Hutchins v. Hutchins

• Decision Date: 27 September 1976
• Docket Number: Docket No. 25674
• Parties: Robert Lloyd HUTCHINS, Plaintiff-Appellee, v. Iva Lea HUTCHINS, Defendant-Appellant.
• Court: Court of Appeal of Michigan — District of US

Page 272

248 N.W.2d 272

71 Mich.App. 361

Robert Lloyd HUTCHINS, Plaintiff-Appellee, v. Iva Lea HUTCHINS, Defendant-Appellant.

Docket No. 25674.

Court of Appeals of Michigan.

Sept. 27, 1976.

Released for Publication Jan. 6, 1977.

Hubbard, Fox, Thomas & Born, by Jack D. Born, Lansing, for defendant-appellant.

J. Richard Robinson, Lansing, for plaintiff-appellee.

Before ALLEN, P.J., and D. E. HOLBROOK, Jr., and PAPP, ^* JJ.

PAPP, Judge.

A judgment of divorce was granted to the plaintiff, Robert Lloyd Hutchins, against his wife. Iva Lea Hutchins appeals from that portion of the judgment having to do with the property division, alimony and attorney fees. Custody of the minor son, born July 14, 1958, was awarded to the defendant, and support of said minor son is not at issue in this appeal nor need it be considered since he has now reached the age of 18 years.

Defendant-wife claims the trial court erred and thus abused its discretion when it failed to take into account the plaintiff-husband's retirement pension in calculating the total assets of the parties subject to distribution, in awarding her alimony and limiting it to a five-year period after 29 years of marriage, and in awarding attorney fees to her in the 'statutory amount' of $180.00.

Briefly, the testimony of the defendant-wife showed that the parties were married for 29 years, that six children were born to the parties, and that she was 53 years of age. In the year 1964, after the children were more mature, she worked on a part-time basis and in 1973 started working full time. She received absolutely nothing in the way of fringe benefits and her average weekly net take-home pay was between $93.00 and $103.00. Plaintiff-husband's testimony indicates that he was 51 years of age, a licensed mortician, had been a Michigan State Trooper for 23 years before retiring in July of 1974 at an earlier age than was required, that he received $3,500.00 in severance pay and thereafter commenced to receive monthly pensions of $545.00. In March of 1975, he started to work as a court officer in the Lansing District Court at a yearly salary of $10,200.00, or $614.00 net per month.

The trial judge in rendering his decision stated:

'* * * part of the current difficulty in Michigan law is what is the status of retirement benefits and programs for either spouse in a divorce situation * * *. Until the law becomes more established in Michigan, that is, an adequate guideline for the trial court, it must be kept in line, this is not an appellate or policy-making court, this is a trial court.

'It has been my position that, per se, participation pro-rata in retirement benefits is not approved or disapproved under Michigan law. And I have not, to this juncture, allowed pro rata participation in retirements of either spouse. The only manner in which I have attempted to adjust it has been in relation to either giving an award in all money or an award in division of property to try to compensate for what the inequity might be.'

The first question we are faced with is whether or not the trial judge should have considered as an award in the division of property the retirement pension of the defendant-husband. We are of the belief that it is time to resolve this question which has been plaguing the trial courts, and for our answer we look to the public safety department pension, accident and disability fund act. 1935 P.A. 251; being M.C.L.A. § 28.101 Et seq.; M.S.A. § 3.331 Et seq. Section 1 of the Act reads as follows:

'There is hereby created and established a continuing fund to be known as the Michigan department of public safety pension, accident and disability fund. Such fund shall be made up from contributions from members of the Michigan department of public safety who have subscribed to the constitutional oath of office, from the rewards offered and accepted for such fund and from a yearly sum to be paid into such fund from the appropriation of the Michigan department of public safety in such an amount as shall be deemed sufficient by the commissioner of the Michigan department of public safety approved by the state administrative board to carry out the provisions of this act.'

It is apparent that an individual account is maintained for each member, who shall contribute every month, 5% Of his monthly salary. Any member who resigns or is dismissed for reasons other than breach of the public trust from the Michigan Department of Public Safety shall receive in a lump sum, payable to him or his legal representative, 100% Of the contributions made by him into the fund. In the event of death or legal disability the member or his legal representative may apply. M.C.L.A. § 28.103; M.S.A. § 3.333, as amended by 1965 P.A. 165. ¹

A further reading of the Act indicates that a member who has retired shall receive an annual pension, payable monthly, and in the event of death of such retired member, such pension shall continue to be paid to his widow for the rest of her natural life, or until she remarries. M.C.L.A. § 28.107(a); M.S.A. § 3.337(a) as amended by 1965 P.A. 23. ²

Our search reveals no Michigan cases directly on this issue; however, we do find cases wherein workmen's compensation payments to the husband were properly subject to the terms of a divorce decree. Petrie v. Petrie, 41 Mich.App. 80, 199 N.W.2d 673 (1972), Lv. den. 388 Mich. 771. And in Kauppi v. Dow Chemical Co., 40 Mich.App. 448, 198 N.W.2d 897 (1972), this Court approved a divorce decree wherein the wife was to share a percentage of the benefits that her husband would actually receive and be paid by virtue of a certain retirement pension and profit sharing plan. Since we found no Michigan case directly on this point we turned to other states for enlightenment. In our research in community and noncommunity property states, we find the courts holding that state pension, private pensions, profit-sharing trust and military pensions could be properly distributed as property under a decree of divorce.

In the State of Washington, a community property state, the Supreme Court in Payne v. Payne, 82 Wash.2d 573, 512 P.2d 736 (1973), held that an interest in a military retirement program and anticipated monthly benefits could be properly distributed as property under a decree of divorce. In Loomis v. Loomis, 47 Wash.2d 468, 479, 288 P.2d 235 (1955), the court noted that it was inclined to agree that a military pension is not in the nature of future earnings, but is an asset acquired during coverture and is not a gift or gratuity accruing to the husband. See also Kirkham v. Kirkham, 335 S.W.2d 393 (Tex.Civ.App.1960). In other community property states, the courts today regard military retirement plans and other retirement pay as a mode of employee compensation. It is an earned property right which accrues by reason of a specified number of years of service in a particular branch of the armed services. Citing Berkey v. United States, 361 F.2d 983, 176 Ct.Cl. 1 (1966); Mora v. Mora, 429 S.W.2d 660 (Tex.Civ.App.1968); LeClert v. LeClert, 80 N.M. 235, 453 P.2d 755 (1969); In re Marriage of Karlin, 24 Cal.App.3d 25, 101 Cal.Rptr. 240 (1972).

The same court in Morris v. Morris, 69 Wash.2d 506, 419 P.2d 129 (1966), in making an award to the wife said she was given 'an interest in a specific amount of the military pension'. And in Roach v. Roach, 72 Wash.2d 144, 432 P.2d 579 (1967), the Supreme Court there held that even though a military pension is 'not a fixed asset but is an emolument or economic advantage of office', did not preclude the court from treating certain aspects of that pension as property, regardless of the fact that there are inherent limitations that make it different from fixed assets.

However, plaintiff-husband, in the present case argues that Michigan is not a community property state and points to a case in a noncommunity property state, In re Marriage of Ellis, 538 P.2d 1347 (Colo.App.1975), wherein the Colorado Court of Appeals expressly ruled that although the husband had retired from the army and was drawing a net monthly pension, the retirement pay was not 'property' to be divided with the wife at divorce. We have read the Ellis case. There, the Court of Appeals found that the husband never contributed to the fund, that the amount of retirement pay was wholly within the control of Congress, that a retired soldier could expect increases or reductions which might be legislated from time to time and therefore retirement pay was not a fixed or tangible asset having any cash surrender, loan, redemption of lump-sum value. However, the court did find it to be a resource of the husband in the nature of income to be received in the future to be considered in fixing the amount of maintenance and child support which the husband was able to pay as related to the needs of the wife and children. We believe the facts in Ellis, supra, are far removed from the case we are asked to consider.

In In re Marriage of Pope, 544 P.2d 639 (Colo.App.1975), another Colorado case, we find that the facts are similar to the case at hand. There, the husband, an employee of the State, under the Colorado Public Employee Retirement Association Act (PERA) § 24--51--101 Et seq., CRS 1973, was required to pay into the retirement fund a percentage of his salary through the medium of payroll deductions, and these contributions were then paid into a retirement fund which consisted principally of accumulated deductions from salaries of members. If the employee terminated his employment for any reason other than death or retirement, the full amount of accumulated deductions was refunded. In the event of death, the accumulated deductions were paid in a lump sum to designated beneficiaries or heirs. In the event of retirement or disability, the employee received a fixed amount based upon his final average salary (although there are other options available). The Colorado Court stated:

'An examination of this statutory scheme leads...