IN RE: MARRIAGE OF Sylvia L. and Thomas C. COX. Sylvia L. COX, Appellant, v. Thomas C. COX, Respondent.
The issue presented in this consolidated appeal is whether the California Legislature may retroactively override a pronouncement of our United States Supreme Court.
The parties' 26 year marriage was terminated by a final decree of dissolution entered on January 28, 1982. Husband, a retired military officer, was awarded his non-disability retirement pension as his separate property. On March 23, 1983 wife filed a motion to set aside that portion of the interlocutory decree which had awarded the retirement pension to husband in order that part thereof be awarded to her as community property. She contended the then recently enacted Federal Uniformed Services Former Spouse's Protection Act 1 authorized the states to treat military retirement pay as community property and that the Act was to be applied retroactively to final judgments. The motion was denied and wife appealed.
In January 1984 wife filed a second, similar motion, this time relying on recently enacted Civil Code section 5124.2 That motion was also denied and again wife appealed. We have consolidated the appeals.
After In re Marriage of Fithian (1974) 10 Cal.3d 592, 111 Cal.Rptr. 369, 517 P.2d 449 and In re Marriage of Brown (1976) 15 Cal.3d 838, 126 Cal.Rptr. 633, 544 P.2d 561, California trial courts characterized non-disability retirement pension interests acquired during coverture as community property subject to division upon dissolution. However, on June 26, 1981, the United States Supreme Court in the now famous McCarty 3 decision declared a different rule must be applied. It proclaimed federal law was applicable to the distribution on dissolution of all military non-disability retirement pension interests. It further declared the pension, with all its rights and interests, belonged exclusively to the military spouse.
Congress, in response to a perceived unfairness in the McCarty rule, enacted FUSFSPA twenty months later. That Act empowered the various states to characterize non-disability military retirement pay “either as property solely of the member or as property of the member and his spouse in accordance with the law of the jurisdiction of such court.” (10 U.S.C. § 1408(c)(1).)
The only reported California decision to address the issue (Mueller v. Walker (1985) 167 Cal.App.3d 600, 213 Cal.Rptr. 442) has concluded Congress did not intend FUSFSPA be applied retroactively to McCarty judgments which had become final before FUSFSPA's effective date. While we agree with that general proposition, we reject Mueller's result and find its reasoning on this issue unpersuasive.
The trial court in the Muellers' dissolution action had followed McCarty and had awarded to husband as his separate property his non-disability military retirement pension. That decree became final in October 1982. Wife subsequently filed suit to establish a community property interest in her former spouse's military pension benefits. The trial court sustained husband's demurrer (brought on res judicata grounds) without leave to amend and dismissed the action.
The Mueller court reversed the judgment of dismissal after having determined Civil Code section 5124 clearly authorized the remedy wife sought. (Mueller v. Walker, supra, 167 Cal.App.3d at p. 607, 213 Cal.Rptr. 442.) The Civil Code section 5124 discussion was necessary because the court had initially concluded, without further analysis, “FUSFSPA has been held applicable only to those cases not yet final as of its effective date, i.e., February 1, 1983.” (Id., at p. 605, 213 Cal.Rptr. 442.) However, the authorities Mueller cites for this proposition (In re Marriage of Fairfull (1984) 161 Cal.App.3d 532, 207 Cal.Rptr. 523 and In re Marriage of Hopkins (1983) 142 Cal.App.3d 350, 191 Cal.Rptr. 70) both involve non-final McCarty decrees which were pending on FUSFSPA's effective date. Consequently, we examine the retroactivity issue anew.
Whether a statute operates retrospectively or prospectively only is entirely referable to legislative intent. (Hassett v. Welch (1938) 303 U.S. 303, 58 S.Ct. 559, 82 L.Ed. 858.) Courts have long employed a rule of strict construction against the retrospective operation of statutes. (E.g., United States v. The Peggy (1801) 5 U.S. (1 Cranch) 103, 110, 2 L.Ed. 49). They will conclude a legislative body intended a statute operate retrospectively only where that intention is expressly stated (Murray v. Gibson (1853) 56 U.S. (15 Howard) 421, 423, 14 L.Ed. 755) or where the intent is “clearly, explicitly, positively, unequivocally, unmistakeably, and unambiguously shown by necessary implication or by terms which permit no other meaning to be annexed to them, and which preclude all question in regard thereto, and leave no reasonable doubt thereof.” (73 Am.Jur.2d, Statutes, § 350, p. 487 and authorities cited [fns. omitted]; see also the authorities collected in 12B U.S. L.Ed. Digest, Statutes, §§ 209, 213, pp. 349–351, 352–353.) This rule of construction is particularly applicable where, as here, retrospective application would impair a vested right. (Ibid.)
FUSFSPA contains no express language it be applied retrospectively to final McCarty judgments, or to final judgments at all. In re Marriage of Downes (1983) 177 Cal.App.3d 205, 222 Cal.Rptr. 776 is supportive. That case involved a husband's appeal from Civil Code section 5124 orders reopening the parties' final 1982 dissolution decree and divesting husband of a portion of his military retirement pension which had been confirmed to him as his separate property. The Downes court reserved as premature the issues we decide today and reversed and remanded the matter with directions to determine a preliminary factual issue not relevant to this appeal. However, the court did observe the following: “F.U.S.F.S.P.A. was not specifically made retroactive to apply to dissolution decrees that became final during the ‘window’ period between the time McCarty was decided and the date F.U.S.F.S.P.A. became effective. The California Legislature, however, enacted Civil Code section 5124 to make F.U.S.F.S.P.A. applicable to the window period so ‘[t]he parties therein would receive the same treatment given to similarly situated parties whose dissolution became final before McCarty or after the corrective federal law.’ [Citation.]” (Fns. omitted.) (Ibid.)
Although the Act does authorize community property states to treat “pay payable to a member for pay periods beginning after June 25, 1981 ․ as [community property]” (10 U.S.C. § 1408(c)(1)), it is speculative to conclude Congress had more than pending cases in mind when it selected that language and chose to omit any reference to the statute's retrospective operation or to final judgments, McCarty or vested rights. (Compare Civ. Code, § 5124(a), fn. 2, supra.) Indeed, portions of FUSFSPA's legislative history suggest Congress intended McCarty retain at least some vitality: e.g., “The House Amendment would apply to court orders finalized before the McCarty decision, but not to subsequent modifications thereto which have the effect of implementing the holding in the McCarty decision (for example, divesting a former spouse of a previously awarded right to a portion of a member's retired pay)․” (J. Explanatory Statement of the Com. of Conf. on Sen. No. 2248 from the House Conf. Rep. No. 97–749, U.S. Code Cong. & Admin. News 1982, pp. 1555, 1569, Aug. 16, 1982, p. 5999, 128 Cong. Rec. (1982). The full Statement as it pertains to FUSFSPA is set forth verbatim in the appendix.) We note Congress legislates with full awareness of the canons of statutory construction. (See, e.g., 2A C. Sandra, Sutherland Statutory Construction (4th ed. 1984), § 45.12, p. 55 and cases cited; see also Lorillard v. Pons (1978) 434 U.S. 575, 580, 98 S.Ct. 866, 870, 55 L.Ed.2d 40, Cary v. Curtis (1845) 44 U.S. (3 Howard) 236, 240, 11 L.Ed. 576 and Lykes Bros. Steamship Co. v. United States (1972) 198 Ct. Cl. 312, 459 F.2d 1393, 1395.) We consequently decline to ascribe to the Act an application and operation Congress did not clearly intend.
The result we reach on this issue is also compatible with a recent observation of our California Supreme Court: “This [the drive to make McCarty disappear] pretty much reduced the impact of McCarty to judgments which became final between June 25, 1981, the date of that decision, and February 1, 1983, the effective date of FUSFSPA. The few unfortunate nonmember spouses whose judgments did become final between those dates, were given special permission by the California Legislature to ask that the judgments be modified ‘to include a division of military retirement benefits payable on or after February 1, 1983, ․’ [Citation.]” (Aloy v. Mash (1985) 38 Cal.3d 413, 422, fn. 7, 212 Cal.Rptr. 162, 696 P.2d 656.)
Despite her protestations to the contrary, our dissenting colleague is the sole California jurist to conclude Congress intended FUSFSPA be universally employed to invade and divest property interests previously settled by final dissolution decrees. Such reasoning would render Civil Code section 5124 redundant. Indeed, the fact our Legislature enacted that section for the purpose of “mak[ing] F.U.S.F.S.P.A. applicable to the window period” (In re Marriage of Downes, supra, 177 Cal.App.3d 205, 222 Cal.Rptr. 776) further supports our conclusion FUSFSPA is not retroactive to final McCarty decrees.
Since McCarty was a determination by our United States Supreme Court, it is the supreme law of this land for non-disability military pension awards finalized between June 26, 1981 and February 1, 1983. The court's characterization of those pensions as the service members' separate property is controlling. California Civil Code section 5124, which purports to allow those final decrees to be reopened for a different determination, must yield to the supremacy clause of the United States Constitution. “This Constitution, and the laws of the United States which shall be made in pursuance thereof; and all treaties made, or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the Judges in every State shall be bound thereby, anything in the Constitution or laws of any State to the contrary notwithstanding.” (U.S. Const., art. VI, § 2.) (See also Maryland v. Louisiana (1981) 451 U.S. 725, 746–747, 101 S.Ct. 2114, 2128–29, 68 L.Ed.2d 576 and McCulloch v. Maryland (1819) 17 U.S. (4 Wheat) 316, 427, 4 L.Ed. 579.)
The dissent urges if FUSFSPA is not retroactive it should be construed as enabling the affected states to elect to follow McCarty or not as they might separately choose. To the extent the Act might be so construed (which we also doubt for the reasons previously stated in this opinion) it would likely constitute an unlawful delegation of Congressional power to the legislatures of the various states. (See Knickerbocker Ice Co. v. Stewart (1920) 253 U.S. 149, 40 S.Ct. 438, 64 L.Ed. 834 and Wilkerson v. Rahrer (1891) 140 U.S. 545, 11 S.Ct. 865, 35 L.Ed. 572.) Federal statutes are to be construed so as to achieve a uniform result throughout the nation. (Reconstruction Finance Corp. v. Beaver County, Pa. (1946) 328 U.S. 204, 209, 66 S.Ct. 992, 995, 90 L.Ed. 1172.) It is entirely repugnant to our federal system of government that McCarty might be the law in some states but not in others. We are constrained to place upon FUSFSPA a construction which does not excise the supremacy clause from the United States Constitution. (See Blanchette v. Connecticut General Ins. Corps. (1974) 419 U.S. 102, 134, 95 S.Ct. 335, 354, 42 L.Ed.2d 320; Turner v. Bd. of Trustees (1976) 16 Cal.3d 818, 827, 129 Cal.Rptr. 443, 548 P.2d 1115; County of Los Angeles v. Legg (1936) 5 Cal.2d 349, 353, 55 P.2d 206.)
In light of our determination we need not discuss the res judicata arguments raised by respondent. Nor do we attempt to rationalize the obvious differences in dispositions which occurred during the McCarty-controlled time period. We leave such discussion to those who chronicle the inequities of our less than perfect system. The orders are affirmed.
§ 1408. Payment of retired or retainer pay in compliance with court orders
(a) In this section:
(1) “Court” means—
(A) any court of competent jurisdiction of any State, the District of Columbia, the Commonwealth of Puerto Rico, Guam, American Samoa, the Virgin Islands, the Northern Mariana Islands, and the Trust Territory of the Pacific Islands;
(B) any court of the United States (as defined in section 451 of title 28) having competent jurisdiction; and
(C) any court of competent jurisdiction of a foreign country with which the United States has an agreement requiring the United States to honor any court order of such country.
(2) “Court order” means a final decree of divorce, dissolution, annulment, or legal separation issued by a court, or a court ordered, ratified, or approved property settlement incident to such a decree (including a final decree modifying the terms of a previously issued decree of divorce, dissolution, annulment, or legal separation, or a court ordered, ratified, or approved property settlement incident to such previously issued decree), which—
(A) is issued in accordance with the laws of the jurisdiction of that court;
(B) provides for—
(i) payment of child support (as defined in section 462(b) of the Social Security Act (42 U.S.C. 662(b)));
(ii) payment of alimony (as defined in section 462(c) of the Social Security Act (42 U.S.C. 662(c))); or
(iii) division of property (including a division of community property); and
(C) specifically provides for the payment of an amount, expressed in dollars or as a percentage of disposable retired or retainer pay, from the disposable retired or retainer pay of a member to the spouse or former spouse of that member.
(3) “Final decree” means a decree from which no appeal may be taken or from which no appeal has been taken within the time allowed for taking such appeals under the laws applicable to such appeals, or a decree from which timely appeal has been taken and such appeal has been finally decided under the laws applicable to such appeals.
(4) “Disposable retired or retainer pay” means the total monthly retired or retainer pay to which a member is entitled (other than the retired pay of a member retired for disability under chapter 61 of this title) less amounts which—
(A) are owed by that member to the United States;
(B) are required by law to be and are deducted from the retired or retainer pay of such member, including fines and forfeitures ordered by courts-martial, Federal employment taxes, and amounts waived in order to receive compensation under title 5 or title 38;
(C) are properly withheld for Federal, State, or local income tax purposes, if the withholding of such amounts is authorized or required by law and to the extent such amounts withheld are not greater than would be authorized if such member claimed all dependents to which he was entitled;
(D) are withheld under section 3402(i) of the Internal Revenue Code of 1954 (26 U.S.C. 3402(i)) if such member presents evidence of a tax obligation which supports such withholding;
(E) are deducted as Government life insurance premiums (not including amounts deducted for supplemental coverage); or
(F) are deducted because of an election under chapter 73 of this title to provide an annuity to a spouse or former spouse to whom payment of a portion of such member's retired or retainer pay is being made pursuant to a court order under this section.
(5) “Member” includes a former member.
(6) “Spouse or former spouse” means the husband or wife, or former husband or wife, respectively, of a member who, on or before the date of a court order, was married to that member.
(b) For the purposes of this section—
(1) service of a court order is effective if—
(A) an appropriate agent of the Secretary concerned designated for receipt of service of court orders under regulations prescribed pursuant to subsection (h) or, if no agent has been so designated, the Secretary concerned, is personally served or is served by certified or registered mail, return receipt requested:
(B) the court order is regular on its face;
(C) the court order or other documents served with the court order identify the member concerned and include the social security number of such member; and
(D) the court order or other documents served with the court order certify that the rights of the member under the Soldiers' and Sailors' Civil Relief Act of 1940 (50 U.S.C.App. 501 et seq.) were observed; and
(2) a court order is regular on its face if the order—
(A) is issued by a court of competent jurisdiction;
(B) is legal in form; and
(C) includes nothing on its face that provides reasonable notice that it is issued without authority of law.
(c)(1) Subject to the limitations of this section, a court may treat disposable retired or retainer pay payable to a member for pay periods beginning after June 25, 1981, either as property solely of the member or as property of the member and his spouse in accordance with the law of the jurisdiction of such court.
(2) Notwithstanding any other provision of law, this section does not create any right, title, or interest which can be sold, assigned, transferred, or otherwise disposed of (including by inheritance) by a spouse or former spouse.
(3) This section does not authorize any court to order a member to apply for retirement or retire at a particular time in order to effectuate any payment under this section.
(4) A court may not treat the disposable retired or retainer pay of a member in the manner described in paragraph (1) unless the court has jurisdiction over the member by reason of (A) his residence, other than because of military assignment, in the territorial jurisdiction of the court, (B) his domicile in the territorial jurisdiction of the court, or (C) his consent to the jurisdiction of the court.
(d)(1) After effective service on the Secretary concerned of a court order with respect to the payment of a portion of the retired or retainer pay of a member to the spouse or a former spouse of the member, the Secretary shall, subject to the limitations of this section, make payments to the spouse or former spouse in the amount of the disposable retired or retainer pay of the member specifically provided for in the court order. In the case of a member entitled to receive retired or retainer pay on the date of the effective service of the court order, such payments shall begin not later than 90 days after the date of effective service. In the case of a member not entitled to receive retired or retainer pay on the date of the effective service of the court order, such payments shall begin not later than 90 days after the date on which the member first becomes entitled to receive retired or retainer pay.
(2) If the spouse or former spouse to whom payments are to be made under this section was not married to the member for a period of 10 years or more during which the member performed at least 10 years of service creditable in determining the member's eligibility for retired or retainer pay, payments may not be made under this section to the extent that they include an amount resulting from the treatment by the court under subsection (c) of disposable retired or retainer pay of the member as property of the member or property of the member and his spouse.
(3) Payments under this section shall not be made more frequently than once each month, and the Secretary concerned shall not be required to vary normal pay and disbursement cycles for retired or retainer pay in order to comply with a court order.
(4) Payments from the disposable retired or retainer pay of a member pursuant to this section shall terminate in accordance with the terms of the applicable court order, but not later than the date of the death of the member or the date of the death of the spouse or former spouse to whom payments are being made, whichever occurs first.
(5) If a court order described in paragraph (1) provides for a division of property (including a division of community property) in addition to an amount of disposable retired or retainer pay, the Secretary concerned shall, subject to the limitations of this section, pay to the spouse or former spouse of the member, from the disposable retired or retainer pay of the member, any part of the amount payable to the spouse or former spouse under the division of property upon effective service of a final court order of garnishment of such amount from such retired or retainer pay.
(e)(1) The total amount of the disposable retired or retainer pay of a member payable under subsection (d) may not exceed 50 percent of such disposable retired or retainer pay.
(2) In the event of effective service of more than one court order which provide for payment to a spouse and one or more former spouses or to more than one former spouse from the disposable retired or retainer pay of a member, such pay shall be used to satisfy (subject to the limitations of paragraph (1)) such court orders on a first-come, first-served basis. Such court orders shall be satisfied (subject to the limitations of paragraph (1)) out of that amount of disposable retired or retainer pay which remains after the satisfaction of all court orders which have been previously served.
(3)(A) In the event of effective service of conflicting court orders under this section which assert to direct that different amounts be paid during a month to the same spouse or former spouse from the disposable retired or retainer pay of the same member, the Secretary concerned shall—
(i) pay to that spouse the least amount of disposable retired or retainer pay directed to be paid during that month by any such conflicting court order, but not more than the amount of disposable retired or retainer pay which remains available for payment of such court orders based on when such court orders were effectively served and the limitations of paragraph (1) and subparagraph (B) of paragraph (4);
(ii) retain an amount of disposable retired or retainer pay that is equal to the lesser of—
(I) the difference between the largest amount of retired or retainer pay required by any conflicting court order to be paid to the spouse or former spouse and the amount payable to the spouse or former spouse under clause (i); and
(II) the amount of disposable retired or retainer pay which remains available for payment of any conflicting court order based on when such court order was effectively served and the limitations of paragraph (1) and subparagraph (B) of paragraph (4); and
(iii) pay to that member the amount which is equal to the amount of that member's disposable retired or retainer pay (less any amount paid during such month pursuant to legal process served under section 459 of the Social Security Act (42 U.S.C. 659) and any amount paid during such month pursuant to court orders effectively served under this section, other than such conflicting court orders) minus—
(I) the amount of disposable retired or retainer pay paid under clause (i); and
(II) the amount of disposable retired or retainer pay retained under clause (ii).
(B) The Secretary concerned shall hold the amount retained under clause (ii) of subparagraph (a) until such time as that Secretary is provided with a court order which has been certified by the member and the spouse or former spouse to be valid and applicable to the retained amount. Upon being provided with such an order, the Secretary shall pay the retained amount in accordance with the order.
(4)(A) In the event of effective service of a court order under this section and the service of legal process pursuant to section 459 of the Social Security Act (42 U.S.C. 659), both of which provide for payments during a month from the retired or retainer pay of the same member, such court orders and legal process shall be satisfied on a first-come, first-serve basis. Such court orders and legal process shall be satisfied out of moneys which are subject to such orders and legal process and which remain available in accordance with the limitations of paragraph (1) and subparagraph (B) of this paragraph during such month after the satisfaction of all court orders or legal process which have been previously served.
(B) Notwithstanding any other provision of law, the total amount of the disposable retired or retainer pay of a member payable by the Secretary concerned under all court orders pursuant to this section and all legal processes pursuant to section 459 of the Social Security Act (42 U.S.C. 659) with respect to a member may not exceed 65 percent of the disposable retired or retainer pay payable to such member.
(5) A court order which itself or because of previously served court orders provides for the payment of an amount of disposable retired or retainer pay which exceeds the amount of such pay available for payment because of the limit set forth in paragraph (1), or which, because of previously served court orders or legal process previously served under section 459 of the Social Security Act (42 U.S.C. 659), provides for payment of an amount of disposable retired or retainer pay that exceeds the maximum amount permitted under paragraph (1) or subparagraph (B) of paragraph (4), shall not be considered to be irregular on its face solely for that reason. However, such order shall be considered to be fully satisfied for purposes of this section by the payment to the spouse or former spouse of the maximum amount of disposable retired or retainer pay permitted under paragraph (1) and subparagraph (B) of paragraph (4).
(6) Nothing in this section shall be construed to relieve a member of liability for the payment of alimony, child support, or other payments required by a court order on the grounds that payments made out of disposable retired or retainer pay under this section have been made in the maximum amount permitted under paragraph (1) or subparagraph (B) of paragraph (4). Any such unsatisfied obligation of a member may be enforced by any means available under law other than the means provided under this section in any case in which the maximum amount permitted under paragraph (1) has been paid and under section 459 of the Social Security Act (42 U.S.C. 659) in any case in which the maximum amount permitted under subparagraph (B) of paragraph (4) has been paid.
(f)(1) The United States and any officer or employee of the United States shall not be liable with respect to any payment made from retired or retainer pay to any member, spouse, or former spouse pursuant to a court order that is regular on its face if such payment is made in accordance with this section and the regulations prescribed pursuant to subsection (h).
(2) An officer or employee of the United States who, under regulations prescribed pursuant to subsection (h), has the duty to respond to interrogatories shall not be subject under any law to any disciplinary action or civil or criminal liability or penalty for, or because of, any disclosure of information made by him in carrying out any of his duties which directly or indirectly pertain to answering such interrogatories.
(g) A person receiving effective service of a court order under this section shall, as soon as possible, but not later than 30 days after the date on which effective service is made, send a written notice of such court order (together with a copy of such order) to the member affected by the court order at his last known address.
(h) The Secretaries concerned shall prescribe uniform regulations for the administration of this section.
August 16, 1982TITLE X—FORMER SPOUSES' PROTECTION
The House amendment contained provisions (sec. 901–907) that would provide certain rights and benefits for the former spouse of a member of a uniformed service. The Senate bill contained no similar provisions, however, the Senate Committee on Armed Services had reported a bill on July 14, 1982, with similar provisions (S.1814).
The House amendment would permit disposable military retired pay to be considered as property in divorce settlements under certain specified conditions. This provision in the House amendment would have the effect of reversing the decision of the United States supreme court in the case of McCarty v. McCarty, 453 U.S. 210 (1981), which held that a court could not order a division of non-disability retired pay as part of a distribution of community property incident to a divorce proceeding.
The House amendment would also permit the former spouse to receive court-awarded payments directly from the military finance center without having to resort to periodic garnishment proceedings. Direct payments could be made out of military retired pay for court-awarded alimony, child support, and division of property.
The House amendment contained several provisions that would place restrictions on the division of retired pay. Under the House amendment, military retired pay could only be considered property if the marriage lasted at least 10 years while the service member was performing creditable service. Further, the amendment specified that courts could not treat military retired pay as property unless the court has jurisdiction over the member by reason of the member's residence in the state other than because of military orders, domicile (legal residence) in the state, marriage in that state, or consent to the court's jurisdiction. In addition, the House amendment provided that payments for alimony and division of retired pay would terminate if the former spouse remarried before age 60. Finally, the House amendment would require that court orders presented to the service Secretaries for the purpose of direct payments to the former spouse certify that the court had complied with the provisions of the Soldiers' and Sailors' Civil Relief Act.
The amendment also would authorize the service Secretaries to pay to a former spouse a portion of disposable military retired pay to satisfy a court order garnishing retired pay for non-payment of property settlements other than retired pay. This provision would have the effect of expanding existing garnishment procedures in section 459 of the Social Security Act (42 U.S.C. 659) as they apply to military retired pay to include garnishment for non-payment of property settlements unrelated to division of retired pay.
The House amendment contained a provision that would authorize care in military medical facilities or under the Civilian Health and Medical Program for the Uniformed Services (CHAMPUS) for unremarried former spouses who had been married to the member for at least 20 years while the member was performing creditable service. The coverage provided would be the same as the coverage for retirees, dependents of retirees and survivors. The benefit would only be available during periods when the former spouse was not covered by another health benefit plan as a result of his or her employment.
The House amendment would also direct the Secretary of Defense to prescribe regulations authorizing commissary and exchange benefits for the unremarried former spouse who had been married to the member for at least 20 years while the member was performing creditable service.
The House amendment would authorize coverage for a former spouse under the insurable interest provisions of the Survivor Benefit Plan if the service member voluntarily elected to provide that coverage.
The House amendment would apply to court orders finalized before the McCarty decision, but not to subsequent modifications thereto which have the effect of implementing the holding in the McCarty decision (for example, divesting a former spouse of a previously awarded right to a portion of a member's retired pay) or which, based on the enactment of the new title X, effected a first-time division of retired pay. It would also apply to court orders finalized on or after the McCarty decision as well as to subsequent modifications. The provisions related to medical care and eligibility for commissary and exchange privileges would only apply to former spouses divorced after the effective date of the changes.
Finally, the House amendment contained a provision (sec. 907) that would provide that nothing in title IX of the House amendment would overrule or require the modification of any state law or court decision in any state that treats marital property as community property.
The Senate recedes with amendments.
The conferees agreed to remove the restriction that would require 10 years of marriage before military retired pay could be considered property by the courts. The conferees further agreed, however, that direct payments by the service finance centers to a former spouse from the member's retired pay based on a division of that retired pay as property would be limited to situations in which the former spouse was married to the member for at least 10 years while the member performed military service. The 10-year restriction would not apply to direct payments based on the award of child support or alimony.
Currently, there is no Federal enforcement mechanism for court-ordered property division of military retired pay available to former spouses of military personnel. The conferees agreed to a Federal enforcement provision as described above; however, jurisdiction of the courts to consider military retired pay when fixing the property rights between the parties to a divorce, dissolution, legal separation or annulment would not be affected by the 10-year marriage requirement.
The conferees agreed to retain the 10-year requirement as apart of the enforcement procedures after due deliberation but remain uncertain about the potential impact of restricting Federal enforcement remedies based upon duration of marriage. Specifically, there is insufficient evidence on the retention impact. Therefore, the conferees expect the Armed Services Committees of the Senate and the House of Representatives to monitor closely whether the 10-year restriction on enforcement might become a disincentive for men and women deciding whether to reenlist for a third tour of duty. The conferees believe that there is insufficient evidence to evaluate the contention that returning to the states the authority to divide military retired pay would have a detrimental impact on retention. Continued oversight of the impact of the 10-year provision will better enable the Armed Services Committees to determine whether a duration of marriage rule of any length promotes military manpower goals or whether future legislative modifications may be required.
The conferees agreed to delete the provision in the House amendment that would terminate payments for alimony or a division of retired pay to a former spouse if the former spouse remarried before age 60.
The conferees also agreed that courts could not treat retired pay as property unless the court has jurisdiction over the member by reason of the member's residence in the state other than because of military orders, domicile in the state or consent to the court's jurisdiction.
Finally, in view of the other changes recommended by the conferees, the conferees agreed to delete section 907 of the House amendment.
The conferees adopted the provision contained in the House amendment, related to the application of the new title X to court orders finalized before the McCarty decision. Although the conference report contains no prohibition against courts reopening decisions before that date, the conferees agreed that changes to court orders finalized before the McCarty decision should not be recognized if those changes were effected after the McCarty decision (and before the effective date of the new title X) to implement the holding in that decision (for example, a modification setting aside a pre-McCarty division of military retired pay).
In additions, the conferees intend this provision to preclude recognition of changes to court orders finalized before the McCarty decision if those changes are effected after the McCarty decision and as a direct result of the enactment of the new title X of this conference report. In other words, the courts should not favorably consider applications based on the enactment of this title to reopen cases finalized before the McCarty decision wherein military retired pay was not divided.
With certain exceptions the provisions adopted by the conferees are similar to the provisions of S. 1814 as reported by the Senate Armed Services Committee (S.Rept. 97–502). For the purpose of describing these similar provisions, the section-by-section analysis (p. 12–28) in the Senate report is referred to.
Limited medical coverage for deserving former spouses
The conferees recognize that, because the medical care provision is prospective, certain deserving former spouses whose divorces occurred prior to the effective date will not be eligible to receive medical care even though they may suffer from illnesses or diseases that were incurred during a period of the member's military service. For example, one case was brought to the attention of the conferees in which a former spouse was unable to obtain private sector medical insurance because she suffered from a chronic disease contracted while she accompanied her husband on a tour of military duty in the Philippines.
In situations such as these, particularly those in which it can be determined that the illness or disease was caused or aggravated by conditions associated with the member's military service, the conferees strongly encourage the Secretary of Defense and the Secretaries of the Military Departments to use the discretionary authority provided by title 10, United States Code, to judiciously authorize space available medical care in uniformed services medical treatment facilities. In making this recommendation, the conferees expect the Secretaries to limit this special medical designee status to certain deserving former spouses where the marriage lasted for at least 20 years during which the member served in the uniformed services. As with the medical care authorized in this bill, the conferees do not envision exercising this Secretarial authority if the former spouse is enrolled in or covered by a medical insurance program.
If the majority's premise were correct, I would have no quarrel with its conclusion. A state legislature may not pass legislation directly in conflict with a holding of the United States Supreme Court. And if the United States Congress disallows retroactive application of remedial legislation, a state legislative body has no choice but to follow that directive. But, this is not our situation.
The United States Supreme Court in McCarty v. McCarty (1981) 453 U.S. 210, 101 S.Ct. 2728, 69 L.Ed.2d 589 determined military non-disability retirement pension benefits belonged to the military spouse. In response, FUSFSPA was passed. Contrary to my colleagues' analysis, FUSFSPA was intended to allow our state Legislature to enact Civil Code section 5124.
The majority opinion fails to recognize the clear and unequivocal message of FUSFSPA. Congress did not like McCarty and wished to eradicate any and all effects of the holding. The legislation was intended to allow the states to determine, for themselves, how they wished to characterize non-disability military retirement pensions. Thus, by virtue of FUSFSPA, no state could allow a party to benefit from McCarty by reopening a final judgment decided before it was rendered. All states could allow reopening of final judgments rendered after McCarty but before FUSFSPA. And lastly, for pensions payable after June 25, 1981, the states are free to determine for themselves how they wish to characterize the pensions. The majority accepts the first and third conclusion, but refuses to acknowledge the second.
The majority suggests “Congress intended McCarty retain at least some vitality․” (Majority opn., ante, p. 657.) The passage cited by the majority supports a contrary conclusion. The conferees specifically noted “the conference report contains no prohibition against courts reopening decisions before [the date McCarty was decided] ․ [but] agreed that changes to court orders finalized before the McCarty decision should not be recognized if those changes were effected after the McCarty decision (and before the effective date of the new title X) to implement the holding in that decision (for example, a modification setting aside a pre-McCarty division of military retired pay).” (Emphasis added.)
And why was this a concern of Congress? Not because Congress refused to condone reopening final judgments. Rather, Congress would not allow McCarty to govern a modification made during the window period, notwithstanding the fact McCarty was “the supreme law of this land [during the window period].” (Majority opn., ante, p. 658.) Rather than instilling a breath of life into McCarty, the FUSFSPA drafters intended the statute would “remove the effect of the United States Supreme Court decision in McCarty v. McCarty․” (Sen.Rep. No. 97–502, U.S.Code Cong. & Admin.News 1982, p. 1596, July 22, 1982, p. 1, as attached to the bill.)
The legislation itself applies to all cases pending after its enactment. “[A] court may treat disposable retired or retainer pay payable to a member for pay periods after June 25, 1981 [the day before the McCarty decision was rendered], either as property solely of the member or as property of the member and his spouse in accordance with the law of the jurisdiction of such court. ” (10 U.S.C. § 1408(c)(1), emphasis added.) I am not, as stated by the majority, “the sole jurist to conclude Congress intended FUSFSPA be universally employed to invade and divest property interests․” (Majority opn., ante, p. 658, emphasis added.) Rather, I am saying Congress envisioned the reopening of window period final judgments where courts had employed McCarty, if state law so provided.1
The majority says the legislation itself must be explicitly retroactive. It is, when its legislative history is considered. The Joint Explanatory Statement of the Committee of Conference intended Title X to “apply to court orders finalized on or after the McCarty decision as well as to subsequent modifications.” (See House Report attached to majority opn.) There is no prohibition against reopening decisions made on or after the date of the McCarty decision but before the passage of FUSFSPA. But, unlike pre-McCarty final orders, the statute is applicable to subsequent modifications of those final orders.
The fact Congress did not specifically refer to final judgments in section 1408(c)(1) is of no moment. Section 1006(b) of Public Law 97–252 notes federal remittance of retirement pay pursuant to a state court order “shall apply only with respect to payments of retired or retainer pay for periods beginning on or after the effective date of this title, but without regard to the date of any court order. However, in the case of a court order that became final before June 26, 1981, payments under such subsection may only be made in accordance with such order as in effect on such date and without regard to any subsequent modifications.” (Emphasis added.) Had Congress intended to dishonor modified post-McCarty final judgments, those judgments would have been included.
The Joint Committee Report notes, “The provisions adopted by the conferees are similar to the provisions of S. 1814 as reported by the Senate Armed Services Committee (Sen. Rep. 97–502, U.S.Code Cong. & Admin.News 1982, p. 1596). For the purpose of describing these similar provisions, the section-by-section analysis (p. 12–28) in the Senate report is referred to.”
The Senate Report, on page 16, states, “The purpose of [§ 1408(c)(1) ] is to place the courts in the same position that they were in on June 26, 1981, the date of the McCarty decision, with respect to treatment of non-disability military retired or retainer pay. The provision is intended to remove the federal pre-emption found to exist by the United States Supreme Court and permit State and other courts of competent jurisdiction to apply pertinent State ․ laws․ This power is returned to the courts retroactive to June 26, 1981. This retroactive application will at least afford individuals who were divorced (or had decrees modified) during the interim period between June 26, 1981 and the effective date of this legislation the opportunity to return to the courts to take advantage of this provision.” (Emphasis added.) The provision makes no distinction between final and appealable judgments rendered during the interim period.2
“The question of whether previously entered court decrees should be modified to comply with the requirements of section 1408 of title 10 is one properly left for the determination of courts having jurisdiction to make such modifications.” (Sen.Rep. No. 97–502, p. 28, U.S.Code Cong. & Admin.News 1982, p. 1623.) Congress did everything in its power to eradicate all vestiges of the McCarty decision. It could not force the state courts to allow the reopening of judgments finalized in the interim period. That decision was left to the individual states as was the option to treat retirement pay “either as property solely of the member or as property of the member and his spouse in accordance with the law of the jurisdiction.” (§ 1408(c)(1), emphasis added.) California's Legislature chose to enact the corrective legislation permitted by Congress.
California law recognized retirement benefits as community property before the McCarty opinion. FUSFSPA merely returned that option to California. In order to remedy the inequity quickly and fairly, each state was allowed to treat decisions made final in the window period as it saw fit. Section 5124 follows Congressional intent.3
In Mueller v. Walker, supra, 167 Cal.App.3d 600, 213 Cal.Rptr. 442, the court decided the same issues raised by our parties.4 There wife moved for reconsideration of a final judgment awarding husband's military retirement pension to him as his separate property. The underlying judgment was entered after McCarty and, as here, before FUSFSPA. The trial court denied her motion but the court of appeal reversed, holding section 5124 authorized the remedy sought by wife.
Husband urges there are several reasons not to follow Mueller. First he suggests “Mueller ignored the limiting language of section 5124 applying it only to cases where jurisdiction was reserved, the pension was omitted, or the judgment assumed that it was separate property.” But the Mueller court ignored nothing. The very language of section 5124 allows “[m]odification of community property settlements, judgments, or decrees ․ whether or not the property settlement, judgment or decree expressly reserved the pension issue for further determination, [or] omitted any reference to a military pension․” (Emphasis added.) In fact, the only limit Civil Code section 5124 establishes is that motions to modify final judgments must be made prior to January 1, 1986.
Next, husband argues res judicata principles prohibit the modification of a final judgment. He suggests the retroactive application of Civil Code section 5124 is unconstitutional because it authorizes a taking of property without due process. In other words, because of the finality of the judgment, the pension became the husband's vested asset. Thus, the issue is whether the Legislature can constitutionally ignore res judicata concepts.5
Husband maintains the Mueller court improperly relied on In re Marriage of Bouquet (1976) 16 Cal.3d 583, 128 Cal.Rptr. 427, 546 P.2d 1371 because the issue there was not modification of a final judgment, but addressed “all property rights, whenever acquired, that have not been finally adjudicated by a judgment from which the time to appeal has lapsed.” (Id., at p. 594, 128 Cal.Rptr. 427, 546 P.2d 1371, emphasis added.) 6 Husband's concerns are, for two reasons, unfounded. First, Bouquet is analogous to the extent vested rights are at issue. The concept of the finality of the judgment is merely a shorthand way of saying an asset belongs to one of the spouses. And that was the same concern with which the Bouquet court wrestled. “We must now determine whether the retroactive application of amended section 5118 constitutes an unconstitutional deprivation of the property of the wife.” (Id., 16 Cal.3d at p. 591, 128 Cal.Rptr. 427, 546 P.2d 1371.) And the court concluded: “Retroactive legislation, though frequently disfavored, is not absolutely proscribed. The vesting of property rights, consequently, does not render them immutable: ‘ “Vested rights, of course, may be impaired ‘with due process of law’ under many circumstances. The state's inherent sovereign power includes the so-called ‘police power’ right to interfere with vested property rights whenever reasonably necessary to the protection of the health, safety, morals, and general well being of the people․ The constitutional question, on principle, therefore, would seem to be, not whether a vested right is impaired by a marital property law change, but whether such a change reasonably could be believed to be sufficiently necessary to the public welfare as to justify the impairment.” ' [Citations.] [¶] In determining whether a retroactive law contravenes the due process clause, we consider such factors as the significance of the state interest served by the law, the importance of the retroactive application of the law to the effectuation of that interest, the extent of reliance upon the former law, the legitimacy of that reliance, the extent of actions taken on the basis of that reliance, and the extent to which the retroactive application of the new law would disrupt those actions.” (Id., at p. 592, 126 Cal.Rptr. 427, 546 P.2d 1371, fns. omitted.) Thus, the fact Bouquet dealt only with judgments not yet final is really a distinction without a difference.
Second, Mueller did more than rely on Bouquet. Mueller's premise is “[a]bsent an indication of any purpose upon the part of the state authority (whether legislative or judicial) to evade some prior decision of the United States Supreme Court or Federal Congress, the principles of finality protecting the parties to this litigation (res judicata or collateral estoppel) are, within the broad limits of fundamental fairness, solely the concern of state law․ [¶] If it be assumed arguendo there is a ‘taking’ by the legislative negation of the finality of a judgment, such taking may be constitutional where public policy and fairness considerations are great. Thus, the Legislature may modify the doctrine of res judicata, allow relitigation, for reasonable public policy grounds or other ‘rational base[s].’ [Citations.]” (Mueller v. Walker, supra, 167 Cal.App.3d 600, 607, 213 Cal.Rptr. 442.)
This same analysis was recently employed by our Supreme Court in In re the Marriage of Buol (1985) 39 Cal.3d 751, 218 Cal.Rptr. 31, 705 P.2d 354 in considering newly enacted section 4800.1. The court held its retroactive application would impair vested property rights without due process of law. The court recognized the Legislature clearly intended the statute to operate retroactively. “Legislative intent, however, is only one prerequisite to retroactive application of a statute.” (Id., at p. 756, 218 Cal.Rptr. 31, 705 P.2d 354.) The court found the property right in question was vested, but as in In re the Marriage of Bouquet, supra, 16 Cal.3d 592, 218 Cal.Rptr. 31, 705 P.2d 354, the Buol court concluded “[v]ested rights are not immutable; the state, exercising its police power may impair such rights when considered reasonably necessary to protect the health, safety, morals and general welfare of the people.” (In re the Marriage of Buol, supra, at pp. 760–761, 218 Cal.Rptr. 31, 705 P.2d 354.)
I conclude the Legislature legitimately exercised its police power in enacting Civil Code section 5124. Unlike other situations where the retroactive application of legislation or case law might bring havoc, we deal with only an 18-month period. This legislation does not give new rights to the parties; it merely restores what was theirs.
I would remand the matter to the trial court for a hearing so the final judgment may be “modified to include a division of [husband's] military retirement benefits payable on or after February 1, 1983, in a manner consistent with federal law and the law of this state as it existed before June 26, 1981, and as it has existed since February 1, 1983.” (§ 5124.)
1. “FUSFSPA” (10 U.S.C. § 1408). The lengthy section is set forth verbatim in the appendix.
2. That section reads as follows:“(a) Community property settlements, judgments, or decrees that became final on or after June 25, 1981, and before February 1, 1983, may be modified to include a division of military retirement benefits payable on or after February 1, 1983, in a manner consistent with federal law and the law of this state as it existed before June 26, 1981, and as it has existed since February 1, 1983.“(b) Modification of community property settlements, judgments, or decrees under this section may be granted whether or not the property settlement, judgment, or decree expressly reserved the pension issue for further determination, omitted any reference to a military pension, or assumed in any manner, implicitly or otherwise, that a pension divisible as community property before June 25, 1981, and on or after February 1, 1983, was not, as of the date the property settlement, judgment, or decree became final, divisible community property.“(c) Any proceeding brought pursuant to this section shall be brought before January 1, 1986.“(d) This section shall remain in effect only until January 1, 1986, and on that date is repealed unless a later enacted statute which is chaptered before that date deletes or extends that date.”3
3. McCarty v. McCarty (1981) 453 U.S. 210, 101 S.Ct. 2728, 69 L.Ed.2d 589.
1. Moreover, the majority's conclusion is the anomaly. As a result of its holding, the appellant is the only reported factually similar litigant in the United States who is precluded from laying claim to her share of her spouse's nondisability retirement pay. In the reported cases discussed, ante, the nonservice spouse was allowed to reopen or reexamine a judgment finalized in the window period.
2. Mueller v. Walker (1985) 167 Cal.App.3d 600, 213 Cal.Rptr. 442 addressed a judgment which became final in the window period. Relying upon authorities addressing only interlocutory orders, Mueller states, “Despite the intention FUSFSPA be applied retroactively in order to abrogate all applications of the McCarty decision, FUSFSPA has been held applicable only to those cases not yet final as of its effective date, i.e., February 1, 1983.” (Id., at p. 605, 213 Cal.Rptr. 442.) The court then opined, without discussion, “FUSFSPA does not have retroactive application to allow reopening of a final judgment.” (Ibid.) It allowed modification based on Civil Code section 5124.
3. This accords with decisions of our sister states whose pre-McCarty law provided for division of military retirement benefits and now reopen window period final judgments. (Edsall v. Superior Court (1984) 143 Ariz. 240, 693 P.2d 895, quoting applicable sections of the committee reports and stating, “Congress made it clear that in passing the Act, their intent was to wipe out the effects of McCarty on persons divorced in the interim period.” (Id., at p. 898.); A.M. Smith v. A. Smith (Del.Fam.Ct.1983) 458 A.2d 711, also relying upon the congressional intent of FUSFSPA and concluding, “Congress thereupon, legislatively vacated McCarty and clearly indicated an intention that persons who had been wronged by McCarty could reopen their cases if permitted under state law․ To do otherwise would be to carve out a category of people whose cases happened to be decided between June 25, 1981 and September 8, 1982 and deprive them of substantial property interests which all other similarly-situated litigants have been awarded.” (Id., at pp. 714–715.); Harkins v. Harkins (1983) 681 P.2d 722, 681 P.2d 722, reopening a stipulated final divorce decree entered after McCarty, but prior to the enactment of FUSFSPA, but finding it equitable under post-FUSFSPA law because wife had been awarded “lifetime alimony in lieu of a division of military retirement.” (Id., at p. 723.)) These decisions are also predicated on existing state rules patterned after Federal Rules of Civil Procedure, rule 60, allowing relief from a final judgment where “it is no longer equitable that the judgment should have prospective application; or ․ any other reason justifying relief from the operation of the judgment.” (Burton v. Burton (1983) 99 Nev. 698, 669 P.2d 703, reopening a final judgment pursuant to a statute similar to section 5124.)
4. The majority bases its decision on the supremacy clause. It therefore did “not discuss the res judicata arguments raised by the [parties].” (Majority opn., ante, p. 659.)
5. The Mueller court recognized the sanctity of res judicata but acknowledged it was within the Legislature's power to prevent its effect. “It is true as a general principle of law after the trial court has divided the property, and the judgment has become final, the court loses jurisdiction to modify or alter the division made.” (Mueller v. Walker, supra, 167 Cal.App.3d 600, 605, 213 Cal.Rptr. 442.) However, “by positive act the Legislature has superseded and modified the preclusive effect of the doctrine of res judicata ․ as applied to military retirement benefits in decrees or judgments or settlements which became final in the specified time frame.” (Id., at p. 607, 213 Cal.Rptr. 442.)
6. Bouquet interpreted legislation which did not indicate whether it was to be applied retroactively. Here, of course, the very statutory language mandates its retroactivity.
TROTTER, Presiding Justice.
WALLIN, J., concurs.SONENSHINE, Associate Justice, dissenting.