It is often times very difficult to answer the titled question. When there us uncertainty as to who is entitled to life insurance proceeds there is a process by which the life insurance company can “interplead” the life insurance proceeds into the registry of the Court. These are situation where the life insurance company knows they owe the life insurance money because the insured has died. What they sometimes don’t know is, who is entitled to the money. This interpleader process allows those who believe they may have an interest in the proceeds to litigate their respective interests.
This issue was presented in a 2022 opinion from the Northern District of Texas, Dallas Division. The style of the case is Sun Life Insurance Company of Canada v. Elizabeth McKinney, Tisha Diante, and Teresa Morris.
Here, Sun Life knew they owed the life insurance proceeds to someone, but was not sure who. After filing a lawsuits to interplead the money, the life insurance company must serve the potential beneficiaries with legal papers so that they may come to court and litigate between themselves as to who is entitled to the proceeds. In this case, Sun Life was having difficulty locating McKinney to have her served with the legal papers.
Because of the difficulty Sun Life was having in its attempts to locate McKinney, Sun Life sought permission from the Court to have McKinney served with legal papers via “substituted service.”
On January 11, 2022, Sun Life moved the Court to serve McKinney by substituted service, attaching to its motion the affidavit of its process server, Donna Jo King. In her affidavit, King states that she was instructed to deliver “a Summons and Complaint for Interpleader . . . to Elizabeth McKinney at 414 Meadow Lark[,] Duncanville, TX 75137.” King attempted service at this address but found that the house on the property was vacant and being sold. She then located another address for McKinney at 2976 Eric Lane, Farmers Branch, TX 75234, which she avers was confirmed by Dallas Central Appraisal District records. King recounts attempting service at the Eric Lane address on four separate occasions, but each time no one answered the front door.
Based on King’s affidavit, the Court granted Sun Life’s motion to serve McKinney by posting the required documents to the front door of the Eric Lane address. Additionally, the Court granted Sun Life an extension of time to serve McKinney, ordering that service be effectuated by January 26, 2021.
On January 19, 2021, Sun Life filed the instant motion seeking to serve McKinney by publication pursuant to Texas Rule of Civil Procedure 109, again attaching King’s affidavit. In its motion, Sun Life avers that it attempted to serve McKinney by posting pursuant to the Court’s Order, but that it was informed by the resident at the Eric Lane address “that she was not the ‘Elizabeth McKinney’ identified in the [c]omplaint.” Additionally, Sun Life states that Defendant Diante is unaware of McKinney’s location and that the above referenced “attempts at service follow[ed] Sun Life and its counsel’s own extensive efforts to contact [McKinney] prior to and after filing its Complaint for Interpleader.” For these reasons, Sun Life contends that service by publication is warranted. The Court reviews Sun Life’s motion below.
The Federal Rules of Civil Procedure, Rule 4(e)(1), authorize serving an individual in accordance with state law. Rule 109 of the Texas Rules of Civil Procedure provides for citation by publication as follows:
When a party to a suit, his agent or attorney, shall make oath that the residence of any party defendant is unknown to affiant, and to such party when the affidavit is made by his agent or attorney, or that such defendant is a transient person, and that after due diligence such party and the affiant have been unable to locate the whereabouts of such defendant . . . , the clerk shall issue citation for such defendant for service by publication. In such cases it shall be the duty of the court trying the case to inquire into the sufficiency of the diligence exercised in attempting to ascertain the residence or whereabouts of the defendant . . . before granting any judgment on such service.
Courts have noted that service by publication is the method of notice which is least calculated to bring to the potential defendant’s attention the pendency of a judicial action. Thus, the trial court has a mandatory duty to inquire into the sufficiency of the diligence exercised in attempting to ascertain the residence or whereabouts of the defendant. The burden is on the moving party to prove a reasonably diligent search was made to locate or effectively serve the defendant. A “diligent search” includes making inquiries that someone who really wants to find the defendant would make, and diligence is measured not by the quantity of the search but by its quality.
This Court then did an analysis of the facts in this case and applied the law. This is a good read for situations where it is hard to locate a potential beneficiary of the life insurance proceeds.