Virginia Family Law Appeals

Using a pension-division order to enforce child support in Virginia: Nkopchieu v. Minlend

SUPPORT ENFORCEMENT – PENSIONS – USE OF QDRO TO ENFORCE. Less than three months before the Legislature got around to passing this Session a statute authorizing the courts to use a Qualified Domestic Relations Order as a support-enforcement device, a case called Nkopchieu v. Minlend, 59 Va. App. 299, 718 S.E.2d 470 (12/20/11), held that existing law authorized courts to do that anyway. It would not be fair to say that was the judges’ way of telling the General Assembly not to meddle in matters of legal development and public policy, especially as the two branches agreed here. The whole matter would probably have been much simpler and never have arisen, or have been determined years ago, except for the Virginia appellate courts’ dogmatic and doctrinaire approach to the abstract question of whether to characterize an income stream like a pension as income or property. Of course we must remember that the declaration that pensions are property, and other money flow is income, and never the twain shall meet, is what enables the courts to double dip on behalf of non-employee spouses and treat the same money as property in order to divide it in equitable distribution and then order the retired wage earner to pay the rest of it to the ex-wife in alimony and child support, even if it’s now his only income. It’s frequently explained that this is proper because she has two sacred rights of entitlement to that same fund in the hermetically-sealed categories of property and income. This abstraction has perhaps been what confused some trial judges for so long, despite the clear intent of the first pension-division statutes, the federal employee ones, that a judge could order division of the pension for property division purposes or support purposes. The unpronounceable instant case was a rather unusual one, in which this husband had failed to make any of the ordered child support payments, and the wife filed an unsuccessful motion for entry of a QDRO to attach husband’s QDRO proceeds for the sole purpose of paying the child support arrearage. The arrearage had been over $28,000. His retirement account was the only asset available for attachment and the Court of Appeals held that this was a proper remedy, including making the ex-wife an “alternate payee” of the plan’s benefits by QDRO under ERISA, specifically 29 U.S.C. §1056(d)(3)(J, K). Though the trial judge thought his denial was required by Hoy v. Hoy, 29 Va. App. 115, 510 S.E.2d 253 (1999), the Court of Appeals held that neither that case nor any other provisions of Virginia domestic relations law keep circuit courts from granting such a QDRO, and neither does ERISA. The appellate judges distinguish Hoy as an attempt to reopen a divorce case that had already been filed for over 20 years to enter a QDRO against a retirement account that did not even exist at the time of the divorce. Perhaps more interesting in Nkopchieu v. Minlend was the father’s argument that the mother’s rquest was precluded by a premarital agreement in which she expressly disavowed any property interests in husband’s retirement assets. Her counsel argued that ERISA allows the court to enter a QDRO for the two separate purposes of property division and support, and that she was not looking for property division at all in this instance, but invoking the second purpose of the QDRO in addressing child support use of a retirement account. The marital agreement in fact provided too that “nothing in this agreement shall be construed as limiting the right of either party to make claims for child support,” and the mother said she was simply pursuing a claim for the arrears of unpaid child support. She was trying to enforce her children’s rights to support through a garnishment-like process, and not to establish new property rights for herself. And mother’s counsel argued that this woman could have enforced a judgment against a debtor even if she had never been married to this man. Indeed, the Court of Appeals says, it is established Virginia law that the obligation of child support is owed to the child, not the mother. What the mother does when she sues is act as a “conduit” for the payment of support to the children. True, ERISA does say that retirement funds cannot be assigned or alienated, but this prohibition, the Court of Appeals says, does not apply when a state domestic relations order is determined to be a qualified one under 29 U.S.C. 29 U.S.C. §1056 (d)(3). QDROs are an exception to the alienation and assignment provision. Section 20-107.2, the court says, authorizes making fathers pay their child support obligations. The court said it could not reach the question of whether the mother’s draft QDRO actually qualified as one under ERISA’s “technical” requirements about the contents of such orders, because the trial judge never reached those questions in the trial below. It was remanded to give him an opportunity to do so.

QDRO can be used to enforce support - Va. Ct. in Nkopchieu v. Minlend

SUPPORT ENFORCEMENT – PENSIONS – USE OF QDRO TO ENFORCE.  Less than three months before the Legislature got around to passing this Session a statute authorizing the courts to use a Qualified Domestic Relations Order as a support-enforcement device, a case called Nkopchieu v. Minlend, 59 Va. App. 299, 718 S.E.2d 470 (12/20/11), held that existing law authorized courts to do that anyway. It would not be fair to say that was the judges’ way of telling the General Assembly not to meddle in matters of legal development and public policy, especially as the two branches agreed here. The whole matter would probably have been much simpler and never have arisen, or have been determined years ago, except for the Virginia appellate courts’ dogmatic and doctrinaire approach to the abstract question of whether to characterize an income stream like a pension as income or property. Of course we must remember that the declaration that pensions are property, and other money flow is income, and never the twain shall meet, is what enables the courts to double dip on behalf of non-employee spouses and treat the same money as property in order to divide it in equitable distribution and then order the retired wage earner to pay the rest of it to the ex-wife in alimony and child support, even if it’s now his only income. It’s frequently explained that this is proper because she has two sacred rights of entitlement to that same fund in the hermetically-sealed categories of property and income.  This abstraction has perhaps been what confused some trial judges for so long, despite the clear intent of the first pension-division  statutes, the federal employee ones, that a judge could order division of the pension for property division purposes or support purposes. The unpronounceable instant case was a rather unusual one, in which this husband had failed to make any of the ordered child support payments, and the wife filed an unsuccessful motion for entry of a QDRO to attach husband’s QDRO for the sole purpose of paying the child support arrearage. The arrearage had been over $28,000. His retirement account was the only asset available for attachment and the Court of Appeals  held that this was a proper remedy, including making the ex-wife an “alternate payee” of the plan’s benefits by QDRO under ERISA, specifically 29 U.S.C. §1056(d)(3)(J, K). Though the trial judge thought his denial was required by Hoy v. Hoy, 29 Va. App. 115, 510 S.E.2d 253 (1999), the Court of Appeals held that neither that case nor any other provisions of Virginia domestic relations law keeps circuit courts from granting such a QDRO, and neither does ERISA. The appellate judges distinguish Hoy as an attempt to reopen a divorce case that had already been filed for over 20 years to enter a QDRO against a retirement account that did not even exist at the time of the divorce.

 

Perhaps more interesting in Nkopchieu v. Minlend was the father’s argument that the mother was precluded by a pre-marital agreement in which she expressly disavowed any property interests in husband’s retirement assets.  Her counsel argued that ERISA allows the court to enter a QDRO for the two separate purposes of property division and support, and that she was not looking for property division at all in this instance, but invoking the second purpose of the QDRO in addressing child support use of a retirement account. The marital agreement in fact provided too that “nothing in this agreement shall be construed as limiting the right of either party to make claims for child support,” and the mother said she was simply pursuing a claim for the arrears of unpaid child support. She was trying to enforce her children’s rights to support through a garnishment-like process, and not to establish property rights for herself. And mother’s counsel argued that this woman could have enforced a judgment against a debtor even if she had never been married to this man.  Indeed, the Court of Appeals says, it is established Virginia law that the obligation of child support is owed to the child, not the mother.  What the mother does when she sues is act as a “conduit” for the payment of support to the children.

 

     True, ERISA does say that retirement funds cannot be assigned or alienated, but this prohibition, the Court of Appeals says, does not apply when a state domestic relations order is determined to be a qualified one under 29 U.S.C. 29 U.S.C. §1056 (d)(3). QDROs are an exception to the alienation and assignment provision.  Section 20-107.2, the court says, authorizes making fathers pay their child support obligations.  The court said it could not reach the question of whether the mother’s draft QDRO actually qualified as one under ERISA’s “technical” requirements about the contents of such orders, because the trial judge never reached those questions in the trial below.  It was remanded to give him an opportunity to do so.

State court can fix pension-division order after federal government misinterprets it - Va.Ct.App.

PENSIONS – QDRO IMPLEMENTATION, INTERPRETATION – SEPARATION AGREEMENTS – INTERPRETATION – OPM/CIVIL SERVICE POLICIES FRUSTRATING PARTY INTENT – REMEDIES – COURTS’ AUTHORITY. A court has jurisdiction to modify its divorce judgment to effect a workable division of a pension by QDRO under §20-107.3(K)(4), and that includes separation agreement cases, and it includes construing the intended meaning of the contractual clauses, the Court of Appeals points out in Craig v. Craig, 59 Va. App. 527, 721 S.E.2d 24 (2/7/12). But it does not include adding to or changing the contract because of changing circumstances or any other reason, the Court explains, and that distinction provided the subject of the husband-wife dispute wherein the trial court had heard her parol evidence, given the wife what she wanted and awarded her fees, and husband appealed. This was one of those agreements that provided for the wife getting a survivor benefit plan on top of her pension percentage, but called for deducting the SBP premium from her share. OPM, however, construed its regulations to deduct the $810 premium twice, first from his share and then from hers. This odd interpretation disadvantaged wife. Husband said that sounded fine to him. The first question was whether the question posed even fit within subsection (K)(4), because if not, the trial court did not even have jurisdiction to make any interpretations of the contract, much less modify it. Interestingly, both sides argued that the contract was unambiguous – so why wasn’t that end of story? Well, because even in that situation the courts can still resolve questions of application intent, the Court of Appeals explains, when an unforeseen and illogical interpretation comes along that would nevertheless be totally inconsistent with the obvious intent, and one party nevertheless says he (now) agrees with it. Somebody has to be there to say what’s right and what isn’t. The court concluded that at the time of formation, both parties intended the use of words (like “gross amount”) in their ordinary sense, rather than the weird one that CSRS/OPM under its own regulations was applying. The Court of Appeals quotes from a previous and almost identical case called Recker v. Recker, 48 Va. App. 188, 629 S.E.2d 191 (2006), 26/2 FLN 31, which involved this kind of off-the-wall interpretation. It went through the ordinary and dictionary meanings of the word “gross,” and said that the ordinary meaning is the one these parties clearly intended. Husband tried an ingenuous attempt to distinguish Recker, pointing out that that consent decree did not specifically mention CSRS (which this one did), but referred to husband’s “specific branch of the Federal Government Retirement & Disability System.” The Court of Appeals responded that “in order to accept husband’s position, we must conclude that wife agreed to have the survivor annuity costs ($810) deducted twice from her share.” It concluded, based on the clear language of the agreement, that the parties intended that the $810 should be deducted only once. This kind of interpretation and modification is authorized by §20-107.3(K)(4), because it modifies a QDRO in order to “conform its terms so as to effectuate the expressed intent of the Order, and does so consistently with the substantive provisions of the original decree.” The Court reiterates that it can’t do this just because of change of circumstances. The Court also rules that it was all right to accept parol evidence from the wife, even to construe an unambiguous agreement. It’s true that parol evidence is inadmissible to contradict, add to or even explain the terms of a complete and unambiguous written agreement, but the Court of Appeals notes that wife’s testimony here did not attempt to alter the terms, but merely stated them in her testimony. The fee award was reversed, because the husband’s contentions were not frivolous and he relied in part on Court of Appeals cases that had caused the scratching of not a few heads at the time, such as Duva v. Duva, 55 Va. App. 286, 685 S.E.2d 842 (2009). The West’s Headnote Number 14 to this case makes the especially helpful observation that the purpose of subsection (K)(4) in giving trial courts continuing jurisdiction to modify “is to protect the interests of pension recipients from the unintended consequences of improperly or incomplete [sic] drafted pension orders.” While the text paragraphs signaled with numbers 13 and 14 did not exactly use these words as the Court of Appeals’s own, they do quote our Family Law Section’s Report on pension division in divorce proceedings from 1991, House Document No. 19, which says this. And although those nice words don’t exactly fit what was done in the Craig case, they are themselves embodied in the appellate court’s quotation from a previous opinion called Irwin v. Irwin, 47 Va. App. 287, 623 S.E.2d 438 (2005), to the effect that the statutory reservation allows a court to revise its orders to comply with the language required by federal law to effectuate the intended pension award. And while that doesn’t necessarily hit the Craig case mark either, it’s helpful to have these additional prongs of statutory authority explained.

 

New Virginia family law legislation: the rest of the story

Over the past few days we've reported the new laws enacted in the areas of divorce, domestic violence, child abuse/neglect/dependency, and adoption. There were a few other bills passed, some affecting family law, others not in family law but still affecting what we family lawyers do in our practice. Here they are:

 

HB 1095 Qualified domestic relations order for enforcement of support. Provides that a court may enforce a support order by entering a qualified domestic relations order or other order designed to attach or garnish pensions and other deferred compensation or retirement plans governed by federal law.

 

SB 89 Garnishment; corrects form listing Exemptions from garnishment.  Corrects the form listing garnishment exemptions by replacing the reference to "rent or services of a laborer or mechanic" with "spousal or child support" to reflect amendments made in 1990 (Acts, Ch. 942) that were never incorporated into the form. This bill also contains technical amendments. This bill is a recommendation of the Committee on District Courts. It changes the § 8.01-512.4. Notice of exemptions from garnishment and lien Form to state that a homestead exemption cannot be claimed in a garnishment for child or spousal support.

 

HB 84 Child custody; judge shall communicate basis for decision, except in certain cases. Provides that the judge's required communication of the basis for his decision regarding child custody or visitation, except in cases of a consent order for custody or visitation, shall set forth the judge's findings regarding the relevant statutory factors used to determine the best interests of the child.

 

HB 229 Doctrine of necessaries; lien not to attach on residence held by spouses as tenants by entireties. Provides that a lien arising out of a judgment under the doctrine of necessaries shall not attach to the principal residence of a husband and wife that was held by the spouses as tenants by the entireties prior to the death of either spouse where the tenancy terminated as a result of such death.

 

 HB 761 Recording deeds; statement of preparation. Authorizes the circuit court clerk to reject for filing or recording a deed, except for deeds where a public service company, railroad, or cable system operator is either a grantor or grantee, unless it states on its first page that it was prepared either by the owner of the property or by an attorney licensed to practice in Virginia.

 

HB 101 / SB 94 Rules of Evidence; adoption of amendments or additions of Rules by Supreme Court of Virginia, etc. Provides that the Rules of Evidence (available here) that have been prepared and adopted by the Supreme Court of Virginia and approved by the Virginia Code Commission shall take effect on July 1, 2012. A rule derived from an evidentiary provision in the Code of Virginia shall note such Code section in the title of the rule. Subsequent amendments or additions to the Rules of Evidence must be adopted by the Supreme Court of Virginia by November 15 and shall become effective on July 1 of the following year unless the General Assembly modifies or annuls such amendments or additions by general law. As introduced, this bill was a recommendation of the Virginia Code Commission. This bill is identical to SB 94.

 

SB 59 Injunctions; requirement for bond. Requires a moving party to post bond only for temporary injunctions. Under current law, a bond is required for both temporary and permanent injunctions. The new version of the law reads:

§ 8.01-631. Injunction bond.  A. Except in the case of a fiduciary or any other person from whom in the opinion of the court awarding an injunction it may be improper or unnecessary to require bond, no temporary injunction shall take effect until the movant gives bond with security in an amount that the trial court considers proper to pay the costs and damages sustained by any party found to have been incorrectly enjoined, with such condition conditions as the trial court or judge may prescribe.

 

US law pre-empts state law changing beneficiaries at divorce - Va.Sup.Ct.

SPOUSAL DEATH BENEFIT STATUTE CHANGING BENEFICIARY UPON DIVORCE – FEGLI – FEDERAL PREEMPTION.  Contrary to the rulings of a majority of state courts, the Virginia Supreme Court held in Maretta v. Hillman, ___ Va. App. ___, ___ S.E.2d ___, 26 VLW 58 (1/13/12) that yes, Virginia, the federal statutory law that awards even a divorced widow, even in our Commonwealth, the late husband’s Federal Employees’ Group Life Insurance (FEGLI), overrides Va. Code §20-111.1(D), denies those benefits to a new wife and now widow, and does not require the payback to the new spouse that §20-111.1(D) would otherwise dictate. After all, the majority said, the FEGLI statute, 5 U.S.C. §8701 et seq. has a provision, §8709(d)(1), which expressly preempts state legislation to the contrary, and a definite scheme of priorities for the award of the benefits under §8705(a). The opinion also states that the Virginia Supreme Court is well aware that it is taking the minority position among states. Justices McClanahan and Millette dissent, holding that the federal statute cannot preempt the payback provision of Virginia Code §111.1(B), which has itself wording that says that it operates when there has been a federal preemption. The majority thinking was that allowing the payback requirement would directly frustrate the intent of Congress, but the dissenters believe that Virginia is free to create an equitable claim for compensation under its domestic relations laws, which, after all, have always been regarded as matters of state law. 

Herrel ruling: You can't use sanctions statute to punish inaction

SANCTIONS – OPPOSING COUNSEL.  Just in case there was any doubt about it, the Court of Appeals affirms that no, a party cannot get an award of sanctions against her spouse’s lawyer for inaction.  And that is still true even if what she really asks for as “sanctions” is her costs, including the money it took her to remedy the situation using other counsel and a CPA.  This counsel for husband was ordered by the trial court in 1997 to prepare the QDRO which would have given wife a share of her husband’s pension from a private employer, but completed and filed it only in 2009, and that failure cost wife money she would have had.  In the meantime, the wife had hired her own lawyer to find out what happened to the QDRO and prepare a new one.  But obviously this malpractice-like relief isn’t any more available from an opposing counsel under the wording of the Virginia sanctions statute, §8.01-271.1, than it is by malpractice litigation.  Herrel v. Herrel, 24 VLW 1311 (unpublished, 5/11/10).

Guardian can get divorce for man who no longer wants it - Andrews v. Creacey

DIVORCE GROUNDS – SEPARATION INTENT – INCAPACITATED WARD’S 2006 STATE OF MIND – DISSIPATION OR NOT – PENSION-DIVISION DENIAL – APPELLATE DRAFTING NOT PROPERLY RAISING ISSUE.  A recent Court of Appeals case concerned the divorce ground of statutory separation and the long-range assessment of the now-incapacitated husband’s permanent-separation intent as of several years back.  The Court of Appeals said that it was not determining the legal question (Code §§ 20-91(9)(a), 37.2-1020.D) of whether divorce can be granted on the basis of a guardian’s determination that it is in his ward’s best interest to be divorced, as it had proof of that long-ago intent from independent evidence.  The other thing that was unusual was that the wife was 88 and the husband 93 at the time of trial.  A guardian ad litem had apparently interviewed the husband in South Carolina in 2006 and on that occasion heard the husband state that he wanted a divorce because of his wife’s heartlessness, and the GAL had attached to his written report a letter from the husband saying “I need to divorce my wife, sell my house and live in safety and peace … .”  The Court of Appeals in this case, Andrews v. Creacey, ___ Va. App. ___, ___ S.E.2d ___, 25 VLW 252 (8/3/10), also made the interesting observation that it could find no law requiring that the intent to separate permanently must co-exist with the actual period of separation. At the trial below, the wife did not want a divorce, and thus there was conflicting testimony, but the Court of Appeals will not overturn the trial court’s finding, which has to have included the assumption that the husband had the mental capacity to form the intent.  The appellate court finds clear the General Assembly’s intention by means of §20-91(9)(a) to create an entitlement to divorce when one party intended a permanent separation at one time and the parties lived apart for the statutory period at another time.  (Which may be news to some trial judges). The intendor need not have remained competent during the waiting period. People’s intent to separate permanently often occurs well after the actual physical separation (as in the serviceman-overseas cases), but this case concerned formation of an intent well before, with the more recent evidence indicating that the husband did not want a divorce.  The Supreme Court in Hooker v. Hooker, 215 Va. 415, 211 S.E.2d 34 (1975), in fact held that the Code Section requires “proof of an intention … followed by physical separation for the statutory period.”
 
  Nor was it error for the trial court to award wife nothing out of a $55,000 sum that husband withdrew from a joint marital account back in 2005, since testimony showed that that money went for lawyer fees, mortgage payments, and homeowner’s insurance for the marital home where wife was living, and for the bills embodying her own living expenses — bills that she had sent to him for payment.  Moreover, withdrawal of cash from that particular account was justified by husband’s belief that at least one of two sons was stealing money out of the account, and the GAL’s report stating that something like that was indeed going on.  And while the wife had sought to raise the interesting question whether the trial court erroneously refused to award her alimony because she will thus be required to deplete the only asset she had in order to support herself, the Court of Appeals found that her Question Presented did not actually raise that particular issue by asking whether the trial court had abused its discretion by refusing to award alimony given the length of the marriage and wife’s income level.  Moreover, it was all right for this trial court to refuse to award wife any share of husband’s civil service pension, which it found minimal, and barely enough to cover husband’s on-going medical expenses.

 

Judd v. Judd: PROPERTY DIVISION – PENSION DIVISION – PROPORTIONS.

In the case named Judd v. Judd, 53 Va. App. 578, 673_ S.E.2d 913, 23 VLW 1178 (3/17/09), which is also here under “CUSTODY”,  the Court decided it was justified in dividing the wife’s pension so as to give 100% to her.  This unusual situation concerned a spouse who had made by far the most monetary contributions, and the Court decided, the most non-monetary contribution and had spent most of her time being employed outside the home as well as raising a family, and that spouse happened to be the wife.  All things considered, it seemed fair and just to let her have her retirement.  Husband had an IRA that was totally separate, and his retirement and the wife’s pension were very close in value.  The husband had brought the real estate into the marriage and the Court recognized his right to credit for that.

Lewis v. Lewis: PROPERTY DIVISION – REMEDIES – ORDER TO PROCURE LIFE INSURANCE FOR WIFE – NO STATUTORY AUTHORITY.

When the Chesterfield trial judge in Lewis v. Lewis, 53 Va. App. 528, 673 S.E.2d 888, (3/24/09), felt the husband had subjected the wife to an outrageous injustice when he retired early and thus “deprived wife of her option, specifically granted to her under the terms of the PSA, to receive her portion of the ... pension over the course of her lifetime,” it afforded wife the remedy she sought: ordering the husband to obtain $200,000 of life insurance with her as beneficiary.  Husband of course protested that there is no statutory authority for this, and the Court of Appeals agreed that the rule of Lapidus v. Lapidus, 226 Va. 575, 579; 311 S.E.2d 786, 788 (1984), still stands.  It thus stated “We conclude that, although the trial court did not err in determining that wife was entitled to some remedy … the trial court did not have authority to order that husband obtain life insurance … .”  So a few things we have always assumed remain true – at least for now.  And if that wasn’t plain enough, The Court of Appeals explained that “under Code §20-107.3(G)(2), a trial court cannot order that a person obtain life insurance on himself for the benefit of the former spouse, although a court can order that a person elect to have survivor’s benefits on their [sic] pension or annuity.”  After unsuccessfully citing cases from other states, wife argued that the delayed-QDRO provision of the statute, §20-107.3(K), in authorizing “additional orders” to effectuate parties’ agreements, allowed the insurance-provision order.  However, the Court did not believe that the general authorization of subsection (K) could control or override the “specific provision in subsection (G) ….”  Thus, entitled as this wife may be to some remedy, “the trial court crafted the wrong remedy here.”  In a footnote, the appellate court hastens to assure the trial judge that it is by no means foreclosing the invention of some kind of remedy, so long as it is a proper one.

Lewis: PROPERTY DIVISION – PENSIONS – REMEDIES – SEPARATION AGREEMENTS – RETIREMENT EARLIER THAN EXPECTED – POST-DIVORCE QDRO.

When Virginia’s pension division statute was first sold to and passed by the Legislature, the assumption on everyone’s part, and the way you explained it to people, was that the non-employee spouse gets her cut of each monthly pension check if, as, and when received – so she doesn’t get paid until he gets paid. And if he retires early and gets a lump sum she gets a lump sum, and if he takes it out monthly over the rest of his remaining years that’s how he gets his and she gets hers, and what could be fairer than that?  But now it appears, from a Court of Appeals opinion known as Lewis v. Lewis, 53 Va. App. 528, 673 S.E.2d 888, (3/24/09), there is a whole moral and sexual-political dimension to this, of which we hitherto have been totally unaware. But the Court of Appeals, if you give them time, will explain it all to you in their fifteen-page opinion.      

     Most Virginia lawyers, if you asked them what happened in the Lewis case, would probably answer “Oh some kind of huge QDRO mess.” But FLN, having had to do so, sought to explore it fully and will do its best at an explanation which it at least hopes is accurate.

       A Chesterfield husband apparently executed a separation agreement dividing his pension from Philip Morris, as well as his profit-sharing plan. The separation agreement more or less contemplated a retirement date much later than the one that husband in fact took. As the Court of Appeals saw it, the separation agreement didn’t deal – or at least didn’t deal satisfactorily – with the apparently unforeseen eventuality of his “retiring early.”  The Court of Appeals uses lots of morally judgmental terms, such as “unilateral” which by now has a whole pejorative subtext, to describe what he did to the hapless wife by taking this early retirement date. So just what exactly did he do to her by pulling the rug out from under the agreement’s comfortable assumptions?  He deprived her of the sacred and inalienable right to choose between getting her pension in measured increments over the course of her remaining life. To say that the unilateralness deprived her of a choice is a bit confusing, since the Plan seemed not to let her choose lump sum if the husband didn’t choose lump sum, but as with alimony, losing the periodicity was an enormously churlish deprivation of a major substantive benefit. Could the trial court give effect to the intent of the separation agreement and afford wife a remedy for this delict?  Indeed it could, and it did, and properly so, according to the Court of Appeals. This husband worked for Philip Morris throughout the 20-year marriage, and was still working there when the parties separated in 2003. They signed a separation agreement in 2004 that gave her alimony, but only until the time of his retirement. Upon retirement, the agreement did not exactly give wife an if/as/when award as such, but stated that “the marital share of Husband’s pension shall be divided 50/50 by a QDRO, by applying a coverture fraction to the accrued benefit as of the date of separation, and Wife shall receive a separate share paid to her for her lifetime based on her actuarial life expectancy.”  Apparently the ambiguous relationship between actual life and actuarial life was not clarified very much by this agreement, but the word coverture did throw some law clerk for a loop, as a lengthy footnote hastens to explain to us all that this oft-used legal term “is an archaic term referring to the condition of being a married woman” according to Black’s, and goes on to explain at great length, with citations to Turner, etc., that some archaic persons use a “coverture fraction” to do that mysterious thing that we do all the time with marital pensions.

     Now the old-fashioned lawyers who drafted this archaic agreement also divided a profit-sharing plan, requiring the trial court to enter a QDRO directing Philip Morris to pay an appropriate part of the profit-sharing account to wife, and another one directing the same from his monthly pension payments. The Court entered the divorce decree, leaving the QDROs still being fine-tuned and argued over, but this decree specifically stated that it was not final but was reserving QDRO authority. But before any QDROs got entered, the husband “unilaterally retired” and stopped paying the alimony, and then filled out his retirement forms by checking a box indicating that he wanted his pension “as a single life annuity, and without any survivor benefit.”  He thus got the full pension amount each month until his employer froze the pension benefits because of the pending case. Wife got her pension split for the term of his life, not hers, and (something on which “the parties agree”) that was because the rule at Philip Morris seems to be that after retirement begins, “the current payouts under the pension plan cannot be altered to provide wife with benefits for her lifetime,” and thus for this couple all payments stop upon husband’s death.

As for the profit-sharing account, husband withdrew the entire balance of $1,114,905 without consulting wife, and bought himself two annuities – which he certainly did not share with her. And although he withdrew $44,565 from one and $8,242 from the other over the next six months, the combined balance of the two accounts still grew by over $24,000 over that period. Apparently it was stipulated that at the time of separation, wife’s part of the profit-sharing account would have been $187,517. The wife then filed a motion asking the court to enter a QDRO to give her $1,658 per month from the date of retirement, and that husband be ordered to procure life insurance to make up for her ill-treatment. The court agreed and awarded the wife $1,246 per month from the pension, required that he obtain $200,000 in life insurance and awarded wife her share of the profit-sharing account, with interest from the time of separation, plus attorneys’ fees.    

     Husband argued, first, that the court’s award gave wife pension benefits based on and earned by his employment after the 2003 separation date. The evidence, the Court says, supports the trial court’s finding that the pension benefit was worth $3,719.92 per month on the June 1, 2003 separation date, and that the appropriate value was used in applying the coverture fraction to determine the statutory “marital share.”  The evidence did not, however, support husband’s argument that wife was getting, by virtue of the $3,719.92 per month valuation a split of the benefits that he earned after separation. A very lengthy footnote explains that divorcing parties usually divide the marital portion of a pension by an if/as/when award without needing to know the actual amount of the future monthly benefits. Thus the court did not err either in the valuing nor the dividing of the pension plan. As to the profit-sharing account, the agreement gave the wife “half of the marital share” of that account, and husband conceded that wife was due $187,517 of the balance on the separation date. But he contended that she could not get any interest that accrued after that date, and that the trial court erroneously awarded her the growth on that account after separation. Concluding that neither Fahey v. Fahey, 24 Va. App. 254, 481 S.E.2d 496 (1997), nor Baker v. Baker, 38 Va. App. 384, 564 S.E.2d 164 (2002), applies to a separation agreement provision like this one, the Court upheld the trial judge. Here, no court order nor agreement provision stated that the wife was entitled to half the marital share “as of” any particular date. The agreement nowhere specifically states that wife was intended to have only half the actual amount in the account as of the separation date, but just says that she gets half of the marital share. The marital share, the Court says, is something which accrued passive interest after the separation and after the agreement’s execution. The interest is clearly not part of his separate portion of the account, nor of his part of the marital share. The interest on wife’s portion of the marital share belongs to her. And moreover, in this case “husband took from wife the ability to control her portion of the profit-sharing account, without her permission. He exerted control over her portion after the PSA had specifically divided that account so that husband was no longer entitled to control that money.” In awarding the wife the growth on her part of the account after the husband took the money and put it into the annuities, “the trial court simply gave effect to this intention of the PSA, which husband had frustrated.”  In fact, the cCourt says, with even more indignation, “husband acted unilaterally, taking upon himself the responsibility for wife’s money,” and he should not be entitled to profit from that.