In re Marriage of Daniels
| Decision Date | 15 December 2020 |
| Docket Number | 53224-7-II |
| Court | Washington Court of Appeals |
| Parties | In the Matter of the Marriage of RACHELL DANIELS, Appellant, And NATHANIEL DANIELS, Respondent. |
UNPUBLISHED OPINION
The dissolution decree for Rachell Daniels (k/n/a Rachell Bonds) and Nathaniel Daniels provided that the present value of the marital portions of their retirement accounts were to be divided equally. In 2013, the trial court granted the parties' joint motion for an addendum to the dissolution decree and an order requiring Bonds to divide her military retirement to achieve equal division of retirement assets. The parties agreed, and in 2014 the trial court ordered that Daniels would receive a portion of Bonds's monthly disposable military retirement payments. The order also contemplated possible changes in the nature of the military retirement benefits and required Bonds to pay Daniels a monthly payment regardless of the specific character of the retirement benefit.
The army then deemed Bonds permanently disabled. It began paying her military disability retirement instead of disposable retirement and the government stopped paying Daniels his monthly portion. Daniels moved to enforce the 2014 order. In 2019, the trial court entered a judgment establishing the total amount still owed and requiring Bonds to pay Daniels a monthly amount equivalent to what he received under the 2014 order.
Bonds appeals from the trial court's order enforcing the prior unappealed final orders and requiring Bonds to make monthly payments to Daniels.
We hold that the dissolution decree and the subsequent orders were valid, unappealed final judgments on the merits. Accordingly res judicata prevented Bonds from collaterally challenging the validity of those final judgments in her response to Daniels's motion to enforce. We also hold that the trial court properly denied Bonds's CR 60(b) motion to vacate. We affirm.
Bonds and Daniels married in 1994, separated in 2006, and entered into a CR 2A agreement in 2007. The Pierce County Superior Court dissolved their marriage in 2008. At the time of the dissolution decree, Bonds was a United States Army captain in good health and she planned to receive military retirement when she retired. Daniels worked for the federal government and planned to receive a federal pension.
Together Bonds and Daniels had six retirement accounts and the marital portions of all six were community property. According to the dissolution decree, the present value of the marital portions of Bonds's and Daniels's retirement accounts would be "totaled and divided such that the end result is each party receives one-half of the present value of the marital portion." Clerk's Papers (CP) at 10. The decree stated, would equalize the division by paying the difference to the other spouse. Id. The decree contained a list of assets that the spouse with the higher valued accounts would use to pay the other. Bonds's military retirement was not one of those assets.
Expert valuation conducted after the decree was entered showed that Bonds's accounts were worth more than Daniels's and Bonds therefore owed Daniels. In 2012, Daniels filed a motion to enforce the retirement account provision of the dissolution decree because Bonds had not yet paid him. Based on the valuation and the division formula in the dissolution decree, Daniels argued that Bonds owed him $146, 191.30. However, Bonds's nonmilitary retirement accounts did not contain enough money to cover the amount she owed. Daniels asked the trial court to enter an order requiring Bonds to pay him from her military retirement.
Bonds agreed that she owed Daniels $146, 191.30, asked the trial court to divide her military retirement, and filed a proposed order to that effect. In 2013, the trial court ruled that Bonds "owed [Daniels] $146, 191.30 pursuant to the decree of dissolution" and stated, "This amount shall come from [Bonds's] military retirement." CP at 48.[1]
In 2014, Bonds and Daniels jointly moved for an addendum to the dissolution decree dividing Bonds's military retirement. The parties agreed and the trial court ordered that Bonds would pay Daniels $593.22 monthly from her military retirement upon her retirement "for . . . 20 years and 6 months, plus on[e] final payment in the amount of $259.18." CP at 50. The trial court entered the addendum to the dissolution decree, granting the parties' joint request.
The trial court simultaneously entered an order dividing Bonds's military retirement. That order provided that "the Member shall pay the Former Spouse, [Nathaniel] Daniels, a portion of her disposable military retirement pay in the amount of $593.22 per month." Suppl. CP at 224 (sealed). Monthly payments from her disposable military retirement were to be sent directly from the Defense Finance Accounting Service (DFAS) to Daniels. As the dissent notes this order also interpreted "military retirement" broadly to include other sources of military retirement benefits. Id.
Significantly, the 2014 order also included separate language requiring Bonds to pay Daniels $593.22 per month without any limitation as to the source of the money. The order also gave the trial court continuing jurisdiction "to entertain a motion for maintenance, alimony or other award of money to compensate the Former Spouse for any diminution in the amount he receives as his portion of the Member's disposable retired pay." Suppl. CP at 226 (sealed).
In 2016, the army placed Bonds on temporary disability retirement status and she began receiving retirement payments. DFAS began paying Daniels $593.22 per month. DFAS made 15 payments to Daniels between 2016 and 2018, totaling $8, 898.30.
In 2018, the army determined that Bonds was 70 percent disabled and medically unfit for duty, so it discharged her, placing her on permanent disability retirement status. This was not an election or voluntary change of status. Bonds began receiving military disability retirement instead of disposable military retirement. As a result of this change, DFAS stopped sending payments to Daniels.
Daniels filed a motion to enforce or clarify the dissolution decree and the 2014 military retirement division order. He also moved under CR 60(b)(6) and (11) to vacate the property award and spousal maintenance provisions of the dissolution decree and award new spousal maintenance or require Bonds to pay the balance of her debt from other sources. Daniels noted that Howell v. Howell, [2] a recent United States Supreme Court decision, prohibited state courts from ordering a service member who received disability payments to indemnify their former spouse for any losses resulting from the service member receiving disability payments instead of disposable retirement. Daniels argued that if Howell applied, the trial court should vacate the decree and determine a new equitable division of property.
Bonds filed her own CR 60(b) motion to vacate the retirement property division provision of the dissolution decree and the 2013-14 orders. Because she no longer received disposable military retirement pay, Bonds argued that the trial court could not divide her military disability retirement or order indemnification under Howell. Bonds asked the trial court to vacate the 2014 military retirement division order.
Daniels argued that the trial court could order Bonds to pay him $593.22 per month directly or pay a lump sum in the amount she owed, and the trial court would not be dividing Bonds's military disability pay or ordering indemnification. Instead, the trial court would be enforcing an agreed-upon "equalization payment" for a preexisting debt using Bonds's military disability retirement as the source of funds. CP at 173.
In January 2019, the trial court entered an order enforcing the judgment against Bonds. The trial court recalculated the total amount Bonds still owed under the terms of the dissolution decree by subtracting the erroneous inclusion of one of Bonds's accounts. The trial court also subtracted the payments Daniels had already received from the total corrected amount and found that Bonds owed Daniels a total of $127, 193.86. The trial court ordered Bonds to pay Daniels $593.22 per month. Although it does not appear that the trial court expressly denied Bonds's CR 60(b) motion to vacate the 2014 order, the trial court necessarily declined to vacate when it entered an order enforcing the 2014 order instead.[3]
Bonds appeals.
The federal government provides retirement pay to retired service members. Howell, 137 S.Ct. at 1402-03. If a service member is disabled, they may receive disability retirement. Id. at 1403.
Under a process known as "Chapter 61 retirement," the military may initiate retirement if it deems the service member medically unfit for duty and thus disabled. See 10 U.S.C. §§ 1201-1222. Chapter 61 retirees receive disability retirement without electing it or waiving disposable retirement. See 10 U.S.C. §§ 1201-1222.[4]
In 1981, the United States Supreme Court held in McCarty v McCarty, 453 U.S. 210, 220, 233, 236, 101 S.Ct. 2728, 69 L.Ed.2d 589 (1981), that Congress did not intend any form of military retirement pay to be treated as community property subject to division in marriage dissolution and federal law preempted state courts from dividing military retirement. In 1982, Congress responded to McCarty by passing the Uniformed Services Former Spouses' Protection Act (USFSPA), 10 U.S.C. § 1408. The USFSPA provided that disposable retirement pay could be divided...
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