Gilmore v. Gilmore

• Decision Date: 15 December 2009
• Docket Number: No. 28,486.,28,486.
• Citation: 227 P.3d 115,2010 NMCA 013
• Parties: Benae Francine GILMORE n/k/a/ Benae Francine Rochin, Petitioner-Appellee, v. Edwin James GILMORE, Respondent-Appellant.
• Court: Court of Appeals of New Mexico

227 P.3d 115

2010 NMCA 013

Benae Francine GILMORE n/k/a/ Benae Francine Rochin, Petitioner-Appellee, v. Edwin James GILMORE, Respondent-Appellant.

No. 28,486.

Court of Appeals of New Mexico.

December 15, 2009.

Atkinson & Kelsey, P.A., Patrick L. McDaniel, Albuquerque, NM, for Appellee.

Kretek Law Office, LLC, Charles C. Kretek, Deming, NM, for Appellant.

OPINION

SUTIN, Judge.

{1} This case involves the division of retirement benefits between Benae Francine Gilmore (Wife) and Edwin James Gilmore (Husband) under a State of New Mexico defined benefits plan. A California court granted the parties' divorce through a default judgment in 1994 and issued a qualified domestic relations order (the QDRO) in 2006 awarding Wife a portion of the benefits under a formula that was based on the time-rule method of calculating Wife's community share. After the California court set aside its 1994 judgment as to all its provisions except the portion dissolving the marriage and also set aside the QDRO in its entirety for lack of personal jurisdiction, Wife sought to divide the retirement benefits in New Mexico pursuant to NMSA 1978, Section 40-4-20 (1993), which allows post-divorce division of undivided community assets. Under the impression that New Mexico required the use of the time rule and therefore using that formula, the district court divided the benefits and rejected Husband's various affirmative defenses. We hold that the district court did not err in rejecting Husband's affirmative defenses. Because New Mexico does not require or automatically use the time rule as a default method to divide retirement benefits when the parties do not agree to a specific method, we reverse the court's use of the time rule and remand for further proceedings consistent with this opinion.

BACKGROUND

{2} The parties were married on October 6, 1981. In October 1984, Husband began employment as a police officer with the City of Deming, New Mexico, and remained in this position through the duration of the marriage. As a state employee, Husband was eligible to participate in the state's defined benefit retirement plan administered by the Public Employees Retirement Association of New Mexico (the PERA administrator) under the Public Employees Retirement Act (the PERA). NMSA 1978, §§ 10-11-1 to -142 (1987, as amended through 2009). Husband filed for divorce in New Mexico sometime in 1994, but on June 9, 1994, the Superior Court of California, County of Yuba, where Wife had filed for divorce in 1991, granted Wife a divorce through a default judgment. It appears that when the New Mexico court was notified of the California divorce, Husband's divorce action was dismissed.

{3} In January 1999, Husband was hired by the Luna County, New Mexico, Sheriff's Department as an undersheriff, where he received an increase in salary. In 2000 Husband became the director of the Luna County Detention Center, which resulted in a significant increase in salary and in the value of Husband's retirement benefits under the PERA (PERA benefits). Husband remarried in 2001 and divorced in January 2005 by a decree that included a $15,000 lump-sum payment to that wife for her share of the community interest in Husband's PERA benefits. Husband retired in March 2005 and began receiving PERA benefits on April 1, 2005.

{4} Wife obtained the QDRO in June 2006 from the Superior Court of California dividing Husband's PERA benefits. However, in October 2006, upon Husband's motion, that same California court set aside its 1994 judgment as to all its provisions except the portion dissolving the marriage and also set aside the QDRO in its entirety for lack of personal jurisdiction over Husband. In February and March 2007, Wife filed a motion and an amended motion in the Luna County District Court to divide the PERA benefits under Section 40-4-20.¹ Section 40-4-20(A) provides:

The failure to divide or distribute property on the entry of a decree of dissolution of marriage or of separation shall not affect the property rights of either the husband or wife, and either may subsequently institute and prosecute a suit for division and distribution or with reference to any other matter pertaining thereto that could have been litigated in the original proceeding for dissolution of marriage or separation.

{5} In his September 2007 response to Wife's motions, Husband challenged subject matter jurisdiction and raised the affirmative defenses of res judicata, laches, statute of limitations, estoppel, waiver, forfeiture, federal preemption, and public policy. Husband also counterclaimed that the QDRO was obtained under false allegations and requested the court to order Wife to pay him back the money she received under the QDRO and also to pay Husband's attorney fees. The district court heard the matter on October 2, 2007.

{6} At the October 2007 hearing, Wife testified about the prior legal proceedings in California that (1) Husband was mailed a copy of the divorce decree, (2) even when she had rejected Husband's lump-sum settlement offers it was never her intent to waive her rights to the retirement, and (3) she had worked and helped Husband get started. Husband testified that he had offered Wife a lump-sum payment and that, although he could pay it over time, he did not have the ability to pay a lump sum at the time of the October 2007 hearing. He also testified that Wife was entitled to benefits based on what Husband was earning at the time of the divorce and that he was entitled to benefits based on his post-divorce earnings increases.

{7} On December 13, 2007, the district court entered orders denying Husband's affirmative defenses and counterclaims and dividing the PERA benefits. The court determined that it had subject matter jurisdiction to divide the PERA benefits under Section 40-4-20. Further, the court found, for the purpose of calculating arrearages due, that Wife had an interest in Husband's PERA benefits "based on the ... number of years credited service during the marriage, the total number of years of credited service, and the qualifying salary levels under the PERA statute." Accordingly, the court calculated that Wife was entitled to a community share of $1025.90 per month based on one half of Husband's gross monthly pension payments of $4351.66 times the ratio of time of credited service during the marriage (9.66 years) divided by the total time of credited service (20.5 years). The court granted Wife a judgment for "arrearages for twenty-nine months ... through December[] 2007, with the monthly amount of the arrearages to be determined by [the] PERA in conformity with their policies and formulas" and ordered Husband, commencing October 1, 2007, to pay the arrearage payments directly to Wife by the first of each month "in the amount to be determined by [the] PERA, with the monthly amount of the arrearage payments to be determined by [the] PERA in conformity with their policies and formulas."

{8} The district court rejected Husband's affirmative defenses of laches, estoppel, waiver, and forfeiture because Wife "pursued her claim in California and New Mexico and [Husband] has not been prejudiced." With respect to Husband's res judicata defense, the court found that "no valid order from California or any other state has divided the PERA retirement." With regard to Husband's statute of limitations defense, the court found that Wife's "claim lies within the statute of limitations period required by New Mexico law." The court denied Husband's public policy argument because the public policy of New Mexico is that "community assets should be divided." Finally, the court denied Husband's counterclaims for the amounts paid to Wife under the QDRO and for attorney fees. Husband filed a motion to reconsider and a brief in support of that motion. On March 6, 2008, the court set the motion for hearing, and on March 11, 2008, after the motion to reconsider was automatically denied by operation of law, Husband appealed. On appeal, Husband argues that the district court erred by concluding it had subject matter jurisdiction and failing to apply the statute of limitations to bar Wife's claim; by not allowing him to make a lump-sum payment to Wife; by denying Husband's affirmative defenses of laches, equitable estoppel, and waiver by acquiescence; and by not valuing his retirement benefits as of the time of the divorce, thereby improperly apportioning to Wife post-divorce benefits increases that he contends were his separate property.

DISCUSSION

A. Subject Matter Jurisdiction

{9} Husband contends that the district court lacked subject matter jurisdiction for two reasons. First, Husband argues that Section 40-4-20 applies to undivided assets and, therefore, the statute cannot confer jurisdiction in the present case because the PERA benefits were previously divided in the California divorce and were actually distributed based on the QDRO. Second, Husband relies on Lewis v. Lewis, 106 N.M. 105, 111, 739 P.2d 974, 980 (Ct.App.1987), and argues that it holds that undivided community property divided pursuant to Section 40-4-20 must be divided in an action other than the original divorce action. Husband further argues that because he had initiated a divorce action seeking division of assets in New Mexico in 1994, Wife's present action "cannot be considered independent." We view these arguments as raising pure legal issues that we review de novo. Jicarilla Apache Nation v. Rodarte, 2004-NMSC-035, ¶ 24, 136 N.M. 630, 103 P.3d 554 {10} Husband specifically shows that the California decree of divorce of 1994 included a provision that divided the PERA benefits and awarded Wife one half of Husband's PERA benefits with the City of Deming. Furthermore, Husband shows that the same California court later issued the QDRO. Even though the provision of the California decree dividing the retirement and the QDRO were subsequently set aside, Husband reasons that Wife "sought to and did divide [Hu...