APPEAL from the Circuit Court of Jackson County; the Hon
PEYTON H. KUNCE, Judge, presiding.
MR. JUSTICE GEORGE J. MORAN DELIVERED THE OPINION OF THE COURT:
Defendant Bonita Snider appeals from a judgment of the trial court of Jackson County finding that the plaintiff-appellee administrator of the estate of Colbert L. Snider was entitled to the proceeds of a group life insurance policy payable on the death of Colbert L. Snider.
This case concerns a dispute between the administrator of the estate of Colbert L. Snider, deceased, and Bonita Snider, the divorced wife of the decedent, over the proceeds of a group policy in the amount of $20,000 on the life of Colbert L. Snider.
Colbert L. Snider, an employee of E.T. Simonds Construction Company, was insured under a contributory group insurance policy with Employers Life Insurance Company of Wausau at the time of his death. He and the appellant were married in 1950 and entered into a property settlement agreement on August 14, 1972.
On August 16, 1972, a decree of divorce incorporating the property settlement was granted to Bonita Snider. Neither the decree nor the property settlement made any mention of insurance. Colbert L. Snider died the next day after the divorce was granted, as a result of an accident.
The administrator of the estate of Colbert L. Snider filed a suit in the circuit court of Jackson County claiming that she was entitled to the proceeds of the group policy by reason of the death of Colbert L. Snider. Defendant Bonita Snider filed an answer claiming the proceeds, and the Employers Life Insurance Company of Wausau tendered the proceeds of the policy in question into the court with the request that the court determine which party was entitled to the money.
The plaintiff contended in the trial court that she was entitled to the money because (1) Bonita Snider was not a designated beneficiary under the terms of the group policy at the time of the death of Colbert L. Snider, and (2) assuming that she was, her interest was abolished by the property settlement incorporated into the divorce decree.
The trial court in holding in favor of the plaintiff stated:
"Assuming arguendo (but not necessarily so specifically holding) that Mrs. Snider was the designated beneficiary of the policy in question, the crucial question in this litigation is whether the divorce decree barred her right to receive the proceeds of the said insurance policy upon his death, in light of the language of said Paragraph 9 of the Divorce Decree.
Although there are no Illinois authorities directly in point and the ruling in this cause may be one of first impression, this court feels that sound reasoning, logic and equity require the answer to the question in the affirmative.
The decided weight of authority in the case law of foreign jurisdictions, as set out in the texts and treatises, such as A.L.R., American Jurisprudence and others, support the principal of law, under the individual circumstances and facts of the case at hand, that the rights of the beneficiary to the proceeds of an insurance policy upon the life of a divorced spouse can be terminated by agreement to relinquish the spouse's right to the proceeds without formally changing the beneficiary by giving notice to the insurance company or its agents of such change. The real question is whether the Divorce Decree barred the defendant's right to receive the proceeds of the insurance policy and this court feels that the answer to this question is that the Decree did so bar her rights to the same."
The critical questions for review are: (1) Was Bonita Snider the designated beneficiary of the policy in question? We hold that she was. (2) Did the divorce decree bar Bonita Snider's right to receive the proceeds of the policy? We hold that it did not.