Retirement Flashcards
When does the non-participating spouse’s interest in the other’s pension become his or her separate vested interest?
Immediately, to be disposed of as he or she wishes. Koelsch v. Koelsch.
What is ARS 25-231 say?
Property acquired during the marriage is community property, while property owned or acquired before the marriage is separate property.
When does a property interest acquire its character as community or separate?
Property acquires its character as community or separate depending on the marriage status of its owner at the time of acquisition. TIme of acquisition refers to the time at which the right to obtain title occurs, not when title is actually conveyed.
What happens to the character of the property when community funds are used to maintain/enhance separate property?
It does not acquire an interest to the title, but merely has a claim for reimbursement on account of the community funds invested.
What is Kelly v. Kelly regarding pensions and SSI?
Kelly v. Kelly says that where the participating spouse does not also contribute to SSI, but the non-participating spouse does, the participating spouse is entitled to an offset in his or her favor to take into consideration that s/he was precluded from benefiting from the division of the SSI benefits, which is precluded by law.
What is Onerous title?
It is title acquired by labor or industry of the spouse.
What is lucrative title?
It is title acquired in any way other than by labor or industry of the spouse, such as luck, future interest, compensation for personal injury, well being, etc.
What is the Van Loan calculation?
Total years of marriage divided by total years of service times 50%
What are pension benefits?
They are generally a form of deferred compensation and thus are considered to be acquired by onerous title.
What does Jurek v. Jurek and Hefner say about personal injury awards
the reimbursement portions are CP however, compensatory is lucrative title (violation of that person’s right to personal security) and punitive has not yet been decided, so apply both lucrative and onerous and come up lucrative. . .
How is title to a disability payment characterized? What about a personal accident plan/insurance?
It is characterized as lucrative title. While earned during marriage CP but upon date of service, becomes sole and separate. Same for a personal accident plan/insurance. Even though community money is used to pay for it, it is only triggered by AD&D.
Who bears the burden of overcoming a presumption of asset characterization?
The spouse seeking to overcome it by clear and convincing evidence.
What occurs when the parties use community money to buy prior years of service in a pension plan to increase the benefit received upon retirement, but those prior years occurred prior to the marriage?
This was the question in Stock v Stock. During the marriage the parties increased H’s federal retirement benefits by purchasing credit for time H served in the military before the marriage. The COA held that where community funds are used to acquire a separate property right in a pension is reimbursable to the community, plus interest since the time of acquisition, but there is no acquisition of an interest in the separate property itself, and therefore only the portion of the pension that was acquired during the marriage is subject to division.
What happens when a participant in a pension plan becomes eligible under a disability provision? Does that benefit become lucrative title and thus sole and separate?
Not if the payment is based solely on prior years of service. This was the result in Sebestyen, H worked for UPS. There were three ways to retire and receive a pension. By the way, only UPS contributed to the pension. One of the ways was to be 100% disabled after 10 years of service. But the benefit payment was based solely on prior years of service so the COA held that the community had an interest in the pension and the portion earned during the marriage was subject to division. INTENT OF EMPLOYER KEY. If employer is rewarding for past years of service, strong indication it is onerous title.
In a military retirement situation where the participant spouse elects to receive a portion of his or her benefits to be calculated and disbursed for disability, is that divisible CP?
No. Those were the facts in Chadez v. Grant. The parties agreed to divide H’s military pension but years later, when he actually retired, he elected to receive a portion for his disability. W filed a petition to enforce. The COA held too bad, so sad. Federal Law PREEMPTS here, and disability based pay is not CP and not divisible.
