By Debbie Gregory.
Last month, the U.S. Supreme Court handed down a decision that may have serious implications for the former spouses of veterans.
In Howell v. Howell , the Supreme Court ruled in favor of a veteran who believed he did not owe his ex-wife 20% of his disability pay, and ruled that state courts cannot order veterans to pay divorced spouses for the loss of his or her retirement pay caused by service-related disability benefits.
Former Airman John Howell believed that he did not have to consider his disability pay as part of divisible assets in his 1991 divorce from wife Sarah. At the time of the divorce, John’s upcoming pension was considered a “marital asset” under Uniformed Services Former Spouses’ Protection Act (USFSPA) and split 50-50 with his former spouse
At issue was whether the USFSPA pre-empted a state court’s order directing a veteran to indemnify a former spouse for a reduction in the former spouse’s portion of the veteran’s military retirement pay, when that reduction results from the veteran’s post-divorce waiver of retirement pay in order to receive compensation for a service-connected disability.
When John received a 20 percent disability rating in 2005 from the Department of Veterans Affairs for a service-connected degenerative joint disease in his shoulder, he elected to waive a portion of his monthly retirement pay under pension offset rules, about $250, in order to receive his full monthly VA award. The result, however, was that Sandra’s portion of the pension went down by about $125 a month.
John gave up $250 of his $1,500 a month in retirement pay so that he could receive the same amount in disability benefits. His decision cost Sandra $125 a month, so she sued him in 2013.
While a series of state courts agreed that even if John’s retirement pay had been reduced, Sandra still deserved half of what his retirement pay would have been without the disability benefits, the Supreme Court did not, citing Mansell v. Mansell.
In Mansell v. Mansell, the Court found that the federal USFSPA exempts disability pay as a portion of the retirement pay that a service member waived in order to receive disability benefits from the amount divisible upon divorce.
This ruling could have serious implications for ex-spouses, most affecting those who were married to veterans with 50% disability ratings or less.