1 NO. 06 -14 -00062

- CV

IN THE

SIXTH COURT OF APPEALS

AT TEXARKANA, TEXAS

KRYSTA LYNNE GARDNER, IN DEPENDENT EXECUTRIX OF THE ESTATE OF

LARRY RAY TINER

V.

PENNY HEDDIN TINER

APPEAL FROM THE

402 ND DISTRICT COURT OF WOOD COUNTY, TEXAS

APPELL EE ’S BRIEF

Wm. Brandon Baade

522 N. Broadway

Tyler, Texas 75702

brandonbaadelaw@gmail.com

903 -526 -5867

Attorney for Appellant

Penny Heddin Tiner

Oral Argument Requested ACCEPTED

06-14-00062-CV

SIXTH COURT OF APPEALS

TEXARKANA, TEXAS

2/1/2015 6:53:54 PM

DEBBIE AUTREY

CLERK2 IDENTITY OF PARTIES AND COUNSEL

Pursuant to Texas Rule of Appellate Procedure 38(a), the following is a list of all parties to the

trial court’s judgment and the names and addresses of all trial and appellate counsel:

App ellant Appellant’s appellate counsel

Krysta Lynne Gardner Lawrence Beason

416 North Pacific Street

Mineola, Texas 75773

SBOT# 01991000

Appellant’s trial counsel

Lawrence Beason

416 North Pacific Street

Mineola, Texas 75773

SBOT# 01991000

Appellee Appellee’s appellate counsel

Penny Heddin Tiner Wm. Brandon Baade

SBOT# 00793189

522 N. Broadway

Tyler, Texas 75702

903

- 526

- 5867

888

- 965

- 9551 (fax)

Appellee’s trial counsel

Wm. Brandon Baade

SBOT# 00793189

522 N. Broadway

Tyler, Texas 75702

903

- 526

- 5867

888

- 965

- 9551 (fax)3 TABLE OF CONTENTS

Identity of Parties and Counsel

................................ ................................ ................................ ........ 2

Table of Contents

................................ ................................ ................................ ............................. 3

Index of Authorities

................................ ................................ ................................ ......................... 4

Statement of the Case

................................ ................................ ................................ ....................... 6

Statement on Oral Argument

................................ ................................ ................................ ........... 6

Issues Presented

................................ ................................ ................................ ............................... 6

Statement of Facts

................................ ................................ ................................ ............................ 6

Summary of the Argument

................................ ................................ ................................ ............... 7

Argument

................................ ................................ ................................ ................................ ......... 8

Issue One: The trial court did not abuse its discretion in denying the

declaratory judgment request of Appellant to order the Texas Employee Retirement System to

change to the beneficiary of Larry Ray Tiner’s optional service retirement annuity from Penny

Heddin Tiner to Debbie Tiner.

Prayer

................................ ................................ ................................ ................................ ............. 13

Certificate of Ser vice

................................ ................................ ................................ ..................... 13

Certificate of Compliance

................................ ................................ ................................ .............. 144 INDEX OF AUTHORITIES

CASES

Bushell v. Dean, 803 S.W.2d 711, 712 (Tex. 1991) (op. on reh’g)....................................9

RULES/STATUTES:

Tex. R. App. P. 331 (a).......................................................................................8

Tex. Fam. Code Ann. § 9.302 (West Supp. 2013)

....................................................... 10

Tex. Gov. Code §802.001

................................ ................................ ................................ .............. 11

26 U.S. Code §414(d)

................................ ................................ ................................ .............. 11, 125 NO. 06

- 14

- 00062

- CV

IN THE

SIXTH COURT OF APPEALS

AT TEXARKANA, TEXAS

KRYSTA LYNNE GARDNER, IN DEPENDENT EXECUTRIX OF THE ESTATE OF

LARRY RAY TINER

V.

PENNY HEDDIN TINER

APPEAL FROM THE

402 ND DISTRICT COURT OF WOOD COUNTY, TEXAS

APPEL LEE ’S BRIEF

Wm. Brandon Baade

522 N. Broadway

Tyler, Texas 75702

brandonbaadelaw@gmail.com

903

- 526

- 5867

Attorney for Appellant

Penny Heddin Tiner6 STATEMENT OF THE CASE

Nature of case: This is an appeal from an order denying a declaratory judgment to change

the beneficiary under a n Employee Retirement System of Texas employee

optional employee service annuity.

Judge/Court: Judge Timothy Boswell , 402 nd D istrict Court of Wood County. (C.R. pg.

1 ).

Trial disposition: The trial court denied the declaratory judgment of Appellant

. (C.R. pg.

50

- 51 ).

STATEMENT ON ORAL ARGUMENT

Appellant is requesting oral argument because it might assist the Court in considering the

factual and legal analysis of this case

.

ISSUES PRESENTED

ISSUE ONE: The trial court did not abuse its discretion in den ying the declaratory judgment

request of Appellant to order the Texas Employee Retirement System to change to the

beneficiary of Larry Ray Tiner’s optional service retirement annuity from Penny Heddin Tiner to

Debbie Tin er.

STATEMENT OF FACTS

Penny Heddin Tiner was married to Larry Ray Tiner until September 6, 2006

. (CR,

pp.23

- 29). During the marriage Larry Ray Tiner was employed by the Texas Department of

Transportation and a participant in the Employee Retirement System of Texas (hereinafter ERS)

.

Under the ERS Larry Ray Tiner had various employement benefits. Among those employment

benefits was an optional service retirement annuity. In April of 2000, d uring his mar riage to

Penny Heddin Tiner

, Larry Ray Tiner, consistent with ERS requirements, designated Penny7

Heddin Tiner has his beneficiary under the optional service retirement annuity. Subsequent to

this designation the marriage ended, and i n the Final Decree of Divorce Larry Ray Tiner was

awarded “any and all retirement funds in his name alone.” (CR, p.28).

Larry Ray Tiner then married Debbie Hughes Tiner on May 9, 2012 . Larry Ray Tiner

changed the beneficiary of all of his ERS benefits except the beneficiary designation for the

optional service retirement annuity. Indeed, four years elapsed from the date of divorce from

Penny Heddin Tiner to the death of Larry Ray Tiner and he at no ti me took action of any kind to

request a change or to change the beneficiary of the optional service retirement annuity.

The optional service retirement annuity offered by the ERS is a part of a public

retirement system and is excepted from the provisions of Section 9.302 of the Texas Family

Code. Therefore, Larry Ray Tiner’s designation of Penny Heddin Tiner was effective at his

death.

SUMMARY OF THE ARGUMENT

ISSUE ONE: The trial court did not abuse its discretion in den ying the declaratory judgment

request of Appellant to order the Texas Employee Retirement System to change to the

beneficiary of Larry Ray Tiner’s optional service retirement annuity from Penny Heddin Tiner to

Debbie Tiner.

The Employee’s Retirement System of Texas is a “public retirement system” under

Government Code Section 802.001 and that the designation by Larry Ray Tiner of Penny Heddin

Tiner as the beneficiary of his optional service retirement annuity was effective, notwithstanding

that the designat ion was made prior to their divorce.8 ARGUMENT

ISSUE ONE: The trial court did not abuse its discretion in den ying the declaratory judgment

request of Appellant to order the Texas Employee Retirement System to change to the

beneficiary of Larry Ray Tiner’s optional service retirement annuity from Penny Heddin Tiner to

Debbie Tiner.

Appellant states in the Summary of Argument section of her brief that the “[C]ourt has

before it a single issue to be resolved.” (Appellant Brief, p. 8) Appellant then frames that single

issue as Penny Heddin Tiner, Appellee, being “unjustly enriched by receiving retirement benefits

from ERS 1 that she had waived or relinquished.” (Id.) However, if you review the issue

presented in the context of the Appellant’s Or iginal Petition for Declaratory Judgment there is no

claim of unjust enrichment before the Court. (CR., pp. 19

- 22). The Appellant’s Original

Petition for Declaratory Judgment only requested, in relevant part to this appeal, the court

declare that “1. ...P enny Heddin has relinquished any and all rights to Larry Tiner’s optional

service retirement annuity. 2. A declaration that Debbie Hughes Tiner, as surviving spouse and

beneficiary under Larry Tiner’s Will, is entitled to Larry’s benefits as beneficiary un der his

optional service annuity with ERS; 3. A declaration that ERS is ordered and directed to change

the beneficiary under his optional service retirement annuity with ERS.” (CR., p. 21).

The record is devoid of any reference to an unjust enrichment claim and the claim was

not tried by consent. Appellee objects to this issue being raised on appeal and contends the issue

has framed in the Summary of Argument is not properly before the Court

..

Undisputed Facts

To preserve a complaint for appellate review, a party must have presented to the trial

court a timely request, objection, or motion that states the specific grounds for the desired ruling,

if they are not apparent from the context of the request, objection or motion. Tex. R. App. P. 331

1 “ ERS” used throughout this brief refers to the Employment Retirement System of Texas.9

(a). If a party fails to do this, error is not preserved, and the complaint is waived. Bushell v.

Dean, 803 S.W.2d 711, 712 (Tex. 1991) (op. on reh’g). Appellee contends that Appellant

waived any request for unjust enrichment. Interestingly, Appel lant did not bring a motion for

enforcement or clarification of a divorce decree regarding any issue. Appellant chose to bring a

Declaratory Judgment action to ask the Court to declare the matters set forth above

.

There are several undisputed facts in this case that lay the factual foundation that frames

the issue. First, it is undisputed that Larry Ray Tiner participated in several retirement benefits

programs through his employment with the Texas Department of Transportation and

administered by the Employment Retirement System of Texas (ERS). Among these was an

employee life insurance policy, a 401(K) and an optional service retirement annuity. (CR.,

p.31,ll . 5

- 25). It is undisputed that in Apirl of 2000, Penny Heddin Tiner was designated as the

beneficiary of the optional service retirement annuity. (CR. Exh. 13).

Penny Heddin Tiner were married and that they were divorced on September 6, 2006.

(CR., p. 23

- 29). It is undisputed that in the decree awarded Larry Ray Tiner “any and all

retirement funds in his name alone.” (CR., p. 24). It is undisputed that at the time of the divorce

that Larry Ray Tiner was retired from the Texas Department of Transporta tion in 2002

. (RR.,p.

25.ll. 20

- 25). Therefore, Larry Ray Tiner and Penny Heddin Tiner were married for

approximately four years beyond Larry Ray Tiner’s retirement and the vesting of all of his

retirement benefits.

It is further undisputed that Larry Ray Tiner died testate on May 9, 2013 . (RR. Exh. 14).

Mr. Tiner’s will is admitted into evidence and part of the Clerk’s Record, pages 30

- 33. Penny

Heddin Tiner was not designated as the beneficiary of the life insurance or the 401(k) of Larry

Ray Tiner up on his death. (RR. Pp. 31, ll.1

- 25). Importantly, the evidence is clear that Penny10

Heddin Tiner remained designated as the beneficiary under Larry Ray Tiner’s optional

employment service annuity from the time she was designated until the death of Larry R ay Tiner.

Indeed , in the four years between the divorce of Larry Ray Tiner from Penny Heddin Tiner, there

was never a request by Larry Ray Tiner of Penny Heddin Tiner or of the Court to order a change

of the beneficiary of the optional employment service annuity ; no such evidence exist. (RR p.

24, ll.10

- 24). Additionally, the evidence shows that ERS was provided a copy of the death

certificate and has continued to pay to Penny Heddin Tiner, as the beneficiary of the optional

employment service annuity, consistent with the designation of Larry Ray Tiner. (RR. p. 26

- 27,

ll. 7

- 16; 17

- 21).

The Relevant Law and It’s Application to the Facts

Section 9.302 sets forth the applicable law regarding the pre

- decree designation of ex

spouse as beneficiary in retirement benefits & other financial plans. Section 9.302(a) sets forth

the rule, inter alia, that if there is a “decree of divorce...rendered after a spouse, acting in the

capacity of an annuitant..., has designated the other spouse as a beneficiary...the des ignating

provision in the plan in favor of the former spouse is not effective unless:.” The section then

gives three provisions that would permit the designation of the former spouse to remain

effective. Appellee concedes that she does not fall into any of the provisions of §9.302(a)(1),(2)

or(3).

However, §9.302(e) provides that “[T]his section does not apply to the disposition of a beneficial

interest in a retirement benefit or other financial plan of a public retirement system as defined by

Section 802.001,, Government Code.” Therefore

, the relevant question is ; is the beneficial

interest that Penny Heddin Tiner received “in a retirement benefit or other financial plan of a11

public retirement system as defined by S ection 802.001, Government Code? ” If it fall s under

this exception then the designation by Larry Ray Tiner of Penny Heddin Tiner is effective.

Section 802.001(3) defines a “public retirement system” as a “continuing, organized

program of service retirement, disability retirement, or death benefits for officers or employees

of the state or a political subdivision, or of an agency or instrumentality of the state or a political

subdivision...” It follows in §802.001(3)(A),(B),(C),(D),(E),(F), and (G) with provision that are

exceptions to the de finition of a “public retirement system” previously set forth. The

Employment Retirement System of Texas does not fall within any provision that would make it

an exception to a “public retirement system” as defined in §802.001. Indeed, there is in eviden ce

in this case a determination letter from the Internal Revenue Service that makes a “favorable

determination on the plan identified,” which is the “Employees Retirement System of Texas.”

(CR. Exh. 13). The “determination letter is based solely on your ( the State of

Texas)(parenthetical added) assertion that the plan is entitled to be treated as a Government plan

under section 414(d) of the Internal Revenue Code.” (Id.).

Therefore, the State of Texas has asked for and received a determination that the

Emp loyees Retirement System of Texas is a governmental plan under section 414(d) of the

Internal Revenue Code. This would include the optional service retirement annuity under which

Larry Ray Tiner designated Penny Heddin Tiner has beneficiary. Looking furt her, Section

414(d) of the Internal Revenue Code states the following:

“ (d) Governmental plan

For purposes of this part, the term “governmental plan” means a plan established and

maintained for its employees by the Government of the United States, by the government

of any State or political subdivision thereof, or by any agency or instrumentality of any of

the foregoing. The term “governmental plan” also includes any plan to which the

Railroad Retirement Act of 1935 or 1937 applies and which is financed by contributions

required under that Act and any plan of an international organization which is exempt

from taxation by reason of the International Organizations Immunities Act ( 59 Stat. 669 ).12

The term “governmental plan” includes a plan which is established and maintained by an

Indian tribal government (as defined in section 7701 (a)(40) ), a subdivision of an Indian

tribal government (determined in accordance with section 7871 (d) ), or an agency or

ins trumentality of either, and all of the participants of which are employees of such entity

substantially all of whose services as such an employee are in the performance of

essential governmental functions but not in the performance of commercial activities

(whether or not an essential government function). ”

Clearly, the Texas Employment Retirement System of Texas is a “public retirement

system” as contemplated by §9.302(e) of the Texas Family Code. Therefore, the designation of

Penny Heddin Tiner as the beneficiary of Larry Ray Tiner’s optional service retirement annuity

is effective. Not only is the pre

- decree designation effective under Texas law, but factually

Larry Tiner never took any action to change the beneficiary under law or the terms o f his

participation in the plan. This is in contradistinction to his actions regarding his life insurance

and 401(k) proceeds. It is axiomatic that these benefits pass outside his estate under Texas law.

Insightful of Larry Ray Tiner’s intentions, beyond his own self evident decisions during

his life, was that in his Last Will and Testament he left his homestead, subject to a life estate to

his current wife, to the grand

- daughter of Penny Heddin Tiner , the appellee . (RR. p. 28

- 29, ll. 6

-

9;10

- 22). It see m s unlikely, that Larry Ray Tiner had any other intention that to leave Penny

Heddin Tiner as his beneficiary under the optional service retirement annuity. Nevertheless, the

facts and the application of the law is clear that the Employees Retirement Syst em of Texas is a

“public retirement system” as defined by Section 801.001 of the Gov ernment Code and the

divorce did not trigger an end to the designation that Larry Ray Tiner freely made and was f ree

to rely on under Texas law as still having force and ef fect.13 Prayer

WHEREFORE, premises considered, Appell ee

, Penny Heddin Tiner , respectfully

requests that the judgment of the trial court be affirmed and judgment rendered, or for such other

and f urther relief to which Appellee may establish h er self entitled.

Respectfully submitted,

Wm. Brandon Baade

By:

Wm. Brandon Baade

Texas Bar Number 00793189

522 N. Broadway

Tyler , Te xas 75702

brandonbaadelaw@gmail.com

903

- 526

- 5867

888

- 965

- 9551

Attorney for Appell ee

Penny Heddin Tiner

CERTIFICATE OF SERVICE

Thi s is to certify that on February 1, 2015 ,, a true and correct copy of the above and foregoing

Appellee ’s Brief has been forwarded by U.S. mail to all counsel of record listed below:

Attorney for Appellant

Lawrence Beason

416 North Pacific Street

Mineola, Texas 75773

Wm. Brandon Baade14 CERTIFICATE OF COMPLIANCE

Pursuant to Texas Rule of Appellate Procedure 9.4, the undersigned counsel certifies that,

exclusive of the exempted portions in Texas Rule of Appellate Procedure 9.4(i)(1), this brief

contains 3, 958 words (less than 15,000), based upon the word count of the Word program u sed

to prepare the document.

Wm. Brandon Baade