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High court: Non-military spouse loses if ex waives retirement pay

On Behalf of | Jun 8, 2017 | Divorce

“The question is complicated, but the answer is not,” explained Justice Stephen Breyer in a recent appeal of a divorce issue. The case before the U.S. Supreme Court is indeed a bit complicated to explain, but basically stands for the principle that federal law trumps state law where they disagree.

The case involved the 1991 divorce of John, a 20-year veteran of the Air Force, and his wife Sandra. As they divided their property, they agreed that Sandra was entitled to half of John’s Air Force retirement pay.

Things went forward with each of them receiving half of the pay. Later, however, John discovered that he had developed degenerative joint disease in his shoulder as a result of his military service. The disease entitled him to VA disability benefits.

According to court records, John wasn’t allowed to “double dip” into the benefits pool by taking the full amount of both the disability and retirement benefits. Instead, he was required to waive some of his retirement benefits to offset the disability claim.

This resulted in both John and Sandra receiving $127 less per month in retirement benefits. Sandra asked the divorce court to order John to make up the difference. The state in which John and Sandra live had a statute that appeared to allow the court to order that.

Finding that nothing in either federal law prohibited them from ordering John to make up that difference, the family court determined that Sandra was entitled to the full amount she was receiving before. Their state’s supreme court upheld that order.

Supreme Court: Federal law specifically addresses this issue

The Supreme Court initially agreed to hear the case, but five months later it decided it could forego the hearing and simply rule. This appears to be because their opinions were virtually unanimous on the issue — Clarence Thomas wrote as separate but concurring opinion and Neil Gorsuch took no part.

The justices found that the Uniformed Services Former Spouses’ Protection Act does directly address the issue, even though the state courts thought it did not.

That law that authorizes the division of military retirement pay in divorce. However, it specifically says that, if a former service member waives part of their retirement pay in order to receive disability benefits, the rules change. The remaining retirement pay can still be divided between the ex-spouses, but the disability benefits cannot.

Basically, the court found that a federal law prohibited the family court from ordering John to make up the difference for Sandra. Whenever a federal law directly contradicts a state law, the federal law wins.