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McKown v. Symetra Life Insurance Company

United States District Court, D. South Carolina, Florence Division

November 20, 2014

William M. McKown, Plaintiff,
Symetra Life Insurance Company, Defendant.


R. BRYAN HARWELL, District Judge.

Plaintiff William M. McKown ("McKown" or "Plaintiff") filed this action in the Court of Common Pleas for Horry County, South Carolina on March 11, 2013, asserting claims for (1) Breach of Contract, (2) Breach of Implied Contract, and (3) Bad Faith Refusal to Pay Life Insurance Benefits. See Compl., ECF No. 1-1. This matter is before the Court on Defendant's motion for summary judgment, filed on October 22, 2014. See Def.'s Mot., ECF No. 45. Plaintiff timely filed a response in opposition to Defendant's motion on October 31, 2014. See Pl.'s Resp., ECF No. 49. Defendant then filed a reply in support of its motion on November 10, 2014. See Def.'s Reply, ECF No. 50. For the reasons stated below, the Court grants in part and denies in part Defendant's motion.[1]


Plaintiff is the beneficiary of a universal life insurance policy ("the Policy") on the life of his father, Duncan McKown, with $100, 000 in coverage. See Policy Excerpts, ECF No. 45-1 at 2. The Policy had an anniversary date of September 18. See id. The Policy included a "grace period" provision, however, which provided that "[a] grace period of 61 days will be granted if the cash value is not sufficient to cover the Cost of Insurance for the next following month." Id. at 6. However, this provision warned that "[i]f such premium is not paid within the grace period, all coverage under the Policy will terminate without value at the end of the 61 day period." Id.

Plaintiff made a premium payment of $2, 787.62 on September 15, 2014. See Phone Transcript, ECF No. 46-6 at 2-3.[2] On September 18, 2009, however, Defendant sent Plaintiff a "Universal Life Insurance Statement, " which indicated that the cost of insurance deductions from September 18, 2009 to the next anniversary date was $9, 233.76, and assuming no further premium payments, the Policy would remain active until October 18, 2009. See Statement, ECF No. 46-1 at 5. Defendant later explained that the $2, 787.62 payment had been insufficient to fund the Policy for the year beginning September 18, 2009. See ECF 46-6 at 4.

On October 18, 2009, Defendant sent Plaintiff a Life Insurance Cash Value Insufficient Notice, which provided that all coverage under the Policy would cease on December 19, 2009, the end of the 61 day grace period, if the requisite premium payment was not received. See Notice, ECF No. 46-2 at 2. Defendant maintains, and Plaintiff does not appear to dispute, that this past due premium amount of $2, 447.58 was not paid by December 19, 2009.

On December 21, 2009, Defendant sent Plaintiff a Lapse/Reinstatement Notice informing him that the 61 grace period had expired, and that coverage had lapsed effective December 19, 2009. See Notice, ECF No. 46-4 at 2. The Notice provided that, in order to reinstate the Policy, Plaintiff needed to submit an executed reinstatement application, a medical release, and the updated past due premium, which was now $3, 986.57. See id. The Plaintiff sent a check for $3, 986.57, and Defendant deposited it on February 1, 2010. See Scan of Check, ECF No. 49-1 at 4.

The insured passed away on February 9, 2010. See Discharge Summary, ECF No. 46-5. The parties dispute when Defendant received notice of the insured's death. Plaintiff stated in his affidavit that he called Defendant "on or about" February 19, 2010 to inform them that the insured had passed away. See Pl. Aff., ECF No. 49-1 at ¶ 14. Defendant, however, provided a copy of a letter sent to Plaintiff of March 17, 2010, which stated that its records show that Plaintiff telephoned the claims unit on February 23, 2010 to inform Defendant the insured had died. See Letter, ECF No. 46-10 at 3. Defendant also provided a copy of a letter dated February 22, 2010, which indicated Defendant was refunding the premium of $3, 986.57 under separate cover. See Letter, ECF No. 46-13. The letter requested that Plaintiff "answer all of the questions on the enclosed health statement/HIPPA form, sign, date, and return the forms along with your premium payment of $3, 986.57." Id. This letter did not mention anything about the insured being deceased. See id. Regardless, it is undisputed that Defendant refunded the premium amount via a check dated February 23, 2010, and mailed that check by letter dated February 24, 2010. See Check, ECF No. 46-8; Letter, ECF No. 46-11. Plaintiff states that he had "rejected" this refund and not negotiated this check. See ECF No. 49-1 at ¶ 18.


Summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The moving party has the burden of proving that summary judgment is appropriate. Once the moving party makes the showing, however, the opposing party must respond to the motion with "specific facts showing there is a genuine issue for trial." Fed.R.Civ.P. 56(e).

When no genuine issue of any material fact exists, summary judgment is appropriate. Shealy v. Winston, 929 F.2d 1009, 1011 (4th Cir. 1991). The facts and inferences to be drawn from the evidence must be viewed in the light most favorable to the non-moving party. Id. However, "the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Id. (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986)).

In this case, the moving party "bears the initial burden of pointing to the absence of a genuine issue of material fact." Temkin v. Frederick Cnty. Comm'rs, 845 F.2d 716, 718 (4th Cir. 1991) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)). If the moving party carries this burden, "the burden then shifts to the non-moving party to come forward with fact sufficient to create a triable issue of fact." Id. at 718-19 (citing Anderson, 477 U.S. at 247-48).

Moreover, "once the moving party has met its burden, the nonmoving party must come forward with some evidence beyond the mere allegations contained in the pleadings to show there is a genuine issue for trial." Baber v. Hosp. Corp. of Am., 977 F.2d 872, 874-75 (4th Cir. 1992). The nonmoving party may not rely on beliefs, conjecture, speculation, of conclusory allegations to defeat a motion for summary judgment. See id.; Doyle v. Sentry, Inc., 877 F.Supp. 1002, 1005 (E.D. Va. 1995). Rather, the nonmoving party is required to submit evidence of specific facts by way of affidavits, depositions, interrogatories, or admissions to demonstrate the existence of a genuine and material factual issue for trial. See Fed.R.Civ.P. 56(c), (e); Baber, 977 F.2d at 875 (citing Celotex, 477 U.S. at 324)). Moreover, the nonmovant's proof must meet "the ...

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