BOGGS v. BOGGS ET AL.
No. 96-79
Supreme Court of the United States
Argued January 15, 1997-Decided June 2, 1997
520 U.S. 833
Paul R. Q. Wolfson argued the cause for the United States as amicus curiae urging reversal. With him on the brief were Acting Solicitor General Dellinger, Deputy Solicitor General Kneedler, J. Davitt McAteer, Allen H. Feldman, Nathaniel I. Spiller, and Judith D. Heimlich.
Edward J. Deano, Jr., argued the cause for respondents. With him on the brief were Guy L. Deano, Jr., and Theresa D. Bewig.*
JUSTICE KENNEDY delivered the opinion of the Court.†
We consider whether the Employee Retirement Income Security Act of 1974 (ERISA), 88 Stat. 832, as amended,
I
Isaac Boggs worked for South Central Bell from 1949 until his retirement in 1985. Isaac and Dorothy, his first wife, were married when he began working for the company, and they remained husband and wife until Dorothy‘s death in 1979. They had three sons. Within a year of Dorothy‘s death, Isaac married Sandra, and they remained married until his death in 1989.
Upon retirement, Isaac received various benefits from his employer‘s retirement plans. One was a lump-sum distribution from the Bell System Savings Plan for Salaried Employees (Savings Plan) of $151,628.94, which he rolled over into an Individual Retirement Account (IRA). He made no withdrawals and the account was worth $180,778.05 when he died. He also received 96 shares of AT&T stock from the Bell South Employee Stock Ownership Plan (ESOP). In addition, Isaac enjoyed a monthly annuity payment during his retirement of $1,777.67 from the Bell South Service Retirement Program.
The instant dispute over ownership of the benefits is between Sandra (the surviving wife) and the sons of the first marriage. The sons’ claim to a portion of the benefits is based on Dorothy‘s will. Dorothy bequeathed to Isaac one-third of her estate, and a lifetime usufruct in the remaining two-thirds. A lifetime usufruct is the rough equivalent of a common-law life estate. See
Sandra contests the validity of Dorothy‘s 1980 testamentary transfer, basing her claim to those benefits on her interest under Isaac‘s will and
After Isaac‘s death, two of the sons filed an action in state court requesting the appointment of an expert to compute the percentage of the retirement benefits they would be entitled to as a result of Dorothy‘s attempted testamentary transfer. They further sought a judgment awarding them a portion of: the IRA; the ESOP shares of AT&T stock; the monthly annuity payments received by Isaac during his retirement; and Sandra‘s survivor annuity payments, both received and payable.
In response, Sandra Boggs filed a complaint in the United States District Court for the Eastern District of Louisiana, seeking a declaratory judgment that ERISA pre-empts the application of Louisiana‘s community property and succession laws to the extent they recognize the sons’ claim to an interest in the disputed retirement benefits. The District
A divided panel of the Fifth Circuit affirmed. 82 F. 3d 90 (1996). The court stressed that Louisiana law affects only what a plan participant may do with his or her benefits after they are received and not the relationship between the pension plan administrator and the plan beneficiary. Id., at 96. For the reasons given by the District Court, it found ERISA‘s pension plan anti-alienation provision,
Six members of the Court of Appeals dissented from the failure to grant rehearing en banc. 89 F. 3d 1169 (1996). In their view, a testamentary transfer of an interest in undistributed retirement benefits frustrates ERISA‘s goals of securing national uniformity in pension plan administration and of ensuring that retirees, and their dependents, are the actual recipients of retirement income. They believed that
The reasoning and holding of the Fifth Circuit‘s decision is in substantial conflict with the decision of the Court of Appeals for the Ninth Circuit in Ablamis v. Roper, 937 F. 2d 1450 (1991), which held that ERISA pre-empts a testamentary transfer by a nonparticipant spouse of her community property interest in undistributed pension plan benefits. The division between the Circuits is significant, for the Fifth Circuit has jurisdiction over the community property States of Louisiana and Texas, while the Ninth Circuit includes the community property States of Arizona, California, Idaho, Nevada, and Washington. Having granted certiorari to resolve the issue, 519 U. S. 957 (1996), we now reverse.
II
ERISA pre-emption questions are recurrent, two other cases on the subject having come before the Court in the current Term alone, see California Div. of Labor Standards Enforcement v. Dillingham Constr., N. A., Inc., 519 U. S. 316 (1997); De Buono v. NYSA-ILA Medical and Clinical Services Fund, ante, p. 806. In large part the number of ERISA pre-emption cases reflects the comprehensive nature of the statute, the centrality of pension and welfare plans in the national economy, and their importance to the financial security of the Nation‘s work force. ERISA is designed to ensure the proper administration of pension and welfare plans, both during the years of the employee‘s active service and in his or her retirement years.
This case lies at the intersection of ERISA pension law and state community property law. None can dispute the
The nine community property States have some 80 million residents, with perhaps $1 trillion in retirement plans. See Brief for Estate Planning, Trust and Probate Law Section of the State Bar of California as Amicus Curiae 1. This case involves a community property claim, but our ruling will affect as well the right to make claims or assert interests based on the law of any State, whether or not it recognizes community property. Our ruling must be consistent with the congressional scheme to assure the security of plan participants and their families in every State. In enacting ERISA, Congress noted the importance of pension plans in its findings and declaration of policy, explaining:
“[T]he growth in size, scope, and numbers of employee benefit plans in recent years has been rapid and substantial; . . . the continued well-being and security of millions of employees and their dependents are directly affected by these plans; . . . they are affected with a national public interest [and] they have become an important factor affecting the stability of employment and
the successful development of industrial relations . . . .” 29 U. S. C. § 1001(a) .
ERISA is an intricate, comprehensive statute. Its federal regulatory scheme governs employee benefit plans, which include both pension and welfare plans. All employee benefit plans must conform to various reporting, disclosure, and fiduciary requirements, see
ERISA‘s express pre-emption clause states that the Act “shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan . . . .”
We first address the survivor‘s annuity and then turn to the other pension benefits.
III
Sandra Boggs, as we have observed, asserts that federal law pre-empts and supersedes state law and requires the surviving spouse annuity to be paid to her as the sole beneficiary. We agree.
“Each pension plan to which this section applies shall provide that—
“(1) in the case of a vested participant who does not die before the annuity starting date, the accrued benefit payable to such participant shall be provided in the form of a qualified joint and survivor annuity.”
ERISA requires that every qualified joint and survivor annuity include an annuity payable to a nonparticipant surviving spouse. The survivor‘s annuity may not be less than 50% of the amount of the annuity which is payable during the joint lives of the participant and spouse.
Respondents say their state-law claims are consistent with these provisions. Their claims, they argue, affect only the disposition of plan proceeds after they have been disbursed by the Bell South Service Retirement Program, and thus nothing is required of the plan. ERISA‘s concern for securing national uniformity in the administration of employee benefit plans, in their view, is not implicated. They argue Sandra‘s community property obligations, after she receives the survivor annuity payments, “fai[l] to implicate the regulatory concerns of ERISA.” Fort Halifax Packing Co. v. Coyne, 482 U. S. 1, 15 (1987).
ERISA‘s solicitude for the economic security of surviving spouses would be undermined by allowing a predeceasing spouse‘s heirs and legatees to have a community property interest in the survivor‘s annuity. Even a plan participant cannot defeat a nonparticipant surviving spouse‘s statutory entitlement to an annuity. It would be odd, to say the least, if Congress permitted a predeceasing nonparticipant spouse
In the face of this direct clash between state law and the provisions and objectives of ERISA, the state law cannot stand. Conventional conflict pre-emption principles require pre-emption “where compliance with both federal and state regulations is a physical impossibility, . . . or where state law stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.” Gade v. National Solid Wastes Management Assn., 505 U. S. 88, 98 (1992) (internal quotation marks and citation omitted). It would undermine the purpose of ERISA‘s mandated survivor‘s annuity to allow Dorothy, the predeceasing spouse, by her testamentary transfer to defeat in part Sandra‘s entitlement to the annuity
Louisiana law, to the extent it provides the sons with a right to a portion of Sandra Boggs’
IV
Beyond seeking a portion of the survivor‘s annuity, respondents claim a percentage of: the monthly annuity pay-
A brief overview of ERISA‘s design is necessary to put respondents’ contentions in the proper context. The principal object of the statute is to protect plan participants and beneficiaries. See Shaw v. Delta Air Lines, Inc., 463 U. S. 85, 90 (1983) (“ERISA is a comprehensive statute designed to promote the interests of employees and their beneficiaries in employee benefit plans“). Section 1001(b) states that the policy of ERISA is “to protect . . . the interests of participants in employee benefit plans and their beneficiaries.” Section 1001(c) explains that ERISA contains certain safeguards and protections which help guarantee the “equitable character and the soundness of [private pension] plans” in order to protect “the interests of participants in private pension plans and their beneficiaries.” The general policy is implemented by ERISA‘s specific provisions. Apart from a few enumerated exceptions, a plan fiduciary must “discharge his duties with respect to a plan solely in the interest of the participants and beneficiaries.”
ERISA confers beneficiary status on a nonparticipant spouse or dependent in only narrow circumstances delineated by its provisions. For example, as we have discussed,
Even outside the pension plan context and its anti-alienation restriction, Congress deemed it necessary to enact detailed provisions in order to protect a dependent‘s interest in a welfare benefit plan. Through a
The surviving spouse annuity and QDRO provisions, which acknowledge and protect specific pension plan community property interests, give rise to the strong implication that other community property claims are not consistent with the statutory scheme. ERISA‘s silence with respect to the right of a nonparticipant spouse to control pension plan benefits by testamentary transfer provides powerful support
We conclude the sons have no claim under ERISA to a share of the retirement benefits. To begin with, the sons are neither participants nor beneficiaries. A “participant” is defined as an “employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit.”
An amicus, the Estate Planning, Trust and Probate Law Section of the State Bar of California, in support of respondents’ position, points to pre-REA case law holding that
We disagree with this reasoning. It is true that the subject of testamentary transfers is somewhat removed from domestic relations law. The QDRO provisions address the rights of divorced and separated spouses, and their dependent children, which are the traditional concern of domestic relations law. The pre-REA federal common-law extension of
Respondents and their amicus in effect ask us to ignore
The conclusion that Congress intended to pre-empt respondents’ nonbeneficiary, nonparticipant interests in the retirement plans is given specific and powerful reinforcement by the pension plan anti-alienation provision. Section 1056(d)(1) provides that “[e]ach pension plan shall provide that benefits provided under the plan may not be assigned or alienated.” Statutory anti-alienation provisions are potent mechanisms to prevent the dissipation of funds. In Hisquierdo we interpreted an anti-alienation provision to bar a divorced spouse‘s interest in her husband‘s retirement benefits. See 439 U. S., at 583-590. ERISA‘s pension plan anti-alienation provision is mandatory and contains only two explicit exceptions, see
Dorothy‘s 1980 testamentary transfer, which is the source of respondents’ claimed ownership interest, is a prohibited “assignment or alienation.” An “assignment or alienation” has been defined by regulation, with certain exceptions not at issue here, as “[a]ny direct or indirect arrangement whereby a party acquires from a participant or beneficiary” an interest enforceable against a plan to “all or any part of a plan benefit payment which is, or may become, payable to the participant or beneficiary.” 26 CFR § 1.401(a)-13(c)(1)(ii) (1997). Those requirements are met. Under Louisiana law community property interests are enforceable against a plan. See Eskine v. Eskine, 518 So. 2d 505, 508 (La. 1988). If respondents’ claims were allowed to succeed
As was true with survivors’ annuities, it would be inimical to ERISA‘s purposes to permit testamentary recipients to acquire a competing interest in undistributed pension benefits, which are intended to provide a stream of income to participants and their beneficiaries. See Guidry, supra, at 376 (“[The anti-alienation provision] reflects a considered congressional policy choice, a decision to safeguard a stream of income for pensioners . . . and their dependents . . .“). Pension benefits support participants and beneficiaries in their retirement years, and ERISA‘s pension plan safeguards are designed to further this end. See
Community property laws have, in the past, been pre-empted in order to ensure the implementation of a federal statutory scheme. See, e. g., McCune v. Essig, 199 U. S. 382 (1905); Wissner v. Wissner, 338 U. S. 655 (1950); Free v. Bland, 369 U. S. 663 (1962); Hisquierdo v. Hisquierdo, 439
439 U.S. 572 (1979); McCarty v. McCarty, 453 U.S. 210 (1981); Mansell v. Mansell, 490 U.S. 581 (1989); cf. Ridgway v. Ridgway, 454 U.S. 46 (1981). Free v. Bland, supra, is of particular relevance here. A husband had purchased United States savings bonds with community funds in the name of both spouses. Under Treasury regulations then in effect, when a co-owner of the bonds died, the surviving co-owner received the entire interest in the bonds. After the wife died, her son—the principal beneficiary of her will—demanded either one-half of the bonds or reimbursement for loss of the community property interest. The Court held that the regulations pre-empted the community property claim, explaining:“One of the inducements selected by the Treasury is the survivorship provision, a convenient method of avoiding complicated probate proceedings. Notwithstanding this provision, the State awarded full title to the co-owner but required him to account for half of the value of the bonds to the decedent‘s estate. Viewed realistically, the State has rendered the award of title meaningless.” Id., at 669.
The same reasoning applies here. If state law is not pre-empted, the diversion of retirement benefits will occur regardless of whether the interest in the pension plan is enforced against the plan or the recipient of the pension benefit. The obligation to provide an accounting, moreover, as with the probate proceedings referred to in Free, is itself a burden of significant proportions. Under respondents’ view, a pension plan participant could be forced to make an accounting of a deceased spouse‘s community property interest years after the date of death. If the couple had lived in several States, the accounting could entail complex, expensive, and time-consuming litigation. Congress could not have intended that pension benefits from pension plans would be given to accountants and attorneys for this purpose.
The axis around which ERISA‘s protections revolve is the concepts of participant and beneficiary. When Congress has chosen to depart from this framework, it has done so in a careful and limited manner. Respondents’ claims, if allowed to succeed, would depart from this framework, upsetting the deliberate balance central to ERISA. It does not matter that respondents have sought to enforce their rights only after the retirement benefits have been distributed since their asserted rights are based on the theory that they had an interest in the undistributed pension plan benefits. Their state-law claims are pre-empted. The judgment of the Fifth Circuit is
Reversed.
JUSTICE BREYER, with whom JUSTICE O‘CONNOR joins, and with whom THE CHIEF JUSTICE and JUSTICE GINSBURG join except as to Part II-B-3, dissenting.
The question in this case is whether the
I
A
This case concerns the disposition of pension plan assets earned by an employee who was married; who had children; whose first wife died; who remarried; who retired; and who then died, survived by his second wife. To be more specific, the employee, Isaac Boggs, a resident of Louisiana, began work for South Central Bell Telephone Company (now known as BellSouth) in 1949. He participated in its ERISA-qualified pension plan for about 36 years. He was married to his first wife, Dorothy Boggs, during almost all of that time—from 1949 until 1979, when Dorothy died. The couple had three children. Isaac married his second wife, Sandra, in 1980. He retired in 1985. He died in 1989. Sandra survives him.
When Dorothy died, she left a will providing that Isaac would receive “the maximum [share of her estate] permitted under the law,” as well as a lifetime “usufruct” (rather like a common-law life estate) in the remainder. Brief for
Throughout his working life, and during his entire 30-year marriage to Dorothy, Isaac participated in a set of BellSouth‘s ERISA-qualified retirement plans. When Isaac retired in 1985 (six years after Dorothy‘s death), he received three assets from those plans: (1) 96 shares of AT&T stock (from BellSouth‘s Employee Stock Ownership Plan); (2) a cash payment of about $150,000 (from BellSouth‘s Savings Plan for Salaried Employees); and (3) an annuity of about $1,800 per month (from BellSouth‘s Management Pension Plan) for his life and afterwards for that of his surviving second spouse, Sandra. Isaac almost immediately placed the $150,000 cash payment in an Individual Retirement Account (IRA), thereby avoiding immediate payment of an income tax. See
B
On December 17, 1992, Sandra Boggs filed an action for declaratory judgment in Federal District Court. See
The District Court disagreed with Sandra. It denied her motion for summary judgment and declared that “ERISA does not preempt Louisiana‘s community property laws.” 849 F. Supp. 462, 467 (ED La. 1994); see also Judgment in No. 92-4174 (ED La., Mar. 9, 1994), p. 1. The Fifth Circuit Court of Appeals affirmed. We are reviewing the Fifth Circuit‘s decision in respect to pre-emption; and we must therefore assume its view of the relevant facts and state law.
II
Judge Wisdom, writing for the Fifth Circuit in this case, described Louisiana‘s community property law as a “system” that “conceives of marriage as a partnership in which each partner is entitled to an equal share.” 82 F.3d 90, 96 (1996); see also W. McClanahan, Community Property in the United States § 2:27, p. 38 (1982) (hereinafter McClanahan) (community property law views marriage “as a civil contract between two persons who ente[r] into the relationship as equals and retai[n] their individual personalities“). Recognizing “the value a spouse, though non-employed, contributes to a marriage,” 82 F.3d, at 96, the state law provides that the interest in pension benefits that accrued during Isaac‘s mar-
Louisiana law, like the law of other States, today allows both women and men to leave their property to their children.
We ask here whether—or the extent to which—ERISA stands as an obstacle to the enforcement of this state law as applied in this case. It does so if state law “relate[s] to any employee benefit plan,”
A
Louisiana community property law “relates to” an ERISA plan within the meaning of
The relevant Louisiana statute does not refer to ERISA or to pensions at all. It simply says that “property acquired during the existence of the legal regime through the effort, skill, or industry of either spouse” is “community property.”
The “connection” problem is more difficult. Insofar as that term refers to a conflict with an ERISA purpose, I discuss the matter primarily in Part II-B, infra. The term “connection,” however, might also encompass the question whether state law intrudes into an area Congress (given ERISA‘s basic objectives) would have wanted to reserve exclusively for federal legislation. Dillingham, supra, at 324 (quoting New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 655 (1995)). Cf. Malone v. White Motor Corp., 435 U.S. 497, 504 (1978) (state law is pre-empted when it falls within a field that Congress has sought to occupy); San Diego Building Trades Council v. Garmon, 359 U.S. 236, 244–245 (1959) (States may not regulate activities that are protected or prohibited under
The state law in question concerns the ownership of benefits. I concede that a primary concern of ERISA is the proper financial management of pension and welfare benefit funds themselves, Dillingham, supra, at 326–327 (citing Massachusetts v. Morash, 490 U.S. 107, 115 (1989)), and that payment of benefits (which amounts to the writing of checks from those funds) is closely “connected with” that management. I also concede that state laws that affect those payments lie closer to ERISA‘s federal heart than do state laws that, say, affect those goods and services that ERISA benefit plans purchase, such as apprenticeship training programs, 519 U.S., at 332–334, or medical benefits, De Buono v. NYSA-ILA Medical and Clinical Services Fund, ante, at 814–816. But, even so, I cannot say that the state law at
My reason in part lies in the fact that the state law in question involves family, property, and probate—all areas of traditional, and important, state concern. Rose v. Rose, 481 U.S. 619, 625 (1987) (domestic relations law traditionally left to state regulation); Hisquierdo v. Hisquierdo, 439 U.S. 572, 581 (1979) (same); Zschernig v. Miller, 389 U.S. 429, 440 (1968) (“The several States, of course, have traditionally regulated the descent and distribution of estates“). But see ante, at 848 (majority‘s effort to distinguish property interests passing at divorce from those passing by devise). When this Court considers pre-emption, it works “on the ‘assumption that the historic police powers of the States were not to be superseded by the Federal Act unless that was the clear and manifest purpose of Congress.‘” Dillingham, supra, at 325 (quoting Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230 (1947)).
I can find no reasonably defined relevant category of state law that Congress would have intended to displace. Obviously, Congress did not intend to pre-empt all state laws that govern property ownership. After all, someone must own an interest in ERISA plan benefits. Nor, for similar reasons, can one believe that Congress intended to pre-empt state laws concerning testamentary bequests. This is not an area like, say, labor relations, where Congress intended to leave private parties to work out certain matters on their own. See Machinists v. Wisconsin Employment Relations Comm‘n, 427 U.S. 132, 144–148 (1976). The question, “who owns the property?” needs an answer. Ordinarily, where federal law does not provide a specific answer, state law will have to do so.
Nor can I find some appropriately defined forbidden category by looking to the congressional purpose of establishing uniform laws to regulate the administration of pension funds. Cf. Ingersoll-Rand Co. v. McClendon, 498 U.S. 133 (1990);
The lawsuit before us concerns benefits that the fund has already distributed; it asks not the fund, but others, for a subsequent accounting. And, as I discuss in Part II-B-3 below, this lawsuit will not interfere with the payment of a survivor annuity to Sandra. See
Of course, one could look for a still more narrowly defined category, such as the category of “testamentary bequests of ERISA pension benefits by one spouse who dies before the other.” But to narrow the category to this extent is to
That question is important. Indeed, the Court, in other cases, has found conflicts between state community property law and federal statutes governing retirement, insurance, and savings funds operated and/or funded by the Federal Government. See Mansell v. Mansell, 490 U.S. 581, 587–595 (1989); McCarty v. McCarty, 453 U.S. 210, 221–236 (1981); Ridgway v. Ridgway, 454 U.S. 46, 53–61 (1981); Hisquierdo, supra, at 582–590; Free v. Bland, 369 U.S. 663 (1962); Wissner v. Wissner, 338 U.S. 655, 658–660 (1950). But those cases turned on the particular federal purposes embodied in the particular federal statutes at issue. The question posed here similarly requires an examination of ERISA‘s specific statutory provisions to see whether they reveal language or an important purpose with which the State‘s community property laws conflict—either directly, or in the sense that the state laws “frustrate” the achievement of a statutory purpose. See Malone, 435 U.S., at 504. I now turn to that question.
B
Sandra Boggs, supported by the Acting Solicitor General, points to three statutory provisions with which, she believes, Louisiana law conflicts—an anti-alienation provision,
1
ERISA‘s “anti-alienation” provision,
The first claim—simply attacking Dorothy‘s possession of an undivided one-half interest in that portion of retirement benefits that accrued during her marriage to Isaac—does not attack any “assign[ment]” of an interest nor any “aliena[tion]” of an interest, for Dorothy‘s interest arose not through assignment or alienation, but through the operation of Louisiana‘s community property law itself. Thus, Sandra‘s claim must be that community property law‘s grant of an undivided one-half interest in retirement benefits to a nonparticipant wife or husband itself violates some congressional purpose. But what purpose could that be? Congress has recognized that community property law, like any other kind of property law, can create various property interests for nonparticipant spouses. See
The second claim—attacking Dorothy‘s testamentary transfer to her children—is more plausible. Nonetheless, with one exception discussed below, ERISA does not concern itself with what a pension fund beneficiary, such as Isaac,
I see one possible answer to this question. One might argue that, because Dorothy was the first to die, her testamentary transfer gave to third parties (persons to whom ERISA is indifferent) funds that Isaac might otherwise have used during his retirement; and, for that reason, the testamentary transfer tends to frustrate the purpose of the “anti-alienation” provision or some more general ERISA purpose. This argument (with one exception, see Part II-B-3, infra) is beside the point, however, for the state-law action here seeks an accounting that will take place after the deaths of both Dorothy and Isaac. Moreover, the argument depends upon doubtful assumptions about Congress’ purposes. Consider the 96 shares of stock and $150,000 cash that Isaac received from the plans when he retired. Dorothy‘s bequest affects those assets—the stock and the cash—not while they remain in BellSouth‘s pension plan funds, but only after they have emerged from the plan in the form of a distributed payment. As far as ERISA is concerned, Isaac could have used the retirement benefits to pay for a vacation, to buy a house, or to bet at the races, or he could have given the money to his children. ERISA would have left Dorothy similarly free to do what she wished with her share of the stock and the cash, had she been alive at the time of their receipt. That being so, I do not understand why or how ERISA could be concerned about Dorothy‘s creation of a will, which affected
2
Sandra Boggs and the Acting Solicitor General look for support to another portion of the anti-alienation section—an amendment that was part of the
The QDRO provisions, in my view, do not support the Government‘s argument. The QDRO exception does not purport to interpret the “anti-alienation” provision (quoted supra, at 863). Rather, it simply says that the provision
“shall apply to the creation, assignment, or recognition of a right to any benefit payable with respect to a participant pursuant to a domestic relations order . . . .”
§ 1056(d)(3)(A) .
“relates to the provision of child support, alimony payments, or marital property rights to a spouse, former spouse, child, or other dependent of a participant.”
§ 1056(d)(3)(B)(ii)(I) .
It then exempts “qualified” orders from the scope of the anti-alienation provision.
Second, the amendment, taken as a whole, concerns divorce and separation, not probate. See Department of Labor Advisory Opinion 90-46A, issued Dec. 4, 1990 (citing 130 Cong. Rec. 13327 (1984); S. Rep. No. 98-575, pp. 18–19 (1984)) (in enacting REA, Congress focused on marital dissolution and dependent support). The amendment says that state-court judges cannot award pension-related property to a nonparticipant spouse unless the order doing so meets certain requirements, such as recordkeeping requirements and a prohibition against increasing the amount of benefits that an ERISA plan would otherwise have to pay.
Third, the QDRO provision shows that Congress did not object to court orders that transfer pension benefits from an ERISA plan participant to a former spouse who is alive—at least if those court orders meet certain procedural requirements. Why then, one might ask, would Congress object to court orders that transfer benefits to a former spouse after her death? Had Dorothy Boggs remained with Isaac for many years and then divorced him, she could have obtained a QDRO that would have declared her community property interest in Isaac‘s pension benefits, and she could then have left that interest to her children. That being so, it would be anomalous to find a congressional purpose in ERISA—despite the absence of express statutory language and any indication that Congress even considered the question—that would in effect deprive Dorothy of her interest because, instead of divorcing Isaac, she “stay[ed] with him till her last breath.” Tr. of Oral Arg. 15.
Finally, the language of
3
Sandra Boggs and the Acting Solicitor General rely on a third statutory provision,
The parties have not argued that this provision affects the shares of stock or the $150,000 lump sum. I need not decide whether that is so. That is because, if these assets do count as “accrued benefits” under
The $1,800 monthly annuity payments, however, are a different matter. They were paid from the BellSouth Management Pension Plan, a “defined benefit” pension plan, initially to Isaac during his lifetime, and then to his second wife, Sandra, for her life. These annuities do fall within the scope of
This inconsistency does not end the matter, however, for Dorothy‘s children here sought different relief. Although the children apparently requested a portion of Sandra‘s
The difference is important, for, as the children pointed out at oral argument, an accounting would simply declare that, when Dorothy died, she had a community property interest in Isaac‘s pension benefits. And it is possible that Louisiana law would permit Dorothy (or her heirs) to collect not the pension benefits themselves, but other nonpension community assets of equivalent value. See
In this case, Isaac apparently retained possession of other, nonpension assets from the Dorothy-Isaac community after Dorothy‘s death because her will gave him a lifetime usufruct in the portion of her estate that she did not bequeath to him outright. (And if Dorothy had not bequeathed that portion of her estate to anyone, it appears that Louisiana law
Of course, the lower courts did not describe the precise nature of Dorothy‘s state-law interest, nor did they explain exactly how the accounting worked. They did no more than deny Sandra‘s request for a declaratory judgment that ERISA prohibits an accounting. But that may reflect the fact that no one raised a
| Pension assets | $ 60,000 |
| Stock investments | 140,000 |
| Total | $200,000 |
Louisiana law might then provide that Dorothy and Isaac each owned $100,000 worth of community assets. Louisiana law might also provide (or permit a probate court to decide) that the share belonging to Dorothy‘s estate consisted of $100,000 worth of stock, leaving Isaac with $40,000 in stock and $60,000 in pension assets. If that is so, why should ERISA care? And if Louisiana law should simply postpone the division of the Dorothy-Isaac community‘s property until after Isaac‘s death because of his lifetime usufruct, why should ERISA care any more? Moreover, if Isaac bequeathed the entire $140,000 worth of stock to a charity, I assume that the probate court would block most of the bequest on the ground that $100,000 worth of stock was not Isaac‘s to give away. I assume it would do the same if he tried to give Sandra the entire $140,000. And I do not see why ERISA would care about the stock (which, after all, belonged to Dorothy) in either case.
I cannot understand why Congress would want to pre-empt Louisiana law if (or insofar as) that law provides for an accounting and collection from other property—i. e., property other than the annuity that
On the assumptions I have made, to find a conflict in this case, one would have to depart from what Congress actually said in ERISA and infer some more abstract general purpose, say to help a second wife at the expense of a first wife‘s state-law-created interest in other property. But should we take anything like this latter approach, there would be no logical stopping place. Confusion and unnecessary interference with state property laws would become inevitable. Moreover, we should be particularly careful in making assumptions about the interaction of
In sum, an annuity goes to Sandra, a surviving spouse; but otherwise Dorothy would remain free not only to have, but to bequeath, her share of the marital estate to her children. This reading of the relevant statutory provisions and purposes protects Sandra, limits ERISA‘s interference with
These general reasons, as well as the specific reasons provided above, convince me that ERISA does not pre-empt the Louisiana law in question. And I would therefore affirm the judgment below.