What’s In a Name?

When I meet with clients to discuss estate planning, I always explain that the documentation that we help put together for them does not override any previously designated beneficiaries on things like life insurance or retirement plans. Named beneficiaries trump any will or trust documents we put together.

Unfortunately, Jeffrey Rolison’s family has learned this the hard way.

In the 1980s, Jeffrey Rolison dated a woman named Margaret Sjostedt. The couple met in a park and later moved to Sullivan County, Pennsylvania, where she worked as a waitress, and he worked at a Procter & Gamble plant. After dating for a year, they moved in together and Rolison named Sjostedt as the beneficiary of his P&G retirement account, identifying her as his “cohabitator.”

The pair broke up two years later, and she later got married, had two children, and is now known as Margaret Losinger. Rolison later moved in with another woman, Mary Lou Murray, until they separated in 2014.

Rolison then died in 2015 at the age of 59, single and childless, and with no will.

Rolison had named his mother and Murray as beneficiaries on his P&G life insurance policy, but later removed Murray. Because his mother predeceased him leaving no named beneficiaries, when Rolison passed, the life insurance proceeds were paid to his estate. Under Pennsylvania’s intestacy rules, or the laws that regulate where a deceased person’s assets go when they have no will, the funds were paid to his brothers, Brian and Richard.

But, nearly four decades after their breakup, Losinger stood to inherit his $1 million retirement account because Rolison listed her as the sole beneficiary of his workplace retirement account in 1987 and never updated it before his death in 2015.

Rolison’s brothers, who discovered Losinger’s claim weeks after his death, contested her rights to the funds in federal court by suing P&G. They claimed that like his life insurance, it was Rolinson’s intention that his retirement account be paid to his estate as well.

In 2020, the court directed P&G to award the retirement money to Losinger, but to put the money in escrow while the brothers pursued their claims. In 2021, the court ruled Murray was not entitled to the money, as she was not his spouse.

But this year, U.S. District Judge Karoline Mehalchick ruled in favor of Losinger. She held that on “numerous occasions” between 1989 and 2015, P&G notified Rolison that he could change his beneficiary designation for the Plan, that he was sent information about the company’s transition to an online beneficiary designation system, which started as an option in 2007, before fully transitioning online in 2015.

She indicated that those notifications often included a recommendation that Rolison review his beneficiary designation. Mehalchick wrote that P&G “routinely informed” Rolison “of his option to designate an online beneficiary or, otherwise, his previous paper designated beneficiary would receive his benefits.”

Judge Mehalchick noted that Rolison was aware of how to change his beneficiary designation, but that “even with notice and directions how to do so, Rolison never designated a new beneficiary for his P&G investment plan.” She concluded that Rolison’s failed actions “do not reflect detrimental reliance and no reasonable fact finder could not conclude otherwise,” and granted P&G’s motion for summary judgement, and dismissed the Rolinson’s estate’s cross-claims against P&G.

So, please double-check your beneficiary designations to ensure your hard-earned funds get to where you want them to go. It’s devastating for your loved ones to lose you, but then to lose money they were expecting to receive just makes it that much harder.

The following two tabs change content below.

Reg P. Wydeven

Elder Law and Estate Planning Attorney at McCarty Law LLP
Hoping to follow in his father’s footsteps from a young age, Reg’s practice primarily consists of advising individuals on estate planning, estate settlement and elder law matters. As Reg represents clients in matters like guardianship proceedings and long-term care admissions, he feels grateful to be able to offer families thorough legal help in their time of need.

Latest posts by Reg P. Wydeven (see all)