Insurance: Insurer prevails in suit over erroneous payment to beneficiary

Where a life insurance company mistakenly made duplicate $230,674.56 payments to a beneficiary, and the beneficiary refused to return the second (incorrect) payment, the company prevailed on its claims for unjust enrichment, conversion and money had and received.

Background

On Dec. 20, 2019, Massachusetts Mutual Life Insurance issued an annuity to Miyoko Mccasland. When Miyoko died on Aug. 20, 2022, the death benefit of the annuity became due and payable to defendant Craig Mccasland. On Dec. 8, 2022, MassMutual made a payment to defendant in the amount of $230,674.56, representing the death benefit amount owed to him under the annuity. This payment was made via direct deposit into defendant’s account as he had requested.

Under the terms of the annuity, the death benefit earns interest. It is MassMutual’s practice to pay the death benefit first, and then the interest due second. The interest due to defendant on the death benefit payment was $134.56.

On Dec. 9, 2022, MassMutual sent a second payment to defendant, which was intended to be for only the interest due on the death benefit payment. Instead, a second payment for the full death benefit amount of $230,674.56 was made via direct deposit to defendant’s account. After MassMutual made numerous unsuccessful attempts to recoup the overpayment, it filed this suit. MassMutual has now filed a motion for summary judgment.

Unjust enrichment

To succeed on a claim for unjust enrichment, a plaintiff must show: “(1) a benefit conferred on the defendant by the plaintiff; (2) knowledge on the part of the defendant of the conferring of the benefit; and (3) acceptance or retention of the benefit by the defendant in circumstances that render it inequitable for the defendant to retain the benefit without paying for its value.” All of these elements are satisfied here.

First, the undisputed facts show that defendant received twice the amount to which he was entitled under the annuity contract. Thus, a benefit was conferred on defendant by plaintiff which he was not owed (the overpayment), and the first element is satisfied.

Second, the undisputed facts show that defendant had knowledge of the overpayment. Plaintiff sent four letters to defendant at an address that he contemporaneously confirmed was accurate. Plaintiff also notified defendant of the overpayment via telephone. Defendant nevertheless depleted the entire account into which the overpayment was deposited.

Third, the undisputed facts show that defendant retained the overpayment in circumstances that render it inequitable for defendant to retain the benefit without paying for its value. The undisputed record shows that defendant was not entitled to the overpayment but retained the overpayment despite it being the result of an honest mistake by plaintiff and plaintiff’s subsequent diligent efforts to recover the overpayment. Accordingly, the last and final element of unjust enrichment is satisfied, and plaintiff is entitled to summary judgment on this claim.

Conversion

To succeed on a claim for conversion, a plaintiff must show: “(i) the ownership or right to possession of the property at the time of the conversion, and (ii) the defendant’s conversion by the wrongful exercise of dominion or control over the plaintiff’s property, depriving plaintiff of possession.” As already explained, defendant was not entitled to the overpayment, and rather than promptly returning the funds upon demand, defendant wrongfully kept and spent the overpayment funds until his account was entirely depleted, preventing plaintiff from recovering possession of the funds. Accordingly, the elements for conversion are satisfied, and plaintiff is also entitled to summary judgment on this count.

Money had and received

To succeed on a claim for money had and received, a plaintiff must show that a defendant “has money of [the plaintiff] which he has no right to retain and which the defendant is obligated by natural justice and equity to refund.” Again, in this case, defendant kept the mistakenly transferred overpayment to which he was not entitled, and which he is obligated by natural justice and equity to refund. Accordingly, plaintiff is also entitled to summary judgment on this count.

Plaintiff’s motion for summary judgment granted.

Massachusetts Mutual Life Insurance Company v. Mccasland, Case No. 1:24-cv-00373, Nov. 13, 2025. EDVA at Alexandria (Alston). VLW 025-3-476. 9 pp.