What Happened on Remand: Daniel v. Daniel. Dividing an Unvested Military Retirement Benefit.

Case Background

Christen and Sean Daniel were married in 1995 and were divorced in 2011. The only real asset of the parties was Sean’s military retirement benefit. Sean had enlisted in the National Guard shortly before the parties married. At the time of the divorce hearing, Sean had sixteen years in the National Guard; fifteen of those were during the marriage. Sometime before the divorce hearing, Sean re-upped for another six years.  Sean will be eligible to receive retirement benefits once he has accumulated twenty years of service credit.

Procedural Posture

The magistrate who heard the case found that a non-vested retirement benefit was not marital property subject to division under Ohio law. The trial judge overruled Christen’s objections, and adopted the magistrate’s decision. In a split decision, the Third District Court of Appeals affirmed. Christen appealed to the Supreme Court of Ohio, with this proposed proposition of law: “Unvested military retirement benefits are marital assets, subject to division in divorce proceedings.”

Pertinent Precedent

R.C. 3015.171 (A)(3)(a)(i) and (ii) include in the definition of marital property “[a]ll real and personal property that currently is owned by either or both of the spouses.. . including the retirement benefits of the spouses… that was acquired by either or both of the spouses during the marriage.”

Thompson v. Thompson, 2011-Ohio-6286 (10th dist.)

¶33 The ratio of the number of years of employment of the employed spouse during the marriage to the total years of his or her employment is known as the coverture fraction.  In Thompson the appeals court approved the use of this fraction to divide vested but unmatured pension benefits at the time of divorce. In Daniel v. Daniel the high court approves the use of this fraction to divide an unvested pension benefit.

Merit Decision

In Daniel v. Daniel,  2014-Ohio-1161,  a 4-3 decision written by Justice O’Neill, for himself and Justices Pfeifer, French, and Kennedy, the Court held that unvested military retirement benefits earned during a marriage are marital assets subject to division in a divorce or dissolution.  Justices O’Donnell, Lanzinger, and O’Connor dissented. In so holding, the majority approved the use of what is known as the coverture fraction to divide the military retirement benefits. This method, which was proposed by Christen throughout the proceedings, and again on remand, multiplies the retirement benefit by a fraction, of which the numerator is the number of marital years the person with the retirement benefit participated in the plan, and the denominator is the total number of years in that plan. Simply put, the coverture fraction is just the marital portion of a benefit subject to equitable distribution.

While the majority approved the use of the coverture fraction to divide the military retirement benefit in this case, it did not require it, leaving that for the trial judge to determine on remand. Read a complete analysis of the merit decision here.

Case Syllabus

Unvested military retirement benefits earned during marriage fall within the definition of marital property in R.C. 3105.171(A)(3)(a) and must be considered for division under R.C. 3105.171(C).

What Happened on Remand

When the case was remanded, the trial court gave both parties the opportunity to present their respective positions, but only Christen did so. Sean Daniel, who did not file a brief or participate at oral argument in this case before the Supreme Court of Ohio, was unrepresented on remand.

On June 10, 2014, Mercer County Domestic Relations Judge Jeffrey R. Ingraham ruled that Sean Daniel’s unvested military retirement benefit earned during the marriage was marital property subject to equitable distribution. This retirement benefit was to be divided by applying the coverture fraction, meaning the ratio of the number of years Sean was in the military during the marriage, (here 15 years) to the total number of years of his military service, which cannot yet be determined, since Sean is still with the National Guard.  Each party will receive one half of this computed amount when Sean is no longer with the service, but only if the benefits are then vested.  In the event that Sean’s military retirement benefits never vest, neither party gets anything. Sean must notify the Court when his military retirement benefits become vested so that the court can issue the appropriate order. His failure to do so would result in a contempt finding.

Student Contributor: Rebecca Campbell

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