## Facts

- Joseph Klein was an insurance agent for Massachusetts Casualty Insurance Company (MCIC) under an “Agent’s Agreement” that entitled him to renewal commissions on policies he sold.
- The Agent’s Agreement limited Joseph’s ability to transfer renewal-commission rights without MCIC’s consent.
- MCIC used a separate form, “Designation of Death Beneficiary for Commissions under Agent’s Agreement,” which expressly amended the Agent’s Agreement and allowed an agent to name a beneficiary to receive renewal commissions after the agent’s death.
- The designation process required MCIC’s consent and recording at MCIC’s home office for a beneficiary change to be effective.
- On April 9, 1979, Joseph signed a Designation of Death Beneficiary naming his son from a prior marriage, Donald Klein, as beneficiary of post-death renewal commissions.
- In the summary-judgment record, MCIC’s general counsel, James Lyons, stated by affidavit that he filled in Donald’s name before sending the designation for signature. Lyons’s cover letter, however, instructed Joseph to fill in the “new beneficiary,” and there was an indication Lyons may have mailed the completed designation to Donald rather than to Joseph.
- On June 9, 1979, Joseph executed a will bequeathing the renewal commissions to his wife, Annabelle Klein, consistent with statements Joseph had made to her in April 1979.
- After Joseph’s death, MCIC paid renewal commissions to Donald pursuant to the April 9 designation.
- Annabelle sued Donald and MCIC seeking the commissions, arguing (1) the designation was testamentary and could be changed by the later will, and (2) Joseph signed the designation in blank and never saw the completed document naming Donald.
- The trial court granted summary judgment for Donald and MCIC, holding the April 9 designation controlled and the commissions were not directed by the will. Annabelle appealed.

## Issues

1. Whether renewal commissions payable after Joseph’s death were governed by the Agent’s Agreement and its beneficiary designation amendment, rather than by Joseph’s later will.
2. Whether the “Designation of Death Beneficiary” was a testamentary disposition that could be revoked or superseded by the subsequent will.
3. Whether the summary-judgment evidence raised a genuine issue of material fact about the validity or effectiveness of the April 9 designation (including Annabelle’s claim that Joseph signed the form in blank).

## Decision

- The court held that the disposition of post-death renewal commissions was controlled by the contract between Joseph and MCIC, including the beneficiary designation amendment, not by Joseph’s later will.
- The court rejected the argument that the designation was testamentary; it treated the designation as a contractual arrangement governing who would receive commissions after Joseph’s death.
- The court concluded Annabelle did not raise a genuine issue of material fact sufficient to defeat summary judgment on the effectiveness of the April 9 designation.
- The court affirmed the trial court’s summary judgment in favor of Donald and MCIC.

## Legal Principles

- A contractual right to payments (such as renewal commissions) may be governed by the contract’s own mechanism for naming a beneficiary, and that mechanism can control payment after death.
- A beneficiary designation that is expressly incorporated into and amends a contract can create enforceable rights in the named beneficiary and operates as a non-probate transfer, so a later inconsistent will does not redirect those contract payments.
- When the contract requires insurer consent and recording to change a beneficiary, a claimant relying on a later will must show a contract-compliant change or a legally recognized basis to set aside the designation.
- Summary judgment is proper when the movant establishes the controlling contractual documents and the nonmovant fails to produce evidence creating a genuine dispute that the designation was ineffective under the contract.

## Conclusion

Klein v. Klein held that Joseph Klein’s renewal commissions were payable according to the beneficiary designation amendment to his Agent’s Agreement with MCIC, not according to his later will, and the court affirmed summary judgment for Donald Klein and MCIC because the summary-judgment record did not show a fact dispute that would invalidate or negate the April 9, 1979 designation.


Klein v. Klein, 638 S.W.2d 94 (1982)