Facts: Husband and Wife divorced after 18 years of marriage.
On the day the case was scheduled to go to trial, Husband and Wife entered into a written agreement signed by both parties and their lawyers where Husband agreed, in relevant part, to pay Wife $2100 from his monthly military retirement benefit of $3678.
The trial court placed the parties under oath, and both confirmed their understanding and approval of the agreement in open court.
After the trial court accepted the agreement, Husband was assigned a disability rating that classified $687 of the monthly benefit as disability pay, thereby changing the amount of the retirement benefit to $3080.
Husband later filed a Rule 59.04 motion to set aside the judgment approving the agreement.
The trial court denied Husband’s motion, finding that both parties were represented by counsel, both are well-educated, and they freely and voluntarily entered into the agreement. The trial court also found there was no mistake entitling Husband to relief.
On Appeal: The Court of Appeals affirmed the trial court.
The Uniformed Services Former Spouses Protection Act, 10 U.S.C. § 1408, permits state courts to divide a military retiree’s retirement benefit in a divorce proceeding. It provides, however, that “the Federal Government will not make community property payments that exceed 50 percent of disposable retired or retainer pay.”
Husband argued the agreement violates federal law because it gives Wife roughly 57% of Husband’s retirement pay.
Husband’s argument has been rejected before.
In Gonzalez v. Gonzalez, the Court of Appeals held the 50% limit in the Uniformed Services Former Spouses Protection Act only addresses the amount to be paid by the government. It does not prohibit the husband from agreeing to provide his ex-wife with 100% of his military retirement pay as part of a comprehensive property settlement.
In Selitsch v. Selitsch, the Court of Appeals held the Act did not preclude spouses from contractually agreeing to divide non-disposable retired pay, i.e., disability pay.
The Court rejected Husband’s argument again, explaining:
Parties are free to contractually determine the division of military retirement pensions and disability benefits, and a court may order a party to pay such monies to give effect to the agreement. . . . Husband and Wife entered into a contractual agreement, whereby Husband voluntarily agreed to pay Wife $2,100.00 per month directly from his military pension. Moreover, the parties in this case specifically noted in their agreement that “[i]n the event that Husband becomes disabled and/or is no longer eligible to receive his retirement benefit for any reason, then he shall continue to pay unto Wife the sum of $2,100.00 per month for the entirety of his life.” Based on the language in the agreement, it is clear that the parties contemplated the possibility of Husband’s retirement pay changing and intended Husband’s obligation to pay Wife $2,100.00 per month to remain, irrespective of such change. Thus, we reject Husband’s insistence that he entered into the agreement under a mistake of fact.
K.O.’s Comment: Military retirement benefits can be tricky for lawyers and litigants alike. Family-law attorneys who rarely deal with these benefits should consider consulting with or referring to those who do. Several attorneys with expertise on this subject can be found in areas near military bases, such as Clarksville, TN.
I have seen military retirees draft their own benefit-division agreements without utilizing the services of a lawyer, much less an experienced family-law attorney. More often than not, the results prove to be disastrous. As this case illustrates, there is often nothing a lawyer can do to correct the mistake after-the-fact. Military retirees are advised to use a lawyer every time.
Information provided by K.O. Herston: Knoxville, Tennessee Divorce and Family-Law Attorney.