When the parties divorced in 2010, Husband worked for United State Border Patrol and, as a federal employee, participated in the Federal Employee Retirement System (called “FERS”). The parties agreed to to equally divide the community interest in Husband’s retirement benefits.
The decree contained this agreement and further provided that the parties would equally divide the cost of any domestic relations orders necessary to divide the retirement benefit. The family court also reserved jurisdiction to resolve any future disputes regarding the division of the retirement plan.
Fast forward to December 2017 when Wife filed a petition to enforce the decree and alleged that Husband was now eligible to retire. Wife asked the family court to order Husband to pay her share of the retirement benefits directly if he elected to continue working, pursuant to the Koelsch v. Koelsch decision.
Husband filed a motion to dismiss the enforcement petition where he argued that Wife waived any claim for Koelsch payments because she did not specifically raise this claim when the decree was entered. He also argued that federal law prohibited Koelsch payments for FERS benefits.
After the family court denied Husband’s motion to dismiss, it asked the parties to brief how the subsequent opinion in Boncoskey v. Boncoskey affected Wife’s claim. Ultimately, the family court denied Wife’s petition and explained that because Koelsch payments were not ordered in the decree, ordering payments now would improperly modify the decree.
Waiver is an equitable defense that may be asserted when an individual voluntarily and intentionally relinquishes a known right. Waiver does not necessarily require an affirmative act, it may occur by omission. Failing to assert a known right may be inferred to waive that right.
Here, Husband argued that Wife waived the right to Koelsch payments because she failed to assert that claim when the decree was entered (and never appealed the decree). But the language of the decree contained no provisions related to the timing or manner of how Wife would receive her share of the retirement plan. It explicitly deferred resolution of those questions to an unspecified date in the future and preserved Wife’s claim for Koelsch payments.
Husband also argued that federal law applicable to FERS benefits prohibits or precludes Koelsch payments. He analogized his retirement plan to military benefits that were addressed in the Barron v. Barron opinion.
Essentially this argument centered around whether or not the FERS benefits were considered “matured” before actual retirement and whether any federal statute restricted state courts’ authority to treat the benefit as community property. As the Barron opinion acknowledged, certain military benefits are not matured or vested until approved upon retirement. Before those benefits are approved, they are deemed discretionary. The Barron opinion held that the family court cannot order Koelsch payments of discretionary benefits that plausibly may never be received.
The Court of Appeals distinguished FERS benefits from the military pay as an actual entitlement certain to be received upon reaching certain employment milestones. It also found no federal statute that directly limits state court authority to divide this particular type of retirement plan. It remanded to the family court with specific instructions to reconsider Wife’s request for Koelsch payments.