# FILED
Ap ril 16, 1997 Cecil Crowson, Jr . App ellate C ou rt Clerk IN THE COU RT OF A PPEA LS OF TENN ESSEE WESTERN SECT ION A T JA CKSON
GLORIA F. STA NLEY GILLILAND , ) ) Plaintiff/Appellee, ) Tipto n General Sessio ns No. 3258 ) VS. ) A ppeal No. 02A 01-9603-GS-00056 ) GARY DON STANLEY, ) ) Defendant/Appellant. )
APPEAL FROM THE GEN ERAL S ESSION S COU RT OF TI PTON C OUNTY

AT COVINGTON, TEN NESSEE THE HONORABLE WILLIAM A. PEELER, JUDGE

JEFFERY L . STIMPSON Munford, Tennessee Attorney for Appellant JOHN R. BR AN SON BR ANS ON & B EAR MAN Memphis, Tennessee Attorney for Appellee

AF FIRMED

ALAN E. HIGHERS , J.

CONCUR: W. FRA NK CRA

WFORD, P.J., W.S. DAVID R. FA RMER, J.2

DefendantGary Don Stanley (the Husband) appeal s the trial court’s or der enforcing the provisi ons of a final divorce decree pr eviously entered by t he court in J uly 19 89. I n enforcing the dec ree, the t ria l co urt ord ered the H usba nd tomakepay ment s toPla inti ff Gloria F. Stanley Gillila nd (the W if e) for her share of the proceeds from th e sale of the parties’ real proper

ty in Doug lassvil le, Texas. The Wife cross-appeals, contendi ng that the trial c ourt erred in refusing to increase the W ife’s interest in the Husband’s m ilitary retirement

bene fit s. For the re ason s her eina fte r stat ed, we affirm the trial court’s judg ment.

As pertinent, the final divorce decree prov ided that the Wife “shall remai n an equal tenantin common in [the parties’ ] real proper ty located in Douglas sville , Texas.” I n the eventthe property

wassold, the final decree entitl ed the Wife to “one-fourth (1/4) of the net proceeds” from such sale. The final decree als o ordered the H usband “to pay by allotment to [the W ife] T HIRTY FIVE PERCENT (35%) of his retirement be nefits from the military when the same vests as long as [the Husband receives] the sam e.”

After the parties’ divorce became final, the H usband took two acti ons which affected the equitable di stribution s cheme of the final div orce decree. First, the Husband sig ned
a power of attor ney whi ch authoriz ed his pa rent s, who ow ned a one-half interest in the Texas property, to sell, l ease, o r otherwise dispose of the pro perty. After obtaining t he power of attorney, the Husband’s parents proce eded to enter into a Lea se with O ption to Purchase contract w ith a thi rd party. Under the terms of the lease, the lessees were required to pay $700for the option, pl us a monthly rental of $200. If thelessees elec ted to purchase the p roperty for a total price of $22, 500, all monthly rents previously paid would be appl ied towar d the purchase pr ice.

The second action taken by the Husband affected the Wife’s interest i n the Husband’s military

retirement benefits. When the Husband reti red in 1990, theWife began receivi ng her share of the retirement ben efits in accordance with the final divorce decree. Subs eque ntly, however , the Husband caus ed his milit ary retirem ent benefits to be decreased when he elected to waive a portion of the retire ment pay so that he instead1 In M an se ll v. M an se ll , 490 U. S. 581 ( 1989), the Un ited Sta tes Su pr em e C ou rt e xp lain ed wh y a

mili tary ret ir ee might make such an elect ion:

In order to prevent double dipping, a m il itary retiree may receive disa bilitybenefi ts onl y t o the ext ent t hat he waiv es a corr espondin g amount of his m ilitar y ret ir em ent p ay. [38 U .S.C . § 31 05 (1 982 ed. & Sup p. V)]. Because disa bility benefi ts ar e exempt from federal , st ate, and l ocal taxat ion, [38 U .S.C . § 3101(a) (1982 ed. & Supp. V)] , mil it aryret ir ees who waive the ir ret ir ement pay in favor of disabil itybenefits increase their aftertax i ncome. Not surpr isi ngly , wai vers ofret ir ement pay ar e comm on. M an se ll , 490 U.S. at 583-84 (foo tnote om itt ed). 3 could rece ive Veteran’s Admi nistration di sability payments. W hile this e lect ion m ay have provided the H usba nd w ith cer tain tax bene fi ts, 1 the decrease in the Husband ’s military retirement

benefits result ed in a corresponding red uc tio n in the amount of reti rement benefits being pai d to the Wife as her divisi on of marital prope rty.

When the Wife discovered the Hus band’s actions , she filed a petitio n forwr it o f scire facias and complaint for damages in the trial court, seekingto enforce the prov isions of the final divorc e dec ree. Afte r con duct ing an evide ntia ry heari ng, the tri al court found the L ease wit h Option to Purc hase contract to be a de facto sales contr act whic h effected a “sale of the property

and/or totall y frustrat[ ed] the intention of the [prior] or ders of the court. ” Acco rdin gly, the trial court awar ded the Wife a judgment for her one-fourt h interest i n the proceedsfrom the sale of the Texas property , in the total amount of $775, which i ncluded
one -fourth of the origi nal option pri ce plus $50 per month since the date of the contract. The tri al court

als o ordere d theHus band to be gin pay ing to t he Wife the sum of $50 per month “as and for her share of the proceedson said property” for so long as the contract remained in effect. As for the reduction in the Husba nd’s militaryretirement benefits, the trial court denied t he relief sough t by the Wife, finding the acti on taken by the Husband “to be within the rights

of [the Husband], as

set [forth] in 1 0 U.S.C. Sec tion 1408, a nd 38 U.S.C. Section 3105, as interpreted by the U.S. Supre me Court in its deci sion [in] Mansell v. Mansell , [490 U.S. 581, 109 S. Ct. 202 3, 104 L. Ed. 2d 675 (198 9)].”

On appeal, the Hus band contends that the trial court erred in awarding the Wife a judgmentfor her interest in the Texas property because the court did not have jur isdiction
or authority

to affect title toforeign proper ty or to construe any conveyance of such land. On cross-appeal , the Wife contends that the trial court erre d i n ru ling that i t lacked the4

authority to incre ase the percentage of the W ife’s interest in the Husband’s m ilitary retirement

benefits after the H usband conver te d a portion of the retirement benefits to disability payments.
I. The Douglassville, Texas, Property
Contraryto the Hus b and’s contention on ap peal, the trial court did not lack jurisdict ion to enter

a judgment affe cting title to the parties’ real property in Texas. It i s true that“a court of one state is w ithoutjurisdiction to pass title to lands ly ing whol ly in anot her state” and, thus, that “ [t]he local cou rt cann ot by its decree bind [such] land.” Cory v. Olmstead , 2 9 0 S

. W. 31, 32 (Tenn. 1926 ). The law is equally well-established, however, that, “in a proper

case, with the necessary parties before t he court, a decree in per sonam maybe properly passed requiring a party defendant holdin g the legal ti tle in trust, or otherwis e, t o transf er such title in accordance with the decree of the court.” Id . As the Supreme Court of Tenness ee has explai ned:

In such case, althoug h the court cannot bind the land itself by the decree, it can bind the conscience of the party in regar d to t he land, and enforce hi m, by proces s against hi s person, t o perform his agreement . Butthe dec ree is merel y in person am, and not in re m. Still, the want of power to act upon th e land, or to enforce the decree in rem, is no object ion to the jurisdict ion to act upon th e person, . . . . Id

. (quoting Johnson v. Kimbro , 40 Tenn. (3 Head) 557, 559 (1859)) ; accord Boal s v. Boals , 519 S.W .2d 594, 597 (Tenn . App. 1973).

In the present cas e, the trial court’s or der did not attempt to pass title to the parties’ real property in Texas. In stead, the court ’s order s imply enforced against the Husband the provisi ons of the final divor ce decree w hich entitled the Wife, in the event of a sale of the real property, to one-fourth of the proceeds. S ignificantl y, the Hus band has not contended thatthe trial court lacked personal jurisdiction over him, or that the court lacked subject matter jurisdiction over the proceedings to enforce the final divorce decree. We conclude,2 On app eal, the Hu sba nd h as n ot ch alleng ed th e trial co urt’s ru ling tha t the Le ase with O ption to

Purchase con tr act was a de fac to sales contr act. (Husband’ s bri ef, pp. 1- 14). The only possibl e basis fo r re ve rs al, there fore , is the H usb and ’s jurisd iction a rgum ent, whi ch we hav e co nclu ded is witho ut m erit. (H us ba nd ’s bri ef, pp. 7- 13). In any eve nt, alt hough the Lease wit h Optio n to Pur chase contr act di d not i nclude the W if e’s name or si gnatur e, i t appear s thatthe cont ract executed by the W if e’s cot enants, which pu rport ed to con vey an und ivided in teres t in the p rope rty, e ventual ly could resul t i n the l essees obtai ning g ood ti tl e, provi ded the les see s’ pos ses sion con tinues for the requ ired s tatuto ry period

. See Hines v. Point er , 523 S.W .2d 7 33, 7 40 (T ex. C iv. App . 197 5); Jones v. Sil er , 100 S.W .2d 352, 353 (T ex. Com m ’n App. 1937).

3 See 10 U.S.C. A. § 1408 ( W est 1983 & Supp. 1996). Congress enact ed the For mer Spouses’ Protect ion Act i n dir ect r esponse to Mc Ca rty v. Mc Ca rty , 453 U. S. 210 ( 1981), in whi ch the Unit ed Stat es Su p r e me Co ur t he ld that“t he feder al statu tes th en g ove rning m ilitary retirem ent p ay pre ven ted s tate c ourts from treating mili tary ret iremen t pay as com m unity property.” M an se ll , 490 U. S. at584. The Act

a uthor iz es state courts to treat “disposable retir ed or retainer p ay” a s com m unity property. [ 10 U.S.C . § 1408(c)(1) (1982 ed. & Sup p. V)]. “‘D isp os ab le ret ir ed or r etai ner pay’ ” i s defi ned as “t he tot al monthl y r eti red or ret ainer

pay t o which a m ilitary m em be r is e ntitle d,” m inu s c er tain deducti ons. [10 U. S.C. § 14 08(a)( 4) (1982 ed. & Supp. V)]. Among the am oun ts requi red to be de du cte d fr om tota l pa y are an y am ou nts wa ive d in orderto rec eive d isab ility ben efits. [10 U.S .C. § 140 8(a) (4)(B ) (19 82 e d. & Su pp. V )]. M an se ll , 490 U.S. at 584- 85. Subseque nt t o the Act ’s passag e, Tennessee courts again began tr eati ng vested and nonvest ed mili tary pensio n ri ghts as mari tal property subj ect to eq uitable distribu tion. Kendrick v. Kendri ck , 902 S.W .2d 918, 926 (T enn. App. 199 4). 5 therefore, that the trial court had jur isdiction to enter an order binding the Husband to pay to the Wife a portion of the proceeds from t he de facto sale of t he pr ope rty. 2

II. The Husband’s Military Retirement Benefits

We als o affirm the trial court’s refusal to increas e the Wife’s interest in the Hu sband’s military

retirement benefits. In Mansell v. Mansell , 490 U.S. 58 1, 594-9 5 (1989), the United States Supreme Court held that, under the Former Spous es’ Protecti on Act, 3 state courts

do nothave “the power to treat as property divisible upon divorce military retirement

pay that has been wai ved to rece ive veterans’ dis ability benef its.” In so holding, the Court ex plained:

S ec tion 1408(c)(1) of the [Former Spou ses’ Protection] Act affirmatively gran ts state courts the power to divide military retirement

pay, yet its lang uage is both precise and l imited. It providesthat “a court may treat dispos able retired or retainer pay . . . either as

property solely of the member or as pr operty of the member an d his sp ouse in accor dance with the law of the jurisdic

tion of su ch court.” [10 U.S.C. § 14 08(c)(1) (1982 ed. & Supp. V)]. The Act’s definiti onal section spec ifically defines the term “disposable retired or retainer pay

” to exclude, inter al ia , milit ary ret irem ent p ay waive d in o rder to rec eive veterans’ d isabil ity pay ments. [10 U.S.C . § 1408(a)(4) (B) (1982 ed. & Supp. V)]. Thus, under the Act’s plain and precise language, state courts

have been granted the authority to treat disposable retir ed pa y a s c ommunity proper ty; they have not4 In t his r egard, we re ject th e W ife’s ch arac terization of the perio dic pa ym ents as a limo ny su bjec t to

m odifica tion. See Towner , 858 S. W .2d at891. 6

been granted the au thority to treat total r et i red pay as comm unit y prop erty. Mansell , 490 U.S. at 588-89 (foo tnote omitted).

In her dissent, Justice O’ Connor, joine d by Justi ce Blackmun, comment e d on the harsh results of the majority’s rulingin Mansell :

The harsh reality of this holding is that former spouses . . . can, without their consent , be denied a fair shar e of thei r exspouse’s military

retirement

pay s imply becaus e he elects to increase his after-tax

inc ome by conve rting a por tion of that pay into disability benefits. Mansell , 490 U.S. at 595 (O’Connor, J., dissent ing).

At the hearing below, the Wife in the present case urged the trial court to avoid the harsh effects of the Mansell ruling by increas ing the Wife’s interes t in the Husband’s militaryretirement benefits from thirty-five percent (35%) to forty-nine and one -half per cent(49.5%). In support of this argume nt, the W ife cited the Former Spou se s ’ Protecti on Act, whi ch authoriz es state courts to awar d to former spouses

up to fifty percent(50%) of a mili tary ret iree’s dis posable retir ed pay. See 10 U.S.C.A. §1408(e)(1) (W est 1983 & Supp. 199 6).

Notwithstanding the Act’s authorization, we conclude that the trial cou rt did not err in refusing to increase the percenta ge of the W ife’s interest in the Husband’s m ilitary retirement

benefits. The Husband’s military retirement bene fits, which accumulated duri ng the part ies’ marriage, constituted mari tal property availabl e for equitabledistributi on, subject to the limitati ons imposed by the Former Spous es’ Protecti on Act. Town er v. Towner , 858 S.W.2d 888, 891 (Tenn. 1993). Thus, the p aymentsto the W ife in this case are, in effect, a distr ibution to her of a portion of the Husband’s militaryretirement benefits. Id

. Inasmuch as thepaym ents repre sent the d ivisio n of mari tal p rope rty, the payments are not subject to modi fication by t he court. Id . at 892. 45 W e also note t hat, on remand from M an se ll v. M an se ll , 490 U.S. 581 (198 9), the Ca lifornia a ppe llate

court enforced the parti es’ pr opert y settl ement agreement under whi ch the husba nd agreed to t he dist ri buti on of both m ilitary retirem ent b ene fits an d disa bility benef its. See In r e M ar ria ge of M an se ll , 265 Cal . Rptr . 227 (Ca l. Ct. Ap p. 19 89), cert. denie d , 498 U.S. 806 (19 90). 7 We recogniz e that this ty pe of post-decretal action by militaryretirees ha s caused probl ems for courts and l itigants a cross thenation in divorce ca ses where a percent age of military

retirement benefits has been distr ibuted as ma rital proper ty. See, e. g. , Clauson v. Claus on , 831 P.2d 1257 (Al aska 1992); Abernethy v . Abernethy , 6 7 0 So. 2d 1027 (Fla. Dist. Ct. App.), review granted , 680 So. 2d 421 (Fla. 1996); McHugh v. McHu gh , 861 P.2d 113 (Idaho Ct. App. 1993); Torwich v. Torwich , 660 A.2d 1214 (N.J. Super. Ct. App. Div. 1995 ); Price v. Price , 480 S.E.2d 92 (S. C. Ct. App. 199 6). A mili tary ret iree may be entitled to convert a portion of his retirement pay to disability pay, thereby reducing his tax liabi lity. See Mansell , 490 U.S. at 583-84 (citing 38 U.S.C. §§ 3101 (a), 3105 (1982 ed. & Supp . V)). By doin g so, h oweve r, themi litary retiree unilaterally alters the equitable distributi on scheme fash ione d by the tr ial court and , in some cases , by the par ties themselves. See Mansell , 490 U.S. at 595 ( O’Connor, J. , dissenting ); see also Clauson , 831 P.2d at 1261 (con cluding that husband unilaterally and extrajudicially modified divorce decree when he deci ded to waive h is re tirem e nt pension in or der to collec

t disabili ty b enefits); Price , 480 S. E.2d at 94 (hold ing that h usband breache d his obli ga tions unde r property settlement agreement b y waiving port ion of military retirement pay

in order to
rece ive increased di sability pay and thereby unilater ally re ducing w ife’s eq ui table apportionment of benefits acquired during marriage).
Despite the Supreme Cour t’s rulin g in Mansell , where the milita ry reti rement benefits
were distributed pursuant toth e terms of a proper ty settlement

agreement, some state courtshave enforced the agreeme nt against the military retiree, usuallyon the ground that the retiree sho uld not be permit ted to un ilaterall y mo dify the terms of the ag reement. See Clauson , 831 P.2d at 1261; Abernethy , 670 So. 2d at 1029- 31; McHugh , 861 P.2d at 115; Price , 480 S.E. 2d at 94. 5 Courts al so have held, even in the absence of a propert y settlementagreement, that such post-dec retal action by the military retiree may entitle the former spouse to rel ief from the divor ce decree. See Torwich , 660 A.2d at 1216 (holding thathusband’s acti on in ob taining dis ability payments in l ieu of military retirement pay6 Com pare McH ugh v. McHugh , 861 P.2d 113 (Idah o Ct. App. 1993 ), i n which the cou rt grant ed the

rel iefreq ue ste d in thi s case byincr easing the per centage ofthe husba nd’s mil it aryret ir ement benefi ts t o which the wif e was enti tl ed. I n order to ensur e thatthe wi fe cont inued to r eceiv e the same monthly amount, even after the husba nd reduced hi s ret ir ement benefi ts by accepti ng in creased disabili ty payments, the court incr eased the w ife’s pe rce ntag e intere st fro m 18% to 40 .37%

. Id . at 115 . W e co nclu de th at McHugh is dis ting uis ha ble from the pr esent case b ecause, i n McHugh , t he courtspecif ical ly ret ained juri sdict ion f or t he li mited purpose ofmodify ing i ts or der, ifnecessary , t o carry out the i ntentof t he part ies’ sett lement agr eement that the wife re ceive a se t m onth ly am oun t of the hus ban d’s m ilitary retirem ent b ene fits. Id

. 8 constituted “exceptio nal and compel ling” circumstance entitlingwife to rel ief from judgment of divorce) ; see also Clauson , 831 P.2d at 1261 (holdin g that husband’s action in waiv ing his retiremen t pensi on in order to collect disability benefits constitu ted sufficiently extraordinarycircumstance to supp ort relief from judgmen t under catch-all provision of Civil Rule 60(b)(6)).

In T ennessee, however, the l aw is cl ear: unlike alimony, the divisi on of marital property is not subjec

t to subsequent

modification by

the courts. Towner v . Towner , 858 S.W.2d 888, 892 (Tenn. 1993); Jones v. J ones , 784 S.W.2d 349, 351 (Tenn. App. 1989). 6 Mor eover, Tennessee law does not appear to afford relief from judg ment under the circumstances

of this case. See, e. g. , Duncan v. D uncan , 789 S.W .2 d 557, 564 (Tenn. App. 1 990) (denying wife’s motion for relief f rom judgment under “catch-all” provisio n o f T.R.C.P. 60.02(5) w here, based on testimony of husband’s account ants, trial court val ued husband’s business at $400,000 b ut, pending appeal of final divorce decree, husband sold business for $2.5 milli on); but see Clauson v. Clauson , 831 P.2d 1257, 1261 (Alaska 1992) (holding that husband’s ac tion in waiving his retirement pension in or der to collect disabilit

y benefits constituted sufficiently extraordi nary cir cumstance tosupport rel ief from judgment under catch-all provisi on of Civil Rule 60( b)(6 )). Accor dingly , we are constrained to conclude thatthe trial court in this case correc

tly decl ined to modify the pr operty provisions of the final divorce decree r elative to the Wife’s interest in the Husband’s mil itary retirement benefits.

The trial court’s j udgment is hereby affirmed. Costs on appeal are adjudged equally again st th e par ties , fo r which execu tion may is sue i f ne cess ary.9 HIGHERS, J.

CONCUR:

CRAWFORD, P.J., W.S.

FARMER, J.