Ex-Wife Awarded Share Of Pension When Stubborn Ex-Husband Refused To Retire

26 June 2015
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It is common in a divorce action for one spouse to be awarded a portion of the other spouse’s retirement pension. But what happens when the spouse with the pension stubbornly refuses to retire upon attaining retirement age, thereby depriving the other spouse of pension income? The Rhode Island Supreme Court recently addressed this issue in the case of Macarone v. Macarone and held that a divorced man could be ordered to pay his former wife a portion of his retirement pension, even before he retired.
As part of the parties’ property settlement agreement, the plaintiff wife was to receive 50% of the defendant husband’s pension upon his retirement from state service. Their agreement contemplated that the husband would retire upon reaching the age of retirement eligibility (age 60). To ensure that the husband retired on schedule, the parties agreed that $25,000 would be placed in an escrow account to be established by the husband. If the husband did not retire at age 60, the wife would receive a sum from the escrow account equal to what she would have received from the husband’s pension. These payments would continue until the husband retired and wife began receiving payments directly from the pension plan.
The defendant husband failed to set up the escrow account and failed to have funds disbursed to the wife, even though he was eligible to retire. The plaintiff wife sought to enforce the property settlement agreement in the Family Court. The defendant husband argued that the wife was only entitled to a portion of his retirement pension upon his retirement and not before. A justice of the Family Court disagreed with the husband, finding that he was obligated to establish the escrow account and disburse funds from the account until he retired and the wife was able to receive a portion of his retirement pension.
On appeal to the Rhode Island Supreme Court, the justices determined that the parties’ property settlement agreement was ambiguous as to the valuation date for the husband’s pension and the date the wife would begin receiving her share. Ultimately, the Court found that the Family Court justice correctly resolved the ambiguity in the parties’ agreement by applying the principles of equity. The Court was satisfied that the Family Court’s order that the husband make payments to the wife from October 2007 (when he turned 60 and was eligible to retire) to June 2013 was an equitable result.

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