Griffin v. Griffin

• Decision Date: 28 January 2014
• Docket Number: Record No. 1177–13–1.
• Citation: 753 S.E.2d 574,62 Va.App. 736
• Court: Virginia Court of Appeals
• Parties: Sandra D.T. GRIFFIN v. David L. GRIFFIN, Deceased, c/o Kimberly Cowser–Griffin, Executrix of the Estate of David L. Griffin.

62 Va.App. 736

753 S.E.2d 574

Sandra D.T. GRIFFIN

v.David L. GRIFFIN, Deceased, c/o Kimberly Cowser–Griffin, Executrix of the Estate of David L. Griffin.

Record No. 1177–13–1.

Court of Appeals of Virginia, Chesapeake.

Jan. 28, 2014.

J. Roger Griffin, Jr. (Christie, Kantor, Griffin, Smith & Harris, P.C., Virginia Beach, on brief), for appellant.

W. Hunter Old (Christopher T. Page; Kaufman & Canoles, P.C., Williamsburg, on brief), for appellee.

Present: HUMPHREYS, BEALES and HUFF, JJ.

HUMPHREYS, Judge.

Sandra D.T. Griffin (“Mrs. Griffin”) appeals the order of the Circuit Court of Sussex County (“circuit court”) denying her request for entry of a qualified domestic relations order (“QDRO”), which she pursues so that a certain term of her prior divorce decree might be enforced. For the following reasons, we reverse the circuit court's order.

I. BACKGROUND

“When reviewing a [circuit] court's decision on appeal, we view the evidence in the light most favorable to the prevailing party, granting it the benefit of any reasonable inferences.” Congdon v. Congdon, 40 Va.App. 255, 258, 578 S.E.2d 833, 835 (2003). However, the facts relevant to the resolution of this appeal are undisputed.

David L. Griffin (“Mr. Griffin”) and Mrs. Griffin were married on March 20, 1987 and had two children, James J. Griffin, III, born on October 25, 1987, and Gloria D. Griffin, born on July 6, 1992. The parties were divorced by a final decree of divorce entered in the circuit court on August 12, 1998. The final decree of divorce (“final decree”) incorporated the Separation and Property Settlement Agreement (hereinafter, “PSA” or “Agreement”) entered into by the parties on August 30, 1996. The Agreement term that is the subject of this appeal reads: “The parties agree to name the children of the marriage as co-beneficiaries under all 401K Plans and other such plans which would be distributed upon the death of either party.”

At the time of his death, Mr. Griffin was employed by Dominion Virginia Power (“Dominion”). At Dominion, he qualified for retirement benefits and he elected a 401(k) plan, known as Dominion's Salaried Savings Plan (“Salaried Savings Plan” or “Plan”), which is governed by the Employee Retirement Income Security Act (“ERISA”). The Salaried Savings Plan is a defined contribution plan designed to encourage retirement savings. Dominion's contributions to the plan depend on the participant's contributions and years of service. There is no actuarial analysis to determine the participant's benefits, and the participant's life expectancy is not a consideration in the Salaried Savings Plan. Under the Salaried Savings Plan, the surviving spouse is the beneficiary upon the participant's death unless she has consented to another beneficiary. The Salaried Savings Plan documents also provide that “if you are divorced, benefit payments from the Pension Plan or Savings Plan may be made to your former spouse, your child, or other dependent only in response to a Qualified Domestic Relations Order (QDRO).” The Dominion Plan Administrator testified that the Salaried Savings Plan is not a survivor annuity and it is strictly payable to the designated beneficiary.

In 2002, Mr. Griffin had named his children as his beneficiaries. However, Mr. Griffin married Kimberly Cowser–Griffin (“Cowser–Griffin”) in 2007, and in 2008 Mr. Griffin named Cowser–Griffin as his beneficiary for most of his funds, including the Salaried Savings Plan.¹ He named his children only as contingent beneficiaries on the Salaried Savings Plan. Shortly after his marriage to Cowser–Griffin, Mr. Griffin was diagnosed with renal cell cancer. He died on May 26, 2012. He had not retired from Dominion. No party had applied for a QDRO or notified the Dominion Plan Administrator of an alternate payee for the Salaried Savings Plan. In October 2012, Mrs. Griffin sent a draft QDRO to Dominion. Dominion's Plan Administrator responded that the proposed domestic relations order (“DRO”) would not be treated as a QDRO in light of Board of Trustees of the Indiana State Council of Plasterers & Cement Masons Pension Fund v. Steffens, Case No. 4:12CV513 JCH, 2012 WL 5207499 (E.D.Mo.2012), a case concerning a domestic relations order entered after the plan participant's death. However, Dominion continued an administrative hold on Mr. Griffin's Salaried Savings Plan benefits pending the outcome of the litigation concerning the proper beneficiary under the Plan.

The circuit court ruled that it had jurisdiction to reinstate the parties' divorce case upon the docket “for such purposes as may be necessary to grant full relief to all parties,” citing Code § 20–121.1, and that Code § 20–107.3(K) grants the circuit court continuing authority and jurisdiction “to make any additional orders necessary to effectuate and enforce any order entered pursuant to [equitable distribution].” The circuit court clarified that if it were to enter the QDRO it would not be modifying the final decree's incorporation of the property settlement agreement, “but rather would effectuate and enforce such an order by entry of a QDRO.” However, the circuit court denied Mrs. Griffin's request to enter a proposed QDRO, finding that “under controlling federal law, without a preexisting QDRO, Mr. Griffin's retirement benefits in the Dominion Salaried Savings Plan vested entirely in the designated beneficiary and surviving spouse, [Cowser–Griffin], once the plan participant passed away.” The circuit court found that under federal case law,

at the time of retirement or preretirement death the former spouse must have perfected a QDRO at the time the benefits became payable, or that in order to effect a postmortem qualification of the domestic relations order (“DRO”) as a QDRO, there must have been a DRO awarding the interest in the pension plan and substantially complying with ERISA's QDRO specificity requirements at the time the benefits became payable. Alternatively, Ms. Sandra Griffin could have put the plan on notice of her children's interest in the benefits. Ms. Griffin failed to perfect a QDRO prior to Mr. Griffin's passing, and the final decree of divorce and the PSA do not qualify as a QDRO. Further, there is no evidence in the record that any notice of the children's potential claim under the PSA was ever provided to the Plan at any time before the plan participant's death. Thus, Defendant's Motion for Entry of the [QDRO] is denied.

Mrs. Griffin timely appealed to this Court.

II. ANALYSIS

Mrs. Griffin's assignment of error is that “[t]he trial court erred in ruling that the court could not properly enter a qualified domestic relations order under the circumstancesof the case.” “We review the [circuit] court's statutory interpretations and legal conclusions de novo.” Navas v. Navas, 43 Va.App. 484, 487, 599 S.E.2d 479, 480 (2004) (quoting Sink v. Commonwealth, 28 Va.App. 655, 658, 507 S.E.2d 670, 671 (1998)).

The disbursement of Mr. Griffin's Salaried Savings Plan falls under the federal Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., as stated in the Salaried Savings Plan documents and because it is an “employee pension benefit plan” as defined in 29 U.S.C. § 1002(2). An “employee pension benefit plan” or “pension plan” includes a plan maintained by an employer that provides retirement income to employees or deferred income for employees regardless of the method of calculating the benefits under the plan or the method of distributing benefits from the plan. 29 U.S.C. § 1002(2).

The principal goal of ERISA is to provide “a set of standard procedures to guide processing of claims and disbursement of benefits.” Egelhoff v. Egelhoff, 532 U.S. 141, 148, 121 S.Ct. 1322, 1328, 149 L.Ed.2d 264 (2001). 29 U.S.C. § 1144(a) provides that the Act “shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan.” The legislative intent behind ERISA was to establish a uniform administrative scheme governing employee benefit plans to prevent the employer from being subject to differing regulatory requirements in differing states. Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 9, 107 S.Ct. 2211, 2216, 96 L.Ed.2d 1 (1987). The United States Supreme Court has “not hesitated to enforce ERISA's pre-emption provision where state law created the prospect that an employer's administrative scheme would be subject to conflicting requirements.” Id. at 10, 107 S.Ct. at 2216.

A. 29 U.S.C. § 1055 Does Not Apply to the Salaried Savings Plan

Congress enacted the Retirement Equity Act of 1984 (“REA”) which “enlarged ERISA's protection of surviving spouses in significant respects.” Boggs v. Boggs, 520 U.S. 833, 843, 117 S.Ct. 1754, 1761, 138 L.Ed.2d 45 (1997). The enlarged protections in REA are codified in 29 U.S.C. § 1055. Pursuant to the statutory language, 29 U.S.C. § 1055 applies to,

(A) any defined benefit plan,

(B) any individual account plan which is subject to the funding standards of section 302 [29 USCS § 1082], and

(C) any participant under any other individual account plan ²unless—

(i) such plan provides that the participant's non-forfeitable accrued benefit (reduced by any security interest held by the plan by reason of a loan outstanding to such participant) is payable in full, on the death of the participant, to the participant's surviving spouse (or, if there is no surviving spouse or the surviving spouse consents in the manner required under subsection (c)(2), to a designated beneficiary),³

(ii) such participant does not elect the payment of benefits in the form of a life annuity, and

(iii) with respect to such participant, such plan is not a direct or indirect transferee (in a transfer after December 31, 1984) of a plan which is described in subparagraph (A) or (B) or to which this clause applied with respect to the participant.

29 U.S.C. § 1055(b)(1) (footnotes added). While § 1055 governs most pension plans with surviving spouse benefits,...