Elder Law FAX The April 23, 2007, issue of Elder Law FAX, a free newsletter published every other Monday by the Elder Law Practice of Timothy L. Takacs.   The Meaning of "Substantial Compliance" In April of 2000, Globe Life and Accident Insurance Company issued a $10,000 term life insurance policy to James Nicholson. The beneficiary of the policy was his wife Marie Nicholson. The Nicholsons were divorced on June 4, 2002. Mr. Nicholson died January 1, 2003.   At the time of Mr. Nicholson's death, Globe's records reflected that Marie Nicholson was the beneficiary of the policy. Ms. Nicholson filed a claim with Globe for the policy proceeds.   Shortly thereafter, Globe received letters from the lawyer for Pam Oliver, Mr. Nicholson's daughter, stating that Mr. Nicholson had executed a change of beneficiary form that Ms. Oliver had mailed to Globe prior to his death. The form allegedly named Ms. Oliver as the new beneficiary.   Because of the competing claims against the life insurance proceeds, Globe filed an "interpleader action" in court to bring all parties into court. The trial judge entered an order requiring Globe to pay the funds into court and dismissed Globe be paid into the court and dismissed Globe from the lawsuit.   At a hearing on the case, Globe presented evidence that it had not received a change of beneficiary form prior to Mr. Nicholson's death. Ms. Oliver testified that Mr. Nicholson completed the change of beneficiary form naming her as beneficiary and changing his address to his daughter's.   Ms. Oliver presented a copy of the form, at the top of which is the date 12/24/01, a date printed by the company rather than filled in by Mr. Nicholson. Mr. Nicholson's signature is dated 1/9/02. The form also includes a change of address section which had been filled in to change Mr. Nicholson's address to Ms. Oliver's house.   Ms. Oliver also presented written communications from Globe during 2002, primarily premium notices, sent to her at her address.   The trial judge awarded the policy benefits to Ms. Oliver. Ms. Nicholson appealed.   The policy provides that Globe will pay the proceeds of the policy to "the Beneficiaries based on the designation in force at death." The policy also provides that the insured may change the beneficiary at any time, and "To change a Beneficiary, file a satisfactory written request with us. Once we record it, the change will take effect. But the change will not affect any payment we made or action we took before the change was recorded."   As a general rule of law, courts in Tennessee will apply a "substantial compliance" test to determine whether an insured has "done all he could" to effect a change in beneficiary of a life insurance policy.   For example, where an insured completed the beneficiary form but the agent failed to deliver it to the home office, a Tennessee court found substantial compliance.   By contrast, an insured who merely listed his intended new beneficiary on an employee benefits survey form distributed by his employer and had not even attempted to complete a change of beneficiary card, as he had done a few years earlier, the court concluded he had not taken all reasonable steps possible to meet the insurer's requirements.   The critical question in this case was whether Mr. Nicholson took reasonable steps to comply with the change of beneficiary requirements set out in the policy. That is a question of fact whose answer in large part depends on whether Mr. Nicholson executed and caused to be mailed the change of beneficiary form.   The trial court found that Mr. Nicholson had substantially complied with the policy's requirements for change of beneficiary. The only way the court could have reached that conclusion was to find that Mr. Nicholson had executed the required form and had taken reasonable steps to have it delivered.   Ms. Nicholson argued on appeal that the evidence was insufficient to support such a finding. However, the question was really whether the weight of the evidence in the record is against the trial court's finding.   After reviewing the evidence, the Tennessee Court of Appeals upheld the trial court's finding. There was no challenge to the authenticity of Mr. Nicholson's signature. Mr. Nicholson and his daughter Ms. Oliver received communications from Globe after the change of beneficiary form was sent in at the address noted on it, giving them no reason to believe the change of beneficiary had not also been made. Ms. Oliver paid the premiums during the next year. The change of beneficiary form was, on its face, sent by Globe to Mr. Nicholson presumably at his request.   Globe Life & Accident Insurance Company v. Marie Nicholson and Pam Oliver, April 5, 2007.