Sprott v. Sprott, 8129

• Decision Date: 23 December 1978
• Docket Number: No. 8129,8129
• Citation: 576 S.W.2d 653
• Parties: Jack N. SPROTT, Appellant, v. Catherine Louise SPROTT, Appellee.
• Court: Texas Court of Appeals

Page 653

576 S.W.2d 653

Jack N. SPROTT, Appellant, v. Catherine Louise SPROTT, Appellee.

No. 8129.

Court of Civil Appeals of Texas, Beaumont.

Dec. 23, 1978.

Rehearing Denied Jan. 18, 1979.

Philip C. Friday, Austin, for appellant.

George E. Ramsey, III, Austin, for appellee.

CLAYTON, Justice.

This appeal concerns the nature of military retirement benefits of an enlisted man in the United States Naval Fleet Reserve. Appellee brought this divorce action against her husband, appellant, seeking a divorce, child conservatorship, and division of the community property. The case was tried before the court, without a jury, and judgment was entered in favor of appellee wherein she was awarded a certain interest in appellant's retirement benefits and a certain interest in appellant's retainer pay, and awarding appellee her proportionate interest in future cost of living increases in appellant's retainer and retirement pay paid by the U.S. government.

Appellant does not appeal from the trial court's fractional interest (264/289 for retainer pay and 281/360 for retirement pay), nor from the amount of such interest (60%), but challenges the trial court's findings that (1) appellant's retainer pay is community property, and is subject to division between the parties and that (2) future cost-of-living increases in appellant's Naval retainer and retirement pay are community property.

The trial court made findings of fact and conclusions of law, embodied within the judgment, as follows:

1. Appellant served on active duty with the United States Navy from September 1951 through September 1975 for a period of 289 months.

2. The parties were married on October 3, 1953, and divorced effective February 28, 1977, for a period of 281 months; and during the marriage, appellant served on active duty with the United States Navy for 264 months.

3. In September 1975 appellant was transferred from active duty to the Fleet Reserve; appellant will remain in the Fleet Reserve until September 1981, at which time he will be retired.

4. During appellant's service in the Fleet Reserve, he has received, and will continue to receive, retainer pay, which amounts to $786.53 gross per month.

5. Appellant will be eligible for retirement pay upon his retirement in September 1981.

6. Appellant's retainer pay and his retirement pay are subject to cost-of-living increases payable by the United States Navy to appellant.

The trial court concluded, based upon the above findings that appellant's "retainer pay is community property to the extent it was earned by (appellant) during the marriage, . . . that . . . (his) retirement pay is community property . . . and that cost-of-living increases accruing to (appellant's) retainer and retirement pay in the future are community property."

Judgment was entered in accordance with such findings of fact and conclusions of law, and awarded appellee, inter alia, as her sole and separate property 60 percent of the community interest in appellant's retainer pay, if, as, and when received, including any future cost-of-living increases.

Appellant's first point of error complains of error by the trial court in concluding appellant's Naval retainer pay is community property, and awarding appellee an interest therein.

The question presented by this appeal has not been answered or decided by our Supreme Court. In Taggart v. Taggart, 540 S.W.2d 823 (Tex.Civ.App. Corpus Christi 1976), the Court of Civil Appeals held that Naval retainer pay was not community property, but the Supreme Court in Taggart v. Taggart, 552 S.W.2d 422 (Tex.1977), reversed the Court of Civil Appeals' decision on other grounds, and did not address the question of retainer pay, stating specifically that the wife "did not seek any part of the retainer pay that (husband) earned for his service in the Fleet Reserve." The question of Naval retainer pay was involved in Ex parte Sutherland, 526 S.W.2d 536 (Tex.1975), wherein the trial court held that such retainer pay was community property. The Supreme Court did not decide the question, but its decision in that case was made upon other grounds. The Supreme Court, in the Sutherland case did state, however, "In this instance relator's 'right' to future retainer pay constitutes, at least arguably, no less an earned property right than the disability retirement benefits in Busby v. Busby, Tex.Sup., 457 S.W.2d 551 (1970)." The Supreme Court further stated in the Sutherland case that "(w)e are not saying that the determination made by the court in the divorce suit is necessarily correct. See French v. French, 17 Cal.2d 775, 112 P.2d 235, 134 A.L.R. 366."

Appellant does not challenge the trial court's conclusion that his potential retirement pay is part of the community estate and subject to division, even though it has not matured. This question has been clearly determined in Cearley v. Cearley, 544 S.W.2d 661 (Tex.1976). The primary rationale is that retirement pay is deferred compensation for past services rendered and that the wife is entitled to share in the benefits paid referable to services rendered to the marriage.

When an enlisted man in the United States Navy has completed twenty or more years of active service, he may, at his request, be transferred to the Fleet Reserve. 10 U.S.C.A., Sec. 6330(b) (1959). When not on active duty, a member of the Fleet Reserve receives what is referred to by the statutes as "retainer pay." 10 U.S.C.A., Sec. 6330(c) (1959).

An enlisted man must complete thirty years of service before he is eligible for retirement pay. 10 U.S.C.A., Sec. 6326 (1959). If he elects to transfer to the Fleet Reserve, he may be retired when the aggregate of his active service and Fleet Reserve service reaches thirty years. 10 U.S.C.A.,...