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### STATE OF MICHIGAN

COURT OF APPEALS

DEBORAH LYNN FOSTER,

Plaintiff/Counter-DefendantAppellee, UNPUBLISHED October 13, 2016

v No. 324853

Dickinson Circuit Court RAY JAMES FOSTER, LC No. 07-015064-DM

Defendant/Counter-PlaintiffAppellant.

Before: M ARKEY , P.J., and M URPHY and R ONAYNE K RAUSE , JJ.

P ER C URIAM

.

Defendant appeals as of right a n order holding him in contempt of court for failure to pay plaintiff in compliance with t he parties’ consent divorce judgm ent that was entered in December 2008. Defendant argues that the contempt order and the divorce judgment itself are unenforceable because their effect is to require defendant to p ay plaintiff a portion of his military disability benefits as part of th e property settlement in viola tion of federal law. Defendant also presents arguments regarding alleged problematic factual findin gs and other legal shortcomings tied to entry of the divorce judgment. Defendant’s arguments a re effectively and ultimately rooted in the judgment of divorce and its terms; however, he ne ver appealed that judgment, nor

has he moved for relief from t hat judgment, MCR 2.612. Thus, d efendant is engaging in an improper collateral attack on the divorce judgment. See Kosch v Kosch , 233 Mich App 346, 353; 592 NW2d 434 (1999) (the defendant's failure to appeal the original divorce judgment precluded collateral attack on the merits of the judgment and e ffectively constituted a stipulation to its provisions). Indeed, defendant agreed to the very provi sion in the divorce judgment that he now assails. Nevertheless, for the reasons set forth below, we also substantively reject defendant’s arguments. In sum, we affirm.

The parties were married on August 6, 1988, and plaintiff file d for divorce on November 20, 2007. Defendant had served in the military during, and pri or to, the marriage, and he retired from the Army in September 2007. Defendant testified at the di vorce hearing, which involved finalizing the parties’ settlemen t, that he was receiving both military retirement pay and military disability benefits based on injuries he had sustained during t he war in Iraq. Both parties waived their rights to seek spousal suppo rt and agreed that defendant’ s disability benefits were not subject to division by the court because they were not consider ed marital property under federal-2- law. However, pursuant to the pr operty settlement, plaintiff w as awarded 50 percent of defendant’s retirement pay, or “disposable military retired pay ,” as calculated based on defendant’s creditable military service during the marriage. T he parties also agreed to the inclusion of the following provision in the divorce judgment, w hich we shall refer to as the “offset provision:”

If Defendant should ever become disabled, either partially or in whole,

then Plaintiff’s share of Defenda nt’s entitlement shall be calc ulated as if

Defendant had not become disabl ed. Defendant shall be responsib le to pay, directly to Plaintiff, the sum to which she would be entitled i f Defendant had not become disabled. Defendant shall pay this sum to Plaintiff out of his own pocket and earnings, whether he is paying that sum from his disability pay or otherwise, even if the military refuses to pay those sums directly to Plai ntiff. If the military merely reduces, but does not entirely stop, direct payment to P laintiff, Defendant shall be responsible to pay dir ectly to Plaintiff any decrease in pay that Plaintiff should have been awarded had Defendant not become disabled, tog ether with any Cost of Living increases that Plai ntiff would have received had Defendant not become disabled. Failure of Defendant to pay these amounts is p unishable through all contempt powers of the Court.

At the divorce hearing, the trial court questioned the attorney s regarding the language of the offset provision, noting that it seemed to suggest that def endant was not currently receiving any disability benefits, which was not the case. Counsel for b oth parties acknowledged that the language was awkward, but explained that the intent was simply to address a scenario in which defendant became entitled to and accepted more disability benef its than currently being received, inversely diminishing the retirement benefits that were being d ivided and awarded to plaintiff. The purpose of the offset provision was to protect plaintiff in such a scenario. The trial court also discussed the offset provi sion with defendant in the follo wing exchange:

Court. All right, . . . Mr. Foster, you do acknowledge that if you w ere to defer any of your current military retirement pay or convert it to disability pay, or if your military retirement pay were reduced because the level of your disability pay was increased, you acknowledge this Court’s ability to enfo rce payment to Ms. Foster the level of benefits that she would be entitled [to ] presently from your retirement pay?

Defendant . Yes.

Shortly after the entry of the divorce judgment, defendant beca me eligible for and began receiving increased disability benefits, which consequently red uced the amount of his retirement payments and the amount plaintiff received from defendant’s mil itary retirement pay. This was the precise circumstance that the parties had contemplated in d rafting and agreeing to the offset provision. However, defendant fai led to comply with the divorc e judgment by paying plaintiff the difference between the reduced amount of retirement pay she received and the amount that she had received at the time of the divorce judgment. A number of show cause and contempt proceedings took place over several years, leading to the order that defendant now appeals, wherein the trial court held defendant in contempt for failure to pay plaintiff in compliance with-3- the consent divorce judgment. The court ordered him to pay pla intiff $1,000 per month, with $812 credited as current payments due under the divorce judgmen t and $188 to be credited against the arrearage of $34,398 until the arrearage was paid i n full.

Defendant’s primary argument on appeal is that the divorce judg ment and the trial court’s order enforcing the judgment were legally invalid because they required him to pay plaintiff a portion of his disability benefits in violation of federal law. We disagree. Defendant’s argument entails statutory construction a nd questions of law in general, which we review de novo on appeal. Snead v John Carlo, Inc , 294 Mich App 343, 354; 813 NW2d 294 (2011).

“Members of the Armed Forces who serve for a specified period, generally at least 20 years, may retire with retired pay.” Mansell v Mansell , 490 US 581, 583; 109 S Ct 2023; 104 L Ed 2d 675 (1989) (citations omitte d). And retired or retiremen t pay is generally subject to division in state court divorce proceedings under the Uniformed Services Former Spouses’ Protection Act (USFSPA), 10 USC 1408. Id. at 584-585; Megee v Carmine , 290 Mich App 551, 562; 802 NW2d 669 (2010). With respect to disability pay, “[m] ilitary veterans in general are entitled to compensation for se rvice-connected disabilities und er 38 USC 1101 et seq .,” sometimes referred to as “VA disability benefits.” Megee , 290 Mich App at 560. Pursuant to 10 USC 1414(a)(1), as effective January 1, 2004, “ ‘a member or fo rmer member of the uniformed services who is entitled for any month to retired pay and who i s also entitled for that month to veterans’ disability compensat ion for a qualifying service-conn ected disability . . . is entitled to be paid both for that month . . . .’ ” Id. at 560-561 (ellipses in Megee ). “This concurrent receipt of military retirement pay and VA disability benefits is common ly referred to as CRDP, which stands for ‘concurrent retirement and disability pay.’ ” Id. at 561 (citation omitted). Another form of military disability pay, separate from standard VA disa bility benefits, is combat-related special compensation (CRSC), 10 USC 1413a. Id. at 552-553. “To be eligible for CRSC, a person must be a member of the uniformed services who is entitl ed to retired pay and who has a

combat-related disability.” Id. at 560, citing 10 USC 1413a(c) (emphasis added). A veteran who is qualified for CRDP (retire ment pay plus VA disability pa y) and who is also qualified for CRSC (combat-related disability p ay), may elect to receive CRDP or CRSC, but not both.
Megee , 290 Mich App at 561.

According to defendant, he became entitled to receive CRSC, wh ich determination was apparently made retroactive to a date preceding entry of the di vorce judgment. Defendant elected to receive CRSC, which resulted in a diminution of his retirement pay and plaintiff’s 50 percent award of that pay. See Megee , 290 Mich App at 561 (“Plaintiff elected CRSC, which effectively discontinued his retirement pay that had been subje ct to the QDRO, halting payments to defendant.”). The Megee panel observed the following concerning CRSC and the division o f waived retirement pay related to CRSC, i.e., retirement pay tha t is not being received because of

a CRSC election:

The trial court here effectivel y divided plaintiff’s CRSC and, although

Mansell did not directly address division of disability pay, the USFSPA clearly does not allow such a division. Subsection (c)(1) of the USFSPA , 10 USC 1408(c)(1), permits a court to tr eat only “disposable retired p ay” as “property of the member and his spouse,” and CRSC is “not retired pay,” 10 U SC 1413a(g). Accordingly, the trial court e rred by dividing plaintiff’s CRSC and forcing-4- plaintiff to pay a portion of his CRSC to defendant. However, o n the subject

addressed in Mansell , i.e., dividing waived retirement pay, the Mansell decision actually supports making plaintiff in the case at bar pay defen dant half of the retirement pay that he would be receiving but for his election to take CRSC. The

Mansell Court concluded that waived retirement pay could not be divided as property in circumstances in which the pay had been waived in f avor of title 38 VA disability benefits, given that the definition of “disposabl e retired pay” in 10 USC 1408(a)(4)(B) excludes consid eration of amounts waived in o rder to receive title 5 or title 38 compensation. Under the reasoning and ratio nale of Mansell

, there would be no prohibition he re against considering for divi sion waived retirement pay under the USFSPA because we are addressing a wai ver of title 10 CRSC not mentioned in 10 USC 1408(a)(4)(B). Thus, all of plaint iff’s envisioned yet waived military-retirement pay can be divided without offen ding the USFSPA

or Mansell . Accordingly, there is no bar to ordering plaintiff to compens ate defendant in an amount equal to 50 percent of plaintiff’s envis ioned retirement pay as intended under the terms of the divorce judgment after p laintiff made a

unilateral and voluntar y postjudgment election to waive his ret irement pay in favor of disability benefits cont rary to the terms of the judgm ent.

* * *

We hold that a military spouse remains financially responsible to compensate his or her former spouse in an amount equal to the s hare of retirement pay ordered to be distributed to the former spouse as part of a divorce judgment's property division when the military spouse makes a unilateral a nd voluntary postjudgment election to waive the retirement pay in favor of d isability benefits contrary to the terms of the di vorce judgment. Conceptually, an d consistently with extensive caselaw from other jurisdictions, we are dividing wai ved retirement pay in order to honor the terms and intent of the divorce judgment. Importantly, we are not ruling that a state cou rt has the authority to divide a military spouse's CRSC, nor that the military spouse can be ordered by a court to pay the former spouse using CRSC funds. Rather, the compensation to be paid th e former spouse as his or her share of the property division in lieu of the wai ved retirement pay can come from any source the military spouse chooses, but it mu st be paid to avoid contempt of court. To be c lear, nothing in this opinion s hould be construed as precluding a military spouse from using CRSC funds to satisf y the spouse's obligation if desired. [ Megee , 290 Mich App at 566-567, 574-575 (footnote omitted).]

Megee governs and dictates, given the involvement of CRSC, that the o ffset provision in the consent divorce judgment is f ully enforceable through the t rial court’s contempt powers. Defendant attempts to distinguish Megee on the basis that, because of the retroactive nature of the CRSC award, he effectively became entitled to and elected C RSC and waived retirement pay
prior to entry of the divorce judgment, whereas Megee concerned a unilateral, postjudgment election to waive retirement pay and opt for CRSC. Defendant’s argument construes Megee much too narrowly and misses the broader legal principle that e manates from Megee , which is that a state divorce court has the authority to divide waived r etirement pay, which waiver had-5- resulted from a veteran’s decision to elect CRSC, so long as th e court does not directly order payment from CRSC funds. 1 Thus, assuming for the sake of argument that defendant’s waiv er of retirement pay and election of CRSC must be treated as havin g already occurred when the divorce judgment was entered, th e offset provision contemplatin g the division of waived

retirement benefits was nonetheless valid and enforceable under Megee

.

Defendant presents an alternative argument under 38 USC 5301, which regards the nonassignability and exempt status of veterans’ benefits. Defe ndant’s argument is woefully undeveloped and we deem it waived. See Mudge v Macomb Co , 458 Mich 87, 104-105; 580 NW2d 845 (1998). Moreover, as ruled earlier, the argument refl ects an improper collateral attack on the judgment of divorce. See Kosch , 233 Mich App at 353. Finally, 38 USC 5301(a)(1) speaks of precluding th e assignment of benefits “exc ept to the extent specifically authorized by law[.]” As noted above, the USFSPA generally per mits the division of disposable retired pay in state divorce acti ons, and the instant dispute c oncerns the division of waived retirement pay, which the Megee panel held was proper under feder al law when the waiver is in

relation to a CRSC election. Megee , 290 Mich App at 566-567, 574-575.

Finally, defendant poses arguments regarding alleged mistakes of fact by the trial court, along with purported fraud and unc onscionable advantage, all ti ed to the procurement of the divorce judgment. These arguments are an improper and untimely attempt to relitigate the divorce action that was settled years ago absent appeal, and th e arguments are therefore rejected. We additionally note that defendant’s assertion that the trial court was factually mistaken with respect to whether defendant was suffering from a disability at the time of the divorce hearing is belied by the record. The trial court expressly recognized tha t defendant was currently receiving disability benefits and sought clarification from the parties c oncerning the language in the offset provision that suggested otherwis e. In sum, defendant’s argume nts are unavailing.

Affirmed. Having fully prevailed on appeal, plaintiff is awar ded taxable costs under

MCR 7.219.

/s/ Jane E. Markey /s/ William B. Murphy /s/ Amy Ronayne Krause

1 The contempt order does not require payment from CRSC funds, n or do we construe the divorce judgment’s offset provision as ordering payment from CR SC funds, and any such

construction must be avoided.