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Applying the Doctrine of Revocation by Divorce to Life Insurance Policies Alan S

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Applying the Doctrine of Revocation by Divorce to Life Insurance Policies Alan S Cornell Law Review Volume 73 Article 6 Issue 3 March 1988 Applying the Doctrine of Revocation by Divorce to Life Insurance Policies Alan S. Wilmit Follow this and additional works at: http://scholarship.law.cornell.edu/clr Part of the Law Commons Recommended Citation Alan S. Wilmit, Applying the Doctrine of Revocation by Divorce to Life Insurance Policies, 73 Cornell L. Rev. 653 (1988) Available at: http://scholarship.law.cornell.edu/clr/vol73/iss3/6 This Note is brought to you for free and open access by the Journals at Scholarship@Cornell Law: A Digital Repository. It has been accepted for inclusion in Cornell Law Review by an authorized administrator of Scholarship@Cornell Law: A Digital Repository. For more information, please contact [email protected]. APPLYING THE DOCTRINE OF REVOCATION BY DIVORCE TO LIFE INSURANCE POLICIES The Uniform Probate Code states: "If after executing a will the testator is divorced or his marriage annulled, the divorce.., revokes any disposition or appointment of property made by the will to the former spouse .... 1 Forty-four states have similar revocation-by- divorce statutes.2 The revocation statutes recognize that "[d]ivorce usually repre- sents a stormy parting, where the last thing one of the parties wishes is to have an earlier will carried out giving everything to a former 1 UNIF. PROB. CODE § 2-508 (1982). Section 2-508 states in full: If after executing a will the testator is divorced or his marriage an- nulled, the divorce or annulment revokes any disposition or appointment of property made by the will to the former spouse, any provision confer- ring a general or special power of appointment on the former spouse, and any nomination of the former spouse, as executor, trustee, conserva- tor, or guardian, unless the will expressly provides otherwise. Property prevented from passing to a former spouse because of revocation by di- vorce or annulment passes as if the former spouse failed to survive the decedent, and other provisions conferring some power or office on the former spouse are interpreted as if the spouse failed to survive the dece- dent. If provisions are revoked solely by this section, they are revived by testator's remarriage to the former spouse. For purposes of this section, divorce or annulment means any divorce or annulment which would ex- clude the spouse as a surviving spouse within the meaning of Section 2- 802(b). A decree of separation which does not terminate the status of husband and wife is not a divorce for purposes of this section. No change in circumstances other than as described in this section revokes a will. 2 ALA. CODE § 2-508 (1975); ALASKA STAT. § 13.11.185 (1985); ARZ. REV. STAT. ANN. § 14-2508 (1975); ARK. STAT. ANN. § 28-25-109(a)(2) (1987); CAL. PROB. CODE § 6122 (West Supp. 1988); COLO. REV. STAT. § 15-11-508 (1973); CONN. GEN. STAT. ANN.§ 45-162 (West 1981); DEL CODE ANN. tit. 12, § 209 (1987); FLA. STAT. ANN. § 732.507 (West 1976); GA. CODE ANN. § 53-2-76 (1982); HAWAII REV. STAT. § 560:2- 508 (1985); IDAHO CODE § 15-2-508 (1979); ILL. ANN. STAT. ch. 110 1/2, § 4-7(b) (Smith-Hurd Supp. 1987); IND. CODE ANN. § 29-1-5-8 (Burns 1972); IOWA CODE ANN. § 633.271 (West Supp. 1988); KAN. STAT. ANN. § 59-610 (1983); ME. REV. STAT. ANN. tit. 18-A, § 2-508 (1980); MD. EST. & TRUSTS CODE ANN. § 4-105 (1974 & Supp. 1987); MASS. GEN LAWS ANN. ch. 191, § 9 (West 1981); MICH. Comp. LAWS ANN. § 700.124 (West 1980); MINN. STAT. ANN. § 524.2-508 (West 1975); Mo. REV STAT. § 474.420 (1986); MONT. CODE ANN. § 72-2-322 (1985); NEB. REV. STAT. § 30-2333 (1985); NEV. REV. STAT. § 133.115 (1980); NJ. STAT. ANN. § 3B:3-14 (West 1983); N.M. STAT. ANN. § 45-2-508 (1978); N.Y. EST. POWERS & TRUSTS LAW § 5-1.4 (McKinney 1981); N.C. GEN. STAT. § 31-5.4 (1984); N.D. CENT. CODE § 30.1-08-08 (1976); OHIO REV. CODE ANN. § 2107.33 (Anderson 1976 & Supp. 1987); OKLA. STAT. tit. 84, § 114 (1970 & Supp. 1988); OR. REV. STAT. § 112.315 (1983); 20 PA. CONS. STAT. ANN. § 2507(2) (Pur- don 1975); R.I. GEN LAWS § 33-5-9.1 (Supp. 1987); S.C. CODE ANN. § 21-7-230 (Law. Co-op. 1976); TENN. CODE ANN. § 31-1-102 (1984); TEx. PROB. CODE ANN. § 69 (Vernon 1980); UTAH CODE ANN. § 75-2-508 (1984); VA. CODE ANN. § 64.1-59 (1987); WASH. REV. CODE. ANN. § 11.12.050 (1967); W. VA. CODE § 41-1-6 (1987); Wis. STAT. § 853.11 (1971); Wyo. STAT. § 2-6-118 (1977). 653 654 CORNELL LA W REVIEW [Vol. 73:653 spouse." 3 These statutes also recognize that people have difficulty accepting their own death.4 The statutes reflect the view that the testator's failure to change his will after divorce is a delay in expres- sing a changed testamentary intent rather than a continued expres- sion of that intent.5 Today, the life insurance policy has replaced the will as the dominant means of wealth transfer at death.6 The logic behind rev- ocation-by-divorce statutes clearly applies to transfers of wealth by life insurance policies. "[P]rinciples of construction and presump- tions of transferors' intent that have been developed in the law of wills do not apply" to life insurance policies, however, because the legal system recognizes and gives effect to the formal distinctions between the two instruments. 7 Part I of this Note outlines the development of the doctrine of revocation by divorce from the doctrine of revocation by implica- tion. It discusses the traditional interpretation and application of revocation by implication and the subsequent development of revo- cation-by-divorce statutes. Part II discusses the effect divorce has on life insurance policies, and evaluates the legal rules that have prevented courts from extending revocation by divorce to these pol- icies. Part III demonstrates the practical similarity between wills and life insurance policies, and Part IV criticizes the courts for deny- ing the protection of intent the owners of life insurance that the rev- ocation-by-divorce statutes provide to testators. Finally, the Note concludes that courts and legislatures should abandon the formalis- tic distinctions between wills and life insurance policies and extend the application of revocation-by-divorce statutes to life insurance policies. 3 Young, Probate Change, 20 BOSTON B.J., Dec. 1976, at 6, 10. 4 See S. FREUD, Thoughts for the Times on War and Death (1915), in 4 COLLECTED PA- PERS 304-05 (1925) ("Our own death is indeed unimaginable, and whenever we make the attempt to imagine it we can perceive that we really survive as spectators. Hence ... at bottom no one believes in his own death, or to put the same thing in another way, in the unconscious every one of us is convinced of his own immortality."). 5 See id.; see also Note, Implied Revocation of Wills after Divorce and Property Settlement, 4 DUKE BJ. 122, 126 (1954) (authored by Gary S. Stein) ("[I]n the vast majority of cases the testator's failure to revoke his will subsequent to divorce is due to neglect, and that to find an implied revocation usually gives effect to a testator's real intentions."). 6 See Kimball, The Functions of Designations of Beneficiaries in Modern Life Insurance: U.S.A., in LIFE INSURANCE LAW IN INTERNATIONAL PERSPECTIVE 74, 76 (J. Hellner & G. Nord eds. 1967) ("In view of the numbers of people involved, the life insurance benefici- ary designation is the principal 'last will and testament' of our legal system."). 7 Langbein, The Nonprobate Revolution and the Future of the Law of Succession, 97 HARV. L. REV. 1108, 1136 (1984). 1988] REVOCATION BY DIVORCE 655 I THE DEVELOPMENT OF REVOCATION BY DIVORCE A. Revocation by Implication The law of wills has historically allowed the revocation of a will by implication when a testator experienced certain changes in cir- cumstances after executing his will.8 At common law, two changes in circumstances revoked a testator's will by implication. 9 For a fe- male, marriage after the creation of a will (marriage of afeme sole) '0 revoked the will. For a male, marriage and birth of issue after the creation of a will served to revoke the will." Eventually the Wills Act 12 nullified the doctrine of revocation by implication in England. In the United States, however, a number of states specifically incorporated the doctrine into their probate statutes.' 3 In these states, courts continued to recognize and apply the doctrine. These courts expanded the scope of revocation by im- plication to apply to other changes of circumstances. 8 Durfee, Revocation of Wills by Subsequent Change in the Conditionor Circumstances of the Testator, 40 MICH. L. REV. 406, 406 (1942) ("Among the oldest rules in the law of wills are those by which a will is held to be revoked by implication by certain changes in circumstances of the testator."). 9 Graunke & Beuscher, The Doctrine of Implied Revocation of Wills by Reason of Change in Domestic Relations of the Testator, 5 Wis. L. REV. 387, 387 (1930). 10 The common law prohibited a married woman either from making or changing a will. Id. at 388-89. The will in force at the time of her marriage would thus have dic- tated the disposition of a woman's property. Common law judges who believed in the ambulatory nature of wills refused to accept such a result. Id. ("[T]o say that the will of a feme sole was to remain in effect..
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