Schaad v. Schaad, 5th Dist. Morgan No. CV05-098, 2019-Ohio-2553 (Decided June 19, 2019).
Issue: Can a court redistribute property/order spousal support at the time of retirement, in a manner that differs from the divorce decree, to make the division “equitable?”
Decision: The Fifth District Court of Appeals determined the trial court did not have the ability to order a division of retirement benefits/spousal support, which were inconsistent with the divorce decree. The Wife in this case had a pension from the State Teachers Retirement System of Ohio (“STRS”). The parties divorced in 2007. At the time of divorce, the decree stated that Husband would receive half of Wife’s STRS pension offset by his social security benefit (this is common in State of Ohio plans such as STRS because the Participant’s social security benefit is reduced by virtue of participating in the plan). With the social security offset, Husband’s portion of Wife’s STRS was calculated to be 43.27%.
In 2010, Wife retired so both her and Husband began receiving their respective portions of the STRS benefit. After her retirement, Wife became aware that Husband was receiving veterans benefits, which, when combined with his portion of Wife’s STRS benefit, resulted in Husband receiving a higher monthly income than Wife. In 2018, Wife filed a motion claiming her STRS benefit was divided improperly, in part, because Husband’s veteran benefits were not addressed in the divorce decree. Husband argued his veterans benefits were separate property and that is why they were not addressed in the decree. The trial court granted Wife’s motion and vacated the division of property order dividing Wife’s pension – thereby rescinding Husband’s right to the STRS benefit. The trial court further ordered Husband to pay Wife spousal support, which was never mentioned in the divorce decree, to “equalize” the parties’ monthly incomes.
On appeal, the Fifth District Court of Appeals found the trial court exceeded its authority in altering the divorce decree by revoking Husband’s right to the STRS benefit and requiring Husband to pay spousal support. The Fifth District held the trial court was without authority to modify the decree after it had been ordered. Courts are permitted to clarify divorce decrees; however, they cannot not alter them after they are final.
Observation: Divorce decrees, like executed settlement agreements, are final and binding. It is vitally important that the language in decrees/settlement agreements are correct and cover all retirement assets. The post-divorce litigation in this matter could have been avoided by simply addressing the Husband’s veterans benefits in the divorce decree. If the benefits were addressed, even if simply to state they were separate property, there would have been no grounds for Wife to bring her motion. Although Husband was eventually successful in this action, he incurred additional costs.
How we can help: We can help you with all stages of litigation to ensure that your client receives his/her correct share of the marital retirement benefit. We provide assistance in discovery of assets, we provide advice on the most advantageous division of the benefits for your client, we help draft/review division language, we help in negotiating settlements, and we can be your expert witness at trial.