Smith v. FarmerSmith v. Farmer
MICHAEL W. SANDNER, Atty. Reg. No. 0064107, 2700 Stratacache Tower, 40
Attorney for Plaintiff-Appellant
JAMES R. KIRKLAND, Atty. Reg. No. 0009731, 10532 Success Lane, Dayton, Ohio 45458
Attorney for Defendant-Appellee
OPINION
{¶ 1} Elaine Smith appeals from the trial court‘s denial of her motion for summary judgment and its grant of summary judgment in favor of Carolyn Farmer on Smith‘s claims related to Farmer‘s receipt of survivor benefits from the Ohio Police and Fire Pension Fund (“OP&F“). For the following reasons, the trial court‘s judgment will be affirmed.
I. Facts and Procedural History
{¶ 2} This action concerns whether Smith or Farmer is entitled to survivor benefits from OP&F. The following facts are undisputed.
{¶ 3} Elaine Smith (“Smith“) is the former spouse of Larry Smith, a retired police officer. The two married on July 13, 1963. In December 1983, Larry applied for disability retirement benefits from OP&F, then known as the Police and Fireman‘s Disability and Pension Fund of Ohio. OP&F permits plan members to elect a retirement allowance payable for the retiree‘s lifetime or, instead, to receive an actuarial equivalent of his retirement allowance in a lesser amount payable for his life and continuing after his death to a surviving designated beneficiary. See
{¶ 4} The Smiths divorced on August 15, 1988, after 25 years of marriage. Section III of the divorce decree, which addressed OP&F benefits, provided that Smith was to receive half of Larry‘s gross monthly benefits, including any increases. It also provided for Smith to be named the surviving spouse if the pension plan later was modified to provide for a surviving spouse benefit.
{¶ 5} On September 29, 1988, the domestic relations court issued a qualified domestic relations order (QDRO), which restated the terms of the divorce decree regarding OP&F. Soon thereafter, the Ohio Attorney General, on behalf of OP&F, filed a motion in the domestic relations court seeking vacation of the QDRO on the ground that OP&F was expressly exempt from the Employee Retirement Income Security Act of 1974 (ERISA). The domestic relations court agreed, and on November 28, 1988, it filed an entry vacating the QDRO and ordering that Smith receive one-half of Larry‘s gross monthly benefit as spousal support. The entry did not mention the conditional surviving spouse benefit.
{¶ 6} OP&F did not receive a copy of the 1988 divorce decree. However, it was provided copies of the QDRO and the entry vacating the QDRO. Pursuant to the entry, Smith received her portion of Larry‘s gross monthly benefit.
{¶ 7} On July 14, 1993, Larry married Carolyn Farmer, and the couple remained married until Larry‘s death on August 7, 2019, 26 years later. Shortly after Larry died, Farmer submitted a Survivor Benefit Application to OP&F. Farmer received a one-time death benefit of $1,000 from OP&F on August 29, 2019. In addition, pursuant to
{¶ 9} The trial court‘s original deadline for filing motions for summary judgment was March 14, 2022. Upon the joint request of the parties, that deadline was extended to March 28, 2022.
{¶ 10} Smith filed a timely motion for summary judgment on March 25, 2022. She argued that the final judgment and decree of divorce contained an express provision for the handling of OP&F benefits, which required that she be named the alternate payee and that she receive half of the gross benefits, which she did from October 1, 1987 through August 1, 2019. Smith also asserted that the decree further provided that if the pension plan were modified to provide for a surviving spouse, then she, as the alternate payee, was to be designated the surviving spouse upon Larry‘s death, entitling her to survivor benefits from OP&F. Smith noted that a QDRO had been entered but was vacated because it was inapplicable to OP&F. She stated that, following new legislation in 2002, property divisions concerning OP&F were to be addressed through division of property orders (DPO); no DPO was filed prior to Larry‘s death. Smith argued that Farmer was unjustly enriched by her receipt of survivor benefits from OP&F and that she (Smith) was entitled to a constructive trust, in accordance with Fischbach v. Mercuri, 184 Ohio App.3d 105, 2009-Ohio-4790, 919 N.E.2d 804 (2d Dist.). Finally, Smith asserted that a preliminary injunction should be entered against Farmer, enjoining her from further receipt of OP&F benefits. Smith did not address her conversion or breach of contract claims.
{¶ 11} On April 1, 2022, Farmer filed a combined motion for summary judgment and memorandum in opposition to Smith‘s motion for summary judgment. Farmer emphasized that while the QDRO specifically mentioned a surviving spouse benefit, the entry vacating the QDRO did not, thus terminating any right Smith had to survivor benefits. Farmer noted that OP&F had received copies of the QDRO and the entry vacating it, but not the divorce decree. Farmer thus argued that she rightfully applied for survivor benefits after Larry‘s death and thereafter properly received them. Farmer also argued, alternatively, that even if the survivor benefit provision remained in force despite the order vacating the QDRO, the language of the divorce decree did not comply with the statutory mandates of distribution set forth in
{¶ 12} Smith moved to strike Farmer‘s motion as untimely and requested a status conference. The trial court held a status conference on May 19, but the record does not reflect whether the court addressed the motion to strike. No written entry addressing the motion to strike was filed.
{¶ 13} The trial court subsequently granted Farmer‘s motion for summary judgment and denied Smith‘s motion. The
{¶ 14} Smith appeals from the trial court‘s judgment, raising four assignments of error. We will address them in a manner that facilitates our analysis.
II. Untimely Motion
{¶ 15} In her fourth assignment of error, Smith claims that the trial court erred in granting Farmer‘s motion for summary judgment because the motion was untimely.
{¶ 16} “Trial courts have inherent power to manage their own dockets and the progress of the proceedings before them.” (Citations omitted.) Roberts v. Kauffman 4 Dayton, Ltd., 2d Dist. Montgomery No. 29412, 2022-Ohio-3164, ¶ 11. In reviewing whether a court erred in the implementation of its own scheduling order, we generally apply the abuse of discretion standard. Id.; Pond v. Pond, 10th Dist. Franklin No. 20AP-262, 2021-Ohio-1708, ¶ 9. Similarly, we review a trial court‘s denial of a motion to strike an untimely-filed motion for an abuse of discretion. Cromartie v. Goolsby, 8th Dist. Cuyahoga No. 93438, 2010-Ohio-2604, ¶ 18. An abuse of discretion occurs when the trial court‘s decision is unreasonable, arbitrary, or unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217, 219, 450 N.E.2d 1140 (1983).
{¶ 17} The trial court did not rule on Smith‘s motion to strike Farmer‘s motion for summary judgment and, instead, considered Farmer‘s motion on the merits. We therefore presume that the motion to strike was overruled. E.g., State ex rel. The V Cos. v. Marshall, 81 Ohio St.3d 467, 469, 692 N.E.2d 198 (1998) (“[W]hen a trial court fails to rule on a pretrial motion, it may ordinarily be presumed that the court overruled it.“).
{¶ 18} We find no abuse of discretion in the trial court‘s consideration of Farmer‘s summary judgment motion. The motion was filed on April 1, 2022, only four days after the court‘s deadline for filing summary judgment motions, and it also served as Farmer‘s memorandum in opposition to Smith‘s summary judgment motion. The untimely filing did not cause any delay to the proceedings. Putting aside the trial court‘s ruling on Farmer‘s summary judgment motion, Smith was not prejudiced by the trial court‘s consideration of Farmer‘s motion. Moreover, the court‘s resolution of the motion promoted judicial economy by allowing the matter to be resolved on a dispositive motion when no genuine issues of material fact existed.
{¶ 19} Smith‘s fourth assignment of error is overruled.
III. The Parties’ Cross-Motions for Summary Judgment
{¶ 20} In her first, second, and third assignments of error, Smith claims that the trial court erred in denying her motion for summary judgment on her claims for unjust enrichment, the imposition of a constructive trust, and for a preliminary and permanent injunction. She asserts that
{¶ 21}
{¶ 22} In this case, the underlying facts were undisputed. Farmer is receiving survivor benefits from OP&F that Smith claims she should be receiving in accordance with the divorce decree. The ultimate issue is whether Smith is entitled to those survivor benefits. The trial court did not answer this question.
{¶ 23} In its summary judgment decision, the trial court recognized that the “crucial determination is whether plaintiff‘s right to survivor benefits established in her divorce from Mr. Smith in the QDRO, was terminated.” However, it stated that it was “not in a position to second-guess the OP&F decision to grant the survivor benefits of Mr. Smith‘s pension to his surviving spouse at the time of his death rather than his former wife pursuant to the QDRO portion of the 1988 Divorce Decree.” The court reasoned:
Whether that survivor benefit remained in place or was eliminated by the OP&F‘s solicited Entry Vacating the QDRO is not at all clear. The Court would have to infer an intention to deny a significant benefit bargained for in the Domestic Relations Court by its absence from the Entry Vacating the separate QDRO because OP&F was concerned about being garnished or obligated to make support payments through SEA. See OP&F Motion. The Court cannot make such an inference especially on summary judgment.
Instead, the trial court found that Farmer was entitled to summary judgment because any action on her part in receiving the survivor benefits was not the result of ill will, intentional misrepresentations, fraud, or deceit. We agree with the trial court‘s judgment but employ a different analysis.
{¶ 24} As an initial matter, it is irrelevant whether Farmer‘s receipt of survivor benefits from OP&F was obtained by fraud, misrepresentation, ill will, or the like. None of Smith‘s claims – unjust enrichment, breach of contract, or conversion – required that the defendant act with wrongful intent. See TruLogic, Inc. v. Gen. Elec. Co., 2d Dist. Greene No. 2021-CA-3, 2021-Ohio-2860, ¶ 69 (unjust enrichment requires (1) a benefit conferred on the defendant by the plaintiff, (2) defendant‘s knowledge of the benefit, and (3) retention of the benefit would be unjust without payment); Gevedon v. Decker, 2d Dist. Clark No. 2020-CA-21, 2021-Ohio-77, ¶ 30, quoting Cent. Ohio Med. Textiles v. PSC Metals, Inc., 10th Dist. Franklin No. 19AP-167, 2020-Ohio-591, ¶ 25 (“While conversion does not require a showing of wrongful intent to interfere with the owner‘s property rights, a plaintiff must demonstrate that the defendant intentionally exercised dominion or control over the property.“); Brown v. Fukuvi USA Inc., 2d Dist. Montgomery No. 29294, 2022-Ohio-1608, ¶ 17 (elements of a breach of contract claim are the existence of a contract, performance by plaintiff, breach by defendant, and damage or loss to the plaintiff). While a constructive trust is often employed as a remedy for fraud, it may also be imposed without fraud when principles of equity require it. Dart v. Katz, 2d Dist. Montgomery No. 28913, 2021-Ohio-1429, ¶ 54.
{¶ 25} We therefore begin our analysis with the terms of the domestic relations court‘s judgments and whether the conditional surviving spouse provision in the divorce decree remains valid.
A. Validity of the Surviving Spouse Provision in the Divorce Decree
{¶ 26} At the outset, we emphasize that the trial court was permitted to review the domestic relations court‘s judgments to resolve this matter. See, e.g., Rimby v. Heritage Union Title Co. Ltd., 7th Dist. Columbiana No. 21 CO 0002, 2021-Ohio-3635, ¶ 34 (“[A]fter a final divorce decree is entered, proceedings that may include interpreting a domestic relations decree have been permitted to occur in a division other than the domestic relation division, especially when other parties are involved.“); Khan v. Hughes, 8th Dist. Cuyahoga No. 102651, 2015-Ohio-4502, ¶ 14 (“Because the domestic relations court had issued a judgment granting the divorce and providing for the division of the property, the domestic relations court no longer had exclusive jurisdiction over the matter and the common pleas court, which has concurrent jurisdiction, had the power to enforce the order of the domestic relations court.“).
{¶ 27} “Ohio law clearly establishes that a judgment may be interpreted if it is ambiguous. If there is good faith confusion over the interpretation to be given to a particular clause of a divorce decree, the trial court in enforcing that decree has the power to hear the matter, clarify the confusion, and resolve the dispute.” (Citations omitted.) Quisenberry v. Quisenberry, 91 Ohio App.3d 341, 348, 632 N.E.2d 916 (2d Dist.1993). Whether a divorce decree is ambiguous is a question of law, which an appellate court reviews de novo. Stevens v. Stevens, 2d Dist. Montgomery No. 27761, 2018-Ohio-2662, ¶ 31. If an ambiguity exists, we review the trial court‘s clarification for an abuse of discretion. Id.
{¶ 28} Here, the domestic relations court issued three relevant judgments: the divorce decree, the QDRO, and the entry vacating the QDRO. We must consider whether there is any ambiguity in those judgments, particularly as it relates to the validity of the surviving spouse provision in the divorce decree.
{¶ 29} The divorce decree set forth the parties’ rights to Larry‘s pension benefits. “Pension or retirement benefits accumulated during the course of a marriage are marital assets subject to property division in a divorce action.” Erb v. Erb, 75 Ohio St.3d 18, 20, 661 N.E.2d 175 (1996). “After a trial court issues a divorce decree, it lacks jurisdiction to modify or amend the marital property division, including the division of retirement assets, unless the parties expressly consent in writing to the modification. Colombo v. Chesser, 10th Dist. Franklin No. 17AP-278, 2018-Ohio-1477, ¶ 9, citing
{¶ 30} A QDRO is an order that creates or recognizes an alternate payee‘s rights to receive all or a portion of a plan participant‘s benefits in an ERISA-qualified retirement plan. See Hoyt v. Hoyt, 53 Ohio St.3d 177, 179, 559 N.E.2d 1292 (1990); ERISA,
{¶ 31} Governmental plans, such as state retirement plans, are exempt from ERISA.
{¶ 32} At the time of the Smiths’ divorce, Ohio appellate courts and OP&F interpreted
{¶ 33} With 2000 H.B. 535, effective January 1, 2002, the Ohio legislature made clear that state retirement systems were permitted to make payments to a participant‘s former spouse pursuant to a court order for the purpose of dividing a retirement benefit. See
{¶ 34} With this background in mind, we find no ambiguity as to whether the surviving spouse provision in the divorce decree was eliminated by the subsequent entry vacating the QDRO. Under the terms of the divorce decree, Smith was entitled to receive one-half of the benefit that Larry received, plus half of any increases to that benefit, and she did, in fact, receive one-half of his gross monthly benefit until his death in August 2019. Section III(H) of the divorce decree further provided:
In the event the Plan is modified to provide for a “surviving spouse” upon the death of the Participant [Larry], then in that event, Alternate Payee [Smith] shall be a “surviving spouse” entitled to such benefits, but only to the extent of the benefit pursuant to the Plan. Because [Larry] and [Smith] have been married for more than one (1) year, [Smith] shall be treated as meeting the requirements of [IRS Code 417(d)] for purposes of determining surviving spouse benefits.
The divorce decree required Larry and Smith to execute any documents requested by OP&F to reflect their intent. The parties further agreed that the divorce decree did “not require the Plan to provide any type or form of benefit, or any option, not otherwise provided under the Plan[.]” The decree made clear that the terms were intended to constitute a QDRO.
{¶ 35} The September 29, 1988 QDRO matched the terms of Section III of the divorce decree, and it was promptly provided to OP&F. But, as discussed, OP&F sought vacation of the QDRO because the plan was exempt from ERISA. The domestic relations court vacated the QDRO on this basis.
{¶ 36} The subsequently-filed entry vacating the QDRO ordered Larry to pay one-half of his gross monthly benefit (plus one-half of any increases) to Smith as spousal support, and it ordered OP&F to withhold that amount from Larry‘s account and to pay it to Smith through MCSEA. Because the case law at the time precluded OP&F from paying pension benefits directly to a former spouse, converting the pension benefit to spousal support was a mechanism by which the domestic relations court could order OP&F to withhold a portion of Larry‘s pension benefit. The order was consistent with the intent of the divorce decree regarding Smith‘s receipt of her portion of Larry‘s pension benefit during his lifetime and provided Smith the same monthly benefit included in the divorce decree. Although the order did not mention a surviving spouse benefit, we cannot reasonably discern an intent to modify the divorce decree, which the domestic relations court lacked jurisdiction to do. Section III(H) of the divorce decree, addressing Smith‘s entitlement to be a “surviving spouse” should the plan later be modified, remained valid following the filing of the entry vacating the QDRO.
B. Smith‘s Entitlement to Survivor Benefits
{¶ 37} The parties do not discuss whether Section III(H) itself is ambiguous. Because Farmer is receiving statutory surviving spouse benefits under
{¶ 38} Statutory survivor benefits existed prior to the Smiths’ divorce case. In 1988, when the divorce action was filed,
{¶ 39} Although the parties do not discuss the annuity provisions, it is possible that Section III(H) referred to Larry‘s election under
{¶ 40} In our view, it is irrelevant which survivor benefit is the subject of Section III(H), because Smith cannot prevail, as a matter of law, for either type of survivor benefit. Assuming first that the divorce decree referred to a change in the annuity selection, Smith has no basis for a claim. According to the stipulated documentation from OP&F, Larry never altered his election. Rather, during his lifetime, he received the higher retirement allowance payable during his lifetime, and Smith received her share of those benefits. Upon his death, those payments ceased and, significantly, neither Smith nor Farmer is receiving benefits as a surviving beneficiary. The divorce decree did not obligate Larry to alter his election and name Smith as his beneficiary. To the contrary, Larry arguably was only required to name Smith as his surviving spouse if he took action to modify the plan, which did not occur.
{¶ 41} Whether Smith is entitled to benefits as a “surviving spouse” for purposes of
{¶ 42} A court‘s goal when analyzing a statute is to discern and apply “legislative intent [as] manifested in the words of the statute.” Proctor v. Kardassilaris, 115 Ohio St.3d 71, 2007-Ohio-4838, 873 N.E.2d 872, ¶ 12. As such, if the statutory language is “plain and unambiguous[,] [the statute] must be applied as written without further interpretation.” Id. But if the statute is ambiguous, then a court must determine the legislature‘s intent. Cline v. Ohio Bur. of Motor Vehicles, 61 Ohio St.3d 93, 96, 573 N.E.2d 77 (1991). A statute “is ambiguous ‘if a reasonable person can find different meanings in the [statutory language] and if good arguments can be made for either of two contrary positions.’ ” Sunset Estate Properties, L.L.C. v. Lodi, 9th Dist. Medina No. 12CA23, 2013-Ohio-4973, ¶ 20, quoting 4522 Kenny Rd., L.L.C. v. Columbus Bd. of Zoning Adjustment, 152 Ohio App.3d 526, 2003-Ohio-1891, 789 N.E.2d 246, ¶ 13 (10th Dist.); see also Turner v. Hooks, 152 Ohio St.3d 559, 2018-Ohio-556, 99 N.E.3d 354, ¶ 12. When a statute is ambiguous, “[a]ll statutes pertaining to the same general subject matter
{¶ 43} OP&F has provided and continues to provide survivor benefits to Farmer pursuant to
{¶ 44}
{¶ 45} This interpretation is consistent with the statutory definitions included in other public retirement systems in Ohio. The Public Employees Retirement System, the State Teachers Retirement System, and the Public School Employees Retirement System each define a surviving spouse as “an individual who establishes a valid marriage to a member at the time of the member‘s death by marriage certificate” or as recognized by a court order. See
{¶ 46} The divorce decree states that if the plan was modified to provide for a “surviving spouse” upon Larry‘s death, then Smith, the alternate payee, shall be the surviving spouse entitled to those benefits, to the extent of the benefit pursuant to the plan. But, since statutory surviving spouse benefits under
{¶ 47} In this case, OP&F provides survivor benefits to a surviving spouse, but there is no statutory authorization to provide those benefits to anyone other than the spouse at the time of the participant‘s death, in this case Farmer. OP&F is a “creature of statute,” whose authority is constricted by “that which is expressly or impliedly conferred by statute.” Erb, 75 Ohio St.3d at 22, 747 N.E.2d 230, quoting Dreger v. Pub. Emp. Retirement Sys., 34 Ohio St.3d 17, 20-21, 516 N.E.2d 214 (1987). Under the terms of the pension fund, Farmer is statutorily entitled to the statutory survivor benefits.
{¶ 48} Smith argues that Ohio law was amended to allow for division of property orders through H.B. 535, effective January
{¶ 49} Smith emphasizes that she has not sought to receive survivor benefits directly from OP&F and that a constructive trust should be imposed on the survivor benefits to effectuate the terms and intent of the divorce decree that she receive those benefits. She relies on Fischbach v. Mercuri, 184 Ohio App.3d 105, 2009-Ohio-4790, 919 N.E.2d 804 (2d Dist.), to support her position. Farmer argues that this case is governed, instead, by Cosby v. Cosby, 96 Ohio St.3d 228, 2002-Ohio-4170, 773 N.E.2d 516, and similar cases.
{¶ 50} In Cosby, the Ohio Supreme Court held that a plan participant‘s first wife was not entitled to a constructive trust over survivor benefits that the second wife was receiving from the State Teachers Retirement System (STRS). The divorce decree awarded the first wife a portion of the plan participant‘s retirement benefits, but he died prior to retirement. The participant had not designated a beneficiary for his survivor benefits, and his surviving spouse therefore was statutorily entitled to the benefits. In concluding that a constructive trust was inappropriate, the supreme court reasoned that STRS was statutorily prohibited from paying benefits prior to retirement, and the plan participant had died prior to retiring. It further stated that STRS benefits were “governed exclusively by statute,” and the second wife, as the qualified statutory beneficiary of the account, was receiving survivor benefits. The supreme court stated that the imposition of a constructive trust over a portion of second wife‘s benefit for the benefit of first wife was “contrary to statutory mandates of STRS.” Id. at ¶ 19.
{¶ 51} Seven years later, we held that a constructive trust was appropriate in Fischbach. Fischbach was the former spouse of Joseph, a participant in STRS; Mercuri was Joseph‘s spouse at the time of his death. When Fischbach and Joseph divorced, Joseph agreed that he would designate Fischbach as the beneficiary of his survivor annuity and would elect a survivor benefit that would pay her $1,767.50 per month for the remainder of her life. Joseph failed to designate Fischbach as his beneficiary prior to his death, and he had no valid beneficiary designation when he died. As a result, STRS applied the statutory succession under
{¶ 52} On review, we reversed the trial court‘s judgment and found that a constructive trust was the appropriate remedy. Initially, we distinguished Cosby, emphasizing that Cosby‘s first wife had been awarded retirement benefits in the divorce
“Prior to retirement, the participant may designate whomever he wishes as his beneficiary as there is not spousal consent required for the election of a beneficiary.
R.C. 3307.562(B) . This beneficiary designation is only valid prior to retirement.” Romans v. Romans, 2006-Ohio-6554, ¶ 11. Thus, Joseph could have designated Fischbach as his beneficiary at any time before his death, and that designation would have been effective to establish Fischbach as his beneficiary for survivorship benefits, because Joseph died before retiring. And Joseph was ordered to designate Fischbach as his beneficiary under the divorce decree. Therefore, his failure to do so was wrongful, and Mercuri received, and continues to receive, survivorship benefits as a result of Joseph‘s wrongful failure to have designated Fischbach as his beneficiary. As a result, Fischbach‘s receipt
of these benefits is the inequitable result of Joseph‘s wrongful act (or omission to act), and the imposition of a constructive trust is an appropriate equitable remedy.
Fischbach, 184 Ohio App.3d 105, 2009-Ohio-4790, 919 N.E.2d 804, at ¶ 63.
{¶ 53} In this case, the recipient of statutory survivor benefits is determined solely by the statutory language. Under the plain language of
{¶ 54} We find this case more analogous to Cosby, in which the supreme court stated that it was not proper to impose a constructive trust when the trust would result in the reallocation of pension funds in a manner contrary to the statutory mandates of the public pension plan. The divorce decree cannot provide Smith with statutory survivor benefits contrary to the mandates of
{¶ 55} Accordingly, we conclude that Farmer‘s receipt of survivor spouse benefits from OP&F is not inequitable as a matter of law. and Smith has no claim over those funds. The trial court did not err in granting summary judgment to Farmer and denying Smith‘s motion for summary judgment. Smith‘s first, second, and third assignments of error are overruled.
IV. Conclusion
{¶ 56} The trial court‘s judgment will be affirmed.
DONOVAN, J. and LEWIS, J., concur.
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Michael W. Sandner
James R. Kirkland
Hon. Richard S. Skelton