Boyle v. Jennings

Decision Date09 January 2018
Docket NumberCivil Docket No.: CL17-11333
CourtCircuit Court of Virginia
PartiesRE: James B. Boyle v. Michelle Marie Jennings
MARY JANE HALL JUDGE

Mary Elizabeth Davis, Esquire

Davis Law Office, P.C.

One Columbus Center, Suite 609

Virginia Beach, VA 23462

Leslie Ann Shaner, Esq.

QDRO Virginia, PLC

7018 Whisperwood Drive

Richmond, VA 23234

Dear Counsel:

This matter came before the court on December 22, 2017, on Ms. Jennings' notice and motion for entry of an order incorporating the parties' property settlement agreement and Final Decree of Divorce into an Approved Domestic Relations Order and on the Motion in Opposition to Entry of an Incorrect Retirement Order filed by Mr. Boyle.

The primary issue presented to the Court is whether the Property Settlement Agreement (the "PSA") entitles Ms. Jennings to a marital share of a benefit known as the Deferred Retirement Option Program (the "DROP") under the Norfolk Employees Retirement System ("Retirement System"). For the reasons stated herein, the Court finds that the DROP benefit is part of Mr. Boyle's retirement pension within the meaning of the PSA; and Ms. Jennings' marital share of that benefit must be distributed to her in accordance with its terms.

BACKGROUND

The PSA, dated November 9, 1994, provides that Ms. Jennings is entitled to a marital share of Mr. Boyle's retirement pension when he receives it:

4. Retirement Benefits. It is agreed between the Husband and Wife that the Wife shall receive as the marital share of the Husband's retirement pension and proportion of said retirement when received determined by a fraction, the numerator of which shall be 10, which represents the number of years of marriage prior to separation, and the denominator of which will be the actual number of years of credible service with the Norfolk Fire Department as of the date of retirement divided by one half. By way of example only, if Husband retires with 20 years of credible services, with Wife's share would be 10/20 X ½ - ¼ or twenty five percent (25%) of Husband's disposable retirement pay. Disposable retirement pay for the purpose of this Agreement shall be defined as gross retirement pay less federal and state taxes, if withheld.
Husband's tax status for the purposes of calculating taxes on his gross retirement pay shall be one exemption filing single, unmarried, unless he remarries, then the exemption shall be two exemptions, filing married. Wife shall receive the benefit of any increase in Husband's monthly disposable retirement pay due to cost of living increases so that Wife will always receive the same percentage of Husband's disposable retirement pay.

(PSA at 4-5.) The Final Decree of Divorce entered on May 18, 1995, incorporated the terms of the PSA.

In 2014, the Norfolk City Code was amended to establish a Deferred Retirement Option Program for police and fire officers. The DROP allows employees who choose to participate to accumulate a portion of their retirement while continuing to work for the City for a maximum of four additional years of service. During the DROP period, the Retirement Plan pays 70% of participants' retirement benefits in an account which is distributed to them at the termination of the DROP period when they cease employment. See NORFOLK, VA., CODE § 37.84 (2017).

The Norfolk Ordinance provides that participation in the DROP is irrevocable and that the employee will be considered a retired member for all purposes related to the Retirement System once his application to participate in the DROP is approved. No retirement allowance may be actually paid to the member during the DROP period; the 70% of his monthly retirement allowance that accrues during that period must be paid to a DROP account. That account may be paid to the member either as a lump sum when he terminates his employment or to his eligible retirement plan. Id.

Counsel for Mr. Boyle represented that he participated in the DROP program through December 1, 2017, and has received the benefits that accrued during his participation period in a lump sum. He no longer works for the City and has begun receiving retirement benefits. Ms. Jennings has not received any portion of those benefits.

ANALYSIS

Counsel for Mr. Boyle strenuously contends over a 29-page legal memorandum and 442 attached pages of supplemental material that Ms. Jennings is not entitled to any portion of the DROP benefit because (i) it is a benefit distinct from the regular payments made to him by the Retirement System and therefore outside the scope of the retirement benefits contemplated in the Agreement, and (ii) Mr. Boyle was not considered fully retired at the time that money accumulated:

It is clear that the PSA provides the exact amount that the defendant is to receive from the Norfolk Employees Retirement System where it states that ["]Disposable retirement pay for the purpose of this Agreement shall be defined as gross retirement pay less federal and state taxes, if withheld.["] There is no mention of any other type of retirement payment such as being entitled to a portion of the DROP payment; therefore, at the time of the entry into the PSA, there was no intent to receive a portion of the DROP payment.

(Pl.'s Mot. in Opp'n at 11.)

The Norfolk Code of Ordinances was not amended to provide for a DROP program until 2014, so the lack of a specific mention of that program in the 1994 PSA does not establish that the parties intended to exclude that benefit from division as a marital asset. If the DROP benefit is construed as part of the husband's "disposable retirement pay" within the meaning of the PSA, the Court need not look for any other specific mention of the particular type of benefit at issue.

Mr. Boyle also attaches much significance to the language in the Norfolk Ordinance establishing when a member is considered retired. Under subsection (b) of the Ordinance, a member is considered a retired member for all purposes related to the Retirement System upon his acceptance into the DROP. Under subsection (d)(3), in contrast, the member is determined to be retired for all purposes related to employment with the City upon the termination of the DROP period. Counsel argues that Mr. Boyle was not actually retired until after the DROP payments had accrued and been paid into an account, and thus those payments could not constitute retirement benefits within the meaning of the PSA.

The Court notes that the Ordinance does consider that the member was retired for purposes related to the Retirement System at the beginning of the DROP period. To the extent that his status as retired or not retired when the benefits accrued controls this analysis, the Court relies upon the characterization of the Retirement System itself in considering that Mr. Boyles was retired for all purposes relating to his retirement benefits. Further, whether he was retired or not when the benefits accrued, he was...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT