Mary Kathryn C. Wallace v. Kristin W. Wildensee, 990 N.W.2d 637

Background

Mary Kathryn and Douglas Wallace were long‑married and sought to transfer Douglas’s ERISA‑covered 401(k) into Mary Kathryn’s name for estate/tax planning; no divorce or separate maintenance proceeding was filed.
They executed an interspousal agreement and asked the district court to enter a domestic relations order (a QDRO) to effect the transfer; the court denied the first petition for lack of consideration and lack of authority.
The Wallaces filed a revised interspousal agreement (with nominal consideration), proposed a domestic relations order, and the district court again refused, holding it lacked statutory authority to enter a domestic relations order outside chapter 598 proceedings.
Douglas died on appeal; the Iowa Supreme Court allowed substitution of executors and addressed the merits under the public‑importance exception to mootness.
The Supreme Court held ERISA requires a qualified domestic relations order (QDRO) made pursuant to state domestic relations law, and Iowa law authorizes domestic relations orders only in chapter 598 dissolution/separate‑maintenance proceedings; therefore a standalone QDRO cannot be entered absent such a proceeding.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether an Iowa district court may issue a QDRO to effect an ERISA plan transfer without a divorce or separate maintenance action	Wallace: Iowa statutes in chapter 597 (interspousal contracts) or other authority permit entry of a domestic relations order enforcing the interspousal agreement	Appellees/district court: Iowa law only authorizes domestic relations orders in chapter 598 dissolution/separate‑maintenance proceedings; chapter 597 does not grant that power	Held: No. QDROs are ancillary to domestic relations matters; Iowa courts cannot enter QDROs solely to move ERISA plan funds absent a chapter 598 action
Whether the case is justiciable after Douglas’s death	Wallace: appeal should proceed to effectuate parties’ agreement	Appellees: death may moot the appeal	Held: Court assumed possible mootness but reached merits under the public‑importance exception to mootness
Whether chapter 597 authorizes district courts to enter domestic relations orders enforcing interspousal agreements	Wallace: chapter 597 statutes allow spouses to resolve/contract over property and thus permit court orders enforcing interspousal agreements	Appellees: chapter 597 merely preserves property/contract rights between spouses; it does not authorize judgments/decrees under state domestic relations law	Held: Chapter 597 does not supply authority; only chapter 598 grants domestic relations ordering power
Whether denial of a QDRO violates equal protection	Wallace: refusing a QDRO to married persons denies equal protection compared to divorced parties who may obtain QDROs	Appellees: similarly situated persons are treated alike—domestic relations orders available only in dissolution/separate‑maintenance contexts	Held: No violation; similarly situated groups are treated the same under the statutory scheme

Key Cases Cited

Boggs v. Boggs, 520 U.S. 833 (1997) (QDRO provisions concern rights of divorced or separated spouses and their children)
Jago v. Jago, 217 A.3d 289 (Pa. Super. Ct. 2019) (QDROs are ancillary to domestic relations matters; cannot be issued solely to move ERISA funds absent such a matter)
Riley Drive Ent. I, Inc. v. Reynolds, 970 N.W.2d 289 (Iowa 2022) (public‑importance exception to mootness; factors for discretionary review)
Molitor v. City of Cedar Rapids, 360 N.W.2d 568 (Iowa 1985) (parties cannot confer jurisdiction by consent)
Am. Tel. & Tel. Co. v. Merry, 592 F.2d 118 (2d Cir. 1979) (discussion of ERISA spend‑thrift/antialienation provision and exceptions in family‑law context)
Bruns (In re Marriage of Bruns), 535 N.W.2d 157 (Iowa Ct. App. 1995) (ERISA spend‑thrift provision and QDRO context)
Burrage v. United States, 571 U.S. 204 (2014) (courts must apply statutes as written; policy arguments do not override clear statutory language)