McCleary v. Reliastar Life Insurance Co.
- Citation:
- McCleary v. Reliastar Life Insurance Co., No. 11-3169 (8th Cir. June 29, 2012)
- Tag(s):
-
- Ruling:
- AFFIRMING District Court's finding on a motion for summary judgment that a chapter 7 trustee's sale of a claim against a probate estate, where the sole beneficiary of the probate estate is the bankruptcy debtor, provided there are no creditors of the probate estate. The Court upheld the District Court's ruling that that the sole beneficiary of an intestate estate without any creditors in Iowa has the complete right to sell an asset of the estate, without regard to whether this is stated to be in the capacity of administrator of the estate of or as the sole beneficiary of the estate. Accordingly, when the bankruptcy trustee of the chapter 7 probate estate's sole administrator/sole beneficiary sold the debtor's interest in a claim held by the probate estate, neither the probate estate nor the debtor retained an interest in the claim.
- Procedural context:
- Summary judgment granted in a dispute over the validity and extent of sale of a claim against a probate estate by the chapter 7 trustee of the sole beneficiary of the probate estate.
- Facts:
- A woman purchased life insurance, naming her estate as the sole beneficiary. She died, without leaving a will. Her son was named administrator of her estate. The son was also the sole beneficiary of the estate. The estate was eventually "functionally" closed. The son filed for bankruptcy protection, not indicating any interest in the life insurance in his schedules. The son then sued on his own behalf and on behalf of his mother's probate estate to collect on the insurance. The son dismissed the individual claim against the insurer. The insurer purchased the son's interest in the claim against the insurer from the son's bankruptcy trustee.
- Judge(s):
- WOLLMAN and COLLOTON, Circuit Judges, and HICKEY, District Judge.
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