Wanamaker v. Wanamaker

• Decision Date: 05 January 1978
• Citation: 93 Misc.2d 784,401 N.Y.S.2d 702
• Parties: , 1 Employee Benefits Cas. 1367 In the Matter of Mary Frances WANAMAKER, Petitioner, v. Lawrence WANAMAKER, Respondent.
• Court: New York Family Court

Page 702

401 N.Y.S.2d 702

93 Misc.2d 784, 1 Employee Benefits Cas. 1367

In the Matter of Mary Frances WANAMAKER, Petitioner, v. Lawrence WANAMAKER, Respondent.

Family Court, Rockland County.

Jan. 5, 1978.

Kevin D. Ashley, White & Case, New York City, for respondent.

Edward P. Kallen, Nanuet, Brent, Phillips, Dranoff & Davis, P.C., Nanuet, for petitioner.

Federal Paper Bd. Co., Inc., Payroll Dept., Piermont, Harry Smith, Probation Officer, New City, in pro per.

HOWARD MILLER, Judge.

The petitioner commenced a proceeding pursuant to § 466 Family Court Act seeking to enforce a decree of the Supreme Court, State of New York, County of Rockland dated January 12, 1973. Upon respondent's default, after due service of notice of the proceeding, this Court entered an order of enforcement directing the respondent to pay to the petitioner the sum of $50 per week alimony and concurrently entered a payroll deduction.

The employee, respondent herein, retired 3/1/77 and left the State of New York. He appears to be presently residing in the State of Virginia. The petitioner and respondent were married June 17, 1944 and were divorced on January 12, 1973. There were two children of the marriage both over 21 years of age and not involved in these proceedings.

Thereafter, upon notification of retirement of respondent the Court entered a payroll deduction against the pension benefits of the respondent through respondent's former employer, Federal Paper Board Company, Inc., hereinafter called "the Company".

The Company moves to vacate the payroll deduction herein claiming that the pension plan benefit of respondent is exempt under Federal Law from proceedings under State Law to subject such benefits to satisfy respondent's obligation of support. The Company further claims that payment under such payroll deduction would be a violation of Employee Retirement Income Security Act of 1974 (hereinafter called ERISA) as provided in § 206(d) and § 1021(c) of said act, also designated as 29 U.S.C. § 1001 et seq.

The moving papers filed on behalf of the Company shows that the Company located in Piermont, New York is engaged in business throughout the United States. Its business is as an industrial manufacturer of paper products. It is further shows that the Internal Revenue Service certified that the fund connected with the pension plan was a qualified trust for income tax purposes and subject to the provisions of Title I and III of ERISA. The moving papers state that respondent was employed by the Company until March 1, 1977 when he retired and is, therefore, entitled to receive a pension benefit under the Federal Paper Board Company, Inc., hourly wage employees pension fund, the fund against which the within payroll deduction was directed.

The obligation of support of alimony to be paid from fixed trusts or pensions is a long and established principle of statute law and of case law. The Estates, Powers and Trusts Law (New York) § 7-1.5 on the divesting of trust property provides in subd. (d):

"The beneficiary of an express trust to receive the income from property and apply it to the use of or to pay it to any person is not precluded by anything contained in this section from transferring or assigning any part or all of such income to or for the benefit of persons whom the beneficiary is legally obligated to support." (italics supplied)

Where there was an assignment of trust income for support of wife and children and circumstances under which a trust provided against alienation, the Court of Appeals held in Matter of Knauth, 1963, 12 N.Y.2d 259, 238 N.Y.S.2d 942, 189 N.E.2d 482, that such assignment of benefits to dependents:

" . . . far from violating the policy or spirit of the rule, actually tends to effect its purpose."

So, too, where a man was separated from his family, the Surrogate's Court in Matter of Chusid, 1969, 60 Misc.2d 462, 465, 301 N.Y.S.2d 766, 771, noted:

" . . . the obligation to support dependent children transcends all other obligations including that of the beneficiary himself for his own food, clothing and shelter."

That Court concluded by directing the trustee of the trust to make appropriate payments for the support of the dependents from income and from the corpus of the trust (Wetmore v. Wetmore, 149 N.Y. 520, 529, 44 N.E. 169, 170; 162 N.Y. 503, 510, 56 N.E. 997, 999; Zwingman v. Zwingman, 150 A.D. 358, 134 N.Y.S. 1077).

The obligation of the respondent in the case at bar stems from his 29 year marriage to the petitioner herein. The judgment of divorce dated January 12, 1973 directed support to the wife, petitioner herein, in the amount of $50 per week. Stipulation was made in open court and referred to in the said divorce decree. The order of enforcement of Family Court dated September 7, 1977 directed the payment of said sum of $50 per week to the petitioner for support to her as provided in the order of the Supreme Court above referred.

The respondent's obligation to support petitioner is created by the marital relationship that existed between the parties. A person cannot avoid paying an obligation to support by retiring from his position (Grant v. Grant, 1969, 61 Misc.2d 968, 307 N.Y.S.2d 153).

The application to vacate the support deduction from the pension of the respondent is predicated upon an interpretation of ERISA under 29 U.S.C. § 1056(d)(1) which states:

"Each pension plan shall provide that benefits provided under the plan may not be assigned or alienated."

It is alleged that the pension plan herein concerned meets all of the standards of ERISA which fact has not been controverted. In sustaining its claim the Company further cites the Conference Committee Report on the Pension Reform Act, House Rep't 93-1280, 93rd Congress, 2nd Session, page 280 et seq., reported in Handbook on Pension Reform Law, Prentice Hall, Inc., Englewood Cliffs, New Jersey, 1975 at page 614 where it is stated:

"Alienation * * * (A) Plan must provide that benefits under the plan may not be assigned or alienated. However, the plan may provide that after a benefit is in pay status, there may be a voluntary revocable assignment (not to exceed 10% Of any benefit payment) by an employee which is not for the purposes of defraying the administrative costs of the plan. For the purposes of this rule, a garnishment or levy is not to be considered a voluntary assignment."

The Company proposes to place a former spouse seeking enforcement of a support order in the position of a creditor. The spouse is not a creditor (Matter of Chusid, supra). Her position is that of one who is seeking her natural and statutory rights as a former wife of 29 years. These rights have been reduced to a divorce decree of the Supreme Court, Rockland County, State of New York, and of the Family Court, Rockland County.

The right of support has been recognized even within the ERISA program itself wherein § 1001 (Congressional Findings and Declaration of policy) in the defining of the purpose of the act the Congress of the United States stated in subd. (a) that the purpose of the Act was " . . . the continued well being and security of . . . employees and their dependents . . . "

and further thereon in stating the purpose of the adoption of the ERISA added:

" . . . in the...