Facts: The trial court approved and adopted the marital dissolution agreement (“MDA”) Husband and Wife entered into to resolve their divorce. It had this provision regarding the division of Husband’s federal pension:

FYI, “FERS” stands for Federal Employees Retirement System.

Two years later, Husband petitioned to enforce the MDA. He argued that Wife “now conveniently interprets” the paragraph above “to mean that she is to receive one-half of Husband’s gross monthly annuity, including his postmarital contributions. However, at the time of the execution, Wife advised that she wanted to remove ‘the marital portion’ language since Husband was fully vested in the Plan at the time of the divorce.”

Wife argued Husband was trying to modify the MDA, not enforce it. Wife filed a counter-petition to enforce the MDA, specifically asking for a third-party attorney to draft the qualified domestic relations order (“QDRO”) dividing the entirety of Husband’s FERS Basic Benefit Plan per the MDA. She also asked the trial court to hold Husband in civil contempt for refusing to take steps to allow the attorney to draft the QDRO.

The trial court denied Husband’s petition, determined the MDA was unambiguous, ordered that the QDRO be prepared to divide the entire retirement account, and awarded Wife attorney’s fees of $15,000 per the MDA’s enforcement provision.

On Appeal: The Court of Appeals affirmed the trial court’s ruling.

In Tennessee, MDAs are treated as contracts and are subject to the rules governing the construction of contracts. The central tenant of contract construction is that the intent of the contracting parties at the time of executing the agreement should govern. The parties’ intent is presumed to be that which is specifically expressed in the body of the contract.

A court’s initial task in construing a contract is to determine whether the language of the contract is ambiguous. If the language is clear and unambiguous, the literal meaning of the language controls the outcome of the dispute. The contract is ambiguous only when its meaning is uncertain and may fairly be understood in more than one way. If the contract is found to be ambiguous, a court must then apply established rules of construction to determine the intent of the parties.

Husband argued Wife only has the right to portions of the FERS account that accrued during the marriage. The Court rejected that argument, finding that Husband voluntarily contracted to give Wife more than what she would’ve been entitled to under the statute:

From the plain language employed by the parties, we conclude that there is no ambiguity in [the paragraph], and it can be interpreted in only one way. The MDA clearly awards Wife one-half of Husband’s gross monthly annuity, with gross monthly annuity being defined as the “unreduced monthly annuity” less the monthly cost of the survivor benefit, which the parties would share equally. The language that follows, i.e., “The parties acknowledge that such plan is fully vested at the time of executing this MDA,” indicates that the parties understood Husband’s benefits to be fully vested, i.e., he had a current or future right to them at the time of divorce. Accordingly, we conclude that the language of the MDA clearly shows Husband’s intent to relinquish one-half of these benefits to Wife as part of the divorce settlement. Contrary to Husband’s argument, there is no language in the MDA to suggest that Wife would receive only the portion of the retirement account that accumulated during marriage. Indeed, the parties’ striking “of the marital portion” from the MDA shows the opposite—that Wife would receive one-half of the entirety of Husband’s annuity, not simply one-half of the “marital portion.” Therefore, we agree with the trial court’s holding that [the paragraph] is clear and unambiguous, and the language used therein controls the outcome of this case. As such, we affirm the trial court’s conclusion that Wife is entitled to receive one-half of Husband’s gross monthly annuity from his FERS account.

The Court affirmed the trial court’s judgment. The MDA also has a common enforcement provision requiring a court to award reasonable attorney’s fees to the prevailing party in any action to enforce the MDA. Thus, the Court also awarded Wife her reasonable attorney’s fees on appeal.

Source: Walton v. Walton (Tennessee Court of Appeals, Western Section, October 20, 2024).

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