In re the Marriage of Herald
322 P.3d 546
| Or. | 2014Background
- Parties were married 21 years; husband (51) and wife (53) each have federal retirement benefits; wife eligible for CSRS (no own SS benefits) while husband participates in FERS with Social Security taxes; trial court divided marital assets including CSRS and potential SS considerations; court offset wife’s CSRS by hypothetical SS benefits to which she would have been entitled; Court of Appeals affirmed; this Court addressed federal preemption under 42 USC § 407(a) and ORS 107.105(l)(f) rather than a simple offset; Swan held that explicit value-based consideration of Social Security benefits in a property division is improper; majority here narrows Swan and allows considering existence/absence of anticipated Social Security benefits within an overall just and proper division; decision analyzes Hisquierdo, McCarty, Keffeler, and evolving case law; outcome: district court’s approach did not violate § 407(a) as applied to this case; three emphasized factors for just and proper division include probability of future benefits, relative magnitude of anticipated benefits, and recognition that Social Security is not a marital asset; dissenters argue under Keffeler and Hisquierdo that such offsets exceed federal preemption; majority limits Swan and remands with a narrowed preemption rationale.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 407(a) preempts considering Social Security benefits in a state property division | Husband: Swan precludes any consideration of Social Security benefits. | Wife: Court may consider anticipated SS benefits within just division. | No per se preemption; consideration permissible within limits. |
| Whether the trial court violated Swan by offsetting wife’s CSRS benefits | Husband: Offset akin to direct transfer/offset prohibited by Swan. | Wife: Offset intended to achieve just division, not transfer. | Not a prohibited transfer or offset under § 407(a) as applied here. |
| Whether ORS 107.105(l)(f) permits consideration of anticipated SS benefits in a just division | Husband: Statute allows equal division without considering SS. | Wife: Statute permits considering all factors to achieve just division. | Yes; within limits, consideration is permissible. |
| Whether the analysis aligns with related federalism preemption cases (Hisquierdo, Keffeler, McCarty) | Husband: Hisquierdo/McCarty prohibit such arrangements. | Wife: Court can balance under state law with federal limits. | Majority aligns with some, but not all, precedent; limits Swan accordingly. |
| Whether the dissent's view on preemption should control | Husband: Dissents would require stricter preemption. | Wife: Dissent offers alternate view consistent with other cases. | Dissenting view rejected; majority controlling. |
Key Cases Cited
- Hisquierdo v. Hisquierdo, 439 U.S. 572 (U.S. 1979) (federal preemption of division of railroad benefits; antiassignment and noncontractual nature of Social Security-like benefits discussed)
- McCarty v. McCarty, 453 U.S. 210 (U.S. 1981) (military retirement benefits and preemption; CSRS/SS distinctions noted)
- Swan v. Swan, 301 Or. 167 (Or. 1986) (court cannot consider value of Social Security benefits in property division; narrow scope refined here)
- Keffeler v. Keffeler, 537 U.S. 371 (U.S. 2003) (representative payee and 'other legal process' concept; limits on applying § 407(a) preemption)
- Hillman v. Maretta, 133 S. Ct. 1943 (U.S. 2013) (presumption against preemption in domestic relations matters; limits to preemption)