Marriage of Clark

Filed 3/17/06 Marriage of Clark CA5

NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS

California Rules of Court, rule 977(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 977(b). This opinion has not been certified for publication or ordered published for purposes of rule 977.

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

FIFTH APPELLATE DISTRICT

APPEAL from a judgment of the Superior Court of Kern County. Frank A. Hoover, Judge.

Kilpatrick & White and Michael R. Kilpatrick for Appellant.

William H. Morris for Respondent.

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In reaching an equitable division of community assets upon dissolution of marriage, the trial court did not assign a value to and allocate the survivor's benefit under a private retirement plan. John^[1] appeals, contending the trial court erred when it deemed the survivor's benefit a terminable interest and abused its discretion when it failed to establish a present value and allocate the asset to Maria. We disagree with John and will affirm the judgment.

FACTUAL AND PROCEDURAL SUMMARY

John and Maria married on August 20, 1980. Prior to their marriage, John had been in the United States Navy. In 1977 he went to work for the company that became known as Northrop-Grumman. John remained employed at Northrop-Grumman until his retirement in 1998. John and Maria separated on October 5, 2001.

John elected a payout option on the Northrop-Grumman pension plan that provided for a survivor's benefit. By electing this option, the monthly payment during John's life was less than if this option had not been selected. According to John, he designated Maria as the beneficiary of the survivor's annuity.

Maria claimed that her interest in the community property portion of the Northrop-Grumman pension plan was 45.454545 percent. John calculated Maria's percentage as 42 percent. The trial court's interim determination was that Maria had a 43.89 percent interest.

After John was ordered to pay a portion of his Northrop-Grumman monthly annuity to Maria, he claimed that his and Maria's marriage was invalid. He also asserted that because the marriage was invalid, Maria would not have any right to the survivor's annuity. Additionally, John maintained that even if the trial court found Maria to be a putative spouse, she would not be eligible to receive the survivor's annuity.

The trial court determined that there was a valid marriage and a dissolution was granted on October 28, 2003. All other issues were reserved for trial. The trial court also requested that a copy of the pension plan and any actuarial documentation be provided to the court before the December 9, 2003, trial date. Prior to the December 9 trial date, the parties resolved most of the issues surrounding the division of community property. In part, the parties agreed that the monthly distributions from the Northrop-Grumman pension plan would be divided pursuant to the time rule formula. They also agreed that a Qualified Domestic Relations Order (QDRO) be prepared and served on the plan administrator so that Maria's share of the monthly payments would be paid directly to her.

The issue of the survivor benefit was not resolved prior to trial. At trial John argued that Maria was designated as the beneficiary of the survivor benefit, was statistically likely to survive him, and the value of monthly payments during his lifetime was reduced because of the survivor benefit election.

John retained a forensic economist to value the survivor's annuity. The forensic economist estimated the community value of the survivor's annuity to be $61,000 to $62,000. John requested that the trial court allocate that value to Maria as part of the division of community assets. He also requested that he receive an offset for the value of the survivor benefit from other community assets.

Maria argued that there was no evidence that the designation of beneficiary for the survivor benefit was irrevocable. Although the plan documentation provided by John stated that the selection of a survivor benefit payout option was irrevocable, there was no language in that documentation stating that the designation of a beneficiary for the survivor benefit was irrevocable. There also was no evidence that the plan would allow an ex-spouse to receive a survivor's benefit.

Maria asked that the trial court retain jurisdiction over the survivor benefit, with she and John to retain their proportionate community interest in the survivor benefit. Maria contended that absent evidence she was the irrevocable beneficiary, requiring her to pay John for his proportionate interest at this point in time placed her at risk. Maria speculated that unless there was proof she was the irrevocable beneficiary and entitled to a survivor benefit after dissolution of marriage, John could change beneficiaries after she had paid John for his proportionate interest.

The trial court asked Maria if she was willing to renounce a portion of the survivor benefit and retain only a 44 percent share of the survivor benefit, to which she responded affirmatively.

The trial court issued its ruling on March 1, 2004. That ruling stated that the Northrop-Grumman pension plan payments would be divided by the time rule; the survivor benefit payments were too speculative to divide at this point in time and constituted a terminal interest; and the trial court would retain jurisdiction over the survivor's benefit in the event John â€