Connelley v. Connelley

Opinion

5 IN THE SUPERIOR COURT OF GUAM 6

7 JOSEPH C. CONNELLEY, 8 CASE NO. DM 0496-06 Plaintiff,

9 V.

10 DECISION AND ORDER CARMELITA 0. CONNELLEY, II

12 Defendant.

13

14

15 INTRODUCTION

16 This matter came before the Honorable Arthur R. Sarcinas on the 11th day of September, 17 2013, for a hearing on the issue of Defendant's request for declaratory relief regarding her 18 entitlement to a portion of Plaintiff's Government of Guam retirement benefits. Attorney Daniel 19

20 Somerfleck represented Plaintiff and Attorney William D. Pesch represented Defendant. For the

21 reasons set forth below, Defendant is entitled to her share of Plaintiff's Government of Guam 22 retirement benefits upon his retirement.

23 DISCUSSION

24 Plaintiff and Defendant wed on August 5, 1995. Plaintiff filed a Complaint for Divorce 25

26 on July 19, 2006. On June 26, 2009, this Court issued Interlocutory and Final Decrees of

27 Divorce ("Divorce Decree") as well as a Stipulated Order Dividing Community Property and 28 Assets ("Community Property Order"), with the latter stipulated nunc pro tunc to December 21, 0 cision and Order C nnelley v. Connelley, DM 0496-06

2007. Pursuant to the Divorce Decree, this Court retained continuing jurisdiction over all

2 outstanding and unresolved issues pertaining to, inter alia, property and asset distribution.

3 Plaintiff served as a teacher for the Government of Guam Public School System for 4 about eleven years; the parties were married for about nine and a half of those years. Plaintiff 5 made contributions to a retirement benefit plan in connection with his employment. This Court 6

7 previously concluded that, pursuant to 19 GCA §§ 6101 (c) and (g) and 4 GCA § 8166,

8 Plaintiff's retirement fund is community property and Defendant is entitled to a percentage, not 9 to exceed fifty percent, of the retirement benefits earned by Plaintiff while in the service of the 10 Government of Guam. The Community Property Order set aside for separate argument the II extent of Defendant's interest in Plaintiff's Government of Guam retirement fund. The issues 12

13 remaining for determination are Defendant's share of the pension benefits and the time of

14 distribution. 15 Defendant moved for declaratory judgment to clarify the division of Plaintiff's 16 Government of Guam retirement benefits. 7 G.C.A. § 26801; see also Hart v. Hart, 2008 Guam 17 11, ,, 11-14 (Superior Courts of Guam are empowered to provide declaratory relief to clarify 18

19 divorce decrees). Defendant contends that she should immediately be awarded fifty percent of

20 all contributions Plaintiff made to the retirement from their marriage, on August 5, 1995, until 21 their separation in July 2006. During this period, Plaintiffs contributions totaled $26,452.59;

22 Defendant accordingly seeks $13,226.30. Plaintiff argues that Defendant is not entitled to her 23 percentage of the fund until he retires, and that to hold otherwise would harm the retirement 24

25 fund.

26 The parties espouse, albeit without specific reference, the two basic methods for 27 distributing pension benefits upon marriage dissolution. See Pulliam v. Pulliam, 1990 OK 71, 28

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Decision and Order Connelley v. Connelley, DM 0496-06

796 P.2d 623 (discussing both methods and collecting cases). The present value method,

2 favored by Defendant, requires Plaintiff to pay Defendant immediately and eliminates the

3 necessity of future contact between the parties on the issue. The deferred distribution method, 4 on the other hand, requires Plaintiff to disburse Defendant's share only once he becomes 5 eligible for retirement benefits. The present value method could work a hardship on Plaintiff if 6 he lacks liquid assets or incurs penalties by withdrawing from the retirement fund, while the 7

8 deferred distribution method lacks finality.

9 The nature of retirement funds supports adoption of the deferred distribution method; 10 that is, retirement fund contributions are pooled, restricted from immediate expenditure, and II accrue interest over time for retirement availability. Insofar as this eventual right to retirement 12 benefits derives from employment before separation, it represents a community asset or l3

14 property interest available to both spouses. Lehman v. Lehman, 18 Cal.4th 169, 183 (1998).

15 Once a spouse accrues a right to retirement benefits, the retirement benefits "are stamped a 16 community asset from then on." Id. at 183. The parties are entitled to those benefits only when 17 the benefits reach maturation. See id. An early distribution of Defendant's share of Plaintiff's 18

19 retirement benefits would harm Plaintiff's fund and produce a result that fails to reflect

20 Defendant's share of accrued pension benefits attributable to the marriage. See Tucker v. 21 Tucker, 103 So. 3d 493, 495 (La. App. 2 Cir. 2012), writ denied, 100 So. 3d 844 (2012) ("To 22 assign a present valuation to an unmatured pension benefit would be speculative.")

23 It must also be noted that the parties already stipulated to a deferred distribution 24

25 arrangement with respect to Plaintiff's military pension benefits. Therefore, this Court

26 concludes that Defendant is entitled to her share of Plaintiff's Government of Guam retirement 27 benefits once he retires. Effective upon Plaintiff's retirement and continuing for so long as both 28

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Decision and Order Connelley v. Connelley, DM 0496...06

parties shall live, Defendant hall receive fifty percent of Plaintiffs benefit times a fraction, the

2 numerator of which is the number of months of retirement fund contributions from the parties'

3 date of marriage, August 5, 1995, 1 up to and including the parties' month of separation, July 4 2006, and the denominator of which is the total number of months of retirement fund 5 contributions. Plaintiff has a duty to exercise control of the retirement fund in good faith. See 6 Tucker v. Tucker, 103 So. 3d at 496.

7

8

9 CONCLUSION 10 For the reasons set forth above, Defendant is entitled to her share of Plaintiffs 11 Government of Guam retirement fund upon his retirement.

12

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15

16 IT IS SO ORDERED this day of NOV 0 7 2013 17

18

19 ~· HONORABLE ARTHUR R. SARCINAS 20 Judge, Superior Court of Guam : ~)G ' ,fYC: ~;~, >:i-· :·.\·_) . :~<~ ·~· 21 (s d t _:H frue .ir"ld corrB-~..:1 ·::.r;~-.~Y thP O'Y,Jifldi on '1le 1r: !he .)!"c,,. J f ~, ,e 22 Ci~rk :f ih~; S~ :.~ai4Y -.~C;:: · ; .)7-J~;;J . "f!

23 NOV 0 ? 2013 24

25 d ,

26

27 1 According to the Summary of Contributions received by this Court on October 23, 2009, the first month of the 28 parties' marriage in which Plaintiff made a retirement fund contribution was September, 1995.

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