Source: https://supreme.justia.com/cases/federal/us/453/210/
Timestamp: 2019-12-12 13:38:01
Document Index: 18511636

Matched Legal Cases: ['§ 5118', '§ 1434', '§ 1447', '§ 1434', '§ 1402', '§ 813', '§ 511']

McCarty v. McCarty :: 453 U.S. 210 (1981) :: Justia US Supreme Court Center
Justia › US Law › US Case Law › US Supreme Court › Volume 453 › McCarty v. McCarty
been rejected in In re Fithian, 10 Cal. 3d 592, 517 P.2d 449, cert. denied, 419 U.S. 825 (1974). [Footnote 10] Furthermore, the court concluded that the result in Fithian had not been called into question by this Court's subsequent decision in Hisquierdo v. Hisquierdo, supra, where it was held that benefits payable under the federal Railroad Retirement Act of 1974 could not be divided under state community property law. See also Gorman v. Gorman, 90 Cal. App. 3d 454, 153 Cal. Rptr. 479 (1979). [Footnote 11]
Appellant argues that California's application of community property concepts to military retired pay conflicts with federal law in two distinct ways. He contends, first, that the California court's conclusion that retired pay is "awarded in return for services previously rendered," see Fithian, 10 Cal. 3d at 604, 517 P.2d at 457, ignores clear federal law to the contrary. The community property division of military retired pay rests on the premise that that pay, like a typical pension, represents deferred compensation for services performed during the marriage. Id. at 596, 517 P.2d at 451. But, appellant asserts, military retired pay, in fact, is current compensation for reduced, but currently rendered, services; accordingly, even under California law, that pay may not be treated as community property to the extent that it is earned after the dissolution of the marital community, since the earnings of a spouse while living "separate and apart" are separate property. Cal.Civ.Code Ann. §§ 5118, 5119 (West 1970 and Supp.1981).
quoting Fithian, 10 Cal. 3d at 600, 517 P.2d at 454. But this argument fails to recognize that Congress deliberately has chosen to favor the widower or widow over the ex-spouse. An ex-spouse is not an eligible beneficiary of an annuity under either plan. 10 U.S.C. § 1434(a) (RSFPP); §§ 1447(3) and 1450(a) (SBP). In addition, under the RSFPP, deductions from retired pay for a spouse's annuity automatically cease upon divorce, § 1434(c), so as "[t]o safeguard the participants' future retired pay when . . . divorce occurs. . . ." S.Rep. No. 1480, 90th Cong., 2d Sess., 13 (1968). While the SBP does not expressly provide that annuity deductions cease upon divorce, the legislative history indicates that Congress' policy remained unchanged. The SBP, which was referred to as the "widow's equity bill," 118 Cong.Rec. 29811 (1972) (statement of Sen. Beall), was enacted because of Congress' concern over the number of widows left without support through low participation in the RSFPP, not out of concern for ex-spouses. See H.R.Rep. No. 9281, pp. 4-5 (1971); S.Rep. No. 92-1089, p. 11 (1972).
a provision in the House bill, H.R. 10670, that would have allowed attachment of up to 50% of military retired pay to comply with a court order in favor of a spouse, former spouse, or child. See H.R.Rep. No. 92-481 at 1; S.Rep. No. 91089 at 25. The House Report accompanying H.R. 10670 noted that, under Buchanan v. Alexander, 4 How. 20 (1845), and Applegate v. Applegate, 39 F. Supp. 887 (ED Va.1941), military pay could not be attached so long as it was in the Government's hands; [Footnote 23] thus, this clause of H.R. 10670 represented a "drastic departure" from current law, but one that the House Committee on Armed Services believed to be necessitated by the difficulty of enforcing support orders. H.R.Rep. No. 92-481 at 17-18. Although this provision passed the House, it was not included in the Senate version of the bill. See S.Rep. No. 92-1089 at 25. Thereafter, the House acceded to the Senate's view that the attachment provision would unfairly
At the time the interlocutory judgment of dissolution was entered, appellant had not begun to receive retired pay, since he had not yet completed 20 years of active service. Under California law, however, "pension rights" may be divided as community property even if they have not "vested." See In Re Brown, 15 Cal. 3d 838, 544 P.2d 561 (1976). A California trial court may divide the present value of such rights, which value must take into account the possibility that death or termination of employment may destroy them before they vest. Id. at 848, 544 P.2d at 567. Alternatively, the court may maintain continuing jurisdiction, and award each spouse an appropriate portion of each pension payment as it is made. Ibid. The trial court here apparently elected the latter alternative.
10 Cal. 3d at 604, 517 P.2d at 457.
In Gorman, the California Court of Appeal held that Hisquierdo was based on the unique history and language of the Railroad Retirement Act of 1974; the court therefore considered itself bound to follow Fithian "pending further consideration of the issue by the California Supreme Court." 90 Cal. App. 3d at 462, 153 Cal. Rptr. at 483. The California Supreme Court has since reaffirmed Fithian in In re Milhan, 27 Cal. 3d 765, 613 P.2d 812 (1980), cert. pending sub nom. Milhan v. Milhan, No. 80-578.
Relying upon Tyler, the Ninth Circuit recently rejected the argument that Congress' alteration of the method by which retired pay is calculated deprived retired military personnel of property without due process of law. Costello v. United States, 587 F.2d 424, 426 (1978), cert. denied, 442 U.S. 929 (1979). The court held that, since "retirement pay does not differ from active duty pay in its character as pay for continuing military service," 587 F.2d at 427, its method of calculation could be prospectively altered under the precedent of United States v. Larionoff, 431 U. S. 864, 431 U. S. 879 (1977). See also Abbott v. United States, 200 Ct.Cl. 384, cert. denied, 414 U.S. 1024 (1973); Lemly v. United States, 109 Ct.Cl. 760, 763, 75 F. Supp. 248, 249 (1948); Watson v. Watson, 424 F. Supp. 866 (EDNC 1976).
A number of state courts have held that military retired pay is deferred compensation, not current compensation for reduced services. See, e.g., In re Fithian, 10 Cal. 3d at 604, 517 P.2d at 456; In re Miller, ___ Mont. ___, 609 P.2d 1185 (1980), cert. pending sub nom. Miller v. Miller, No. 80-291; Kruger v. Kruger, 73 N.J. 464, 375 A.2d 659 (1977). It is true that retired pay bears some of the features of deferred compensation. See W. Glasson, Federal Military Pensions in the United States 99 (1918). The amount of retired pay a service member receives is calculated not on the basis of the continuing duties he actually performs, but on the basis of years served on active duty and the rank obtained prior to retirement. See n 7, supra. Furthermore, should the service member actually be recalled to duty, he receives additional compensation according to the active duty pay scale, and his rate of retired pay is also increased thereafter. 10 U.S.C. § 1402, as amended by Pub.L. 96-342, § 813 (b)(2), 94 Stat. 1102, and by Pub.L. 96-513, § 511 (50), 94 Stat. 2924.
In Fithian, 10 Cal. 3d at 600, 517 P.2d at 454, the California Supreme Court observed and acknowledged:
439 U.S. at 439 U. S. 584-585. Now we are told that preemption of community property law is suggested in this case because there is no community property concept at all in the statutory scheme. Under Hisquierdo, this absence would have been thought to suggest that there was no preemption, since the argument could not be made, as it was in Hisquierdo, that Congress had addressed the question and drawn the line. See In re Milhan, 27 Cal. 3d 765, 775-776, 613 P.2d 812, 817 (1980), cert. pending sub nom. Milhan. v. Milhan, No. 80-578. I am not certain whether the analysis was wrong in Hisquierdo or in this case, but it is clear that both cannot be correct . One is led to inquire where this moving target will next appear.