McPherren v. McPherren

967 S.W.2d 485, 1998 WL 166116
CourtCourt of Appeals of Texas
DecidedMay 20, 1998
Docket08-97-00048-CV
StatusPublished
Cited by38 cases

This text of 967 S.W.2d 485 (McPherren v. McPherren) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McPherren v. McPherren, 967 S.W.2d 485, 1998 WL 166116 (Tex. Ct. App. 1998).

Opinion

OPINION

McCLURE, Justice.

Candice Ann McPherren appeals from a judgment of the district court denying her motion for enforcement or clarification of a decree of divorce or, in the alternative, post-judgment partition. We affirm.

FACTUAL SUMMARY

For ease of reference, we will address the parties’ according to their prior marital status as Husband and Wife. During the marriage, Husband was employed by Enron Corporation. Although the record does not detail the date on which he began his employment or the duration thereof, it is undisputed that the employment relationship was severed in 1989. On October 23, 1992, the Court entered a final decree of divorce which incorporated the parties’ property settlement agreement.

THE DECREE AND QDRO

At the outset, we note that pursuant to a “Mother Hubbard” clause, Husband was awarded all retirement benefits in three Enron plans except the amounts specifically awarded to Wife:

Any and all sums, whether matured or unmatured, accrued or unaccrued, vested or otherwise, together with all increases thereof, the proceeds therefrom, and any other rights related to any profit-sharing plan, retirement plan, pension plan, employee stock option plan, employee savings plan, accrued unpaid bonuses, or other benefit program existing by reason of [Husband]’s past, present or future earnings, except that amount specifically awarded to [Wife] herein in the Enron Corp. Savings Plan, Enron Corp. Retirement Plan and Enron Corp. Employee Stock Ownership Plan.

The Qualified Domestic Relations Order (QDRO) contained in the decree also specified the existence of three retirement plans:

5.04 Participant has accrued benefits or has had contributions made to his account under the following tax qualified pension plans (collectively referred to herein as the ‘Pension Plans’):
Enron Corp. Savings Plan, a defined contribution pension plan;
Enron Corp. Retirement Plan, a defined benefit pension plan;
Enron Corp. Employee Stock Ownership Plan (‘ESOP’), a leveraged defined contribution pension plan.

According to Mary Hollis, the Enron benefits representative, there were no other plans in existence at the time of the divorce.

*487 The ESOP plan was divided into two sub-accounts, which are described in the decree:

5.05 Assignment Covering Defined Contribution Plans.
C. The total interest of Participant in the Enron Corp. Employee Stock Ownership Plan (‘ESOP’) is the total sum of all contributions, together with all interest and earnings thereon, which have been allocated and are credited to the ESOP account of Participant as of September 30, 1992, (‘ESOP Interest’). Of such ESOP Interest, the portion thereof credited to the ESOP Savings Account of the Participant is referred to as the ‘ESOP Savings Account Interest’, and the portion thereof credited to the ESOP Retirement Account of the Participant is referred to as the ‘ESOP Retirement Account Interest’.

Wife was awarded 50 percent of the Savings Plan and 50 percent of the ESOP subaccount known as the ESOP Savings Account Interest. The distribution of these benefits is not in issue. 1

The parties’ interest in the Retirement Plan is described as:

5.06. Assignment Covering Defined Benefit Plan.
A. The total interest of Participant in the Enron Corp. Retirement Plan (‘Retirement Plan’) is the amount of the monthly life only benefit accrued on behalf of Participant under the Retirement Plan as of September 30, 1992, subject to reduction by the ESOP Offset provisions thereof (‘Retirement Plan Interest’). The estimated monthly life only Retirement Plan accrued benefit of Participant under the Retirement Plan prior to 1987 is Three Hundred Thirty-Nine and 76/100 Dollars ($339.76), which is not subject to reduction by the ESOP Offset provisions. The estimated monthly life only Retirement Plan accrued benefit of Participant under the Retirement Plan after 1986 is Three Hundred Ten and 84/100 Dollars ($310.84), which is subject to reduction by the ESOP Offset provisions.
Since a portion of the interest granted to Alternate Payee in Participant’s Retirement Plan Interest is subject to reduction by the ESOP Offset, Alternate Payee has also received grant of a contingent interest in Participant’s ESOP Retirement Account.
B. Of Participant’s Retirement Plan Interest, Alternate Payee is awarded and granted a monthly amount of Three Hundred Twenty-Five and 30/100 Dollars ($325.30) or fifty percent (50%) of Participant’s Retirement Plan Interest, whichever is greater, becoming due and payable to the Alternate Payee upon payment of benefits under the Retirement Plan to Participant.

Thus, Wife received one-half of the Retirement Plan, i.e. the defined benefit plan. The contingent interest in the ESOP retirement subaccount awarded to Wife specified:

5.05 Assignment Covering Defined Contribution Plans.
E. Alternate Payee is awarded and granted a contingent interest in Participant’s ESOP Retirement Account interest until such time as the amount of the total ESOP Offset provided for in the Retirement Plan is determinable (the ‘Offset Determination Date’). No distribution, withdrawal or loan of the assets of Participant’s ESOP Retirement Account Interest shall be made to Participant until the Offset Determination Date. The value of such interest granted to Alternate Payee shall be all or a portion of the ESOP Retirement Account (as determined by the plan administrator of the retirement Plan using actuarial factors provided for administration of the ESOP Offset in the Retirement Plan) which as of the Offset Determination Date would provide Alternate Payee an amount of monthly income for life equal to ‘A’ minus ‘B’ (A — B), where ‘A’ is the total interest granted to Alternate Payee in the Participant’s Retirement Plan Interest not reduced by the ESOP Offset, and ‘B’ is that portion of ‘A: *488 [sic] which is reduced by the ESOP Offset.

Wife was not awarded one-half of this subac-count or any other award save for the contingent interest which secured her annuity under the Retirement Plan.

TRIAL TESTIMONY

Plan Funding Amendment

The testimony at trial revealed that the ESOP plan came into existence on January 1, 1987. The shares of stock held in the ESOP retirement subaccount were to be used to buy an annuity that would provide the monthly benefit that accrued after January 1, 1987. Benefits accrued prior to that date were funded by the retirement plan trust. Upon retirement, the participant could choose to purchase an annuity, to take a lump sum cash award, or to take the shares of stock. At the time of divorce, the plans prohibited access to the stock until the participant retired.

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Bluebook (online)
967 S.W.2d 485, 1998 WL 166116, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mcpherren-v-mcpherren-texapp-1998.