Samaroo v. Samaroo ( 1999 )

Opinions of the United
1999 Decisions States Court of Appeals
for the Third Circuit
9-24-1999
Samaroo v. Samaroo
Precedential or Non-Precedential:
Docket 98-5245
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Recommended Citation
"Samaroo v. Samaroo" (1999). 1999 Decisions. Paper 265.
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Filed September 24, 1999
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 98-5245
LOUISE ROBICHAUD SAMAROO,
v.
WINSTON R. SAMAROO,
(D.C. Civil No. 89-2215)
AT&T MANAGEMENT PENSION PLAN,
v.
LOUISE M. ROBICHAUD,
(D.C. Civil No. 89-2216)
Louise M. Robichaud.
Appellant
On Appeal from the United States District Court
for the District of New Jersey
(D. C. Civil Nos. 89-2215 and 89-2216)
District Judge: Garrett E. Brown, Jr.
Argued: April 27, 1999
Before: MANSMANN, Circuit Judge, and
WEIS and JOHN R. GIBSON, Senior Circuit Judges.*
(Filed: September 24, 1999)
_________________________________________________________________
* The Honorable John R. Gibson, Senior United States Circuit Judge for
the Eighth Circuit Court of Appeals, sitting by designation.
Louise M. Robichaud (ARGUED)
Kingston, NJ 08528
Pro Se Appellant
Christopher H. Mills (ARGUED)
Somerset, NJ 08873
Attorney for Appellee
OPINION OF THE COURT
JOHN R. GIBSON, Senior Circuit Judge.
Louise Robichaud appeals the district court's1 entry of
summary judgment against her on AT&T Management
Pension Plan's complaint for declaratory relief. The Plan
sought a declaration that Robichaud was not entitled to
pre-retirement survivor's annuity benefits of her former
husband, Winston Samaroo, who died while still actively
employed by AT&T Technologies. Although the Samaroo-
Robichaud divorce decree did not state that Robichaud
should receive benefits under Samaroo's pre-retirement
survivor's annuity, after Samaroo's death Robichaud
obtained a nunc pro tunc amendment to the divorce decree
purportedly creating such an entitlement. The district court
held that the amended order was not a qualified domestic
relations order capable of conferring on Robichaud the
benefits she seeks. We affirm.
Robichaud and Samaroo were divorced on October 25,
1984, by the New Jersey Superior Court, Chancery
Division. The divorce decree incorporated a property
settlement reached by the parties which had the following
language concerning Robichaud's rights in Samaroo's
pension benefits:
(d) Pensions, Profit Sharing and Bell System Savings
Plan
_________________________________________________________________
1. The Honorable Garrett E. Brown, Jr., United States District Judge for
the District of New Jersey.
2
Savings Plan-- (1) Husband has a vested pension
having a present value, if husband were to retire at
this time, of $1,358.59 per month. At the time of
husband's retirement and receipt of his pension he
agrees to pay to wife one half of said monthly amount.
Neither the decree nor the property settlement mentions
any rights to Samaroo's survivor's annuity.
Samaroo died at the age of 53 on September 20, 1987,
about three years after the divorce, while still actively
employed by AT&T. He was covered under the AT&T
Management Pension Plan, a defined benefit plan which
provided pensions and survivors' annuities in amounts
based on a percentage of the employee's average salary
times years of service. Based on Samaroo's age and years of
service, he had a vested right to a deferred vested pension,
which would have begun, at the earliest, at age 55. Because
Samaroo did not live to the age to qualify to receive pension
payments, there were, strictly speaking, no pension benefits
that ever became payable in respect of Samaroo. Therefore,
the benefit expressly mentioned in the divorce settlement
agreement never came to fruition.
However, the Plan provides a pre-retirement survivor
annuity available to the surviving spouse of any Plan
participant who died after vesting but before retiring. If
there is no surviving spouse, there is no annuity.
Under the Employee Retirement Income Security Act of
1974 as it existed at the time of the Samaroo-Robichaud
divorce, it was unclear whether state divorce decrees could
effectively convey a share in one spouse's pension benefits
to the other spouse. See generally Dial v. NFL Player
Supplemental Disability Plan, 174 F.3d 606, 610 (5th Cir.
1999); ABA Section of Labor and Employment Law,
Employee Benefits Law 171-72 (1991). The Retirement
Equity Act of 1984, Pub. L. No. 98-397, enacted in August
1984 and effective January 1, 1985, amended ERISA to
provide that pension benefits may be alienated by means of
a Qualified Domestic Relations Order (known as a QDRO),
29 U.S.C. S 1056(d)(3)(A) (1994). Although the Retirement
Equity Act was not in effect on October 25, 1984, the date
of the Samaroo-Robichaud divorce, plan administrators
3
may, in their discretion, treat orders entered before the date
of the Act as QDROs. S. Rep. No. 98-575, at 23 (1984),
reprinted in 1984 U.S.S.C.A.N. 2547, 2569.
The Plan denied Robichaud's claim for a pre-retirement
survivor's annuity because the divorce decree did not
mention any entitlement to such rights, and in the absence
of a surviving spouse or a QDRO designating a former
spouse as such, there was simply no pre-retirement
survivor's annuity payable in respect of Samaroo.2
_________________________________________________________________
2. Robichaud has chosen to amend the original divorce decree rather
than relying on that decree to entitle her to the pre-retirement
survivor's
annuity; however, she suggests in her reply brief that the original decree
could have been read to give her that right. Robichaud tells us the only
issue in this case is the validity of the amended order, and therefore we
conclude that the adequacy of the original decree is not before us.
However, we briefly observe that there are several problems with reading
the original decree to convey a survivor's annuity to Robichaud. First,
the property settlement apparently only gives Robichaud the right to
receive one half of Samaroo's pension payments of $1,358.89 per month,
the value of Samaroo's pension rights at the time of the divorce. This
shows an intent to divide property rights existing at the time of the
divorce, not to give Robichaud an interest in post-divorce earnings.
Robichaud now claims half of all benefits payable with respect to
Samaroo, including benefits earned after the divorce.
Second, the original decree entitles Robichaud to receive the benefit
payments at the time they were paid out to Samaroo, rather than
conveying to her a portion of Samaroo's interest in the Plan. Since no
benefits became payable to Samaroo himself, the original decree
evidently did not convey anything. See Dugan v. Clinton, No. 86 C 8492,
1987 WL 11640, at *3-*4 (N.D. Ill. May 22, 1987) (unpublished) (divorce
order entitling wife to portion of husband's "monthly pension plan
benefit payment" when received did not convey interest in pre-retirement
survivor annuity); see generally Pamela D. Perdue, "Pension and Welfare
Benefit Administration QDRO Guidelines, 62 ALI-ABA Course of Study
Materials 743, 756-57 (1998) (distinguishing between "separate interest"
QDROs that divide the actual pension, and "shared payment" QDRO's
which merely split the stream of payments and in which "the alternate
payee will not receive any payments unless the participant receives
payments or is already in pay status").
Third, the original decree was silent on the issue of survivor's rights.
Congress has required QDROs to be quite specific in order to convey
ERISA benefits. The statute requires a QDRO to state specifically the
4
Robichaud filed a motion in the New Jersey Superior Court,
Chancery Division, to amend the Final Judgment of Divorce
nunc pro tunc to convey to her a right tofifty percent of the
preretirement survivor's annuity payable in respect of
Samaroo. Samaroo v. Samaroo, 743 F. Supp. 309, 311
(D.N.J. 1990). Robichaud joined the Plan as a defendant in
the divorce case. Id. The Plan removed the action to federal
court and also filed a complaint for declaratory relief in the
same court. Id. The two cases were consolidated. The
district court remanded that portion of the removed case
that involved the terms of the divorce, but retained
jurisdiction of Robichaud's claim against the Plan for the
retirement benefits. Id. at 317.
After a hearing, the New Jersey state court held that the
Plan did not have standing to object to alteration of the
divorce decree. Winston Samaroo's estate did not oppose
Robichaud's request to amend the decree nunc pro tunc,
since conveying the survivorship rights once Samaroo was
dead did not cost the estate anything, but undid the effect
of Samaroo dying without a survivor. The attorney who
drafted the agreement testified that the issue of survivor's
benefits never came up at the time of the agreement:
_________________________________________________________________
extent of the alternate payee's interest in the plan, 29 U.S.C.
S 1056(d)(3)(C)(ii) and (iii), and states that for purposes of survivor
annuities, a former spouse can be treated as a surviving spouse "to the
extent provided in any qualified domestic relations order." 29 U.S.C.
S 1056(d)(3)(F). In Roth v. Roth, 506 N.W.2d 900 (Mich. Ct. App. 1993),
the divorce order conveyed an interest in pension rights, but said
nothing about survivorship rights. After the husband's death, the former
wife sought to amend the decree retroactively to give herself the
survivorship rights that otherwise would lapse. The Michigan courts,
applying federal law, held that the decree did not entitle the former wife
to a pre-retirement survivor's annuity. Id. at 903. Compare Indiana State
Council of Carpenters Pension Fund v. Veclotch, 785 F. Supp. 106,108-
110 (N.D. Ind. 1992) (genuine issue of fact as to parties' intent
regarding
survivor annuity precluded summary judgment where divorce agreement
referred only to pension, but there was extraneous evidence that parties
negotiated survivorship issue and intended former wife to receive
survivorship rights).
Fourth, the original decree was entered before the effective date of the
Retirement Equity Act. See page 3, supra.
5
Q: That section [of the agreement] is silent on the
issue of survivor benefits?
A: That's correct.
Q: Okay. Was the survivor benefit addressed at that
time?
A: No, it never came to mind at that time, it wasn't
brought up at all by you [Robichaud], or by
Winston, or by me.
Robichaud herself testified that "neither Winston [nor his
attorney] or I thought about the survivor rights to this
pension." Based on the evidence that the divorce was
amicable, the state court amended the divorce decree
retroactively to give Robichaud "rights of survivorship to
50% of [Samaroo's] vested pension benefits." The court
stated, however, that whether or not the state court order
resulted in any benefits becoming payable to Robichaud
under the Plan was a question of federal law over which the
federal court had retained jurisdiction and which would
have to be resolved by the federal court.
After the state court's ruling, Robichaud and the Plan
filed cross motions for summary judgment in the pending
federal district court action. The district court examined the
statutory requirements for a QDRO under 29 U.S.C.
S 1056(d)(3)(C) and(D). The court held that the amended
divorce order satisfied the specificity requirements of
section 1056(d)(3)(C), but not the substantive requirements
of section 1056(d)(3)(D). Under that section a domestic
relations order is not a QDRO if it requires the plan to
provide any type of benefits not otherwise provided by the
plan or to provide increased benefits. 29 U.S.C.
S 1056(d)(3)(D)(i) and (ii). The court relied on the reasoning
of Hopkins v. AT&T Global Information Solutions Co., 105
F.3d 153, 156 (4th Cir. 1997), to conclude that entitlement
to a survivor's annuity in respect of Samaroo had to be
determined as of the day Samaroo died, and that the
amended divorce decree represented an attempt to obtain
increased benefits from the Plan. The court therefore
entered summary judgment for the Plan and against
Robichaud. Robichaud appeals.
6
We review a grant of summary judgment de novo, using
the same standard the district court must use: summary
judgment is proper only if there are no genuine issues of
material fact and the moving party is entitled to judgment
as a matter of law. Fed. R. Civ. P. 56(c); Hullett v. Towers,
Perrin, Forster & Crosby, Inc., 38 F.3d 107, 111 (3d Cir.
1994).
The district court stated that it would review the Plan's
denial of Robichaud's claim under the arbitrary and
capricious standard of review appropriate when, as here, a
benefit plan gives the plan administrator discretionary
authority to construe the terms of the plan. See Firestone
Tire and Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). 29
U.S.C. S 1056(d)(3)(G)(i)(II) requires the plan administrator
to make the initial determination of whether an order is a
QDRO. However, we conclude that the issue in this case is
a question of statutory construction regarding the
requisites of a QDRO, rather than a question of
interpretation of the Plan. Cf. Hullett, 38 F.3d at 114(reserving question of whether administrator's finding of
QDRO is reviewed de novo). The deferential standard of
review of a plan interpretation "is appropriate only when
the trust instrument allows the trustee to interpret the
instrument and when the trustee has in fact interpreted the
instrument." Moench v. Robertson, 62 F.3d 553, 567 (3d Cir.
1995) (emphasis in original) (internal quotation omitted),
cert. denied, 516 U.S. 1115 (1996). In this case, there is no
dispute about the interpretation of the Plan, but only about
whether the nunc pro tunc order qualifies as a QDRO under
federal law. We must review legal conclusions and
questions of statutory construction de novo. See Dial v. NFL
Player Supplemental Disability Plan, 174 F.3d 606, 611 (5th
Cir. 1999) (court should review de novo administrator's
decision that a property settlement agreement constituted a
QDRO, since that involves interpretation of settlement
agreement and statutory construction, not interpretation of
the plan).
We turn first to the statutory language defining QDROs.
Under section 1056(d)(3)(D)
A domestic relations order meets the requirements of
this subparagraph only if such order--
7
(i) does not require a plan to provide any type or
form of benefit, or any option, not otherwise provided
under the plan, [and]
(ii) does not require the plan to provide increased
benefits (determined on the basis of actuarial value)
. . . .
A domestic decree that would have the effect of increasing
the liability of the Plan over what has been provided in the
Plan (read in light of federal law) is not a QDRO, no matter
what the decree's status under state law. The district court
held that a decree conferring survivor's benefits on
Robichaud after those benefits have lapsed would provide
increased benefits and therefore cannot be a QDRO.
The district court relied on the Fourth Circuit's decision
in Hopkins, which recognized that defined benefit plans are
based on actuarial calculations that would be rendered
invalid if participants were allowed to change the operative
facts retroactively. In Hopkins a pension plan participant
retired and began to draw his pension in the form of a joint
and survivor annuity based on the lives of himself and his
current wife. Sometime later, his former wife obtained a
state court order that she should be treated as the
participant's surviving spouse for purposes of the annuity.
105 F.3d at 155. The Fourth Circuit held that this domestic
relations order was not a QDRO because the current wife's
right to the survivor's benefits vested upon the participant's
retirement and could no longer be alienated. Id. at 156-57.
The court observed in a footnote that its holding was
consistent with actuarial necessity:
Because the disbursement of plan benefits is based on
actuarial computations, the plan administrator must
know the life expectancy of the person receiving the
Surviving Spouse Benefits to determine the
participant's monthly Pension Benefits. As a result, the
plan administrator needs to know, on the day the
participant retires, to whom the Surviving Spouse
Benefit is payable.
105 F.3d at 157 n.7.
Reasoning similar to that in Hopkins was employed in a
New Jersey survivor benefits case, Ross v. Ross, 705 A.2d
8784 (N.J. Super. Ct. App. Div. 1998). There, a couple's
divorce decree purported to convey the survivorship rights
in the husband's several pension plans to the wife, but as
to one plan the decree was not specific enough to be
considered a QDRO. Id. at 795. After the divorce, the
husband remarried and then died. The first wife attempted
to have a QDRO entered after the husband's death to
convey the survivorship rights to her. The New Jersey
Superior Court, Appellate Division, held that entitlement to
survivor's rights was determined as of the day of the
participant's death. Id. at 796-97. Under ERISA, the rights
could only be conveyed by a QDRO. Because there was no
QDRO in place at the time of the participant's death, the
first wife could not change the result by obtaining a more
specific state court order after the rights had vested in the
second wife.
Robichaud argues that by determining the right to
benefits as of the day of Samaroo's death, the Plan has
cheated Samaroo out of receiving any benefit from
participating in the Plan. But actually, successful operation
of a defined benefit plan requires that the plan's liabilities
be ascertainable as of particular dates. The annuity
provisions of a defined benefit plan are a sort of insurance,
based on actuarial calculations predicting the future
demands on the plan. Some annuity participants will die
without ever receiving a payment and some participants
will receive payments far in excess of the value of their
contributions. The fact that some participants die without
a surviving spouse to qualify for benefits is not an unfair
forfeiture, as Robichaud contends, but rather part of the
ordinary workings of an insurance plan. Allowing the
insured to change the operative facts after he has lost the
gamble would wreak actuarial havoc on administration of
the Plan.3
Besides, it is inaccurate to say that Samaroo was
deprived of any benefit from the Plan. Until he died,
Samaroo enjoyed the right to remarry and thereby bestow
_________________________________________________________________
3. Our holding and opinion are limited to the particular facts before us,
and it is not necessary that we reach the broader issue expressed in the
dissent's characterization of our holding, infra at 12.
9
on a new wife the survivorship rights under his
preretirement annuity. Alternatively, after the enactment of
the Retirement Equity Act, he could have entered a QDRO
conveying the rights to Robichaud. (But if Samaroo had
entered a QDRO making Robichaud his "surviving spouse"
under the Plan, he would have lost the right to confer the
same survivorship benefits on a new wife. See 29 U.S.C.
S 1056 (d)(3)(F) (to the extent QDRO designates former
spouse as participant's surviving spouse, current spouse
shall not be treated as spouse for purposes of plan)). When
Samaroo died without remarrying or naming Robichaud as
alternate payee of the survivor's rights, the right to dispose
of the benefits lapsed. Allowing Samaroo (or his estate) to
preserve the right to confer the benefits on a new wife as
long as he was alive and had the possibility of remarrying,
and then to designate Robichaud as the surviving spouse
after his death, is allowing him to have his cake and eat it,
too.
Robichaud urges us to follow an unpublished district
court decision, Payne v. GM/UAW Pension Plan, No. 95-CV-
73554DT, 1996 WL 943424 (E.D. Mich. May 7, 1996),
which is of course not binding on us, both because it is a
district court case and because it is unpublished. There, a
divorcing couple entered a QDRO specifically denying the
wife the right to survivor benefits. After the husband's
remarriage and death, the first wife obtained a nunc pro
tunc order in the state court giving her the survivorship
benefits the husband had withheld when he was alive. The
Eastern District of Michigan held that the nunc pro tunc
order was effective as a QDRO and that the first wife was
entitled to survivor's benefits in accord with that order. Id.
at *8.
Far from being persuaded by the reasoning in Payne, we
think it provides a telling demonstration of why the order in
this case cannot be regarded as a QDRO. In Payne, the
husband expressly refused to designate the first wife as his
surviving spouse, apparently in view of the fact that he was
planning to remarry. After his death (which, incidentally,
occurred before he and his new wife had been married long
enough for her to qualify for survivor's benefits), the first
wife took advantage of his absence to obtain an amended
10
decree giving her the benefits she had not been able to
obtain through the divorce negotiations. This is clearly an
attempt to expand the pension plan's liability, and the
order purporting to accomplish that expansion cannot
therefore be recognized as a QDRO under section
1056(d)(3)(D). By holding that the Plan in this case was
obligated to recognize the New Jersey court's order in this
case as a QDRO, we would make pension plans vulnerable
to the sort of abuse shown in Payne.
Finally, Robichaud argues that we must give retroactive
effect to the state court amendment of the decree because
that decree stated that it was nunc pro tunc. Actually, the
state judge recognized that he had power only to affect the
legal relation between the Robichaud and the Samaroo
estate and that the effect of the amendment on the Plan
was a matter of federal ERISA law over which the federal
district court had retained jurisdiction when it remanded
the divorce case to the state courts. The state court said:
"Of course, it will be for the federal court to decide whether
or not there were any benefits to be left to Ms. Robichaud."
This observation was correct; the effect of the amended
decree on the Plan is a matter of federal law which the
district court did not remand to the state court. See
Samaroo, 743 F. Supp. at 317.
The judgment of the district court is affirmed.
11
MANSMANN, Circuit Judge, dissenting:
Today the majority holds, in effect, that a state court's
power to enter or modify a Qualified Domestic Relations
Order ("QDRO") with respect to a participant's interest in a
pension plan ends with the participant's death. 1 Because I
believe that this holding will work an unwarranted
interference with the states' ability to administer their
domestic relations law and to effectuate equitable divisions
of marital assets, I must respectfully dissent.
Initially, I note that the majority's holding is not
compelled by anything in the governing Act. The only
statutory authority cited by the majority is 29 U.S.C.
S 1056(d)(3)(D), which provides that a QDRO cannot require
a plan to provide increased benefits. The majority approves
the District Court's holding to the effect that"a decree
conferring survivors' benefits on Robichaud after those
benefits have lapsed would provide increased benefits and
therefore cannot be a QDRO." Supra at 12. By assuming
that the benefits were conferred after they had lapsed (i.e.,
after Mr. Samaroo's death), however, it begs the central
question whether the state court's entry of its order nunc
pro tunc, as of a date before Mr. Samaroo's death, is to be
given effect.2
The majority's holding also is not compelled by caselaw.
The cases relied on by the District Court and the majority
both involved attempts to divest and transfer benefits
already vested in a subsequent spouse. See Hopkins v.
AT&T Global Informations Solutions Co., 105 F.3d 153 (4th
Cir. 1997); Ross v. Ross, 705 A.2d 784 (N.J. Super. App.
_________________________________________________________________
1. The majority expressly forecloses a post-death modification of a QDRO
which requires "increased benefits." In addition, the Hopkins and Ross
cases on which the majority's decision is premised foreclose any shifting
of benefits once vested in a particular payee upon a participant's death.
See infra 12-13. I am therefore unable to conceive of circumstances in
which, under the majority's reasoning, a meaningful alteration of a
QDRO could be effected post-death.
2. There appears to be no dispute that if the order had actually been
entered on its stated effective date, Ms. Robichaud would be entitled to
the survivor's benefit she seeks. There is also no dispute that the Plan
did not appeal the state court's decision, making itfinal.
12
Div. 1998).3 The only case cited by the parties in which
benefits had not vested in another holds that the
retroactive decree must be given effect. See Payne v.
GM/UAW Pension Plan, No. 95-CV-73554-DT, 1996 WL
943424, 1996 U.S. Dist. LEXIS 7966 (E.D. Mich. May 7,
1996).
The majority characterizes the state court's retroactive
amendment of a divorce decree in Payne as "abuse",
apparently because the husband had refused to grant the
requested survivor designation in negotiations while he was
alive.4 I am not so ready to presume that a state judge, fully
apprised of the facts, possessed of expertise in domestic
relations matters, and sworn to uphold the law, has
participated in or countenanced abuse. In any event, as
discussed below, I believe that we are required to assume
that such judicial acts are legitimate.
In rejecting the contention that the state court decree
must be given retroactive effect because it stated that it was
nunc pro tunc, the majority explains that the effect of the
decree on the Plan is a matter of federal law over which the
District Court had retained jurisdiction. While I agree that
the effect was for the District Court to determine under
federal law, I cannot agree with the implicit premise that
federal law permits us to disregard the decree's express
_________________________________________________________________
3. The Ross holding was premised in part on the Court's observation that
"[n]o federal case has allowed a QDRO to be entered after a participant's
death." 705 A.2d at 797. However, the (unpublished) Payne case was
decided prior to Ross.
4. See supra at 10-11. The majority's opinion reflects an implicit
assumption that domestic relations orders merely reflect what the
parties have agreed to. Cf. supra at 9-10 (stating that Mr. Samaroo --
rather than the state court -- could have entered a QDRO while he lived,
and that his estate -- rather than the state court-- designated Ms.
Robichaud as surviving spouse after his death). While it may often work
that way in practice, I know of no rule that precludes a state court from
ordering relief that one party has refused to accede to in negotiations.
On the contrary, although courts in New Jersey will enforce consensual
agreements for equitable distribution "if found to be fair and just", they
nevertheless retain "the utmost leeway and flexibility in determining
what is just and equitable in making allocations of marital assets". Smith
v. Smith, 72 N.J. 350, 359-60, 371 A.2d 1 (1977).
13
retroactivity provision. On the contrary, federal law
mandates that we give effect to the decree in accordance
with its terms.
In my view the question before us -- whether to
effectuate the state court's nunc pro tunc order -- is
conclusively answered in the affirmative by the Full Faith
and Credit Act, which provides that the judicial proceedings
of a state court "shall have the same full faith and credit in
every court within the United States . . . as they have by
law or usage in the courts of such State . . . ." 28 U.S.C.
S 1738. We have observed that this section"directs all
courts to treat a state court judgment with the same
respect that it would receive in the courts of the rendering
state", and that we may not "employ [our] own rules . . . in
determining the effect of state judgments, but must accept
the rules chosen by the State from which the judgment is
taken". In re General Motors Corp. Pick-Up Truck Fuel Tank
Products Liability Litigation, 134 F.3d 133, 141-42 (3d Cir.
1998) (quoting Matsushita Elec. Indus. Co. v. Epstein, 516
U.S. 367, 373 (1996) (brackets and ellipsis in original;
internal quotation marks and citation omitted). These
principles apply in determining the effect of a state decree
in a federal action. See American Sur. Co. v. Baldwin , 287
U.S. 156, 166 (1932) ("The full faith and credit clause,
together with the legislation pursuant thereto, applies to
judicial proceedings of a state court drawn into question in
an independent proceeding in the federal courts."); Grimes
v. Vitalink Communications Corp., 17 F.3d 1553, 1562 (3d
Cir. 1994) (holding that Full Faith and Credit Act bars
relitigation of issues decided by a state court even as
applied to claims over which the state court lacked
jurisdiction) (citing Marrese v. American Academy of
Orthopaedic Surgeons, 470 U.S. 373, 380-81 (1985).
Because the courts of New Jersey would respect a nunc
pro tunc provision in a final judgment, we are required to
respect it as well. See, e.g., Fulton v. Fulton, 204 N.J.
Super. 544, 549, 499 A.2d 542, 545 (Chanc. Div. 1985)
(holding that nunc pro tunc entry of divorce decree would
determine surviving spouse status for purpose of intestate
distribution); Olen v. Olen, 124 N.J. Super. 373, 307 A.2d
121 (App. Div. 1973) (remanding for amendment of divorce
14
judgment, nunc pro tunc as of original judgment before
wife's death).5
Although I believe the full faith and credit analysis is
dispositive, giving effect to the state court's decree also
furthers the policy interests at stake. There is good reason
to allow state courts some leeway in entering or modifying
domestic relations orders even after a participant's death,
or retirement, or other status-altering event. The state
courts are charged with administering the important, and
often complex and volatile, area of domestic relations law.6
The evident purpose of the ERISA's recognition of QDROs is
to avoid undue interference with state courts' fulfillment of
that charge.7 Imposing a cut-off date by which a state
court's orders must be in prescribed form -- a cut-off that
does not appear anywhere in the text of ERISA -- would
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5. Cf. Ross, 705 A.2d at 797 (reasoning that due to ERISA preemption,
"New Jersey's concepts of equity cannot be applied and a QDRO cannot
be entered after the fact").
6. See, e.g. Hisquierdo v. Hisquierdo, 439 U.S. 572, 581 (1979) ("The
whole subject of domestic relations of husband and wife . . . belongs to
the laws of the States and not to the laws of the United States.")
(quoting
In re Burrus, 136 U.S. 586, 593-594 (1890)); Brandon v. Travelers Insur.
Co., 18 F.3d 1321, 1326 (5th Cir. 1994) (observing in ERISA preemption
analysis that "[f]ederal respect for state domestic relations law has a
long
and venerable history" and that "[w]hen courts face a potential conflict
between state domestic relations law and federal law, the strong
presumption is that state law should be given precedence" because "[t]he
law of family relations has been a sacrosanct enclave"). Cf. American
Telephone and Telegraph Co. v. Merry, 592 F.2d 118, 122 (2nd Cir. 1979)
(referring to the "fundamental principle of statutory interpretation
(whereby) courts have presumed that the basic police powers of the
States, particularly the regulation of domestic relations, are not
superseded by federal legislation unless that was the clear and manifest
purpose of Congress").
7. As the District Court acknowledged, "Congress' concern that the
combination of ERISA preemption and the provisions of REA would lead
to unnecessary federal involvement in state domestic relations laws
prompted the statutory exemption of [QDROs] from ERISA preemption.
Samaroo, 743 F. Supp. 309, 315 (D.N.J. 1990) (citing 29 U.S.C.
S 1144(b)(7)).
15
unnecessarily impede those courts' efforts to provide for a
just disposition of marital assets.8
There appears to be no strong countervailing policy
reason to warrant such interference in this case. I agree
that it is important not to upset the actuarial basis of
pension plans, but it is hard to believe that the single
survivor benefit at issue here is material to the actuarial
soundness of a plan with 87,500 participants. Moreover,
the Plan does not allege that it reduced funding levels or
otherwise changed its position in reliance on a belief that it
would not have to pay a surviving spouse benefit with
respect to Mr. Samaroo.
Finally, I cannot agree with the majority's contention that
designation of Ms. Robichaud as surviving spouse after Mr.
Samaroo died without remarrying would allow him to "have
his cake and eat it, too"9 because Mr. Samaroo retained the
right to confer surviving spouse status on a new wife so
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8. Thus, for example, the court in Ross lamented that the "unfortunate
result" of its holding (disallowing correction of a QDRO where benefits
had vested in a subsequent spouse) was that "equity will not prevail."
705 A.2d at 797.
Post-death (or post-retirement) entry or modification of a decree may
reasonably occur in a variety of circumstances, including, e.g., clerical
error, appeals, and delays attendant on the formulation of an
appropriate order. This is an example of the former: Mr. Samaroo's
attorney, who drafted the domestic relations order, testified that,
although they did not specifically discuss survivorship benefits, Mr.
Samaroo indicated his intent that Ms. Robichaud receive half interest in
"everything he had or was entitled to" and that it was only due to the
attorney's unfamiliarity with ERISA that the survivor designation was
erroneously omitted. See Joint Appendix at 553-54. Counsel also
testified that he had no doubt that Mr. Samaroo would have wanted Ms.
Robichaud to receive survivorship benefits, see Joint Appendix at 555,
and confirmed in a submission to the state court that "the intent of [Mr.
Samaroo] at that time was to give this 50 per cent [survivorship] right to
his then wife unconditionally and without any contingencies thereto."
Joint Appendix at 583. Even if the evidence regarding the scrivener's
error is inconclusive, the state court's acceptance of the attorney's word
should not be disregarded by a federal court bound to give the state
court's determination full faith and credit.
9. Maj. Op. at 10.
16
long as no QDRO designated his former wife as surviving
spouse. If the state court's nunc pro tunc order is credited,
after its effective date Mr. Samaroo retained the right to
accord a new wife surviving spouse status only to the
extent of the 50% interest not already granted to Ms.
Robichaud.10 Thus, Mr. Samaroo would not have been
allowed to have his cake and eat it, too; instead, the law
allows the state court to divide the cake equitably and
mandates that ERISA plans give effect to that division.
For the foregoing reasons, I would reverse the decision of
the District Court and remand with instructions to accord
full faith and credit to the state court's retroactive QDRO.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
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10. The majority cites 29 U.S.D.C S 1056(d)(3)(F) for the proposition that
"if QDRO designates former spouse as participant's surviving spouse,
current spouse shall not be treated as spouse for purposes of plan". Id.
I do not read the statute to provide such an all-or-nothing choice. Under
the statute, a former spouse shall be treated as a surviving spouse, and
a subsequent spouse shall not be so treated, only"[t]o the extent
provided" in a QDRO. 29 U.S.C. S 1056(d)(3)(F). Here, the "extent
provided" is 50%. The REA expressly recognizes the right to make such
partial designations. See 29 U.S.C. S 1056(d)(3)(B)(i)(I) (defining QDRO
as
order which, inter alia, recognizes or assigns right to receive "all or a
portion" of benefits under a plan). A natural reading would call for
treating Ms. Robichaud as surviving spouse to the extent of 50% of the
applicable benefit, and treating a new wife (if any) as spouse only to the
extent of the remaining 50%.
17