Friday, August 3, 2012

Military Retirement Divided Identically to Corporate Retirement

Johnson v. Johnson, 2012 UT App 22, January 26, 2012

Johnson and Zoric were married for ten years.  At the time of the divorce (1984), Johnson was and E-5 in the Air Force.  In 1999, Johnson retired and began receiving his pension and Zoric filed a QDRO to divide the pension.  The Trial court awarded Zoric her portion based on Johnson’s E-7 level, which was his pay level at the time of retirement.  The trial court also ordered that Zoric’s portion be awarded prior to all other deductions giving her an even greater amount of the pension. Johnson appealed.  Johnson also argued that Zoric’s QDRO was filed too long after the decree and violated the statute of limitations.

The Court of Appeals in a divided (2-1) decision affirmed the trial court’s award at the E-7 pay grade.  The Court of Appeals found that such an award a direct application of the Woodward formula. See page 433 of Woodward. Trial court divided the number of years in service during the marriage (10) divided by the total number of years to accrue the benefit (24) and awarded Zoric 20.8% of the retirement.

The Court of Appeals reversed and remanded with instructions to recalculate Zoric’s potion after the deduction of taxes.  The trial court was instructed that it must only divide disposable retirement.

As to the issue of the statute of limitations (SOL), the Court of Appeals affirmed finding that the SOL does not begin to run until be the payment is due.  Because QDRO was filed within SOL it was enforceable.

Davis Dissent: Would divide pension and award only a portion of E-5 to Zoric.  Also believes that the appellate court should review the matter under a matter of law standard and not abuse of discretion standard.


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