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A Better Partnership
December 09, 2009

COA Opinion: Handwritten terms in application for annuity control distribution

On December 8, 2009, the Court of Appeals published its opinion in Helms v. Lemieux, No. 286397. In this case, the Court of Appeals examined the distribution of assets from an annuity. The annuity, purchased by an elderly couple, provided that the proceeds would be paid to the annuitant, except that after the annuitant's death the proceeds would be paid to the designated beneficiary. Apparently, there were handwritten additions in the application for the annuity where the wife was described as the annuitant, and the husband as the joint owner. In contrast, the annuity policy issued later describes the wife as the annuitant, and the husband as a joint annuitant. The Court concluded that, accordingly to contract interpretation principles, the description of the husband and wife's roles in the application (that was signed by both) controls. Thus, when the wife died, the beneficiary's interest in the annuity vested, and that beneficiary was entitled to the benefits of the annuity.

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