Lookingbill v. Lookingbill

• Decision Date: 01 September 1983
• Docket Number: No. 59,59
• Parties: Earl Kenneth LOOKINGBILL v. Myra LOOKINGBILL. ,
• Court: Maryland Court of Appeals

Page 283

301 Md. 283

483 A.2d 1

Earl Kenneth LOOKINGBILL v. Myra LOOKINGBILL.

No. 59, Sept. Term, 1983.

Court of Appeals of Maryland.

Oct. 31, 1984.

Michael George Raimondi, Baltimore (Murray L. Sherman and Allen L. Fox, P.A., Baltimore, on the brief), for appellant.

Michael S. Levin, Westminster (McIntire & Johnson, Westminster, on the brief), for appellee.

Argued before MURPHY, C.J., and SMITH, ELDRIDGE, COLE, DAVIDSON ^*, RODOWSKY and COUCH, JJ.

SMITH, Judge.

The Circuit Court for Carroll County issued a decree divorcing a vinculo matrimonii Myra Lookingbill (Wife) from Earl Kenneth Lookingbill (Husband). While married to Wife, Husband became a permanent fireman in the Baltimore County regular fire department. Baltimore County Code (1978, 1982 Supp.) § 20-9(4). ¹ By reason of his employment several types of retirement plans were available to him under certain circumstances. We are interested in two of them. The first is a service retirement plan provided by BCC § 20-19 in which age and length of service are the dominant factors (service plan). The second is an accidental injury retirement plan provided by BCC § 20-22 in which the dominant factor is a work-related injury, that is, an injury occurring during the actual performance of the employee's duties without wilful negligence on his part (disability plan). Under this plan a fireman may receive an allowance regardless of age or length of service.

Husband, during coverture, contributed to the retirement system for some years by deductions from his wages. As a result of a work-related injury he was retired on 1 June 1982 and was awarded an allowance under the disability plan. Several months later the absolute divorce was granted.

In the divorce decree the Chancellor granted a monetary award to Wife. Maryland Code (1984) § 8-205(a) of the Family Law Article. ² In reaching the amount of the award the Chancellor concluded that the pension received by Husband constituted marital property. FL § 8-201(e) and § 8-203. He determined its value. FL § 8-204. Husband was aggrieved both by the determination that the pension constituted marital property and by the value placed upon it. He noted an appeal, claiming that the Chancellor erred with respect to each of these holdings. On our own motion, before consideration of the appeal by the Court of Special Appeals, we ordered the issuance of a writ of certiorari.

At this point it is appropriate that we explain some of the terms used herein. For the purpose of this opinion "retirement plan" and "pension" are interchangeable. The rights under a pension may be referred to as "retirement benefits," "retirement allowance," "retirement pay," or "pension payments." Those terms are considered to be synonymous. In the context of a dispute over marital property arising in an action for divorce, a pension may be said to be "vested" or "matured." A vested pension is not the same as a matured pension. A pension is generally regarded as "vested" upon the attainment of a specified number of years of employment. A vested pension thus survives the discharge or voluntary termination of an employee. A pension is generally said to "mature" at the time benefits become presently payable. In other words, a pension does not mature until the employee is compelled or elects to retire and receives benefits. A "non-contributory" pension is one funded solely by an employer. A "contributory" pension requires payments by the employee, usually by payroll deductions. Deering v. Deering, 292 Md. 115, 118, n. 3, 437 A.2d 883 (1981). Finally, we are concerned here with civil, that is private or governmental pensions as distinguished from military retirement benefits. E.g., Hill v. Hill, 291 Md. 615, 620-621, 436 A.2d 67 (1981).

Retirement Benefits as Marital Property

In Deering we addressed the scope of a spouse's rights in civilian retirement plans acquired by his or her marriage partner during the coverture period. 292 Md. at 117, 437 A.2d 883. We had before us two cases involving pensions. In one case the husband, as a result of his employment as a park police officer, possessed certain unmatured, fully vested pension rights based on obligatory contributions made by him during marriage. Id. at 118, 437 A.2d 883. In the other case, by reason of years of government service, the husband was entitled to a civil service pension upon retirement on reaching a certain age. This pension also had vested but had not matured and was funded in part by obligatory contributions made during marriage. Id. at 120, 437 A.2d 883. We decided that each of these pensions was marital property under the laws of this State. We held that

a spouse's pension rights, to the extent accumulated during the marriage, constitute a form of "marital property" .... Id. at 128, 437 A.2d 883.

In reaching the conclusion in Deering that the pensions constituted marital property, we looked to the Property Disposition in Annulment and Divorce Law (the Act). Under the Act " 'Marital property' means the property, however titled, acquired by 1 or both parties during the marriage." FL § 8-201(e)(1). A pension plan is not one of the properties expressly excluded from marital property. FL § 8-201(e)(2). In the grant of an absolute divorce, if there is a dispute as to whether certain property is marital property, the court shall determine which is marital property. FL § 8-203(a)(1). We recognized in Deering that the Act represents a new legislative approach to the concept of marriage. We called attention to the preamble to the Act in which the General Assembly declared " 'that marriage is a union between a man and a woman having equal rights under the law [and that] [b]oth spouses owe a duty to contribute his or her best efforts to the marriage, and both, by entering into the marriage, undertake to benefit both spouses....' " Deering, 292 Md. at 122, 437 A.2d 883, citing 1978 Md.Laws, Ch. 794 and Report of Governor's Comm. on Domestic Relations Laws (1978). We thought it to be significant that over the past several years, "pension benefits have become an increasingly important part of an employee's compensation package which he or she brings to a marriage unit.... [T]he pension right ... may well represent the most valuable asset accumulated by either of the marriage partners." Id. at 122-123, 437 A.2d 883. We found that "those states, which, like Maryland, confer authority on courts considering divorce matters to make some form of distribution of joint and separate property upon termination of a marriage, with near unanimity, subject retirement benefits in general to division between the former spouses." Id. at 123, 437 A.2d 883. We set out a compendium of representative cases supporting this statement. Id. at 123-124, 437 A.2d 883. The cases essentially view pension benefits "as an economic resource acquired with the fruits of the wage earner spouse's labors which would otherwise have been utilized by the parties during the marriage to purchase other deferred income assets." Id. at 124, 437 A.2d 883. We declared that

there is no reason to exclude one form of deferred income asset from the marital estate while including others. Both the nonemployed spouse and his or her wage earning marital partner have the same retirement goals and expectancies regarding the pension benefits as they would if they provided for their later years by using wage income to purchase other investments. Id. at 125, 437 A.2d 883.

We thought that it was "manifestly contrary to the language and purpose of [the Act] to strip the nonemployee spouse of the value of the retirement asset by precluding the [C]hancellor from evaluating its worth prior to adjudicating the property rights of the estranged marriage partners." Id. We found support for our view in the sweeping language of FL § 8-201(e)(1) which defines, as we have seen, "marital property" as "the property, however titled, acquired by 1 or both parties during the marriage." We noted, quoting Diffendall v. Diffendall, 239 Md. 32, 36, 209 A.2d 914 (1965) that

[t]he term property, "when considered in a broad sense, is a term of wide and rather comprehensive significiation.... It has been stated that the term embraces everything which has exchangeable value or goes to make up a man's wealth--every interest or estate which the law regards of sufficient value for judicial recognition." Deering, 292 Md. at 125, 437 A.2d 883.

Whether a pension is vested or unvested or matured or unmatured is immaterial to a determination of its status as marital property. " 'In the final analysis, one must determine whether a property right has been acquired during the marriage and whether equity warrants its inclusion in the marital estate in light of its limitations.' " Id. at 127, 437 A.2d 883, quoting Weir v. Weir, 173 N.J.Super. 130, 413 A.2d 638, 640 (1980). It was in the light of our comprehensive discussion of the nature of pensions and the impact of the Act on them that we concluded that a spouse's pension rights, to the extent accumulated during the marriage, constitute a form of marital property subject to consideration by the Chancellor in making a monetary award. See Ohm v. Ohm, 49 Md.App. 392, 431 A.2d 1371 (1981).

The pension in dispute here became available to Husband during coverture by reason of his employment as a fireman. Like the pensions in Deering, it is a civil, contributory retirement plan to which contributions were made by Husband during the marriage by deductions from his wages. Unlike the Deering pensions, the pension here had matured during coverture--Husband was receiving a retirement allowance. We have seen, however, that neither the fact of vesting nor the fact of maturing is significant to a determination whether a pension is marital property. The major distinction between the Deering pensions and the pension here is that the Deering pensions were service plans while Husband's pension is a disability plan. Deering did not speak directly to...