Dunham v. Dunham

Citations: 602 So. 2d 1139; 1992 WL 163550Docket: 91 CW 1660

Court: Louisiana Court of Appeal; June 29, 1992; Louisiana; State Appellate Court

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In the case of Brenda M. Dunham v. John M. Dunham, the Court of Appeal of Louisiana addressed whether the trial court erred in denying John Dunham's exception of no cause of action regarding the partition of military retirement pay. Brenda filed a petition on February 23, 1990, seeking a supplemental partition of community property after their 1974 divorce, asserting that certain community property, specifically John’s military retirement pay earned during their marriage, was omitted from their prior "Settlement of Community." John argued that the military retirement benefits were not community property at the time of their settlement because they had not vested until 1980, six years post-divorce, and claimed that neither Brenda nor her attorney inquired about these benefits during their negotiations. He also raised defenses of equitable estoppel, laches, prescription, and res judicata. The district court denied Brenda's motion for summary judgment and overruled John’s exception of no cause of action. John sought writs, contending that current federal law, specifically 10 U.S.C. 1408(c)(1), prohibits his former wife from claiming any portion of his military retirement pay. The appellate court ultimately reversed the trial court's decision, indicating that federal statutory law must be applied.

The statute authorizes courts to treat disposable retired pay of military members as property of either the member or both the member and their spouse, effective for pay periods after June 25, 1981. Courts are restricted from classifying retired pay as marital property if a divorce decree was finalized before that date without addressing the treatment of the retirement pay. The statute was amended on November 5, 1990, allowing the second sentence, which applies to judgments issued before or after the amendment's enactment, while a savings clause protects obligations from judgments issued before the amendment. In this case, the defendant contends that his military retirement cannot be classified as community property due to his divorce judgment and settlement occurring before June 25, 1981, which did not reserve any rights to treat the retirement pay as community property. Historically, military pensions were considered community property in states like Louisiana until the U.S. Supreme Court's ruling in McCarty v. McCarty (1981), which determined that federal law prohibits state courts from dividing military nondisability retirement pay under state community property laws, overturning previous state court decisions that classified such benefits as community property.

The Court determined that state community property laws are incompatible with the federal military retirement system, asserting that military retirement benefits are classified as separate property and not subject to community property division. It highlighted distinctions between military retirement pay and typical pensions, emphasizing that the military retirement system does not grant spouses any entitlement to retirement pay, which is considered a personal entitlement of the service member. The Court expressed concerns that applying community property principles to military retirement pay could undermine significant federal interests and the objectives set by Congress regarding the financial well-being of retired service members.

The Louisiana Supreme Court recognized the impact of the McCarty decision in local partition cases, exemplified by Dedon v. Dedon, where a former wife was denied a claim to military retirement pay due to federal preemption. The Supreme Court acknowledged that Congress could enact legislation to allow states to treat military pensions differently, which led to the creation of the Uniformed Services Former Spouse Protection Act (USFSPA) to counter McCarty. This Act applies to retirement pay periods after June 25, 1981, and subsequent cases, such as Simmons v. Simmons, found that Congress intended the USFSPA to have retroactive effects, effectively nullifying McCarty's implications.

In Simmons, the court ruled that military retirement benefits were community property despite the husband's opposition, stating that the USFSPA reasonably balanced economic interests and expectations of the parties involved. Similar rulings in Menard v. Menard and other cases confirmed the retroactive application of the USFSPA for couples married prior to the McCarty decision, affirming the inclusion of military retirement benefits in community property considerations.

The application of the Uniformed Services Former Spouses' Protection Act (USFSPA) in Louisiana has historically included retroactive effects on various situations, prompting a 1990 amendment due to congressional disapproval of reopening divorce cases for military retirement pay distribution. The core issue post-amendment is whether it bars actions by former spouses entitled to military retirement shares, had the amendment not been enacted. The conclusion reached is that the amendment applies retroactively to prohibit such actions. The legal framework allows Congress to retract previously established claims without a specific legislative directive to apply the amendment only prospectively. The 1990 amendment specifically aims to retroactively enforce the McCarty ruling for divorces finalized before it, where the nonmilitary spouse did not preserve their claim.

The evaluation of potential manifest injustice, as per the Supreme Court's Bradley case, requires consideration of the parties' identities, rights, and the law's impact on those rights. The parties involved are private individuals with equal standing, and the right to military retirement benefits is of significant public concern. While the plaintiff claims a vested right to these benefits, it was her responsibility to preserve this right in her property settlement. The amendment does not affect all pre-McCarty cases; it specifically targets those where the nonmilitary spouse did not reserve rights to military retirement benefits. Ultimately, the court determined that applying the 1990 amendment retroactively does not result in manifest injustice, leading to the reversal of the trial court's decision that had previously denied the defendant's exception of no cause of action.

The court dismisses Brenda Dunham's petition with prejudice, requiring her to bear the costs incurred in both the trial court and on appeal. The writ is granted, and the judgment is reversed and rendered. The ruling establishes that the mere existence of the plaintiff's lawsuit at the time new legislation was enacted does not render the amendment unconstitutional or prevent its application to her case. Citing precedent, the document references United States v. Heinszen, which supports the idea that Congress can amend laws without infringing on existing claims. It also cites Battaglia v. General Motors Corp., where the court upheld Congress's authority to eliminate claims under the Fair Labor Standards Act through subsequent legislation. This reflects a broader principle that legislative power allows for the modification or abrogation of claims in matters under its jurisdiction. Additional support is drawn from Paul v. United States, reinforcing the idea that claims subject to legislative authority can be altered by later amendments.