Monday, June 25, 2018

G.W. Law Prof Cahn Addresses USSC Ruling on Statutory Insurance Revocation Following Divorce

George Washington Law Professor Naomi Cahn has written a very timely piece considering the Supreme Court's June 11 decision in Sveen v. Melin

For academics, this decision could be relevant to many courses, including estate planning, family law, property law, and contract law, and, of course, constitutional law. Did a state divorce law, potentially effectuating revocation of a former wife as the named beneficiary of her former husband's life insurance policy, conflict with the Contracts Clause of the U.S. Constitution?  The case has drawn attention in part because it offers an "early look" at analysis rendered by President Trump nominee Justice Gorsuch, in his lone dissent.   

Naomi is also interested in the dissent.  She writes in part:

Rather than critique Justice Gorsuch’s interpretation of the Contracts Clause, I want to focus on another aspect of his dissent: he twice (approvingly) cites to a brief filed by more than a dozen women’s groups supporting Kaye Melin (the majority does not mention this issue at all).

 

It is important to acknowledge that, while virtually all states provide for revocation of beneficiary provisions in wills in favor of an ex-spouse, only about half the states (and the Uniform Probate Code) have extended this revocation to nonprobate assets, such as life insurance policies. There is a policy debate among states about whether automatic revocation is a good idea, and Congress does not provide for such automatic revocation in federally regulated nonprobate assets.

 

In addition, there is little empirical evidence concerning what policyholders actually want or expect will happen upon divorce. Indeed—and here is one of the two contexts in which Gorsuch cited the women’s brief—“[a] sizeable (and maybe growing) number of people do want to keep their former spouses as beneficiaries.” The growth of collaborative divorce, for example, shows that divorce is not necessarily the messy, take-no-prisoners assumption that underlies modern divorce revocation statutes. As Justice Gorsuch noted, citing to a brief filed by the U.S. government in a 2013 case that argued a state divorce revocation statute should be preempted, there may well be legitimate reasons why a decedent did not change a beneficiary designation, ranging from wanting to support the ex-spouse’s care for joint children to feelings of connection. Justice Gorsuch cited the Women’s Law Project brief again in addressing alternatives to the state’s choice. . . . 

For Professor Cahn's full analysis, including her interesting conclusion, see Svenn v. Melin: The Retro View of Revocation on Divorce Statutes.  

https://lawprofessors.typepad.com/elder_law/2018/06/gw-law-prof-cahn-addresses-ussc-ruling-on-statutory-insurance-revocation-following-divorce.html

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