Interpleader Proper When Two Colorable Claims To Policy Proceeds.

Husband and wife bought life insurance on their minor child, and then they divorced, but the policy was not distributed in the dissolution proceedings. After the divorce, the wife removed the husband as a beneficiary. Then their daughter died. Both the husband and wife claimed the proceeds. The life insurance company interpleaded the policy proceeds with the district court. The district court found the wife was entitled to all the proceeds, and the husband did not appeal that decision. The wife asserted claims of bad faith against the insurance company, arguing the action in interpleader was frivolous, but the district court granted summary judgment in favor of the company, finding an action in interpleader was appropriate. The Ninth Circuit affirmed, stating that interpleader is proper when a stakeholder has at least a good faith belief that there are conflicting colorable claims.  Michelman v. Lincoln National Life Insurance Company  (Ninth Circuit; July 12, 2012.) 685 F.3d 887.