and a

motion for summary judgment against Aetna on the cross-claim. On March

5, 2014, the court denied Appellant’s cross-motion for summary judgment;

granted summary judgment in favor of the Gallagher Appellees; denied

Appellant’s cross-claim against Aetna; and awarded the proceeds of

Decedent’s life insurance policies under the Plan to Appellees Joann

Gallagher and Michael Gallagher, Sr., pursuant to the default provisions of

the Plan.   Appellant filed a timely notice of appeal on April 1, 2014.   The

court did not order Appellant to file a concise statement of errors complained

of on appeal pursuant to Pa.R.A.P. 1925(b); and Appellant filed none.

      Appellant raises the following issues for our review:

         DID THE [ORPHANS’] COURT ERR AS A MATTER OF LAW
         AND/OR ABUSE[] ITS DISCRETION BY ENTERING
         SUMMARY JUDGMENT IN FAVOR OF THE [GALLAGHER
         APPELLEES]…AND AGAINST APPELLANT BY:

            DETERMINING THAT AS A MATTER OF LAW THE
            ELECTRONIC    LIFE    INSURANCE    BENEFICIARY
            DESIGNATIONS     UTILIZED   BY   [PENN]   AND
            ACCEPTED BY AETNA…, NAMING [APPELLANT] AS
            THE PRIMARY BENEFICIARY OF TWO POLICIES
            TOTALING $354,000.00, WERE INVALID;

            DISREGARDING COMPETENT EVIDENCE IN THE
            FORM OF SCREEN SHOTS OF THE COMPUTER
            RECORDS WHICH SHOW UNEQUIVOCALLY THAT THE
            LIFE INSURANCE BENEFICIARY DESIGNATION OF
            [DECEDENT],  NAMING   [APPELLANT] AS  THE
            PRIMARY BENEFICIARY WAS INVALID;

            DETERMINING         THAT       THE       ELECTRONIC

                                     -5-
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            DESIGNATION OF LIFE INSURANCE BENEFICIARY IS
            A “PROGRAM MODALITY BY DEFAULT” AND RELYING
            UPON…THE HEARSAY LETTER DATED MARCH 8, 2012
            FROM HELEN C. LOGAN; AND

            DETERMINING THAT [APPELLANT] IS NOT ENTITLED
            TO LEGAL FEES AND COSTS UNDER ERISA
            PURSUANT TO 29 U.S.C. § 1132(a)(1)(B) FOR
            AETNA’S REFUSAL TO PAY THE LIFE INSURANCE
            PROCEEDS     TO THE   DESIGNATED     PRIMARY
            BENEFICIARY.

(Appellant’s Brief at 3).

      In his sub-issues one through three, Appellant argues Aetna and

Penn’s records established Appellant was named as primary beneficiary

under Decedent’s life insurance policies when Decedent died.       Appellant

contends Penn’s screen shots of information in the Enterprise system, which

constituted Aetna’s official record of beneficiary information, unequivocally

identified Appellant as primary beneficiary. Appellant asserts the Gallagher

Appellees failed to present evidence indicating Decedent named anyone

other than Appellant as primary beneficiary or that the designation was

somehow improper.       Appellant insists he had no obligation to produce a

paper form that Decedent had originally submitted to name Appellant as

primary beneficiary.        Appellant claims the Plan permitted electronic

designation of beneficiaries as early as 2006, and ever since then.       In

support, Appellant states the language from the 2010 Aetna Plan Summary,

which provided the policyholder “may” name or change a beneficiary via

written request, was optional not mandatory. Appellant further contends the


                                     -6-
J-A05011-15


court improperly relied on a letter from Penn’s Office of General Counsel,

which suggested Appellant had somehow been “inadvertently” designated as

a primary beneficiary by default when Decedent added Appellant to

Decedent’s medical insurance coverage.         Appellant asserts this letter is

hearsay and speculation. For these reasons, Appellant concludes this Court

should reverse the summary judgment entered in favor of the Gallagher

Appellees and enter judgment in favor of Appellant or, alternatively, remand

for trial. We agree with Appellant that summary judgment on this issue was

in error.

      Our standard of review of an order granting summary judgment

requires us to determine whether the trial court abused its discretion or

committed an error of law. Mee v. Safeco Ins. Co. of Am., 908 A.2d 344,

347 (Pa.Super. 2006). Our scope of review is plenary. Pappas v. Asbel,

564 Pa. 407, 418, 768 A.2d 1089, 1095 (2001), cert. denied, 536 U.S. 938,

122 S.Ct. 2618, 153 L.Ed.2d 802 (2002). In reviewing a trial court’s grant

of summary judgment,

            [W]e apply the same standard as the trial court, reviewing
            all the evidence of record to determine whether there
            exists a genuine issue of material fact. We view the record
            in the light most favorable to the non-moving party, and
            all doubts as to the existence of a genuine issue of
            material fact must be resolved against the moving party.
            Only where there is no genuine issue as to any material
            fact and it is clear that the moving party is entitled to a
            judgment as a matter of law will summary judgment be
            entered. All doubts as to the existence of a genuine issue
            of a material fact must be resolved against the moving
            party.

                                       -7-
J-A05011-15



          Motions for summary judgment necessarily and directly
          implicate the plaintiff’s proof of the elements of [a] cause
          of action.   Summary judgment is proper if, after the
          completion of discovery relevant to the motion, including
          the production of expert reports, an adverse party who will
          bear the burden of proof at trial has failed to produce
          evidence of facts essential to the cause of action or
          defense which in a jury trial would require the issues to be
          submitted to a jury. In other words, whenever there is no
          genuine issue of any material fact as to a necessary
          element of the cause of action or defense, which could be
          established by additional discovery or expert report and
          the moving party is entitled to judgment as a matter of
          law, summary judgment is appropriate. Thus, a record
          that supports summary judgment either (1) shows the
          material facts are undisputed or (2) contains insufficient
          evidence of facts to make out a prima facie cause of action
          or defense.

          Upon appellate review, we are not bound by          the trial
          court’s conclusions of law, but may reach          our own
          conclusions. The appellate Court will disturb       the trial
          court’s order only upon an error of law or an      abuse of
          discretion.

             Judicial discretion requires action in conformity with
             law on facts and circumstances before the trial court
             after hearing and consideration. Consequently, the
             court abuses its discretion if, in resolving the issue
             for decision, it misapplies the law or exercises its
             discretion in a manner lacking reason. Similarly, the
             trial court abuses its discretion if it does not follow
             legal procedure.

Chenot v. A.P. Green Services, Inc., 895 A.2d 55, 61 (Pa.Super. 2006)

(internal citations and quotation marks omitted).

        The Employee Retirement Income Security Act2 (“ERISA”) governs

“any employee benefit plan if the plan is established or maintained by any

2
    29 U.S.C.A. §§ 1001-1461.
                                      -8-
J-A05011-15


employer engaged in commerce or in any industry or activity affecting

commerce.”    Tatterson v. Koppers Co., 458 A.2d 983, 985 (Pa.Super.

1983) (citing 29 U.S.C.A. § 1003(a)(1)). “Under ERISA, plan administrators

and fiduciaries are required ‘to discharge [their] duties with respect to a plan

solely in the interest of the participants and beneficiaries,… in accordance

with the documents and instruments governing the plan….’”                 In re

Estate of Sauers, 613 Pa. 186, 205, 32 A.3d 1241, 1253 (2011) (quoting

29 U.S.C.A. § 1104(a)(1)(D)) (emphasis in original).

      Instantly, the Orphans’ court reasoned as follows:

         Based on the record presented, and in particular the
         documents     and    instruments     governing the     plan,
         [Appellant] has failed to sustain his burden of establishing
         that he was designated by [Decedent] as a beneficiary
         under the procedures established by [the Plan].          The
         relevant provisions of that “Your Group Plan” sponsored by
         the University of Pennsylvania require a specific
         designation of a beneficiary as follows:

            Beneficiaries

            You may name or change your beneficiary by filing
            written request at your Employer’s headquarters or
            at Aetna’s Home Office. Ask your Employer for the
            Forms. The naming or any change will take effect as
            of the date you execute the request. Aetna will be
            fully discharged of its duties as to any payment
            made by it before your request is received at its
            Home Office.

            Any amount payable to a beneficiary will be paid to
            those you name. Unless you state to the contrary, if
            more than one beneficiary is named, they will share
            on equal terms.

                                  *    *    *

                                      -9-
J-A05011-15



          If no named beneficiary survives you or if no
          beneficiary has been named, payment will be made
          as follows to those who survive you:

         Your spouse, if any.
         If there is no spouse, in equal shares to your
          children.
         If there is no spouse or child, to your parents,
          equally, or to the survivor.

       Throughout the long pendency of this dispute, [Appellant]
       has failed to present any designation—written or
       electronic—of a beneficiary selected by [Decedent] in
       compliance with the relevant procedures set forth in the
       Aetna policy. Instead, [Appellant] relies on 2 sets of
       computer screen shots, one produced by Penn and the
       other by Aetna…. These documents, however, are merely
       post-mortem records reflecting Penn and Aetna’s computer
       files, which, the record demonstrates, were dependent on
       information received from ADP. This is made clear in
       Aetna’s    response     to  [Appellant’s]  first set   of
       interrogatories[,] which he presents in support of his
       summary judgment [motion]. When asked if it maintains
       “a record of the primary beneficiary for life insurance
       policies and coverage provided to [Decedent] under the
       [Plan],” Aetna replied:

          Aetna does not maintain (i.e. store) historical
          information or records of beneficiary designations
          made by [Decedent]. Aetna has access only to
          current beneficiary designations which it receives
          through a file feed from ADP, the Plan Sponsor’s
          contracted vendor for administration of the technical
          aspects of the Plan.

       The deposition testimony [Appellant] relies on to support
       his summary judgment motion likewise admits a lack of
       knowledge and deferral to ADP.          The deposition of
       Geraldine Zima, Manager of Benefits Administration for
       Penn, is illustrative.    In her deposition, Ms. Zima
       repeatedly emphasizes her limited knowledge of the
       procedures and information stored by ADP for life
       insurance beneficiaries. For instance, when she was asked

                                 - 10 -
J-A05011-15


       to interpret the three screenshots produced by Penn
       regarding [Decedent’s] designation of life insurance
       beneficiaries and more specifically “what information does
       this screenshot tell you about the beneficiary designation
       of [Decedent’s] life insurance policy,” Ms. Zima candidly
       replied: “You would have to talk to ADP about that. I don’t
       use this screen that much. I’m not familiar enough with
       it.” To her knowledge, these 3 screen shots constitute the
       entire and only record of the beneficiaries of [Decedent’s]
       life insurance. They were stored electronically in ADP’s
       Enterprise System and then [sent] directly to Aetna.

       In addition to this dearth in background information about
       the Penn and Aetna screenshots, [Appellant’s] summary
       judgment [motion] is undermined by the internal
       contradictions between these documents. While the Aetna
       screenshot gives an effective date for the beneficiary
       designation of [Appellant] of “7/1/10,[”] Ms. Zima was
       asked to explain the Penn screenshot’s effective date of
       “12/3/08.” At first she deferred, stating “You would have
       to ask ADP how to read that,” but then offered her opinion
       that [Appellant] had been named a beneficiary before
       12/3/08. This conjecture, however, is unsupported by any
       hard evidence. When specifically asked whether there was
       “any writing signed by [Decedent] designating [Appellant]
       as primary beneficiary that you have seen or have
       knowledge,” [Ms. Zima] replied: “I haven’t seen any
       paper” nor was she aware of “any document signed by
       [Decedent]      designating    [Appellant]   as    primary
       beneficiary.”   Aetna likewise stated that it had never
       received any electronic signatures by [Decedent] and the
       “computer documents do not show when a designation was
       made. Aetna’s records show online designation as of
       7/01/10 of [Appellant].”

       There is no dispute that [Decedent] had named [Appellant]
       as beneficiary of his medical insurance or that he
       subsequently removed him in December 2008. In the
       dearth of a clear electronic or written beneficiary
       designation for [Decedent’s] life insurance, Ms. Zima was
       asked to speculate on how [Appellant’s] name came to
       appear as a beneficiary. In response, she suggests a
       computer default:


                                 - 11 -
J-A05011-15


          Q:    Well, isn’t that in contradiction of your
          statement that [Decedent] elected—isn’t this
          statement saying that he elected to give medical
          benefits to [Appellant], and that the Enterprise
          system,       through    some      programming—some
          programming modality by default named [Appellant]
          in the life insurance beneficiary field?

          A:     It did not name him. It populated the name
          field. There was no designation as to primary or
          contingent. It was up to the employee to make that
          election or change it.

       This suggestion that [Appellant’s] name appears on the
       computer printouts by default contravenes the explicit
       terms of the insurance policy requiring a designation by
       the insured as to his life insurance beneficiary. The lack of
       any evidence of beneficiary designation is fatal to
       [Appellant’s] claim.      Although he counters that the
       [Gallagher    Appellees     have]   never    produced    any
       documentation of a different beneficiary designation, to
       maintain [their] burden of proof, the [Gallagher Appellees]
       do not have to do this. Under the explicit terms of [the]
       policy or plan, if the insured fails to designate a
       beneficiary, there is a default provision clearly mapped
       out.     Under that default provision, the [Gallagher
       Appellees] prevail[] and the benefits should be awarded to
       the parents of [Decedent].

       The other documents offered by [Appellant] to support his
       claim are irrelevant. The 2006 Amendment to the Master
       Services agreement between Penn and ADP as well as the
       Contract between Aetna and Penn effective April 1, 2006
       concerning ADP’s management of data merely define the
       relationship among these parties but were not incorporated
       into the Plan applicable to [Decedent].           The plan
       summaries that [Appellant] presented likewise were
       irrelevant to determination of the designated beneficiary
       but ironically those summaries would not have found
       computer screen shots sufficient to designate a
       beneficiary. The Summary Plan Description as of July
       2006, for instance, provides at page 38 as follows:

          Enrollment and Beneficiary Designation

                                  - 12 -
J-A05011-15


          When you enroll for coverage you complete an
          enrollment form and name a beneficiary to receive
          benefits in case of your death. You may name
          anyone as your beneficiary and can change your
          beneficiary at any time via the online enrollment
          system at www.upenn.edu/u@penn.

       No enrollment form, in paper or in electronic form, has
       been provided. The computer screen shots presented by
       Aetna as well as the screenshots and the touch logs
       produced by Penn as explained by Geraldine Zima in her
       deposition seriously contradict each other.

       Alternatively, the [Gallagher Appellees have] sustained
       [their] burden of showing that there was no designation of
       a beneficiary of [Decedent’s] life insurance policy under
       the terms of the relevant insurance policy. Normally, the
       [Gallagher Appellees] would have faced a daunting task in
       trying to establish this “negative.” [They were] assisted,
       ironically, by the failure of [Appellant] to present any
       documentation—electronic or otherwise—that he had been
       designated by [Decedent] as his life insurance beneficiary
       under the terms of the policy that the [Gallagher
       Appellees] presented as Ex. 10 in support of [their]
       summary judgment motion. The deposition testimony by
       Geraldine Zima, as previously analyzed, revealed that she
       was unaware of any designation of a beneficiary other than
       the three screen shots.       At one point, in fact, she
       hypothesized that [Appellant’s] name had appeared as a
       life insurance beneficiary by computer default. The letter
       exchange the [Gallagher Appellees] presented with Helen
       C. Logan, Administrator of Legal Services at Penn’s [O]ffice
       of the General Counsel likewise buttresses Ms. Zima’s
       suppositions.       When asked whether [Penn] had a
       document designating [Appellant] as a beneficiary of
       [Decedent’s]     life  insurance—either    on   paper     or
       electronically, Ms. Logan responded by letter dated March
       8, 2012[:]

          Penn refers questions about the ADP process to ADP,
          but it is Penn’s understanding that having just added
          [Appellant] to [Decedent’s] medical insurance as a
          domestic partner, [Decedent’s] screen defaulted to
          [Appellant’s] name in the life insurance beneficiary

                                  - 13 -
J-A05011-15


              field. One can simply erase the default name and
              type in another.

         Designation of a life insurance beneficiary by computer
         default is not an alternative to the personal selection of a
         life insurance beneficiary under [the Plan] that the
         [Gallagher Appellees] rel[y] upon in seeking summary
         judgment.     While it is conceivable—though far from
         certain—that such a personal designation might be found
         among ADP’s documents, [Appellant] failed to pursue that
         route. In fact, [Appellant] does not seek to raise that
         argument in the present summary judgment. Moreover,
         the period for discovery is over. There is therefore no
         issue of fact nor one for trial. The [Gallagher Appellees
         have] met [their] burden of proof that no designated
         beneficiary can be proven, so that the default provisions of
         the insurance policy intended for such instances should be
         invoked.

(Orphans’ Court Opinion, filed March 5, 2014, at 12-16).        We cannot fully

agree with the court’s analysis for the following reasons.

      Decedent took out life insurance policies under the Plan in 2003. As

early as 2006, Decedent had a personal key and password he could use to

log into the Enterprise database. Once in the system, Decedent was able to

name or change his primary and contingent life insurance beneficiaries.

Decedent could also submit a paper beneficiary designation form to Penn or

Aetna.    In either case, current beneficiary information was stored in

Enterprise.   Ms. Zima stated during her deposition that the information in

Enterprise constituted Penn’s official and entire record of the beneficiaries for

Decedent’s life insurance policies.     Screen shots of Decedent’s record in

Enterprise taken after his death displayed Appellant’s name as the primary

beneficiary for Decedent’s life insurance policies.      Both Penn and Aetna

                                      - 14 -
J-A05011-15


produced these screen shots. Ms. Zima testified the Penn screen shots were

received from ADP, which administers Enterprise.         Likewise, in answers to

interrogatories, Aetna stated it has access only to current beneficiary

designations, and it receives this information in an electronic file feed from

ADP. Aetna confirmed that the file feed it received from ADP listed Appellant

as the primary beneficiary for Decedent’s life insurance policies.

      The “touch logs” of Decedent’s activity in Enterprise show no electronic

designation of a primary life insurance beneficiary, which might suggest the

designation was done on paper. Nevertheless, the absence of a paper form

signed by Decedent, naming Appellant as primary beneficiary, is not

automatically fatal to Appellant’s case. Aetna stated it stores no historical

information   or   records   of   beneficiary   designations.   The   up-to-date

beneficiary information in the screen shots, however, suggests Decedent

named Appellant as the primary beneficiary for the life insurance policies at

some point in the past. Furthermore, the touch logs of Decedent’s activity in

Enterprise showed he logged into the system in December 2008 to add

Appellee Joann Gallagher as a contingent life insurance beneficiary,3 and to

remove Appellant from medical coverage. Ms. Zima testified that it was her

understanding Appellant was already designated as Decedent’s primary life

insurance beneficiary at that time.      According to the touch logs, however,

3
  In Enterprise, Joann Gallagher’s name is misspelled as “Joan Gallagher”
and her birthdate is incorrect, but the parties do not dispute that the entry is
intended to refer to Decedent’s mother, Appellee Joann Gallagher.


                                       - 15 -
J-A05011-15


Decedent did not alter, change or remove Appellant as the primary

beneficiary then or at any other time that Decedent logged into Enterprise.

The Gallagher Appellees’ assertion, that designating a medical dependent in

Enterprise can automatically populate the primary life insurance beneficiary

field with the same name, fails to establish what actually occurred in this

case and is conjecture at this point.

      Viewing the evidence in the light most favorable to Appellant, as the

nonmoving party in the Gallagher Appellees’ motion for summary judgment,

we conclude a genuine issue of material fact exists as to whether Decedent

designated Appellant primary beneficiary of Decedent’s life insurance

policies. See Chenot, supra. At the summary judgment stage, any doubts

concerning the reason Appellant is listed as Decedent’s primary beneficiary

in Enterprise must be resolved in Appellant’s favor as the nonmoving party.

See id. Summary judgment for either party would be inappropriate at this

juncture in light of the conflicting claims regarding the identity of the

primary beneficiary of the life insurance policies. The factfinder should have

an opportunity to resolve this issue, which includes any questions regarding

alleged inaccuracies in the screen shots as well as the knowledge and

credibility of the witnesses.4


4
  Likewise, the Gallagher Appellees’ objection to the screen shots as
unauthenticated is properly an issue for trial. Assuming without deciding the
touch logs and Ms. Zima’s deposition testimony were insufficient to
authenticate the screen shots, Appellant should have an opportunity to
present testimony or other authentication evidence if the case proceeds to
                                        - 16 -
J-A05011-15


      In his fourth sub-issue, Appellant argues Aetna failed to comply with

ERISA when it deferred action on Appellant’s claim for Decedent’s life

insurance    benefits.       Appellant     contends     Aetna’s   decision   to   file    an

interpleader     petition,    rather     than    approve    Appellant’s      claim,      was

unsupported by substantial evidence. Appellant asserts that even if Aetna

acted reasonably when it filed the interpleader petition, it unjustifiably

ignored evidence (including the screen shots) that subsequently became

available.     Appellant concludes Aetna breached its fiduciary duty under

ERISA when it continuously refused to pay Decedent’s life insurance benefits

to Appellant, the designated primary beneficiary. We cannot agree.

      Section 1132 of ERISA provides in relevant part as follows:

         § 1132. Civil enforcement

         (a) Persons empowered to bring a civil action

         A civil action may be brought—

             (1)    by a participant or beneficiary—

                                       *     *      *




trial. Additionally, the Gallagher Appellees’ “best evidence rule” objection
misconstrues the evidentiary purpose of the screen shots, which was to
show Decedent’s act of naming Appellant as a primary life insurance
beneficiary. See Pa.R.E. 1002 (stating: “An original writing, recording, or
photograph is required in order to prove its content unless these rules, other
rules prescribed by the Supreme Court, or a statute provides otherwise”)
and Comment (stating “writings are not usually treated as subject to the rule
if they are only evidence of the transaction, thing or event”). Rule 1002 did
not require Appellant to produce the original beneficiary designation form,
which would only be additional evidence of this “event.” See id.
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              (B) to recover benefits due to him under the terms
              of his plan, to enforce his rights under the terms of
              the plan, or to clarify his rights to future benefits
              under the terms of the plan;

                                  *     *      *

29 U.S.C.A. § 1132(a)(1)(B). “Under Section 1132…plan administrators are

subject to federal liability should a court find they acted in an arbitrary and

capricious manner by interpreting an ERISA plan document in a manner

which is improper as a matter of federal law.” Estate of Sauers, supra at

210, 32 A.3d at 1256. “In deciding whether a fiduciary’s interpretation was

arbitrary and capricious, we review only the materials available to [the

fiduciary] during the decision-making process.” Pilieri v. Cont’l Cas. Co.,

718 A.2d 1255, 1259 (Pa.Super. 1998).              “[U]nder the ‘arbitrary and

capricious’ standard, a fiduciary’s interpretation of a plan will not be

disturbed if it is reasonable, supported by substantial evidence, and proper

as a matter of law.” Id. “A decision is supported by substantial evidence if

there is sufficient evidence for a reasonable person to agree with the

decision.” Courson v. Bert Bell NFL Player Ret. Plan, 214 F.3d 136, 142

(3d Cir. 2000).

      Instantly, Decedent died on May 27, 2011. On May 31, 2011, Aetna

received separate claims to Decedent’s life insurance benefits from Appellant

and Appellee Michael Gallagher, Jr. On June 1, 2011, after Aetna accessed

records showing Appellant was the named primary beneficiary, Aetna sent

Appellant a letter acknowledging receipt of his life insurance claim and

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J-A05011-15


requesting a copy of Decedent’s certified death certificate in order to process

the claim.    During the ensuing two weeks, Aetna received numerous

telephone calls from members of Decedent’s family seeking information

regarding Decedent’s designated life insurance beneficiary.        Decedent’s

sister believed her mother was the beneficiary.       Aetna received an email

from Penn on June 14, 2011, while Appellant’s claim remained on hold

pending Aetna’s receipt of the death certificate.        That email indicated

Decedent’s family might contest the beneficiary designation.     On June 17,

2011, Appellee Michael Gallagher, Jr. sent a letter to Aetna contesting the

beneficiary designation. The letter stated in part:

         Aetna has informed the family that an online change of
         beneficiary was made in July of 2010.          [Decedent’s]
         relationship with [Appellant] ended approximately four
         years ago. [Appellant] expressed (in writing) his desire to
         be removed from [Decedent’s] life. Having [Appellant]
         listed as [Decedent’s] beneficiary is contradictory to
         [Decedent’s] intentions, statements, direction and efforts.

                                  *     *      *

         [D]uring the past several months, [Decedent] made many
         statements to several individuals that Joann Gallagher is
         the primary beneficiary of his life insurance. We also
         believe there is written evidence of such.

         As Administrator of the Estate, I am writing to determine
         what change was made in July, what the policy was before
         the change, and where the change originated from. It is
         possible [Appellant] knew [Decedent’s] login user name
         and password.

         I am also writing to ask if Aetna will accept a written
         statement, made by [Decedent] in the recent time before
         his death, [in] which Joann Gallagher is designated as

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J-A05011-15


         primary beneficiary? Additionally, will Aetna accept sworn
         and certified affidavits by [Decedent’s] attending
         professionals and health care providers asserting
         [Decedent] intended and believed Joann Gallagher was the
         primary beneficiary? Lastly, will Aetna accept a written
         statement from me, as Power of Attorney, and made while
         [Decedent] was alive, designating Joann Gallagher as
         beneficiary?

(Appendix to Aetna’s Opposition to Appellant’s Motion for Summary

Judgment, filed 5/29/13; R.R. at 523a-524a).     On June 24, 2011, Aetna

received a copy of the petition for citation against Appellant and Aetna,

which sought the award of Decedent’s life insurance benefits to Appellee

Michael Gallagher, Jr., as administrator of Decedent’s estate.    Appellant

provided Aetna with a copy of Decedent’s death certificate on July 6, 2011.

Aetna proceeded to investigate the claim.     Aetna discovered, inter alia,

Decedent and Appellant had separated in 2009, and Decedent had removed

Appellant as a medical dependent around that time. On July 27, 2011, the

Orphans’ court issued a decree directing Appellant and Aetna to show cause

why Appellee Michael Gallagher Jr.’s petition for citation should not be

granted. In September 2011, Aetna filed its petition for interpleader and a

response to the petition for citation.

      Under the circumstances, Aetna acted reasonably when it decided to

interplead Decedent’s life insurance benefits.     Aetna was faced with

competing claims to the benefits, and the issue was hotly contested. Even

after Appellant produced the Enterprise screen shots, the case continued and

genuine factual disputes remain regarding the identity of Decedent’s primary

                                     - 20 -
J-A05011-15


life insurance beneficiary.     Aetna’s decision to defer payment on the

competing life insurance claims pending the outcome of the litigation was

reasonable and supported by substantial evidence. See Pilieri, supra.

       Based upon the foregoing, we conclude Appellant presented facts

sufficient to overcome summary judgment at this juncture.      We further

conclude under these circumstances Aetna’s decision to defer payment on

the competing insurance claims did not violate ERISA.      Accordingly, we

affirm the Orphans’ court decree to the extent it denied Appellant’s cross-

claim against Aetna.      We reverse that part of the decree which granted

summary judgment in favor of the Gallagher Appellees and awarded the

benefits of Decedent’s life insurance policies under the Plan to Appellees

Joann Gallagher and Michael Gallagher, Sr. and remand for further

proceedings.

       Decree affirmed in part and reversed in part; case remanded for

further proceedings. Jurisdiction is relinquished.

Judgment Entered.




Joseph D. Seletyn, Esq.
Prothonotary

Date: 7/23/2015




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