Wilson v. Wilson
117 A.3d 138
| Md. Ct. Spec. App. | 2015Background
- Marvin and Sylvia Wilson divorced; on the record agreement (July 21, 2009) and later Marital Property Consent Order (Jan. 21, 2010) awarded each spouse 50% of the marital portion of the other’s military pension.
- After the agreement, the Air Force placed Marvin on Temporary Disability Retired List and later on permanent disability retirement (60%); DFAS computed his retired pay based on disability.
- Appellee sought her share; DFAS refused to honor the parties’ Constituted Pension Order because all retired pay was disability-based and therefore non-divisible under federal law.
- Trial court found Marvin breached the property settlement by failing to pay Sylvia her share and ordered arrears of $63,543 for May 2011–March 2014, reasoning the agreement included disability retirement benefits and Marvin must satisfy the obligation from general assets.
- Marvin appealed, arguing the contract was void ab initio (benefits non-divisible at agreement time), that parties knew or should have known about disability status, and disputing the arrears calculation.
Issues
| Issue | Plaintiff's Argument (Marvin) | Defendant's Argument (Sylvia) | Held |
|---|---|---|---|
| Whether Marvin breached the property settlement by not paying Sylvia her share of his military retirement | No breach because the contract was void or frustrated: retirement became non-divisible disability pay; some disability status preexisted the agreement | Agreement covered "military pension fund" broadly; nothing excluded disability benefits; Marvin must honor the agreement | Court: Marvin breached; agreement included disability retirement benefits and he must pay arrears from general assets |
| Whether contract was void/unenforceable because benefits were non-divisible at time of agreement | Dapp-like argument: benefits were non-divisible at contract formation, so agreement void ab initio | Relies on Allen/Dexter: agreement was valid when made; subsequent disability classification that converted divisible retirement to non-divisible disability does not defeat contractual obligation | Court: Agreement was valid when made (anticipated benefits were divisible); Allen/Dexter control; Dapp distinguishes and is inapplicable |
| Whether parties knew of Marvin’s disability status when they contracted | Marvin: parties were or should have been on notice (expert testimony, PEB findings) | Sylvia: Marvin concealed disability; record shows no prior disclosure; court record reflected both in good health | Court: No evidence Sylvia or the court knew of disability status before July 21, 2009; expert testimony contradicted by record |
| Proper measure of damages / arrears calculation | Challenges use of Marvin’s 2013 statement, contends taxes/survivor benefits not considered | Sylvia: arrears measured by amount she would have received; payment may be satisfied from Marvin’s general assets | Court: Calculation upheld; issue of taxes/survivor benefits not preserved on appeal (not argued below) |
Key Cases Cited
- Allen v. Allen, 178 Md. App. 145 (Md. Ct. Spec. App.) (courts may enforce a pre-disability property agreement by requiring pensioner to satisfy spouse from general assets when DFAS will not pay a former spouse because pay is disability-based)
- Dexter v. Dexter, 105 Md. App. 678 (Md. Ct. Spec. App.) (voluntary waiver of retirement benefits in favor of disability benefits can constitute breach of separation agreement; damages measured by what spouse would have received)
- Fultz v. Shaffer, 111 Md. App. 278 (Md. Ct. Spec. App.) (contract interpretation principles for property settlement agreements; "retirement benefits" includes disability benefits unless expressly excluded)
- Mansell v. Mansell, 490 U.S. 581 (U.S. Supreme Court) (USFSPA limits state courts to dividing "disposable retired pay" and precludes treating benefits waived for veterans’ disability as divisible)
- Dapp v. Dapp, 211 Md. App. 323 (Md. Ct. Spec. App.) (agreement to assign benefits that are nonassignable under federal statute is void ab initio; distinguishes agreements valid when made)
- Bangs v. Bangs, 59 Md. App. 350 (Md. Ct. Spec. App.) (applies Bangs formula for divisible portions of retirement benefits)
- Lookingbill v. Lookingbill, 301 Md. 283 (Md. Ct. App.) (pension payments are partial consideration for past employment; disability classification does not automatically exclude them from being treated as retirement benefits)