McCarthy v. Kapcar

After Stephen Kapcar married Christine McCarthy (plaintiff), Stephen designated McCarthy as the beneficiary of his employer-provided life-insurance policy with Aetna Life Insurance Co. (Aetna) (defendant). The Aetna policy stated that changes to the beneficiary designation were to be made by submitting a written request to Aetna. Stephen and McCarthy separated in 1977 and divorced in 1978. The divorce decree did not mention the Aetna policy. From the separation until Stephen’s death, Stephen, who had multiple sclerosis, lived with his father, Emil Kapcar (defendant). In 1977, Stephen executed a holographic, or handwritten, will that bequeathed all his property, including any insurance benefits, to Emil. However, Stephen never contacted Aetna to change the beneficiary designation on his life-insurance policy. Consequently, McCarthy remained the designated beneficiary at Stephen’s death in 1984. McCarthy sued Aetna to recover the life-insurance proceeds. Aetna interpleaded Emil, making him a party to the action, depositing the insurance proceeds with the court, and leaving it to McCarthy and Emil to litigate to whom the proceeds rightfully belonged. The trial court held in McCarthy’s favor because Stephen had not followed the policy’s procedure for changing his beneficiary. However, the appellate division reversed, finding that the insurance proceeds belonged to Emil because Stephen’s holographic will sufficiently demonstrated Stephen’s intent that Emil receive the proceeds. McCarthy appealed to the New York Court of Appeals.