IN RE: the MARRIAGE OF Jess H. and Angela HISQUIERDO. (1976)

INTRODUCTION

By its interlocutory judgment of dissolution of marriage insofar as distribution of property is concerned, the trial court awarded to Jess H. Hisquierdo (hereafter Husband) the residence in which there was an equity of $12,828 and the furniture and fixtures valued at $500; to Angela Hisquiersdo (hereafter Wife) the ISI Growth Mutual Fund valued at $100 and a 1965 Ford automobile. These were community property. To equalize distribution, it was ordered that Husband pay to Wife $6,364, with interest, in specified monthly installments for six-and-one-half years and made a judicial lien in favor of Wife on the real property until paid in full.

In addition to the above, the judgment stated: ‘The Court finds that there is no community interest in [Husband's] railroad retirement fund, or in [Wife's] social security benefits.’

Wife has appealed ‘from that portion of the Interlocutory Judgment of Dissolution of Marriage . . . adjudging that there is no community property interest in [Husband's] Railroad Retirement Fund Pension Plan.’

THE FACTS

Husband and Wife were married in September of 1958 and were separated in July of 1972, a period of 13 years and 10 months from date of marriage to date of separaion. There were no children.

At the dissolution of marriage hearing, held July 9, 1975, Wife testified that she had been working ever since she was 18 years old at different jobs; that she presently was working for a firm by which she had been employed eight years; and that she was ‘now fifty-three’ years old. She testified that Husband was fifty-five years old.

The record, including Husband's testimony, shows that Husband began working for the Atchison, Topeka & Santa Fe Railroad in June of 1942 and left in April of 1975 to work for the Los Angeles Union Passenger Terminal where he was working at the time of the hearing; and that these employments were within the provisions of the Railroad Retirement Act of 1937 (45 U.S.C. §§ 228a et seq.; hereinafter 1937 Act), now the Railroad Retirement Act of 1974 (45 U.S.C. §§ 231 et seq.; hereinafter 1974 Act).¹

ISSUE

The sole issue on appeal is whether the trial court correctly held that there was no community interest in the Husband's railroad retirement.

DISCUSSION

Here, Husband has been employed under the retirement acts for more than 30 years, he has not reached the age of 60 years and no annuity benefits yet have become payable under the retirement acts. (1937 Act, § 228b(a)(3); 1974 Act, § 231a(a)(1)(ii).)

Even though it may appear that no vested right exists under this factual situation, the California Supreme Court in In re Marriage of Brown (1976) 15 Cal.3d 838, 845, 126 Cal.Rptr. 633, 544 P.2d 561, overruling French v. French (1941) 17 Cal.2d 775, 112 P.2d 235, recently held that nonvested pension rights in California do not derive from the employer's beneficence but that the employee's right is contractual, and therefore a property right, which is to be valued and divided as community even though not yet payable. (See also In re Marriage of Freiberg (1976) 57 Cal.App.3d 304, 127 Cal.Rptr. 792.)

It is established that federal government pension rights are not contractual, and, accoringy, ‘the government may alter, modify, or even terminate existing annuities by subsequent legislation.’ (60 Am.Jur.2d, Pensions and Retirement Funds, § 25, p. 899. Stouper v. Jones (1960) 109 U.S.App. D.C. 106, 284 F.2d 240, 242–243.) In Ruhl v. Railroad Retirement Board (1965) 7 Cir., 342 F.2d 662, cert. den. 382 U.S. 836, 86 S.Ct. 81, 15 L.Ed.2d 78, it was held (p. 666) that, ‘participation in the [railroad] retirement system is compulsory, a condition of employment, not optional, and the rights involved are statutory, not contractual in nature.’

It has also been held that Congress ‘may determine the community or separate character of a federally created benefit, and such determination binds the states. (Free v. Bland (1962) 369 U.S. 663, 668, 82 S.Ct. 1089, 8 L.Ed.2d 180, 184; Wissner v. Wissner (1950) 338 U.S. 655, 660–661, 70 S.Ct. 398, 94 L.Ed. 424, 429–430.)’ (In re Marriage of Jones (1975) 13 Cal.3d 457, 461, 119 Cal.Rptr. 108, 531 P.2d 420.)

However, in In re Marriage of Milhan (1974) 13 Cal.3d 129, 117 Cal.Rptr. 809, 528 P.2d 1145, involving a National Service Life Insurance policy, the California Supreme Court points out that congressional intent or goals in the creation of the right by federal law controls over the states but so long as the state does not interfere therewith it may find room for application of state principles and ruled that California could evaluate the community interest therein and award the insured's spouse a proper amount in other property available for disposition but could not require the insured to surrender or otherwise impair the policy nor to impair his right to designate the beneficiary or beneficiaries nor impair the named beneficiary from receiving and retaining the full amount of the policy proceeds.

We conclude that the rationale and holding in Milhan does not apply under the statutory provisions and scheme of the instant case for the following reasons:

FIRST: The federal Railroad Retirement Act specifically provides: ‘Notwithstanding any other law of the United States, or of any State, Territory, or the District of Columbia, no annuity or pension payment shall be assignable or be subject to any tax or to garnishment, attachment, or other legal process under any circumstances whatsoever, nor shall the payment thereof be anticipated.’ (1937 Act, § 228l; 1974 Act, § 231m.)²

SECOND: The Railroad Retirement Act specifies in detail the circumstances under which the railroad employee will become entitled to benefits thereunder. (See, e. g., 1937 Act, § 228b, (a) through (d), and § 228c; 1974 Act, § 231a, (a) and (b), and § 231b.) The Railroad Retirement Act specifies in detail the circumstances under which such employee's spouse, widow or widower is entitled to any benefits thereunder. (See e. g., 1937 Act, § 228b, (e) through (i), and § 228e; 1974 Act, § 231a, (c) and (d), and §§ 231c through 231e.) Depending on the particular benefit involved (annuity, lump sum payment, etc.), the federal statute sets forth requirements for eligibility such as attainment of the age of 65 by a spouse or, if a wife, custody of a child as defined (1937 Act, § 228b, (e)(ii); 1974 Act, § 231a, (c)(1)(ii); marriage for not less than one year immediately preceding date of application for spouse's annuity (1937 Act, § 228b, (f); 1974 Act, § 231a, (c)(3); right of widow or widower to lump sum if living with the employee at time of latter's death (1937 Act, § 228e, (f)(1); 1974 Act, § 231e, (a)(1)); spouse's right to annuity ceases on divorce (1937 Act, § 228b, (g)(ii); 1974 Act, § 231d, (c)(3)). Additional similar examples could but need not be given.

As noted above the federal law is most explicit and detailed in setting forth the particular interest or right which the employee and the employee's spouse or wife or widow or widower may become entitled to under the Railroad Retirement Act. The interest or right given the employee is separate and distinct from that given to the spouse or wife or widow or widower of such employee and the interest or right given to the spouse or wife or widow or widower of the employee is separate and distinct from that given to the employee. It is now provided that if, after employee's death, there is no one to whom payments can be made under the provisions of the statute, then those payments escheat to the credit of the Railroad Retirement Account. (1974 Act, § 231e, (a)(5).)

Here, Wife has been separated from Husband for over three years. They are childless. It does not appear that Wife would ever be entitled to any benefits—whether those of a spouse or a wife or a widow—under the Railroad Retirement Act. Her brief suggests none and we have found none.

We conclude that to require Husband in the case at bench to turn over to Wife in equivalent to that which he by law may become entitled upon reaching his 60th year would completely frustrate congressional provisions which grant him those benefits separate and distinct from Wife. (See, e. g., In re Marriage of Milhan, supra, 13 Cal.3d at p. 133, fn. 2, 117 Cal.Rptr. 809, 528 P.2d 1145, second par.)

We, therefore, hold the trial court correctly determined that there was no community interest in Husband's railroad retirement fund.

DISPOSITION

The portion of the judgment from which appeal herein was taken is affirmed.

FOOTNOTES

1.  The period from marriage to separation (13 years and 10 months) falls within the more than 30 years during which Husband has been working in employment under the retirement acts. No community property interest is claimed as to that which antedates the marriage. None may be claimed as to that which postdates separation. (Civ.Code, § 5118; In re Marriage of Bouquet (1976) 16 Cal.3d 583, 128 Cal.Rptr. 427, 546 P.2d 1371.)

2.  Neither the provision regarding National Service Life Insurance policies quoted in Wissner v. Wissner, supra, 338 U.S. 655, 659, 70 S.Ct. 398, 400, 94 L.Ed. 424, now part of 38 U.S.C. § 3101(a), nor the provision contained in the Social Security Act (42 U.S.C. § 407) are worded as above and particularly neither contains the language ‘nor shall the payment thereof be anticipated.’ Husband argues that the Railroad Retirement Act is to be likened to the Social Security Act but cites no decisions which concern that which is presented in this case under either enactment. The Social Security Act differs from the Railroad Retirement Act (although the latter in some provisions refers to sections of the former) and the one does not control the other as to that which here is involved.

HANSON, Associate Justice.

WOOD, P. J., and THOMPSON, J., concur.