Thayer v. Thayer
378 P.3d 1232
Utah Ct. App.2016Background
- Diane (Wife) and Richard Thayer (Husband) divorced by stipulated decree in Sept. 2013; both parties earned pension benefits during the marriage (Wife: Alaska and Utah teacher pensions; Husband: USPHS federal pension).
- The decree awarded Wife 50% of Husband’s “disposable retired pay,” defined in the decree as “gross retirement pay less authorized deductions, including amounts properly deducted for federal, state, or local taxes and disability benefits,” and referenced Johnson v. Johnson and 10 U.S.C. § 1408.
- The decree directed the federal plan administrator to calculate and pay Wife’s share directly; it also included a stop‑gap interim payment of $2,389.93/month from Husband until direct pay was implemented.
- The plan administrator initially proposed a direct payment based on its calculation of “disposable retired pay” (not deducting taxes) but then disapproved the request after Husband objected, citing current federal law and regulations.
- The district court sustained Husband’s objection, interpreting Johnson to require division on a net (post‑tax) basis and ordered that Husband’s pension be divided accordingly; Wife appealed.
Issues
| Issue | Wife's Argument | Husband's Argument | Held |
|---|---|---|---|
| Whether Johnson v. Johnson mandates that state courts must divide federal (military/USPHS) retirement pay on a net (post‑tax) basis | Johnson does not mandate a fixed net‑of‑tax calculation; it requires applying the USFSPA’s applicable definition of “disposable retired pay” | Johnson (and the parties’ inclusion of it) requires deducting federal/state/local taxes as "authorized deductions," so division must be net | Reversed: Johnson requires courts to follow the USFSPA’s definition in force for the award; it does not permanently fix the older net‑of‑tax formula Johnson applied. |
| Whether the parties’ decree required dividing Husband’s pension on a net (post‑tax) basis despite changes in federal law | The decree incorporated the USFSPA and directed the plan administrator to calculate per existing regulations, so Wife is entitled to half of disposable retired pay as defined by current federal law (which does not authorize tax deductions) | The parties’ stipulation adopted Johnson’s calculation (net of taxes), so the decree requires net division | Reversed: the decree should be read to incorporate the USFSPA’s current definition of disposable retired pay (no authorized tax deductions); district court misinterpreted the stipulation. |
| Whether Wife is entitled to attorney fees for enforcing the decree | Wife substantially prevailed on appeal and is entitled to have the trial court consider fees under Utah Code § 30‑3‑3(2), including appellate fees if awarded on remand | Opposed below; not successful on appeal | Remanded: district court should determine, in its discretion, whether Wife is entitled to fees for enforcement below and on appeal; if awarded below, include appellate fees. |
Key Cases Cited
- McCarty v. McCarty, 453 U.S. 210 (federal preemption of state division of military retired pay)
- Mansell v. Mansell, 490 U.S. 581 (USFSPA grants limited authority to state courts to divide only "disposable retired pay")
- Maxwell v. Maxwell, 796 P.2d 403 (Utah Ct. App. discussion applying Mansell and USFSPA limits)
- Johnson v. Johnson, 270 P.3d 556 (Utah Ct. App. 2012) (state court must apply USFSPA definition in effect for the award; trial court reversed for failing to apply authorized deductions)
- Johnson v. Johnson, 330 P.3d 704 (Utah 2014) (affirmation/review referenced in subsequent decisions)