MEMORANDUM DECISION Pursuant to Ind. Appellate Rule 65(D), FILED this Memorandum Decision shall not be May 31 2016, 10:14 am
regarded as precedent or cited before any CLERK Indiana Supreme Court court except for the purpose of establishing Court of Appeals and Tax Court the defense of res judicata, collateral estoppel, or the law of the case.
ATTORNEY FOR APPELLANT ATTORNEY FOR APPELLEE Rodney V. Shrock Jacob D. Winkler Kokomo, Indiana Noel Law Kokomo, Indiana
IN THE COURT OF APPEALS OF INDIANA
Mary J. Coate, May 31, 2016 Appellant-Petitioner, Court of Appeals Case No. 34A02-1509-DR-1433 v. Appeal from the Howard Circuit Court Timothy D. Coate, The Honorable J. David Grund, Appellee-Respondent. Special Judge Trial Court Cause No. 34C01-1304-DR-286
Riley, Judge.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 1 of 21 STATEMENT OF THE CASE
[1] Appellant-Petitioner, Mary J. Coate (Mary), appeals the trial court’s division of
the marital estate following the dissolution of her marriage to Appellee-
Respondent, Timothy D. Coate (Timothy).
[2] We affirm in part, reverse in part, and remand.
ISSUES
[3] Mary raises four issues on appeal, three of which we find dispositive and restate
as follows:
(1) Whether the trial court abused its discretion by awarding the marital
residence to Timothy;
(2) Whether the trial court abused its discretion in its valuation of Timothy’s
pension; and
(3) Whether the trial court abused its discretion by awarding 10% of Timothy’s
pension to Mary and by failing to order that Mary is entitled to a surviving
spouse benefit.
FACTS AND PROCEDURAL HISTORY
[4] On June 6, 1982, Timothy and Mary were married. The marriage produced
two children, who are both now grown. Prior to the marriage, Timothy served
for four years in the United States Army. In 1981, he was hired by the United
States Postal Service as a mail carrier and has been employed there ever since.
During the first half of the marriage, Mary worked several part-time jobs but
otherwise stayed home to care for the children. In 1994, she obtained
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 2 of 21 employment with the Postal Service in its processing department, where she
continues to work. On April 4, 2013, after nearly thirty-one years of marriage,
Mary filed a petition for dissolution.
[5] On November 20, 2014, the trial court conducted the final hearing. The
evidence established that, during the course of their marriage, Timothy and
Mary accrued very little debt. As part of their plan for a comfortable
retirement, they paid off the mortgage on their marital home in Kokomo,
Indiana, which was appraised at $280,000. The parties also contributed funds
to their individual Thrift Savings Plan (TSP) accounts. As of the date the
petition for dissolution was filed, Timothy’s TSP account contained $102,541,
and Mary’s TSP account totaled $136,498. Through their employment with the
Postal Service, both Timothy and Mary have pensions. Timothy has a Civil
Service Retirement System (CSRS) pension, whereas Mary has a Federal
Employees Retirement System (FERS) pension. Under the CSRS, Timothy
does not contribute to the social security system, and he will not be eligible to
receive social security benefits upon his retirement. Conversely, under the
FERS, social security taxes are withheld from Mary’s paychecks, and she will
be entitled to receive social security benefits, in addition to her pension, upon
her retirement.
[6] On February 5, 2015, the trial court entered its Findings of Fact, Conclusions of
Law and Decree of Dissolution. The trial court concluded that the parties
should receive equal shares of the marital estate. The trial court awarded the
marital residence to Timothy, and both parties received their requested items of
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 3 of 21 personal property and life insurance policies. Each party received his/her own
TSP account. In addition, the court determined that Mary’s FERS pension has
a monthly benefit of $550, and Timothy will receive $2,809 per month from his
CSRS pension. The court considered that Mary “delayed employment for
approximately twenty[-]one years to be a homemaker and raise the children”
which “resulted in [Timothy’s] pension benefit being of a much greater value.”
(Appellant’s App. p. 12). Therefore, “in order to equalize the property
division[,]” the trial court used the coverture fraction formula to divide
Timothy’s pension, earned through the date the petition for dissolution was
filed, and awarded 23.5% of his CSRS pension to Mary. (Appellant’s App. p.
12). Also, in order to effectuate an equal division of the estate, the trial court
ordered Timothy to “pay an equalizing judgment of $133,938.07 to [Mary].
[Timothy] shall pay this amount by [Qualified Domestic Relations Order
(QDRO)] from his [TSP] account with any balance paid within [thirty] days
thereafter.” (Appellant’s App. p. 16). 1
[7] On February 18, 2015, Mary filed a “Motion to Correct Errors [sic],” alleging,
in relevant part, that the trial court erred by: awarding the marital real estate to
Timothy; ordering Timothy to pay an equalizing judgment to Mary via a
1 Under the Employee Retirement Income Security Act (ERISA), “pension benefits may be assigned or alienated from the plan participant only if the order alienating the benefit is a [QDRO].” Kendrick v. Kendrick, 44 N.E.3d 721, 725 (Ind. Ct. App. 2015), trans. denied. However, a “governmental plan” is not governed by ERISA. Id.; see 29 U.S.C. §§ 1002(32), 1003(b)(1). As neither party has indicated that the QDRO was an improper means of transferring funds from Timothy’s TSP account, we will presume that the QDRO satisfied the requirements of the TSP administrator.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 4 of 21 QDRO from his TSP account; and failing to require Timothy to opt for the
survivor benefit on his CSRS pension for Mary. (Appellant’s App. p. 29). On
March 4, 2015, Timothy also filed a “Motion to Correct Errors [sic].”
(Appellant’s App. p. 35). Timothy claimed, in part, that the trial court erred by
awarding 23.5% of his pension to Mary. Specifically, Timothy argued that,
unlike Mary, he would not be entitled to receive any social security benefits
upon his retirement, and it would therefore be more equitable to reduce Mary’s
share of his pension to 10%. On July 21, 2015, Mary filed a “Motion for Relief
from Judgment,” claiming that the trial court’s Decree of Dissolution “contains
a mathematical (clerical) mistake”—i.e., “in an attempt to equalize the pension
payments accruing during the marriage . . . the [c]ourt’s obvious intent was to
transfer $862.65 to [Mary] but only provided for a transfer of $660.00.”
(Appellant’s App. p. 37).
[8] On July 22, 2015, the trial court held a hearing on the parties’ motions to
correct error and for relief from judgment. On August 14, 2015, the trial court
issued its “Order on Motion to Correct Errors [sic] and Motion for Relief from
Judgment.” (Appellant’s App. p. 21). The trial court denied both Mary’s
“Motion to Correct Errors [sic]” and her “Motion for Relief from Judgment.”
(Appellant’s App. pp. 29, 37). 2 As to Timothy’s “Motion to Correct Errors
2 Mary raises the trial court’s denial of her “Motion for Relief from Judgment” (regarding a purported mathematical error) as her fourth issue in her appellate brief. (Appellant’s App. p. 37). However, except to broadly identify the claim, Mary does not further develop this argument. Therefore, we find that she has waived the matter for review pursuant to Indiana Appellate Rule 46(A)(8)(a).
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 5 of 21 [sic],” the trial court stated that it “erroneously found that [Mary] delayed
employment approximately twenty-one years to be a homemaker and raise the
children” as she “had [s]ocial [s]ecurity earnings and was employed all but five
(5) years of the marriage.” (Appellant’s App. pp. 25, 35). Thus, the trial court
found that it “fail[ed] to consider the overall retirement benefits to be received
by both parties.” (Appellant’s App. p. 24). Finding that Mary will receive a
monthly pension of $550 plus a monthly social security payment of $2,005, the
trial court reduced Mary’s share of Timothy’s pension from 23.5% to 10% as of
the filing date. The trial court noted that “[i]f this division results in an unequal
division of vested assets[,] it is the [c]ourt’s intention to do so after
consideration of all retirement and [s]ocial [s]ecurity benefits of the parties.”
(Appellant’s App. p. 25).
[9] Mary now appeals. Additional facts will be provided as necessary.
DISCUSSION AND DECISION
I. Standard of Review
[10] In this case, the trial court entered sua sponte findings of fact and conclusions
thereon in accordance with Indiana Trial Rule 52(A). “Sua sponte findings
control only as to the issues they cover, and a general judgment will control as
to the issues upon which there are no findings.” Morgal-Henrich v. Henrich, 970
N.E.2d 207, 210 (Ind. Ct. App. 2012). We will affirm a general judgment “if it
can be sustained on any legal theory supported by the evidence.” Id.
Regarding the special findings and conclusions thereon, we “shall not set aside
the findings or judgment unless clearly erroneous, and due regard shall be given Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 6 of 21 to the opportunity of the trial court to judge the credibility of the witnesses.”
Ind. Trial Rule 52(A). Our review is two-tiered: first, we must determine
whether the evidence supports the trial court’s findings; second, we consider
whether those findings support the judgment. O’Connell v. O’Connell, 889
N.E.2d 1, 10 (Ind. Ct. App. 2008). The trial court’s findings will be found
clearly erroneous if “the record contains no facts to support them either directly
or by inference.” Morgal-Henrich, 970 N.E.2d at 210 (quoting Yanoff v. Muncy,
688 N.E.2d 1259, 1262 (Ind. 1997)). “A judgment is clearly erroneous if it
applies the wrong legal standard to properly found facts.” Id. “In order to
determine that a finding or conclusion is clearly erroneous, [this court’s] review
of the evidence must leave [us] with the firm conviction that a mistake has been
made.” Id.
[11] In addition, it is well established that a challenge to the trial court’s division of
marital property is reviewed under the abuse of discretion standard. Granzow v.
Granzow, 855 N.E.2d 680, 682-83 (Ind. Ct. App. 2006). Here, Mary is
technically appealing from the denial of her “Motion to Correct Errors [sic],”
which is also reviewed for an abuse of discretion. Wortkoetter v. Wortkoetter, 971
N.E.2d 685, 687 (Ind. Ct. App. 2012); (Appellant’s App. p. 29). Our court will
consider only the evidence most favorable to the trial court’s judgment, and we
will uphold the trial court’s decision unless “its judgment is clearly against the
logic and effect of the facts and the reasonable inferences to be drawn from
those facts.” Granzow, 855 N.E.2d at 683. We do not reweigh evidence or
assess the credibility of witnesses. O’Connell, 889 N.E.2d at 10.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 7 of 21 II. Marital Residence
[12] Mary first claims that the trial court abused its discretion by awarding the
marital residence to Timothy and ordering that Timothy pay her an equalizing
judgment via a QDRO. In Indiana, following a petition for dissolution, the
trial court is required to
divide the property in a just and reasonable manner by: (1) division of the property in kind; (2) setting the property or parts of the property over to one (1) of the spouses and requiring either spouse to pay an amount, either in gross or in installments, that is just and proper; (3) ordering the sale of the property under such conditions as the court prescribes and dividing the proceeds of the sale; or (4) ordering the distribution of benefits described in [Indiana Code section] 31-9-2-98(b)(2) or [Indiana Code section] 31-9-2- 98(b)(3) that are payable after the dissolution of marriage, by setting aside to either of the parties a percentage of those payments either by assignment or in kind at the time of receipt.
Ind. Code § 31-15-7-4. There is a rebuttable presumption “that an equal
division of the marital property between the parties is just and reasonable.” I.C.
§ 31-15-7-5. In this case, the trial court determined that the parties should
receive equal shares of the marital estate. In accomplishing this goal, the trial
court was obligated to divide all of the property of the parties, regardless of
whether it was:
(1) owned by either spouse before the marriage; (2) acquired by either spouse in his or her own right: (A) after the marriage; and (B) before final separation of the parties; or (3) acquired by their joint efforts. Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 8 of 21 I.C. § 31-15-7-4(a). “A party challenging the trial court’s division of marital
property must overcome a strong presumption that the trial court considered
and complied with the applicable statute, and that presumption is one of the
strongest presumptions applicable to our consideration on appeal.” O’Connell,
889 N.E.2d at 10 (internal quotation marks omitted).
[13] During the final hearing, both parties testified that they wanted possession of
the family home. In support of its decision to award the marital residence to
Timothy, the trial court found that
[i]n 2011, [Timothy] inherited approximately $100,000.00 and paid off the marital residence mortgage among other debts of the parties. In 1999, [Mary] inherited approximately $6,000.00 and spent [the] same toward marital assets and debts. The [c]ourt considered these facts to be especially important in determining the disposition of the marital residence.
(Appellant’s App. p. 16). In addition, the trial court found that “[Mary]
testified that due to downsizing at the postal service that she anticipates that her
position will soon be transferred elsewhere and she will be required to travel up
to [fifty] or so miles away in order to keep her employment with the post
office.” (Appellant’s App. p. 13).
[14] According to Mary, there was “no evidence that [Timothy] considered his
inheritance as a factor in the division of the home, and the [c]ourt failed to
make any findings or explain why the inheritance would be especially
important.” (Appellant’s Br. p. 9). Also, Mary argues that the evidence
established that she planned to commute in the event her job was relocated. Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 9 of 21 We find that Mary’s arguments amount to a request that we reweigh the
evidence, which we decline to do. It is well established that “[a] trial court’s
discretion in dividing marital property is to be reviewed by considering the
division as a whole, not item by item.” Kendrick, 44 N.E.3d at 724. “In crafting
a just and reasonable property distribution, a trial court is required to balance a
number of different considerations in arriving at an ultimate disposition. The
court may allocate some items of property or debt to one spouse because of its
disposition of other items.” Morgal-Henrich, 970 N.E.2d at 212 (quoting Fobar v.
Vonderahe, 771 N.E.2d 57, 59 (Ind. 2002)).
[15] Here, the trial court determined that an equal property division was just and
reasonable. The evidence most favorable to the trial court’s decision establishes
that Timothy wished to be awarded the house, he contributed his inheritance to
the mortgage, and Mary would likely no longer be employed in Kokomo.
Therefore, we find that it was entirely within the discretion of the trial court to
set the real estate over to Timothy and then require Timothy to make an
equalizing payment to Mary of $133,938.07. 3 See I.C. § 31-15-7-4(2) (providing
that the trial court may “set[] the property or parts of the property over to one
(1) of the spouses and requir[e] either spouse to pay an amount, either in gross
or in installments, that is just and proper”).
[16] Mary further asserts that the trial court abused its discretion because it
3 Mary does not dispute that $133,938.07 is the appropriate amount for an equalizing judgment.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 10 of 21 left her without a residence. She will need a residence after the divorce. There is no finding by the [t]rial [c]ourt that the tax consequences of the equalizing judgment were taken into account. The [t]rial [c]ourt’s award of the marital residence offset by an award of a QDRO implicitly impacted by a tax and tax penalty where a party is divested of ownership in a home is not equitable, results in an unequal division of marital property and is an abuse of discretion.
(Appellant’s Br. p. 10). As such, Mary argues that “[t]he record does not
support an award of the marital residence to either party.” (Appellant’s Br. p.
10). Rather, she posits that “[a]n [o]rder for the sale of the marital real estate
where there are no minor children and the parties are near retirement provides
an equitable solution. The house is either sold at fair market value or purchased
by one of the parties.” (Appellant’s Br. p. 10).
[17] “The court, in determining what is just and reasonable in dividing property
under this chapter, shall consider the tax consequences of the property
disposition with respect to the present and future economic circumstances of
each party.” I.C. § 31-15-7-7. Trial courts are statutorily required “to consider
only the direct or inherent and necessarily incurred tax consequences ‘of the
property disposition.’” Hartley v. Hartley, 862 N.E.2d 274, 284 (Ind. Ct. App.
2007) (quoting Harlan v. Harlan, 560 N.E.2d 1246, 1246 (Ind. 1990)). “[T]o the
extent the trial court was required but failed to consider tax consequences in
dividing the marital estate and the resulting division does not come close to the
attempted apportionment[,] . . . the findings will not support the judgment and
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 11 of 21 we must remand.” Hardin v. Hardin, 964 N.E.2d 247, 254 (Ind. Ct. App. 2012)
(second and third alterations in original) (internal quotation marks omitted).
[18] In this case, no actual evidence of the tax consequences was presented to the
trial court. Rather, the parties’ attorneys vaguely discussed the tax implications
during the hearing on the parties’ motions to correct error. First, Mary’s
attorney argued that the rules for the TSP accounts state
that you cannot start withdrawing it until a certain age without a tax penalty, and then at a certain point in time you must start withdrawing enough amounts so that you do not generate a tax penalty. But if you need the money or need the use of the money immediately, um since it’s a pre-income tax deposit, the person that’s going to cash in that [TSP] is going to suffer a penalty. I think the penalty is usually [20%], and then there’s also the regular income tax that’s going to be assessed against it. So . . . the theory is that[] you’re going to have between [40% and 50%] of that TSP money taken away uh in taxes by the Internal Revenue Service.
(Tr. p. 97) (ellipsis in original). In response, Timothy’s attorney argued that
we tried to divide everything up on the balance sheet and there’s [sic] tax consequences sometimes on how it’s divided up but it’s not a [40%] or [50%] tax rate to [Mary]. Um . . . on that uh there would be no penalty if she withdrew the money to buy a house like she states um because it’s a divorce. And in the penalty part [sic] of the cash withdraw[al] is not imposed under the IRS rules and the, when she withdraws the money it’s at her then income level. So like most 401K[ plans] or [TSPs] are designed, when you retire your income’s lower and you[’re] taxed at a much lower rate. And so it would not equate to a [40%] or [50%] rate. [Timothy] was also awarded his [TSP account], he’[d] have the
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 12 of 21 same identical tax consequences if we wanted to withdraw money from his [TSP account].
(Tr. pp. 103-04) (ellipsis in original).
[19] Here, the trial court could not have been required to consider the tax
consequences of ordering Timothy to transfer money to Mary from his TSP
account via a QDRO because no evidence of the necessarily incurred tax
consequences was presented. Hardin, 964 N.E.2d at 254; see, e.g., Hartley, 862
N.E.2d at 284 (noting that “a certified public accountant calculated the pre-tax
and after-tax values of the parties’ pensions and 401(k) accounts[,]” and these
“calculations were admitted into evidence”). Accordingly, we find that Mary
“has invited the error [s]he now alleges, and has waived this issue on appeal.”
Hardin, 964 N.E.2d at 254. Furthermore, as we have already discussed, it was
well within the discretion of the trial court to set aside the marital residence to
Timothy rather than ordering it be sold and the proceeds divided. See I.C. § 31-
15-7-4.
III. CSRS Pension
A. Value of CSRS Pension
[20] Next, Mary claims that the trial court abused its discretion by assigning a
monthly value of $2,809 to Timothy’s CSRS pension. Prior to the parties’
marriage, Timothy served four years in the U.S. Army, during which time, he
began accruing a pension. After becoming employed by the Postal Service,
Timothy opted to have his four years of military service tacked onto to his
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 13 of 21 CSRS pension. According to Mary, “[t]he $2,809.00 number used by the court
only took into account the thirty-two years he worked at the post office and not
the thirty-six years he is entitled to as a result of the [additional military years].
A thirty-six[-]year service record would amount to a $3,182.00 monthly
pension.” (Appellant’s Br. pp. 10-11). She contends that “there is no rationale
[sic] or equitable basis for the trial court to ignore assets acquired during the
[parties’] cohabitation and after more [sic] six years of cohabitation followed by
almost three decades of marriage.” (Appellant’s Br. p. 11).
[21] “When a trial court engages in valuing assets in the course of acting on a
dissolution action, it has broad discretion, and its valuation will only be
disturbed for an abuse of that discretion. So long as there is sufficient evidence
and reasonable inferences to support the valuation, an abuse of discretion does
not occur.” Granzow, 855 N.E.2d at 685 (internal citations omitted). Indiana’s
“one-pot” theory of marital property “specifically prohibits the exclusion of any
asset from the scope of the trial court’s power to divide and award.” Kendrick,
44 N.E.3d at 728. As we have already stated, marital property consists of
property that is acquired by either spouse prior to the marriage. I.C. § 31-15-7-
4(a). Therefore, although “the court may ultimately determine that the portion
of [Timothy’s] pension earned prior to the marriage should be awarded solely to
him, it must first include the asset in its consideration as to how the marital
estate should be divided.” Kendrick, 44 N.E.3d at 729.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 14 of 21 [22] In this case, the trial court applied the coverture fraction formula to determine
what portion of Timothy’s pension is attributable to the marriage. See In re
Marriage of Fisher, 24 N.E.3d 429, 433 (Ind. Ct. App. 2014).
The “coverture fraction” formula is one method a trial court may use to distribute pension or retirement plan benefits to the earning and non-earning spouses. Under this methodology, the value of the retirement plan is multiplied by a fraction, the numerator of which is the period of time during which the marriage existed (while pension rights were accruing) and the denominator is the total period of time during which pension rights accrued.
Id. (quoting Hardin, 964 N.E.2d at 250). The trial court found the “start date of
[Timothy’s] pension initiation to be June of 1975, the marriage date of June 6,
1982, and the ending date of April 4, 2013 (date of filing).” (Appellant’s App.
p. 13). Using these dates, the trial court determined that the length of the
marriage while pension rights were accruing was 367 months (30.6 years), and
the total period that Timothy’s pension accrued prior to the filing date was 451
months (37.6 years); thus 81% of Timothy’s pension represented the “marital
portion.” (Appellant’s App. p. 13). 4 The trial court found that Mary was
entitled to 40.5% (i.e., one-half of the marital portion) of Timothy’s CSRS
pension. The trial court initially reduced this number to 23.5% to offset
4 We note that the length of the marriage while pension rights accrued (i.e., between June 6, 1982, and April 4, 2013) is actually 369 months, and the total time Timothy earned pension benefits prior to the filing date (i.e., between June of 1975 and April 4, 2013) is 454 months. Regardless, using these numbers also establishes that the marital portion of Timothy’s CSRS pension is 81%.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 15 of 21 Timothy’s share of Mary’s pension. Then, following Timothy’s “Motion to
Correct Errors [sic],” the trial court reduced Mary’s share of the CSRS pension
to 10% based on the fact that she will also receive social security benefits,
whereas Timothy will not. (Appellant’s App. p. 35).
[23] Timothy submitted an annuity estimate into evidence, which provides that a
CSRS pension employee with thirty-two years of service will receive a monthly
payment of $2,809. An employee with thirty-seven years of service will receive
$3,275. (See Respondent’s Ex. H). In using the coverture fraction formula, the
trial court relied on the total number of years—i.e., thirty-seven—that Timothy
contributed to his pension prior to the marriage and up to the filing date.
Accordingly, we find that the trial court should have utilized a value of $3,275
for Timothy’s CSRS pension based on his thirty-seven years of service. We
remand with instructions for the trial court to recalculate and redistribute, if
necessary, the marital estate based on the fact that the value of Timothy’s
monthly CSRS pension benefit is $3,275.
B. Division of CSRS Pension
[24] Mary also claims that the trial court abused its discretion by reducing her share
of Timothy’s CSRS pension to 10%. In its “Order on Motion to Correct Errors
[sic] and Motion for Relief from Judgment,” the trial court “found that [Mary’s]
social security benefits are not a mar[it]al asset to be included in the marital pot
subject to division. But, the parties acknowledged that [c]ourts may consider
these benefits in the overall economic circumstances of the parties in adjudging
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 16 of 21 a just and reasonable division of property between the parties.” (Appellant’s
App. pp. 21, 23). As such, the trial court explained that
[b]oth [p]arties submitted similar exhibits as to their individual post office pensions and the social security benefits of [Mary]. [Mary’s] exhibit attached a document entitled “Your Social Security Statement” which sets forth [Mary’s] benefit at full retirement at $2,005.00 per month. The Statement also states that [Mary] has “earned enough credits to qualify for benefits” now if she became disabled and would receive $1,893.00 per month. [Timothy’s] exhibit “H” also attached a similar Social Security Statement of [Mary’s] benefits. [Mary] will receive $550.00 per month in [FERS] benefits. If one considers the overall retirement benefits to be received by the parties they are substantially similar in amount.
(Appellant’s App. pp. 23-24). The trial court further indicated that it
erred in failing to consider the overall retirement benefits to be received by both parties. After careful consideration of the testimony, exhibits and the factors stated above, [Mary] is awarded a portion of [Timothy’s] pension in the amount of ten percent (10%) instead of twenty-three and one-half (23.5%). The [c]ourt finds that [Mary] will be entitled to all of her own post office pension benefits, which were incurred entirely during the marriage, she will be entitled to all of her social security benefits, and in addition, she will be entitled to ten percent (10%) of [Timothy’s] post office pension benefits as of the filing date. On the other hand, [Timothy] is not entitled to any social security benefits and will receive ninety percent (90%) of his post office benefits as of the filing date. If this division results in an unequal division of vested assets it is the [c]ourt’s intention to do so after consideration of all retirement and [s]ocial [s]ecurity benefits of the parties.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 17 of 21 (Appellant’s App. pp. 24-25).
[25] On appeal, Mary asserts that
[t]he [t]rial [c]ourt admitted its distribution of the vested pensions was unequal and it was the intent of the [c]ourt to do so. [She] argues that such a distribution is patently unfair. Any [s]ocial [s]ecurity benefit she earned during her homemaker years was funded by a tax while [Timothy’s] pension was a depletion of marital assets. Further, the parties agreed upon an equal division of the marital assets in their sworn testimony.
(Appellant’s Br. p. 14). On the other hand, Timothy contends that “[t]o
disallow the trial court from considering Mary’s social security benefits would
penalize [Timothy] because the totality of his CSRS pension is divisible as a
marital asset, whereas Mary’s social security benefits are not. Further, the
parties were able to enjoy the fact that social security taxes were not withheld
from his payroll during the course of their marriage.” (Appellee’s Br. p. 14).
[26] Indiana Code section 31-15-7-5(3) provides that a trial court may deviate from
the presumption of an equal division of marital property if “[t]he economic
circumstances of each spouse at the time the disposition of the property is to
become effective” indicate that “an equal division would not be just and
reasonable.” In the present case, the trial court endeavored to divide all of the
marital property in an equitable manner. While the trial court’s division of the
parties’ pensions may have ultimately provided Timothy with a larger share of
the marital assets, we find that it was within the discretion of the trial court to
consider the parties’ overall financial circumstances—i.e., Mary’s social security
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 18 of 21 benefits, with an established value as of the final hearing of $2,005 per month—
to craft an award that would leave the parties in relatively equal financial
positions upon retirement. 5 See In re Marriage of Bartley, 712 N.E.2d 537, 545
(Ind. Ct. App. 1999) (“Other types of property in which the spouse has no
present possessory interest may be considered as relevant to the parties’ earning
abilities or economic circumstances” so long as those interests are not “too
remote or speculative to be relevant in allocating marital property.”).
[27] Finally, Mary contends that the trial court abused its discretion by failing to
award her with a surviving spouse benefit from Timothy’s CSRS pension.
During the final hearing, Timothy testified that he could sign up for a surviving
spouse benefit, which would be deducted from his CSRS pension. In the event
that Timothy predeceases Mary, “[s]he would receive as much as [53%] of [his]
retirement.” (Tr. p. 50). In its “Order on Motion to Correct Errors [sic] and
Motion for Relief from Judgment,” the trial court stated that
[i]f [Timothy] were required to opt the survivor option[,] [Mary] should also opt the survivor option on her pension. However, this is not possible since [Mary] was awarded all of her own pension benefits and [Timothy] was not awarded any part of [Mary’s] benefits. Additionally, if [Timothy] were required to opt the survivor option it would lower his benefit amount and the value of his monthly pension would be less. No evidence was presented by [Mary] on the value differences between opting or
5 Based on the trial court’s award (and assuming that Timothy’s monthly pension benefit is $3,275), Mary will receive approximately $2,882 per month from her pension, her social security benefits, and her 10% share of Timothy’s CSRS pension. In turn, Timothy will receive approximately $2,947 from his pension.
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 19 of 21 not opting the survivor benefit on the parties[’] pension plans. [Mary’s] request is denied.
(Appellant’s App. pp. 21-22). Although there was no discussion of the costs of
the surviving spouse benefit or who should be responsible therefor during the
final hearing, Timothy submitted an exhibit outlining his annuity payments
under the CSRS pension. This exhibit indicates that an employee of thirty-
seven years would be entitled to a monthly payment of $3,275, which, it
appears, would be reduced by $305 per month for a surviving spouse benefit.
[28] Mary argues that she should receive the surviving spouse benefit because she
“testified that she was willing to pay for the benefit.” (Appellant’s Br. p. 14).
We disagree and find no such testimony in the record. Rather, during closing
arguments at the final hearing, Mary’s attorney merely requested that “there be
a survivor benefit in [Timothy’s] pension.” (Tr. p. 89). Then, during the
hearing on the motions to correct error, Mary’s attorney argued that it would
be unfair not to award the . . . surviving spouse option [to Mary]. It is available, you have to award it, I don’t think it costs [Timothy] anything. And if there is an expense you can, you can charge the expense I suppose to my client. But without the surviving spouse option uh she is not getting the benefit of her thirty plus year marriage to [Timothy] that’s available under the postal service um pension rules.
(Tr. pp. 100-01). Mary also insists that Timothy “will be entitled to a survivor
benefit from Mary’s [s]ocial [s]ecurity if she predeceases him. He pays nothing
for the benefit. By refusing to grant Mary’s request to receive the CSRS
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 20 of 21 surviving spouse benefit at her cost, the [c]ourt has given [Timothy] a benefit for
free that Mary is entitled to fund from her own money.” (Appellant’s Br. p.
14). No evidence was presented to establish that Timothy would be entitled to
a social security survivor benefit or in what amount. Moreover, Mary has
failed to cite to any authority or otherwise present a cogent argument to support
her assertion that she “is entitled to” a surviving spouse benefit. (Appellant’s
Br. p. 14). See Ind. Appellate Rule 46(A)(8)(a). Accordingly, we cannot say
that the trial court abused its discretion by denying her request to order
Timothy to opt for the surviving spouse benefit on his CSRS pension.
CONCLUSION
[29] Based on the foregoing, we conclude that the trial court acted within its
discretion by awarding the marital residence to Timothy and by ordering him to
pay an equalizing judgment to Mary; the trial court erred by assigning a
monthly value of $2,809 instead of $3,275 to Timothy’s CSRS pension; and the
trial court acted within its discretion by considering the overall financial
circumstances of the parties in determining that Mary should receive 10% of
Timothy’s CSRS pension and by denying Mary’s request to order Timothy to
opt for the surviving spouse benefit on his CSRS pension.
[30] Affirmed in part, reversed in part, and remanded.
[31] Najam, J. and May, J. concur
Court of Appeals of Indiana | Memorandum Decision 34A02-1509-DR-1433 | May 31, 2016 Page 21 of 21