Court Opinion

ID: 9852720
Source: CourtListenerOpinion
Date Created: 2023-09-24 05:35:24.523204+00
Date Added: 2024-06-11T09:22:32.826923
License: Public Domain

Benton, J.,
concurring.
The trial judge’s letter opinion in this case contains a clear and careful analysis that commendably demonstrates that his decision was reached consistent with the statutory requirements. Accordingly, I concur in the decision upholding the valuation and monetary award issues. I write separately, however, in order to address the significant effect that the changes in Code § 20-107.3 have upon the “one monetary award” rationale underlying Brinkley v. Brinkley, 5 Va. App. 132, 361 S.E.2d 139 (1987); Price v. Price, 4 Va. App. 224, 355 S.E.2d 905 (1987); and Mitchell v. Mitchell, 4 Va. App. 113, 355 S.E.2d 18 (1987); and to address the interplay between Code §§ 20-107.3 (D) and (G) in distributing pension benefits.
The current equitable distribution statute has changed substantially from the statute that was in effect when Brinkley was decided. I believe that if Brinkley has continuing validity it is because Brinkley suggests that the statute is susceptible to parsing and may be better understood if subjected to an analysis of its elements. Obviously, we must use care in relying on cases decided prior to enactment of the current version of the statute. With that disclaimer, I believe it is necessary to reiterate, as we stated in Brinkley, that “[a]ll of the provisions of Code § 20-107.3 must be followed in making an equitable distribution decision.” Brinkley, 5 Va. App. at 136, 361 S.E.2d at 140.
The headnote to the statute that is commonly referred to as “the equitable distribution statute” states that the “court may decree as to property of the parties.” Code § 20-107.3. The first subsection of Code § 20-107.3 still provides that the trial judge must *579make an analysis of the property. It reads in pertinent part:
[T]he court, upon request of either party, shall determine the legal title as between the parties, and the ownership and value of all property, real or personal, tangible or intangible, of the parties and shall consider which of such property is separate property, which is marital property, and which is part separate and part marital property in accordance with subdivision A 3. The court shall determine the value of any such property as of the date of the evidentiary hearing on the evaluation issue. Upon motion of either party made no less than twenty-one days before the evidentiary hearing the court may, for good cause shown, in order to attain the ends of justice, order that a different valuation date be used.
Code § 20-107.3(A). “This determination must go beyond mere guesswork.” Artis v. Artis, 4 Va. App. 132, 136, 354 S.E.2d 812, 814 (1987).
Once these steps have been performed, the trial judge must determine the “rights and interests [of each party] in the marital property.” Code § 20-107.3(B). The requirements of subsections A and B are fundamental to the analyses which the trial judge must engage when making decisions under the statute. Based upon the analyses under subsections A and B and the factors listed in subsection E, the trial judge may make a decree as to the marital property, if necessary, to reach a fair and equitable result.
Subsections C, D, and G of the statute contain discrete mechanisms by which the trial judge may decree as to the marital property so as to reach a fair and equitable result. The 1988 amendments require the trial judge to consider all the subsection E factors in distributing marital property under subsections C, D, G and H. Before 1988, the statute required trial judges to consider subsection E factors only when calculating the appropriate amount and method of payment of a subsection D monetary award. Under the current statute, however, the trial judge must also decide whether to make a decree as to the marital property under subsections C, D, G or H based on all the factors listed in subsection E. As a result of these changes, it is no longer sufficient for trial judges to make distribution decisions simply by asserting that they based their decisions on all of the statutory factors. The current statute requires an explanation of the manner in which the *580decision was derived.
Subsection C authorizes the trial judge “to order the division or transfer, or both, of jointly owned marital property, or any part thereof.” Code § 20-107.3(C). The trial judge is expressly prohibited from ordering a transfer of “separate property or marital property which is not jointly owned.” Code § 20-107.3(C).1
Subsection D authorizes the trial judge “to grant a monetary award, payable either in a lump sum or over a period of time in fixed amounts, to either party.” Code § 20-107.3(D). Obviously, the subsection D monetary award will be a monetary sum that has a calculable certain value. Equally obvious, subsection D allows the trial judge to effect the statutory purpose in those circumstances where a disproportionate amount of the marital property is not jointly owned and where a fair and equitable distribution may not be accomplished through a division or transfer of jointly owned property.
Subsection G authorizes the trial judge to make a deferred distribution of pension type benefits. That distribution may be made by “direct [ing] payment of a percentage of the marital share of any pension, profit-sharing or deferred compensation plan or retirement benefits, . . . which constitutes marital property and whether payable in a lump sum or over a period of time.” Code § 20-107.3(G).2 Subsection G, as does subsection D, contains the phrase “in addition” to denote the augmentation of the power given to the trial judge under subsection C.
The statutory scheme explicitly states that whether the trial judge makes (1) a division or transfer under subsection C, or (2) a monetary award under subsection D, or (3) a deferred distribution under G, the decree must be based upon the factors set forth in subsection E.3 The statutory scheme does not prefer any one of *581the mechanisms described in subsections C, D, and G over the others. The statutory scheme also does not prohibit the trial judge from using all three mechanisms, or a combination of them, in a given case.4 Obviously in reaching a fair and equitable decree as to the property of the parties, the trial judge should consider how each mechanism (transfer under subsection C, monetary award under subsection D, and deferred distribution under subsection G) may effectively be used to accomplish the statutory purpose. For example, in a proper case, the statute would not forbid, and might equitably require, a trial judge (1) to divide one piece of property jointly titled in the parties’ names by ordering transfer of title, (2) to grant a monetary award to one of the parties based upon the rights and interest of the parties in other designated marital properties, and (3) to order a distribution of a percentage of the marital portion of a pension as the benefits are paid. As long as the trial judge does not subject the same part of any given piece of marital property to multiple mechanisms and thus cause a double allotment, the trial judge may use discretion and sound judgment in determining the manner in which to effect the statutory purpose.
In the case we now decide, the husband argues that the trial judge incorrectly interpreted the provisions of subsections D and G of Code § 20-107.3 as they were applied to the pension. He contends that if the trial judge included any portion of his pension benefits in the consideration of marital property from which the trial judge made a determination to give a monetary award, the trial judge may not require payment of the pension-influenced portion of the monetary award until the pension benefits are payable. While the majority rightly rejects this contention, I believe that the interplay between subsections D and G with respect to pensions and similar benefits deserves specific comment in light of *582the amendments to the statute.
In Brinkley, decided before the current version of the statute was enacted, Code § 20-107.3(G) read as follows:
No part of any monetary award based upon the value of pension or retirement benefits, whether vested or nonvested, shall become effective until the party against whom such award is made actually begins to receive such benefits. No such award shall exceed fifty percent of the cash benefits actually received by the party against whom such award is made.
(Emphasis added).
Thus, under the former statute, if the marital property included pension benefits and the monetary award was based in whole or in part upon the value of those benefits, a portion of the monetary award could not become effective until the benefits were paid.
The current subsection G contains a subtle but significant change. It now reads:
In addition to the monetary award made pursuant to subsection D, and upon consideration of the factors set forth in subsection E, the court may direct payment of a percentage of the marital share of any pension, profit sharing or deferred compensation plan or retirement benefits, whether vested nor nonvested, which constitutes marital property and whether payable in a lump sum or over a period of time. However, the court shall only direct that payment be made as such benefits are payable. No such payment shall exceed fifty percent of the marital share of the cash benefits actually received by the party against whom such award is made. “Marital share” means that portion of the total interest, the right to which was earned during the marriage and before the last separation of the parties, if at such time or thereafter at least one of the parties intended that the separation be permanent.
(Emphasis added).
The change is not inconsequential. It allows the trial judge to chose the best method for valuing pensions. The legislature has created a statutory scheme that recognizes alternative methods by which the trial judge may distribute pension benefits. The language of subsection G indicates that the limitation on the trial *583judge’s exercise of discretion is imposed if the trial judge analyzes and distributes the pension under subsection G. In that instance, the trial judge may not direct that pension benefits be paid prior to the time those benefits are payable to the party against whom the judgment is rendered.
In Mitchell, this Court relied upon the language of Code § 20-107.3(G) then in effect (“any monetary award based upon the value of pension or retirement benefits”) and Code § 20-107.3(E) (“the amount of the [monetary] award . . . shall be determined . . . after consideration of . . . [t]he present value of pension”) to hold that the fifty-percent restriction on the division of pensions applied to the monetary award based on the present value of pensions. 4 Va. App. at 121, 355 S.E.2d at 22. The statutory change in subsections G and E invalidated the Mitchell rationale, and Mitchell’s other holding “that the legislature did not intend to give the Court two alternative methods of distributing pension[s].” Id. at 121, 355 S.E.2d at 22. Indeed, the statutory change allows the trial judge the alternative of deferring the pension distribution or immediately offsetting the pension through use of a monetary award, a position followed by most states. See Seifert v. Seifert, 319 N.C. 367, 354 S.E.2d 506 (1987); L. Golden, Equitable Distribution of Property § 6.16 (1983 & Supp. 1991). Each alternative has advantages and practical problems that should be considered by the parties and the trial judge. See In re Marriage of Gallo, 752 P.2d 47, 54-55 (Colo. 1988)(en banc); Martin v. Martin, 296 S.C. 436, 373 S.E.2d 706 (Ct. App. 1988); L. Golden, supra at § 6.16.
Subsection G, as now written, does not prohibit a trial judge from including the marital portion of the pension, or some part of the marital portion, in the consideration of marital property from which a monetary award is fashioned under subsection D. Sufficient non-pension marital property and evidence of the present value of the pension is all that is required. Although the 1988 amendment to the statute deleted the mandatory requirement to consider present value of pension benefits as a factor under subsection E, the trial court is not prohibited by the revised statute from considering present value when making a determination of a monetary award under subsection D. Removing from the statute by amendment the mandatory requirement of considering present value of pensions is not tantamount to prohibiting its use where *584appropriate.
If there is sufficient non-pension marital property and the trial judge has evidence of the present value of the pension, the trial judge may make a monetary award under subsection D, based upon a consideration of the present value of the pension; provided, it is fair and equitable to do so. Such an award would be immediately effective, provided only that payment of the award may not be directed from a pension, retirement, or similar benefits that are not then payable. Indeed, if a monetary award is based upon use of a present value calculation of a pension, the payment may not be deferred until actual receipt of pension benefits. See Zipf v. Zipf, 8 Va. App. 387, 397, 382 S.E.2d 263, 268 (1989). Carried to its broadest application, this reasoning would allow the trial judge to award the entire marital portion of the pension to the spouse in whom the pension is titled and award the other spouse an equivalent portion of non-pension marital property. Such a ruling would have the desirable effect of eliminating the need for further contact between the parties and the court and resolving the equitable distribution of the marital property without delay. As amended, the statute now brings Virginia into line with the position followed in most states that the trial judge may, if it is equitable to do so, award the spouse with the pension the entire pension and grant the other spouse a monetary award or offsetting property equal to the value of the marital share of the pension.
' Including the marital portion of the pension within the calculations of a subsection D monetary award, however, is not always practicable, desirable, or equitable. For instance, it would be inequitable to base a monetary award on the marital portion of the pension “when the value of the pension benefits is so disproportionate in relation to other marital property that an immediate distribution would be inappropriate.” Seifert, 319 N.C. at 371-72, 354 S.E.2d at 509. It is also obvious that the trial judge must know the present value of the pension in order to direct such payment. A further complicating factor is the uncertainty that often results in reaching a determination of present value and in predicting future activity.
If the trial judge determines that a distribution of pension benefits is necessary to achieve an equitable distribution of the marital property and the non-pension marital property is not sizeable, the trial judge may elect to award to the non-employee spouse a per*585centage of the marital share of the pension benefits as they are payable. See Code § 20-107.3(G). If the trial judge analyzes and distributes the pension under subsection G, the trial court may not direct that pension benefits be paid prior to the time they are actually received by the party against whom the judgment is rendered. Such an award may be expressed in terms of an easily understood formula. See Primm v. Primm, 12 Va. App. 1036, 1037, 407 S.E.2d 45, 46 (1991). See also Troyan, Pension Evaluation and Equitable Distribution, 10 Fam. L. Rep. 3001, 3007 (1983); Seifert, 319 N.C. at 372, 354 S.E.2d at 509; King v. King, 332 Pa. Super. 526, 534, 481 A.2d 913, 917 (1984). In making this type of distribution, the present value of the pension is irrelevant. See Zipf 8 Va. App. at 396-98, 382 S.E.2d at 268. See also King, 332 Pa. Super, at 534, 481 A.2d at 916-17.
In the absence of inequity and impracticality, nothing in Code § 20-107.3 prohibits the trial judge from exercising discretion and choosing to apply subsection D, subsection G, or some combination of both subsections when equitably distributing marital property including the marital portion of a pension. Where the value of the marital property is sufficient to permit it, either a monetary award based upon present value or a deferred distribution in the form of a fixed percentage is a permissible method of distributing pension benefits in arriving at an equitable distribution of marital property. See Seifert, 319 N.C. at 371, 354 S.E.2d at 509.
The court must be given flexibility to determine which method of distribution to utilize in a given case. Whether any particular option represents an appropriate exercise of discretion depends upon the individual facts and circumstances of the case. It may even be feasible to combine the [deferred distribution] and present value methods. It should also be remembered that it is not always necessary for pension benefits to be specifically divided; rather, they may simply be added to the other marital assets, out of which the court will make the final award.
Golden, supra at § 6.16 (footnotes omitted).
There are, however, limitations that must be adhered to. Under the current statutory scheme, a trial judge may not subject any single portion of a marital asset to multiple methods of distribution. This limitation does not, however, prohibit the trial judge *586from distributing portions of a single asset under separate subsections. Clearly the legislature did not intend that the trial judge could both (1) make a monetary award under subsection D based upon the equities and the rights and interests of the parties in the entire marital share of the pension, and (2) direct a payment of a percentage of the marital share of that same pension based upon consideration of the entire marital share of the pension. However, in appropriate circumstances and where the evidence justifies it, the trial judge may consider a portion of the marital share of the pension in making a monetary award under subsection D and use the remaining portion of the marital share of the pension in directing payment of a percentage under subsection G. See Boyd v. Boyd, 116 Mich. App. 774, 783 n.6, 323 N.W.2d 553, 557 n.6 (1982). The trial judge used this method in this case. As long as the trial judge does not subject the same property to a duplicate analysis of the subsection E factors, the trial judge may use separately identifiable portions of a given piece of marital property to support a monetary award based on an analysis of the subsection D factors on one portion and a direct payment of a percentage of the other portion of the pension. No overlap may exist between the two separately identifiable portions.
Here, the trial judge first classified and valued all the parties’ marital property. The trial judge considered, the equities, rights and interests of the parties in all the marital property, including both pension and non-pension property. The trial judge then applied the statutory factors under subsection E to determine the amount of the monetary award and the method of payment. The trial judge “conducted the same analysis under [subsection] G as to the pension benefits taking into consideration [his] determination of the monetary award.” In fashioning an award, the trial judge determined that the wife should retain the marital residence and the husband should retain the principle interest in the parties’ largest marital asset, the husband’s pension. To this end, the trial judge ordered a monetary award to the wife of $35,524.96, to be satisfied in large part by the husband’s conveyance to the wife of his interest in the marital residence. This sum is approximately equivalent to thirty percent of the present value of the marital share of the husband’s pension, as proved by the husband. Under Code § 20-107.3(D), the trial judge offset thirty percent of the wife’s interest in the present value of the husband’s pension by awarding her the equivalent worth in non-pension property (i.e. *587the marital home). However, since the trial judge had determined that the wife was entitled to fifty percent of the marital share of the husband’s pension, and only thirty percent of the present value of the marital share of the pension had been offset by the monetary award, the trial judge determined that the remaining twenty percent should be deferred and paid to the wife when the pension benefits are payable. In the letter opinion, the trial judge specifically stated: “In order to offset the impact of my previously considering a portion of the value of [the] pension, the percentage of [the husband’s] pension award to [the wife] under § 20-107.3G is 20 % of [the husband’s] pension with such payment to be made as the benefits are payable.”
Because each pension plan presents a different set of problems, an appellate court should hesitate to dictate any specific techniques for equitably distributing pension benefits. See Pulliam v. Pulliam, 796 P.2d 623 (Okla. 1990). Our scope of review of the trial judge’s choice of equitable distribution methods should be limited to whether the choice made in a particular case constitutes an abuse of discretion. Artis v. Artis, 4 Va. App. 132, 137, 354 S.E.2d 812, 815 (1987). See also Imagnu v. Wodajo, 85 Md. App. 208, 582 A.2d 590 (1990). In this case, the trial judge’s method was novel, but clearly in line with statutory requirements and supported by the facts recounted in the record.
Accordingly, I would affirm the property decree judgment. For the reasons stated in the majority opinion, I would also reverse the spousal support award.

 In recognition of the power explicitly given to the trial judge to distribute pensions, which generally are not jointly owned, the 1991 amendment to the statute added the phrase “Except as provided in subsection G.” Code § 20-107.3.

 Subsection H authorizes the trial judge to make a distribution of “the marital share of any personal injury or worker’s compensation recovery of either party” in the same manner and upon the same limitation as the pension benefits distribution under subsection G. See Code § 20-107.3(H).

 The statute only uses the term “monetary award” to describe the award granted under subsection D. I believe that the statutory scheme is best understood if the term “monetary award” is confined to the award made under subsection D. For purposes of *581clarity I would refer to relief granted under subsection C as a transfer and to relief granted under subsections G or H as a deferred distribution.

 This is juxtaposed against this Court’s interpretation of the former statutory scheme:
[Tjhe statutory scheme of Code § 20-107.3 requires that the equitable division, if any, of the marital property be made by means of a monetary award. Code § 20-107.3(B) requires the trial court to determine the parties’ interests and rights in marital property solely for the purpose of making a discretionary monetary award and specifically states that ‘such interests and rights shall not attach to the legal title of such property.’
Brinkley, 5 Va. App. at 141, 361 S.E.2d at 143.