McMath

Opinion by Judge Sneed; Concurrence by Judge Sneed.

This case arises from an interpleader action brought by the BankAmerica 401(k) Plan (“401(k) Plan”) and the BankAmerica Pension Plan (“Pension Plan,” collectively, the “Plans”) to resolve the proper beneficiaries of the benefits under the Plans. Defendants in the interpleader action, Alva M. Montgomery and Patsy Patterson (collectively, “Appellants”), appeal the summary judgment of the United States District Court for the Northern District of California, in favor of the co-defendant Alexander S. McMath (“Mr. McMath”). Appellants argue that summary judgment was improper against them because there were genuine issues of material fact and because the district court applied the incorrect law. We agree that the district court did err in that it should have applied California law rather than federal common law. Under California law, Mr. Montgomery did not substantially comply with the 401 (k) Plan’s beneficiary designation requirements. We therefore reverse the decision of the district court.

I.

BACKGROUND

Clarence C. Montgomery (“Mr. Montgomery”) worked at Bank of America from approximately 1990 until his death in November 1996.…

concurring:

We made no presumption in the opinion that Mr. Montgomery intended to designate Mr. McMath as his beneficiary. I concur to emphasize that his designation would fail under California law even if extrinsic evidence could prove that he possessed such intent because California law requires a clear manifestation of intent and “every reasonable effort under the circumstances, complying as far as he is able with the rules.” See Pimentel v. Conselho Supremo De Uniao Portugeuza Do Estado Da California, 6 Cal.2d 182, 188 , 57 P.2d 131, 134 (1936). Mr. Montgomery did not comply as far as he was able with the beneficiary designation requirements.

California law properly recognizes that transfers of wealth at death should be done with a significant degree of formality and should not be left to the vagaries of the testimony of the indicated beneficiary and other claimants arising out of kinship or the murkiness of certain testimonial provisions. Thus, California law properly requires more than a clear manifestation of the intent of the decedent. It requires, to repeat, that the decedent make every reasonable effort under the circumstances to effect that change. This is a heavy…