In Re Marriage of Corriveau

Citations: 183 Cal. App. 3d 1012; 228 Cal. Rptr. 563Docket: B016567

Court: California Court of Appeal; July 29, 1986; California; State Appellate Court

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In re the Marriage of Edna Clare and Clarson Rene Corriveau involves an appeal concerning the Board of Pension Commissioners of the City of Los Angeles (BPC) and the allocation of pension benefits following the dissolution of marriage between Edna Clare Corriveau and Clarson Rene Corriveau, a retired police officer. The central issue is whether BPC's right to set off workers' compensation benefits against Corriveau's disability pension is restricted to the excess of his disability pension over a longevity-based annuity.

The procedural history notes that during the couple's divorce, Edna was awarded a 42.5% share of Clarson's prospective longevity pension, calculated based on their marriage duration relative to his total years in the retirement system. After Clarson opted for a disability retirement due to work-related injuries, which provided a higher benefit than a longevity retirement, BPC sought to offset the workers' compensation benefits it paid against his disability pension. The trial court ruled that any setoff applied entirely to Clarson's share, rather than affecting Edna's share, aligning with the principle established in In re Marriage of Stenquist, which protects the nonemployee spouse's community property rights despite the employee spouse's decision to retire on disability.

Clarson’s argument for a proportional setoff against his wife's share was dismissed, and he also contested BPC's claim, seeking to limit the setoff to the 3% excess of the disability benefits over the longevity benefits. The trial court did not permit evidence on this issue, which was deemed an error by the earlier appellate decision in Corriveau I. Overall, the court concluded that the setoff is not limited and the nonemployee spouse retains rights to the pension as if the retirement were based on longevity.

An element of unfairness to the husband was identified regarding the apportionment of pension benefits between two systems. The court remanded the case for a hearing on the setoff apportionment issue, ultimately siding with the husband and ordering BPC to reimburse him for funds withheld beyond a 3 percent differential. BPC appealed this order.

The Los Angeles City Charter outlines various classifications of retirement pensions, including longevity, service-connected disability, and surviving spouse pensions. BPC's claim for setoff is based on section 190.15, which allows offsets for workers' compensation benefits against all pension classes except longevity pensions that are employee-funded, in line with Labor Code section 3751 prohibiting such offsets. BPC is permitted to offset workers' compensation benefits against disability retirement benefits that are not employee-funded.

The husband's argument of unfair treatment stems from the differing classifications of his pension regarding his wife's Stenquist rights. He contends that his pension is unfairly categorized as disability for setoff purposes while being treated as longevity for his wife's benefit. However, the court found that an apportionment of the setoff was neither possible nor appropriate, as the husband's choice to retire for disability was legitimate, and BPC is entitled to treat it accordingly. His wife's share is based on what she would have received had he retired for longevity, as established in the dissolution order.

The trial court's order for reimbursement was reversed, and a new order consistent with the appellate opinion was mandated. The case was remanded for this purpose, with the husband responsible for appeal costs. The Supreme Court denied the husband's review petition on October 15, 1986. A previous order had limited BPC's future setoff rights to the 3 percent differential, which was not appealed. Section 190.15 of the City charter is affirmed as providing BPC with the right to setoff.

Section 190.15 defines 'compensation' as any payment provided by general law for benefits related to employment-related injury, sickness, or death. It specifies that if compensation is awarded for such incidents involving Department Members, the total pension amount granted will be reduced by the amount of compensation received. The remaining amount after this reduction will constitute the final pension granted. However, pensions awarded under Section 190.11 are exempt from reductions due to compensation received, including for Retired Members or deceased System Members eligible for retirement under that section. Any compensation awarded will be treated as payments on account of the pension, with installment payments being applied first to the compensation before affecting the pension amount. Installments will only be made to the extent that total pension payments exceed the cumulative compensation awarded. Additionally, employee salary deductions for the New System Service Pension Fund will not cover compensation costs, only pension costs under Section 190.11. The excerpt references the Fraide case, which limited the City’s setoff to a proportionate amount based on its contributions to the retirement fund, without clarifying potential tax benefits from a disability alternative related to the offset.