753 S.E.2d 574
Va. Ct. App.2014Background
- David and Sandra Griffin divorced in 1998; their separation agreement (PSA) required the parties to "name the children of the marriage as co-beneficiaries" on 401(k) and similar plans.
- David later remarried and designated his second wife (Cowser‑Griffin) as primary beneficiary of Dominion’s Salaried Savings Plan (a 401(k)-style, defined contribution ERISA plan); children were later listed only as contingent beneficiaries.
- David died in 2012 while still employed; no QDRO had been entered pre‑death and the Plan had not been notified of an alternate payee claim before his death.
- Sandra submitted a proposed QDRO after David’s death to enforce the PSA and make the children alternate payees; the circuit court denied the QDRO, reasoning federal law vested benefits in the surviving spouse and a preexisting QDRO or notice was required.
- The court of appeals reversed: it held the Plan was excepted from 29 U.S.C. § 1055 (so § 1055 annuity rules did not apply), the PSA created vested state-law rights enforceable by a QDRO, a post‑death QDRO can conform a DRO to ERISA specificity requirements, and the proposed QDRO met ERISA’s requirements.
Issues
| Issue | Plaintiff's Argument (Griffin) | Defendant's Argument (Estate/Cowser‑Griffin) | Held |
|---|---|---|---|
| Whether a post‑death QDRO may be entered to enforce a preexisting divorce property settlement against an ERISA plan | Post‑divorce property rights vested in children at decree; court may enter QDRO after death to effectuate decree | ERISA preemption and plan terms vest benefits in surviving spouse at participant’s death; a QDRO entered post‑death cannot divest vested surviving‑spouse rights | Court held post‑death QDRO may be entered; PSA conferred state‑law rights enforceable by QDRO and proposed QDRO satisfied ERISA requirements |
| Whether 29 U.S.C. § 1055 (surviving‑spouse annuity rules) applies to the Salaried Savings Plan | §1055 does not apply because the Plan is an individual account plan that meets the statutory exception | §1055 protections for surviving spouses govern and thus surviving‑spouse rights vested at death | Court held §1055 does not apply to this specific Plan (it is excepted) |
| Whether the proposed QDRO meets ERISA’s QDRO specificity and substance requirements (29 U.S.C. §1056(d)(3)) | Proposed QDRO supplies names, addresses, percentages (50/50), plan identification, and requests forms of distribution allowed by plan | Plan/estate argued proposed order would divest surviving‑spouse benefits or require forms not provided by plan | Court held the proposed QDRO met §1056(d)(3) specificity and substantive limits (no new benefit form or increased actuarial benefit) |
| Whether plan benefits vested in the surviving spouse upon participant’s death, defeating a posthumous QDRO | Children’s rights under state decree vested at divorce; federal law does not automatically vest benefits in surviving spouse for a Plan excepted from §1055 | Surviving spouse’s rights vested at death (or retirement) under ERISA and controlling precedent; a posthumous QDRO cannot divest those rights | Court held benefits did not automatically vest in surviving spouse here; QDRO may be entered to enforce state‑law vested property interest |
Key Cases Cited
- Boggs v. Boggs, 520 U.S. 833 (1997) (ERISA preemption and interplay between state property law and ERISA survivor/annuity protections)
- Egelhoff v. Egelhoff, 532 U.S. 141 (2001) (ERISA’s preemption aims to ensure uniform plan administration)
- Kennedy v. Plan Administrator for DuPont Savings & Inv. Plan, 555 U.S. 285 (2009) (ERISA bars alienation/assignment of benefits except via QDRO)
- Hopkins v. AT&T Global Info. Solutions Co., 105 F.3d 153 (4th Cir. 1997) (surviving‑spouse annuity rights vest at retirement/death for plans governed by §1055)
- Trustees of the Directors Guild‑Producer Pension Benefits Plan v. Tise, 234 F.3d 415 (9th Cir. 2000) (state DROs can create enforceable QDRO interests; QDROs are administrative mechanism to effectuate state awards)
- Carmona v. Carmona, 544 F.3d 988 (9th Cir. 2008) (distinguishes §1055 survivorship annuities from other plan benefits when analyzing vesting and post‑retirement QDROs)