Tuesday, June 25, 2013
Page 1
S.C. Rules for Ex-Husband in Dispute Over CalPERS Credits
Fact That Husband Was Single During Prior Service, Not That He Was Married When Purchasing Credits, Held Determinative
By KENNETH OFGANG, Staff Writer
Retirement credits purchased with a public employee’s separate property funds also constitute separate property if the employee was single during the time period represented by the credits, even if the employee was married while making the payments, the California Supreme Court ruled yesterday.
Unanimously overruling the Sixth District Court of Appeal, the high court reinstated a trial judge’s ruling in favor of Alameda County firefighter Timothy Green, who served four years in the Air Force before he was married and later exercised his right to purchase CalPERS credits for that period.
A Contra Costa Superior Court judge hearing Timothy and Julie Green’s divorce proceedings held that the wife’s interest in the additional benefits—an amount significantly greater than the cost of purchasing the credits—is limited to one-half of the amount of community funds used to buy the credits, plus interest.
Trial Judge Upheld
Justice Ming Chin, writing for the court, said Judge Charles Burch was correct in finding that the credits—less the amount of community property used to pay for them— were separate property, and did not abuse his discretion in calculating the amount owed to Julie Green, which amounted to just under $6,700.
While the Court of Appeal reasoned that the additional credits were community property because they were purchased with community funds during marriage, Chin said the fact that he was single while in the military was determinative.
Timothy Green served in the Air Force from 1982 to 1986 and joined a small regional fire department in 1989. He joined the Alameda County Fire Department in 1997 as a result of a merger.
The ACFD participates in the California Public Employees’ Retirement System, or CalPERS, as Green’s former department did. In 2002, he exercised his right to purchase retirement credit for the period of his military service through a payroll deduction plan that has taken a little over $92 out of each of his semi-monthly paychecks and will continue to do so until 2017.
The Greens were married in 1992. Julie Green filed for divorce in 2008.
“What matters in determining whether retirement benefits are community or separate property is the person’s marital status when the services on which the benefits are based were rendered,” Chin wrote. “Here the husband rendered the military service before the marriage. Accordingly, we conclude that, except for the community’s contribution to the cost of obtaining the credit, the four years of additional credit are the husband’s separate property.”
Prior Case
Chin cited In re Marriage of Sonne (2010) 48 Cal.4th 118. The husband in that case exercised his right to repurchase CalPERS credits after a former spouse cashed out her share of his benefits, partially using community property of his subsequent marriage.
The high court ruled that the repurchased credits were not community property of the subsequent marriage, because they were attributable to employment that preceded the marriage.
The same principle applies to Timothy Green’s premarital military service, the justice said.
“To designate a portion of those four years of credit as community property — as did the Court of Appeal — solely due to the community’s contribution towards the required payment gives no weight to husband’s premarital service to his country,” Chin wrote. “…But Government Code section 21034 specifically mandates that this military service is to be credited as it would be credited if the member had been in state service during’ that service. This demonstrates a legislative intent to fully credit persons for their military service. The four years of military service should be treated the same the way the years at issue in Sonne…were treated — basing the characterization of the credit on the marital status at the time of the service.”
Chin was joined by Justices Marvin Baxter, Carol Corrigan, and Joyce L. Kennard.
Concurring Opinion
Justice Kathryn M. Werdegar authored a concurring opinion that was joined by Chief Justice Tani Cantil-Sakauye and Justice Goodwin Liu. Werdegar agreed that Green’s purchased service credits were separate property, because he was single both during his military service and when he went to work for a public employer.
“A more difficult question would arise if the parties had married before husband began working as a local firefighter,” the jurist wrote. But she said it was unnecessary to address that question in order to resolve the case before the court.
The case is In re Marriage of Green, 13 S.O.S. 3171.
Copyright 2013, Metropolitan News Company