Opinion ID: 1486920
Heading Depth: 3
Heading Rank: 1

Heading: Disability payment:

Text: The only provision within the Divorce Code concerning disability payments is Section 3501(a)(6), which provides that federally created veterans' disability payments are not marital property. Section 3501(a)(6) defines these benefits to include: Veterans' benefits exempt from attachment, levy or seizure pursuant to the act of September 2, 1958 (Public Law 85-857, 72 Stat. 1229), as amended, except for those benefits received by a veteran where the veteran has waived a portion of his military retirement pay in order to receive veterans' compensation. This statutory language conforms the Divorce Code with federal statutes and United States Supreme Court decisions, which taken together, hold that federal law governs these federal benefits and the states cannot treat them as marital property at divorce. In McCarty v. McCarty, 453 U.S. 210, 101 S.Ct. 2728, 69 L.Ed.2d 589 (1981), a divided Supreme Court found that the federal statute, which created these service connected disability payments, controlled and that military benefits were not assignable. Accordingly, McCarty held that a military pension plan was not property subject to division at divorce. In 1982, in response to the McCarty decision, Congress enacted the Uniformed Services Former Spouse Protection Act (Spouse Protection Act) and provided that certain military retirement pay, disposable retired or retainer pay, could be community property. 10 U.S.C § 1408 (1982). After that, in Mansell v. Mansell, 490 U.S. 581, 109 S.Ct. 2023, 104 L.Ed.2d 675 (1989), the Supreme Court held that the Spouse Protection Act allowed states to treat military retirement pay as marital property, but not veterans' disability payments of any kind. In reaching this conclusion, the Mansell court found that although the Spouse Protection Act permitted a state to treat retirement pay as marital property, it did not make such a proviso for disability payments. Applying the rationale in McCarty, these disability payments were not assignable, were not covered by the Spouse Protection Act, and could not be marital property. For the reasons we set forth in this Opinion, we reject Husband's argument that a disability payment is per se excluded from the definition of marital property. [8] While our statute specifically excludes veterans' disability benefits from marital property, it makes no such exclusion for any other type of disability payment. A disability payment that is not a federally created veterans' benefit does not fit within any of the exceptions set forth in Section 3501(a)(1) through (a)(8) and can be property of the marriage. The Superior Court appropriately rejected Appellant's arguments in this regard.