Savelle v. Savelle, 92-CA-00027

• Decision Date: 02 February 1995
• Docket Number: No. 92-CA-00027,92-CA-00027
• Citation: 650 So.2d 476
• Parties: Beatrice A. SAVELLE v. Vernon D. SAVELLE.
• Court: Mississippi Supreme Court

Page 476

650 So.2d 476

Beatrice A. SAVELLE v. Vernon D. SAVELLE.

No. 92-CA-00027.

Supreme Court of Mississippi.

Feb. 2, 1995.

Lampton O. Williams, Jr., Williams Williams & Montgomery, Poplarville, for appellant.

James R. Hayden, Hattiesburg, for appellee.

EN BANC.

McRAE, Justice, for the Court:

In this appeal from a December 18, 1991 order of the Pearl River County Chancery Court, we consider whether one spouse may claim an interest in the other's pension plan as part of a division of property entered into pursuant to a divorce decree. The chancellor, not having the advantage of our recent decisions in the area of divorce law, correctly determined that a spouse is not entitled to an automatic interest in the other's plan, but, rather, a portion of what the other spouse paid in to the plan in order to balance the scales of equity between the parties. Accordingly, we affirm the lower court's decision.

I.

Beatrice and Vernon Savelle were married on February 19, 1958 in Louisiana where they lived until retiring to Mississippi in August, 1988. They were granted a divorce on grounds of irreconcilable differences in Pearl River County on December 18, 1991, dissolving the thirty-three year marriage.

Prior to his retirement, Vernon Savelle worked as a fireman with the City of New Orleans Fire Department for twenty-one years and nine months. He contributed six percent of his salary to the Fire Fighters Pension and Relief Fund from November 6, 1966 to November 6, 1986, the first twenty years of his employment with the fire department in New Orleans. The couple moved to Mississippi after he retired. They separated approximately three years later and Beatrice moved back to Louisiana. Upon his retirement, Vernon's original gross pension was $1,700.52 per month, subject to a three percent annual cost of living increase. ¹ He also received a lump sum distribution of annual and sick leave accrued during his tenure with the Fire Department of $17,230.90. ² Vernon now works part-time, averaging approximately $265.00 per month.

At the time of the divorce, Beatrice worked full-time as the Assistant Director of Medical Records at Slidell Memorial Hospital, where she earned a salary of $2,408.00 per month. She also received $650.00 in monthly rental income from a house in Louisiana she received under the terms of the couple's property settlement.

Beatrice sought an equitable division of the marital property and asserted that she was entitled to fifty percent of Vernon's anticipated retirement benefits. The chancellor did not apply Louisiana law, but based on "equity and good conscience," awarded Beatrice $12,000.00, calculated on the basis of the approximately $22,000.00 Vernon had contributed to his pension plan over the years from his annual six percent salary deduction. In making his decision, the chancellor emphasized the inequities which would result from a fifty-fifty division. Beatrice, who still works full-time, would have enjoyed a monthly income of $3,277.00, while Vernon would have received only $868.00 per month. The chancellor's refusal to make an equal division left the parties' current salaries intact: Mr. Savelle realizing $1798.37 from his pension plan and Mrs. Savelle realizing $2,408.80.

II.

Beatrice, who had lived in Mississippi for three years prior to the divorce, contended that the chancellor erred in not applying Louisiana law and, further, in not awarding her fifty percent of the community property including Vernon's pension benefits and deferred compensation (annual and sick leave). See Sims v. Sims, 358 So.2d 919, 922-23 (La.1978) (right to annuities and other retirement plan benefits are community assets). We disagree.

Our most recent decisions in family law direct us to apply Mississippi law to divorces sought within our jurisdiction. See Hemsley v. Hemsley, 639 So.2d 909 (Miss.1994) and Ferguson v. Ferguson, 639 So.2d 921 (Miss.1994). Significant in Hemsley, the parties lived in many different locations during their marriage, but this Court applied Mississippi law in ascertaining how the property should be divided. Id., 639 So.2d at 911. In Ferguson, this Court recognized that our chancery courts are empowered to apply Mississippi law to pension plans, military retirements, and railroad retirements. Id., 639 So.2d at 927.

Based on our decisions in Brown v. Brown, 574 So.2d 688 (Miss.1990), Southern v. Glenn, 568 So.2d 281 (Miss.1990) and Newman v. Newman, 558 So.2d 821 (Miss.1990), Beatrice argues the chancellor should have applied the community property law of Louisiana, where the parties were domiciled during the period the assets were acquired. However, as distinguished from the case SUB JUDICE, the assets in those cases were military retirement benefits, concerning direct payments made by the government to a non-military spouse. Unlike ordinary pension plans, they are governed by federal law, the Federal Uniformed Services Former Spouses' Protection Act, (FUSFSPA), 10 U.S.C. Sec. 1048. ³ We explained in Brown that, pursuant to FUSFSPA, a spouse's right to the other spouse's military pension benefits was governed by the property law of the state of domicile. 574 So.2d at 690. We further stated that:

As we perceive FUSFSPA, it did not vest any rights in anyone. It merely removed a federal bar and allowed the states to treat the military retirement pensions of their domiciliaries as personal property subject to state property laws.

Id. Accordingly, we have respected the laws of community property states and allowed spouses to stake a claim to military pension benefits where the evidence demonstrates that the benefits accrued while the working spouse was domiciled in a community property state. Newman, 558 So.2d at 825-826. We have not extended this principle beyond military pension benefits, nor are we inclined to do so now. Thus, Mississippi law governs Beatrice's claim.

Mississippi is not a community property state. This Court, by judicial decision, has adopted equitable distribution. See Hemsley v. Hemsley, 639 So.2d 909 (Miss.1994) and Ferguson v. Ferguson, 639 So.2d 921 (Miss.1994). Therefore, one spouse has no vested right in the other's pension or retirement benefits. Armstrong v. Armstrong, 618 So.2d 1278, 1282 (Miss.1993); Southern, 568 So.2d at 283. In the recent case of Hemsley v. Hemsley, 639 So.2d 909 (Miss.1994), we declared military and civil service retirements benefits to be assets subject to equitable division by the chancellor. "A spouse who has made a material contribution toward the acquisition of an asset titled in the name of the other may claim an equitable interest in such jointly accumulated property." Id. at 913 (citing Jones v. Jones, 532 So.2d 574, 580-81 (Miss.1988).

Furthermore, this Court reiterated that a chancery court has authority, where equity so demands, to order a fair division of property accumulated through the joint contributions and efforts of the parties. Hemsley, 639 So.2d at 914 (citing Brown v. Brown, 574 So.2d 688, 690 (Miss.1990)). Hemsley defined marital property for the purpose of divorce as being "any and all property acquired during the marriage." Id. at 915. A spouse's military retirement pension is an asset which the court, when considering matters such as alimony and child support incident to divorce and, thereafter, modification of either of each, is certainly charged to consider. Southern v. Glenn, 568 So.2d at 283-84, n. 1; Bowe v. Bowe, 557 So.2d 793, 795 (Miss.1990).

This Court concluded in Ferguson, "[t]he chancellor may divide marital assets, real and personal, as well as award periodic and/or lump sum alimony, as equity demands." Ferguson v. Ferguson, 639 So.2d 921, 929 (Miss.1994). This division does not require an automatic fifty-fifty split or a vested right in the other spouse's pension plan. When dividing marital assets between divorcing parties, the chancellor must have foremost in his mind fundamental fairness. "Where one spouse has contributed directly to the fund, by virtue of his/her labor, while the other has contributed indirectly, by virtue of domestic services and/or earned income which both parties have enjoyed rather than invested, the spouse without the retirement funds in his/her own name could instead have been working outside the home and/or investing his/her wages in preparation for his/her own retirement." Id. at 934.

In effect, equitable distribution was effected in this case because the chancellor did not give Mrs. Savelle an interest in the pension plan, but instead, monies which reflected her contribution to the marital assets. We find that the chancellor, without the aid of Hemsley and Ferguson, sufficiently balanced the equities between the Savelles.

JUDGMENT IS AFFIRMED.

HAWKINS, C.J., DAN M. LEE, P.J., and SULLIVAN, JAMES L. ROBERTS, Jr., and SMITH, JJ., concur.

PRATHER, P.J., dissents with separate written opinion joined by BANKS, J.

PITTMAN, J., dissents with separate written opinion joined by BANKS, J.

PRATHER, Presiding Justice, dissenting:

At issue in this domestic relations case is a conflict of law question. Did the trial court err in applying Mississippi substantive law (equitable distribution) to a pension plan and deferred compensation earned while the parties were residents of Louisiana, a community property state, where the parties had only been residents of Mississippi for two years prior to their separation and divorce? Because the majority misconstrued our decisions on conflicts of laws in these situations, I dissent.

This appeal is a conflicts of law problem, not merely a domestic law problem. Mississippi follows the Restatement (Second) of the Conflict of Laws in deciding the appropriate state law to apply in conflicts issues. The Restatement provides that the law of the forum where the parties were domiciled at the time the rights in the pension were earned controls its characterization. Newman v. Newman, 558 So.2d 821, 825 (Miss.1990).

The majority...