South Carolina law does not support appellant’s position that she was a third-party beneficiary with vested rights under her father’s USAA individual retirement account.
We affirmed the circuit court’s orders granting Respondents’ motions for summary judgment.
Karen Petit appealed the circuit court’s orders granting Phyllis Krohn, USAA Federal Savings Bank, and USAA Investment Management Co.’s motions for summary judgment, arguing the circuit court failed to view the evidence in the light most favorable to her when considering her claims. The crux of Karen’s argument was that USAA Federal Savings Bank and USAA Investment Management Co. (collectively, USAA) improperly accepted a designation of beneficiary form for her father’s individual retirement account (IRA) after Phyllis “unilaterally decided to change the beneficiaries.” Dr. Edward LeRoy Petit (Decedent) died in 2015. He was survived by his daughter, Karen, and two granddaughters, who are Karen’s nieces. Decedent was predeceased by his wife, Helen, and his daughter, Kathy, who was Karen’s sister. Decedent and Phyllis became companions after Helen died.
Karen argued Phyllis interfered with a contractual relationship “formed pursuant to the facts of this case,” causing Karen damages. We disagreed. Although Decedent had a contract with USAA and later with Wells Fargo, Karen was not a party to either contract. Karen asserted she was a third-party beneficiary with vested rights under the USAA IRA; however, South Carolina law does not support her position. Because the record does not support Karen’s interference claim, we found the circuit court properly granted Phyllis’s motion for summary judgment.
Karen further alleged a fiduciary relationship existed between Phyllis and Decedent and that Phyllis breached this duty when she exceeded the authority granted through Decedent’s USAA power of attorney by changing the IRA beneficiaries. But Karen presented no evidence that Phyllis owed her a fiduciary duty; the circuit court therefore properly granted summary judgment.
Karen next argued Phyllis voluntarily undertook a duty of due care to Karen, a third-party beneficiary of the USAA IRA, when she acted as Decedent’s attorney-in-fact. Karen also alleged Phyllis was negligent or reckless in mismanaging Decedent’s IRA and in changing the account beneficiaries without Decedent’s proper authorization. The evidence does not demonstrate Phyllis owed Karen a duty of care. Perhaps equally important is the fact that Phyllis never took any action pursuant to the USAA power of attorney. Thus, the circuit court correctly granted summary judgment on the negligence claim.
Karen next asserted that by Phyllis’s own admission, she exerted undue influence over the will and intent of Decedent. We disagreed. There is evidence Decedent changed his beneficiaries on more than one occasion and that he knew he could change this designation at any time. And, as the circuit court correctly found, “while the record may demonstrate that the decedent was in poor health at the time the beneficiaries were changed, no evidence was presented demonstrating that the decedent was incompetent to execute the change.” Because Karen has not presented evidence necessary to satisfy the heightened burden of proof required to support a claim of undue influence, the circuit court did not err in granting Phyllis’s motion for summary judgment.
Finally, we found Karen has not established USAA owed her a duty of care. Moreover, Karen failed to present evidence that USAA breached any duty to anyone by processing the 2012 change of beneficiary form—which was requested by Decedent, filled out by Phyllis, and signed by Decedent—because both Decedent and Phyllis, as his attorney-in-fact, had the power to change his beneficiaries at any time (at least until Decedent was deemed mentally incompetent) before his death.
Affirmed.
Petit v. Krohn (Lawyers’ Weekly No. 012-037-24, 12 pp.) (Per Curiam) Appealed from Greenwood County Circuit Court (Donald B. Hocker, J.) Jane Hawthorne Merrill, of Hawthorne Merrill Law, LLC, of Greenwood, and Scarlet Bell Moore, of Greenville, both for appellant; William Stevens Brown, V, of Nelson Mullins Riley & Scarborough, LLP, of Greenville, for respondents USAA Federal Savings Bank and USAA Investment Management Co.; and Joshua Shaheen Nasrollahi, of Greenwood, for respondent Phyllis Jean Krohn. South Carolina Court of Appeals Unpublished