Morgante v. Morgante, 1088 MDA 2014

Decision Date26 June 2015
Docket NumberNo. 1088 MDA 2014,1088 MDA 2014
Citation2015 PA Super 145,119 A.3d 382
PartiesSamuel A. MORGANTE, Appellant v. Kelly S. MORGANTE, Appellee.
CourtPennsylvania Superior Court

Janice R. Yaw, Williamsport, for appellant.

H. Denning Mason, Bellefonte, for appellee.

BEFORE: SHOGAN, WECHT, and STRASSBURGER,* JJ.

Opinion

OPINION BY SHOGAN, J.:

Appellant Samuel A. Morgante (Husband) appeals from the order denying his exceptions to a Master's report and recommendation regarding equitable distribution of property acquired during his marriage to Kelly S. Morgante (Wife).1 We affirm.

The trial court summarized the factual and procedural history of this case as follows:

The parties were married on May 16, 1987 and separated on February 14, 2010. Husband served in the Navy for twenty-three years, eighteen of which were during the parties' marriage. Husband now receives a military pension and an additional $871 per month of Veterans Administration disability pay. Since Husband has been receiving disability he has generally worked full time. The Master through her amended report set Husband with a net earning capacity of $3,000.00 per month due to his culinary skills and certifications. Wife['s] net monthly income is $2,278.08.
A Master's Hearing in regard to Equitable Distribution was held on August 31, 2012; October 12, 2012; December 9, 2012; supplemented by an Order of Court dated March 5, 2013. A Master's Report and Recommendation in regard to Equitable Distribution was filed on June 25, 2013. On July 10, 2013, Husband filed a Motion to Re–Open/Clarify the Record. Subsequently, Husband filed Exceptions on July 10, 2013 and Amended Exceptions on July 15, 2013. A hearing was scheduled before the Family Court Hearing Officer in regard to the Motion to Re–Open/Clarify the Record on August 23, 2013, regarding Husband's request. On September 5, 2013, the [trial court] heard argument from both parties in regard to the Exceptions filed by Husband on July 10, 2013, and Amended Exceptions filed by Husband on July 15, 2013.
The primary issue in Husband's Motion to Re–Open/Clarify the Record concerned Husband's income and inclusion of his Navy Retirement and Disability payment in his income. This was a very similar issue to the issue raised in Husband's Exceptions. The Court had been advised by the Family Court Hearing Officer, who took the additional evidence on Husband's Motion to Re–Open/Clarify the Record, that an Amended Master's Report would be issued based upon the additional evidence that was received. The Court, therefore, deferred ruling on the Exceptions which were filed by Husband until such time as the Amended Master's Report was issued in light of the fact that the Court anticipated that the Amended Master's Report may or may not resolve the Exceptions or may create new exceptions in the matter. The Court indicated that, upon the entry of the Amended Master's Report, the Court would conduct a telephone conference with counsel for Husband and Wife to determine how the parties wished to proceed on the outstanding Exceptions.
An Amended Master's Report on Equitable Distribution was issued on November 19, 2013. The Court, thereafter, conducted a phone conference with counsel on November 22, 2013, to determine counsel's position on how the Court should proceed with the outstanding Exceptions in light of the Amended Master's Report on Equitable Distribution being issued. All parties agreed that additional argument would be necessary.
On November 20, 2013, Husband filed Exceptions to the Amended Master's Report. On December 30, 2013, the [trial court] heard argument by the parties on the outstanding Exceptions. On June 9, 2014 this Court issued an Opinion and Order ruling on Husband's Exceptions. The Court's Opinion and Order were prepared without the benefit of a transcript as neither party had paid for its preparation. Both parties agreed that the Court would review the Master's notes in making determinations regarding personal property.

Trial Court Opinion, 8/29/14, at 2–4.2 The trial court granted some of Husband's exceptions and denied others. Order, 6/9/14. Husband filed a notice of appeal on June 20, 2014, and an amended notice of appeal on July 9, 2014. Husband and the trial court complied with Pa.R.A.P. 1925.

On appeal, Husband presents the following questions for review:

[1] Whether the trial court failed to distribute Husband's military retirement plan consistent with Pennsylvania and Federal law when it ordered Husband to indemnify Wife and maintain a set monthly amount if her share was reduced either because he elected to take a disability waiver or for any other reason?
[2] Whether the trial court erred in its method of valuing and distributing Husband's military retirement plan?
[3] Whether the trial court violated the Equal Protection and Supremacy Clauses of the Constitution by ordering Husband to indemnify Wife for any reductions in her share of the military retirement pay?

* * *

[7] Whether the trial court erred in adopting credibility determinations of the Master regarding the ring, which were not supported by the record[?]

Appellant's Brief at 5.3

We apply the following standard in reviewing an equitable distribution order:

A trial court has broad discretion when fashioning an award of equitable distribution. Our standard of review when assessing the propriety of an order effectuating the equitable distribution of marital property is whether the trial court abused its discretion by a misapplication of the law or failure to follow proper legal procedure. We do not lightly find an abuse of discretion, which requires a showing of clear and convincing evidence. This Court will not find an “abuse of discretion” unless the law has been overridden or misapplied or the judgment exercised was manifestly unreasonable, or the result of partiality, prejudice, bias, or ill will, as shown by the evidence in the certified record. In determining the propriety of an equitable distribution award, courts must consider the distribution scheme as a whole. We measure the circumstances of the case against the objective of effectuating economic justice between the parties and achieving a just determination of their property rights.
Biese v. Biese, 979 A.2d 892, 895 (Pa.Super.2009). Moreover, it is within the province of the trial court to weigh the evidence and decide credibility and this Court will not reverse those determinations so long as they are supported by the evidence. We are also aware that a master's report and recommendation, although only advisory, is to be given the fullest consideration, particularly on the question of credibility of witnesses, because the master has the opportunity to observe and assess the behavior and demeanor of the parties.

Childress v. Bogosian, 12 A.3d 448, 455–456 (Pa.Super.2011) (most internal citations and quotation marks omitted).

Husband's first three issues concern his Navy retirement pay and Veterans Affairs (“VA”) disability pay, 38 U.S.C. §§ 1101 –1163. These issues implicate the interplay of federal and state law. The Uniformed Services Former Spouses' Protection Act (“USFSPA” or The Act), 10 U.S.C. § 1408, refers to military retirement pay as “disposable retired pay” and defines that term as: “the total monthly retired pay to which a member is entitled less amounts which ... (B) are deducted from the retired pay of such member as a result of ... a waiver of retired pay required by law in order to receive compensation under title 5 or title 38 [ (Veterans Affairs) ].” 10 U.S.C. § 1408(a)(4)(B).4 To prevent duplication of benefit payments, a retired service member may only receive VA benefits if he waives a corresponding amount of disposable retired pay. 38 U.S.C. §§ 5304 –5305. The Act further provides that a service member's “disposable retired ... pay” may be treated “as property solely of the member or as property of the member and his spouse in accordance with the law of the jurisdiction.” 10 U.S.C. § 1408(c)(1). In Pennsylvania, disposable retired pay is classified as marital property, divisible upon divorce. Major v. Major, 359 Pa.Super. 344, 518 A.2d 1267 (1986).

Both federal and Pennsylvania law provide that marital property does not include the portion of military retirement pay waived to receive VA disability benefits. In Mansell v. Mansell, 490 U.S. 581, 109 S.Ct. 2023, 104 L.Ed.2d 675 (1989), the United States Supreme Court held, [The Act] does not grant state courts the power to treat, as property divisible upon divorce, military retirement pay that has been waived to receive veteran's disability benefits.” Id. at 594–595, 109 S.Ct. 2023. Following the directive in Mansell, the Pennsylvania Superior Court stated in Martin v. Martin, 385 Pa.Super. 554, 561 A.2d 1231 (1989), [T]o the extent Pennsylvania's Divorce Code allows equitable distribution of VA disability retirement pay, or pay waived to receive disability pay, the Code is preempted by federal law and cannot be given effect.” Id. at 1235. See also Miller v. Miller, 395 Pa.Super. 255, 577 A.2d 205, 207–208 (1990) (discussing Mansell and Martin ); cf. Goodemote v. Goodemote, 44 A.3d 74, 77 (Pa.Super.2012) (holding that where VA disability payments were deposited and held in investment account, increase in value of investment that accrued during marriage is marital property subject to equitable division).

Husband first argues that the trial court violated federal and state law in distributing his disposable retired pay when it ordered him to indemnify Wife and maintain a set monthly payment amount. Husband's Brief at 13. According to Husband:

This case is somewhat unique and may be a case of first impression, and not just in Pennsylvania. The vast majority of cases across the country dealing with waivers of military retirement, including Pennsylvania case law, involve property settlement agreements or consent orders. See Hayward v. Hayward, 868 A.2d 554 (Pa.Super.2005).

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