Opinion ID: 1873943
Heading Depth: 1
Heading Rank: 3

Heading: Valuating and Dividing The Pension Right

Text: The general rules provided by law for partitioning community property are, of course, applicable to dividing a community pension right. Each spouse owns a present undivided one-half interest in the community property. La.Civ.Code art. 2336. When the spouses are unable to agree upon an equal partition of community property, either spouse may bring an action to effect such a partition. La.Civ.Code arts. 807, 1289 and 1308; La.R.S. 9:2801. See also 1 M. Planiol, Traite Elementaire De Droit Civil, Nos. 2497 et seq. (11th ed. La.St. L.Inst. trans. 1959). In allocating the community assets and liabilities, the court may divide a particular asset or liability equally or unequally or may allocate it in its entirety to one of the spouses. The court must consider the nature and source of the asset or liability, the economic condition of each spouse, and any other circumstances that the court deems relevant. La.R.S. 9:2801(4)(c). The court is required to divide the community assets and liabilities so that each spouse receives property of an equal net value. La.R.S. 9:2801(4)(b). In order to avoid an unequal net distribution of assets and liabilities, the court may order the payment of an equalizing sum of money, either cash or deferred, secured or unsecured, upon specified terms and conditions; and the court may order the execution of notes, mortgages, or other documents as it deems necessary, or may impose a mortgage or lien on either community or separate property as security. La.R.S. 9:2801(4)(c). In determining the value of each community asset, including the community interest in the pension right, the court must valuate the asset as of the date of the partition trial on the merits. La.R.S. 9:2801(4)(a); Spaht & Hargrave, supra, at 346. The former spouses continue to be coowners of the community property even after the termination of the community and until it has been finally partitioned. See La.Civ.Code arts. 2369, 2369.1; La.Civ.Code art. 2369 comment (c); Spaht & Hargrave, supra, § 7.19. Consequently, when the court partitions a community property interest in a pension right by granting a former spouse cash or other property in lieu of an actual percentage of the pension payments, the court is required to valuate the community's interest in the pension right and the spouse's portion thereof as of the time of the partition trial on the merits. The general rules for the partition of community property, however, do not address all of the problematic ramifications of classifying, valuating and distributing each spouse's interest in pension benefits which have been earned by one spouse partly during the marriage and partly before or after. In such cases, the pension benefits are composed of the separate property interest of the employee spouse in addition to the community interest. Furthermore, there is no custom from which rules can be derived for each particular situation. Accordingly, in the present case and others a court is bound to proceed and decide equitably to some extent, making resort to justice, reason and prevailing usages. La.Civ.Code art. 4.