Divorce, Division of Retirement Pensions, and Survival Rights

Wife [W] and Husband [H] were married in 1986 and W filed for dissolution of marriage (divorce) in 2010.  During a portion of their marriage, W was in the military.  After her military commission ended, she worked for the federal government.  The federal government provides its career employees with many benefits including a retirement plan.  The plan is known as the Federal Employees Retirement System of FERS.  The FERS program allows for monthly pension payments after retirement until death, and survivor benefits and possibly a lump-sum death benefit after the retired employee dies (assuming the spouse survives the employee).  In California, a spouse’s pension plan earned during the marriage (or a portion of the marriage) is considered to be community property with each spouse entitled to one half earned during the marriage.  (In other words, if the employment lasts longer than the marriage, the former spouse would be entitled to one-half of the percentage of pension benefits earned during the marriage.)

It took many years, but W and H finally agreed to the community distribution including the distribution of W’s FERS pension.  In a stipulation hearing, in open court, W and H both agreed that H would be entitled to one-half of the pension accumulated during the marriage.  The judge ordered H (actually, his attorney) to file a Stipulation Judgment for signature of both parties and the court’s approval.  H created the document and included that the words, “any survivor’s benefits . . . related to their share of the community interest awarded to them.”  W refused to sign the document because survivor benefits were not addressed in the stipulation hearing and she did not want H to receive survivor benefits.

The trial court determined that survivor benefits were a part of the FERS pension benefit package and that H was entitled to his community half-interest.  W disagreed and appealed.

The Appellate Court agreed with the trial court:

“If the court is asked to divide a community retirement plan, each party is entitled to receive their full community property share including all survivor benefits. Section 2610, subdivision (a), provides the court shall make orders to ensure that ‘each party receives the party's full community property share in any retirement plan, . . . including all survivor and death benefits…’”

“…Here, the clear language of the stipulation – that the parties ‘[would] be equally dividing the community property portion of the Wife’s FERS retirement’ – does not manifest an intent or agreement that husband would not receive a survivor benefit. Rather, the language shows an intent and agreement that the equal division of the community retirement plan would include all plan benefits, there being no specific exclusion for any survivor benefit. Wife’s reliance on her subjective intent, based on her belief that husband would not receive a survivor benefit, is irrelevant.”

The Appellate Court also agreed with the trial court in that, unless specifically stated otherwise, what was stated as a community asset included every aspect of that asset.  In this case both parties agreed to equally dividing the FERS pension plan.  That pension plan included a survivor benefit, and H was entitled to his community interest in all of that pension’s benefit plan without having to specifically stating his entitlement to each of the specific benefits included in the plan.

Categories