Benefits tangled up in divorce court drama

A recent ruling by the U.S. Court of Appeals makes it clear that getting divorced raises sticky questions about retirement benefits.

The case involved Warren Snyder, a retired air commander with the Air Force Reserves at March Air Force Base, Calif. In 1989, he married Susan Rice in Florida and, according to Snyder, the two separated shortly thereafter. He moved to California, and his wife went to Texas.

In January 1994, Snyder left civil service. Although still married at the time, Snyder declined a survivor benefit for his wife and wrote on his retirement application that he wanted an annuity payable only during his lifetime. For this type of annuity, the application required his wife's consent. Snyder submitted a Spouse's Consent to Survivor Election form, but it didn't have his wife's signature. Instead, Snyder wrote in the block for his wife's signature, "Not available— unable to locate."

In April 1994, the Office of Personnel Management denied Snyder's request for a reduced annuity because he failed to provide a signed waiver from his spouse.

About a month later, Snyder's wife obtained a divorce in Texas. The divorce decree awarded Susan a pro rata share of Rice-Snyder's retirement annuity and the maximum possible survivor annuity.

The week after the divorce decree, Snyder submitted a second request to OPM for his self-only retirement annuity, claiming that he could not locate his wife to obtain her waiver. OPM responded by informing Snyder that his wife's whereabouts were known and reasserted that her consent was required to grant his request.

Three days later, Snyder was granted a judgment of dissolution by a California court, giving him a full interest in his military and Civil Service Retirement System benefits, including survivor benefits. OPM rescinded its initial decision to consider the case in light of the new California divorce decree.

Meanwhile, Rice-Snyder sent a letter to OPM in July 1994 informing agency personnel that she refused to consent to Snyder's request for the self-only annuity. She also asked the California Superior Court to set aside the California divorce decree based on the prior Texas decree. Her motion was granted in December 1994. But the California court also ruled that "any monies that are owed on the Texas judgment are not enforceable in California."

OPM determined that it would enforce the Texas divorce decree anyway and granted Rice-Snyder a survivor annuity along with a pro rata share of Snyder's monthly annuity, prompting Snyder to appeal to the Merit Systems Protection Board (MSPB).

The board concluded that the Texas decree had not been amended, superseded or set aside by the California order. Snyder then took his case to court.

The court ruled that if an employee is married at the time of his retirement, the employee's annuity must be reduced to provide a survivor annuity for the spouse (U.S. Court of Appeals for the Federal Circuit, 97-3307; Oct. 29, 1998). It said an unreduced annuity cannot be allowed unless the spouse consents. In this case, there was no dispute that Snyder was married at the time of his retirement and that his wife's whereabouts were known when Snyder applied for benefits. The MSPB decided that OPM's decision refusing Snyder's request was correct. If a court order had rescinded Rice-Snyder's right to part of Snyder's annuity, OPM would have been required to comply.

Snyder did not have such a court order, so OPM was required to honor the Texas order and award his former wife a piece of his annuity.

The moral of this story is (1) select your mate carefully, and (2) if you file for divorce, file in your home state and make sure you ask the court to rule on who is entitled to a federal retirement annuity.

-- Bureaucratus is a retired federal employee who contributes regularly to Federal Computer Week.

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