Cir v. Dunkin ( 2007 )


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  •                  FOR PUBLICATION
    UNITED STATES COURT OF APPEALS
    FOR THE NINTH CIRCUIT
    COMMISSIONER OF INTERNAL             
    REVENUE,                                  No. 05-76004
    Petitioner-Appellant,
    v.                         Tax Ct. No.
    4448-03
    JOHN MICHAEL DUNKIN,                        OPINION
    Respondent-Appellee.
    
    Appeal from a Decision of the
    United States Tax Court
    Argued and Submitted
    June 13, 2007—Pasadena, California
    Filed August 31, 2007
    Before: Dorothy W. Nelson, Stephen Reinhardt, and
    Pamela Ann Rymer, Circuit Judges.
    Opinion by Judge D.W. Nelson;
    Dissent by Judge Reinhardt
    11131
    COMMISSIONER OF IR v. DUNKIN            11133
    COUNSEL
    Deborah K. Snyder and Richard Farber, United States Depart-
    ment of Justice, Tax Division, Washington D.C., for the
    appellant.
    John M. Dunkin, Ladera Ranch, California, pro se.
    OPINION
    D.W. NELSON, Senior Circuit Judge:
    The Commissioner of Internal Revenue (“Commissioner”)
    appeals from a decision of the United States Tax Court allow-
    ing John Michael Dunkin (“John” or “appellant”) to reduce
    his taxable income for the 2000 tax year by $25,511—the
    amount he paid his former spouse Julie Green (“Julie”) inci-
    dent to a division of community property assets upon marital
    dissolution. In 1997, a California Superior Court (“divorce
    court”) awarded Julie one half of the marital community’s
    interest in pension benefits provided by John’s employer.
    However, because John chose to continue working and did
    not terminate his participation in the plan following divorce,
    the pension administrator did not begin making distributions
    11134               COMMISSIONER OF IR v. DUNKIN
    straight away. California courts have recognized that an
    employee spouse like John might attempt to defeat a non-
    employee spouse’s community interest in a pension by contin-
    uing to work. As a result, under California law, Julie was not
    required to await John’s actual retirement and instead
    demanded monthly payments in lieu of her community pen-
    sion interest pursuant to In re Marriage of Gillmore, 
    629 P.2d 1
     (Cal. 1981). In 2000, John used $25,511 of the wages he
    earned by continuing to work to satisfy Julie’s “Gill-
    more rights.” We must decide whether John was entitled to
    reduce his taxable income by the amount paid over to Julie in
    2000.1 We conclude that he was not and reverse the Tax
    Court’s contrary holding.
    BACKGROUND
    John Dunkin and his former wife Julie married on August
    26, 1967, separated on February 19, 1996, and were divorced
    on August 19, 1997. For most of this period and continuing
    until his retirement in 2002, John was employed by the Los
    Angeles Police Department (“L.A.P.D.”). As part of his
    L.A.P.D. compensation package, John participated in a
    defined benefit plan administered by the Los Angeles Board
    of Pension Commissioners (“pension board”). Under the plan,
    upon retirement, John was entitled to receive monthly pay-
    ments for life, based on the length of his service, his rank, and
    his monthly salary. As of May 19, 1989, John’s pension rights
    were fully vested and mature.2 The pension benefits earned
    1
    The record does not reveal whether Julie reported the $25,511 she
    received in 2000 as income.
    2
    Pension rights are “vested” where they would survive the discharge or
    voluntary termination of the employee. In re Marriage of Bergman, 
    214 Cal. Rptr. 661
    , 664 n.4 (Cal. Ct. App. 1985). Such rights are “mature”
    where “all the conditions precedent to the payment of . . . benefits have
    taken place or are within the control of the employee.” Gillmore, 
    629 P. 2d at
    3 n.2 (quotations and citations omitted). Because John had accrued
    twenty years of service in 1989, his rights were mature, i.e., the only con-
    dition precedent to his receiving benefits was his actual retirement—an
    event entirely within his control.
    COMMISSIONER OF IR v. DUNKIN             11135
    during marriage were community property. Gillmore, 
    629 P.2d at 3
    ; In re Marriage of Benson, 
    116 P.3d 1152
    , 1156
    (Cal. 2005) (explaining that pension benefits represent “de-
    ferred compensation for work . . . performed during the mar-
    riage”).
    Under California law, upon the dissolution of a marriage,
    a divorce court is required to divide the community estate
    equally. 
    Cal. Fam. Code § 2550
    . In addition, the court may
    order spousal support, commonly referred to as “alimony.”
    
    Cal. Fam. Code § 4330
    (a). In this case, the divorce court
    explicitly declined to order spousal support.
    As part of the division of community property, the divorce
    court awarded one half of the community’s interest in the pen-
    sion to each spouse. A California court may value and distrib-
    ute a community’s interest in a pension in a number of
    different ways. A court may, for example, award the
    employee spouse the full pension and award an offsetting
    lump-sum representing one half of the present value of the
    pension to the non-employee spouse (usually out of other
    community assets if the estate is sufficiently large). Gillmore,
    
    629 P.2d at 7
    ; In re Marriage of Skaden, 
    566 P.2d 249
    , 253-
    54 (Cal. 1977); Bergman, 
    214 Cal. Rptr. at 664-65
    ; In re Mar-
    riage of Shattuck, 
    184 Cal. Rptr. 698
    , 699 (Cal. Ct. App.
    1982) (noting that this represents the “preferable mode of
    division”(internal citation omitted)). Alternatively, a court
    may decline to calculate the present value of the pension and
    simply order a division of each payment as it comes due. Gill-
    more, 
    629 P.2d at 7
    ; In re Marriage of Stenquist, 
    582 P.2d 96
    ,
    105 (Cal. 1978).
    Of course, pension payments typically do not come due
    until the employee spouse has retired. Further, the employee
    spouse alone may decide whether and when to retire. In Gill-
    more, the California Supreme Court recognized that an
    employee’s ability to unilaterally delay retirement, and
    thereby deprive the non-employee of his or her interest in a
    11136            COMMISSIONER OF IR v. DUNKIN
    pension, presented an opportunity for abuse. 
    629 P.2d at 4
    . As
    a result, in California, if an employee spouse chooses to con-
    tinue to work following divorce, the non-employee spouse
    may demand reimbursement for his or her share of the bene-
    fits that would have been forthcoming if the employee spouse
    had retired. 
    Id. at 6-7
    .
    In this case, the divorce court did not calculate the present
    value of the pension and, instead, awarded an in-kind division
    of benefits. The court calculated the community’s interest as
    $4,123.43 per month—the benefit that would have been forth-
    coming had John retired on the date of trial—and Julie’s share
    as $2,072. Julie exercised her rights under Gillmore, and John
    was ordered to reimburse his ex-spouse for the amounts she
    lost as a result of his decision to continue working. The court
    also ordered the pension board to make similar payments to
    Julie following John’s retirement. Because these payments
    were related to Julie’s community property interests and were
    not alimony, there was no provision for their cessation upon
    her death or remarriage. Instead, John was required to make
    payments until he retired, and the pension board was ordered
    to make payments for as long as benefits were payable, even
    if Julie died in the interim, in which case benefits would flow
    to her designated beneficiaries.
    In 2000, John paid $25,511 to Julie pursuant to the divorce
    court’s order. While he was free to use any property at his dis-
    posal, he funded the payments out of the wages he earned in
    exchange for his continued employment with the L.A.P.D.
    John claimed this amount as deductible alimony on his federal
    income tax return and the IRS disallowed the deduction. He
    then sought and was granted relief by the United States Tax
    Court which allowed him to “reduce” his income by $25,511
    without specifying whether appellant was entitled to exclude
    a portion of his wages from gross income or deduct, as ali-
    mony or otherwise, the payments made to his ex-spouse.
    Dunkin v. Comm’r, 
    124 T.C. 180
     (T.C. 2005).
    COMMISSIONER OF IR v. DUNKIN            11137
    DISCUSSION
    I.    Jurisdiction and Standard of Review
    We have jurisdiction over the final judgment of the United
    States Tax Court under I.R.C. § 7482(a). We review decisions
    of the tax court on the same basis as we would any decision
    rendered by a district court in a civil bench trial. Condor
    Intern., Inc. v. Comm’r, 
    78 F.3d 1355
    , 1358 (9th Cir. 1996).
    Therefore, we review the court’s factual findings for clear
    error, its discretionary rulings for abuse of discretion, and its
    conclusions of law de novo. 
    Id.
    Under the Internal Revenue Code, income taxes are
    assessed based on a person’s “taxable income,” defined as
    gross income less deductions allowed by the Code. I.R.C.
    §§ 1, 63(a). Broadly speaking, the question in this case is
    whether John was entitled to exclude from gross income the
    $25,511 in wages that he paid over to Julie in 2000 or, if not,
    whether he was entitled to deduct the payments as alimony.
    II.       Appellant’s Gross Income for 2000 Included the
    Wages that were Paid Over to his Ex-Spouse
    A.    General Principles
    The first step in arriving at taxable income is to determine
    an individual’s “gross income.” Although the term is defined
    broadly (and somewhat circularly) to include “all income
    from whatever source derived,” I.R.C. § 61(a), certain acces-
    sions to wealth that would ordinarily constitute income may
    be excluded by statute or other operation of law. See I.R.C.
    §§ 101-140 (listing items specifically excluded from gross
    income). However, given the clear Congressional intent to
    “exert . . . the full measure of its taxing power,” Comm’r v.
    Glenshaw Glass Co., 
    348 U.S. 426
    , 430 (1955) (internal cita-
    tions and quotation marks omitted), exclusions from gross
    11138            COMMISSIONER OF IR v. DUNKIN
    income are construed narrowly in favor of taxation. Merkel v.
    Comm’r, 
    192 F.3d 844
    , 848 (9th Cir. 1999).
    [1] There is no statutory provision that could plausibly be
    said to exclude from gross income the accessions to wealth at
    issue in this case, i.e., the wages paid by the L.A.P.D. to John
    during the year 2000. Indeed, wages received in exchange for
    labor are the very paradigm of income. I.R.C. § 61(a)(1).
    Although John owed a debt to Julie which he satisfied out of
    his monthly wages, standing alone, this is not a reason to
    exclude the wages from his gross income. Alex v. Comm’r,
    
    628 F.2d 1222
    , 1224 (9th Cir. 1980) (“It is not true that one’s
    paycheck is . . . excludable from gross income whenever it is
    ‘spoken for’ by creditors.”).
    B.    Attribution of Income in the Marital Context
    Although the mere fact that John used a portion of his
    wages to satisfy a debt does not justify any exclusions from
    his income, the fact that the payments were made to his ex-
    spouse under the direction of a divorce court makes this case
    seem difficult. Federal tax is imposed on the income “of”
    individuals. I.R.C. § 1. In Poe v. Seaborn, the Supreme Court,
    noting that “ ‘of’ denotes ownership,” 
    282 U.S. 101
    , 109
    (1930), held that where the community property laws of a
    state create in married persons “vested property right[s] in the
    . . . income of the community, including salaries or wages of
    either husband or wife, or both,” 
    id. at 111
    , each has taxable
    income in the amount of one-half of such inflows. See also,
    e.g., United States v. Mitchell, 
    403 U.S. 190
    , 197 (1971)
    (“[W]ith respect to community income . . . federal income tax
    liability follows ownership. In the determination of owner-
    ship, state law controls.” (citations omitted)); Leonard v.
    Comm’r, 
    76 T.C.M. (CCH) 255
     (T.C. 1998) (“Community
    property income is attributable 50 percent to each spouse.”);
    but see, e.g., I.R.C. §§ 879, 1402(a)(5) (disregarding commu-
    nity property for some purposes).
    COMMISSIONER OF IR v. DUNKIN                    11139
    Under Seaborn and its progeny, if a portion of the wages
    John earned in 2000 was community property under Califor-
    nia law, then the correct tax treatment would be to attribute
    half of that income to John and half to Julie. Put another way,
    it would be correct to exclude from John’s gross income the
    fifty percent paid over to his ex-spouse. In the instant case the
    tax court seems to have reasoned that because John’s obliga-
    tion arose out of an exercise of Julie’s Gillmore rights, the
    funds at issue belonged to Julie and not John under California
    community property law and were therefore not income to
    John under the logic of Seaborn. 124 T.C. at 185-86.
    [2] Unfortunately for John, the tax court was wrong. Under
    California law, “[a]fter entry of a judgment of legal separation
    of the parties, the earnings or accumulations of each party are
    the separate property of the party acquiring the earnings or
    accumulations.” 
    Cal. Fam. Code § 772
    . The wages at issue in
    this case were clearly “earnings or accumulations” acquired
    by John after legal separation.
    In Gillmore, the California Supreme Court did not create a
    new species of community property consisting of those post-
    divorce wages earned by an employee spouse that displace a
    stream of pension income that would have flowed to the com-
    munity had the employee retired.3 Instead, the Court noted
    3
    In dicta the Court noted that “[o]ne commentator argues that when an
    employee who is eligible to retire chooses to continue working, part of his
    [post-divorce] salary is actually attributable to community effort. ‘(F)rom
    an economist’s perspective, the employee spouse’s compensation for con-
    tinued employment is not the full amount of his paycheck. Rather, his
    compensation is only that amount above the pension benefits that he will
    not receive while he continues working.’ ” 
    629 P.2d at
    6 n.7 (quoting
    Note, In re Marriage of Stenquist: Tracing the Community Interest in Pen-
    sion Rights Altered by Spousal Election, 
    67 Cal. L. Rev. 856
    , 879 (1979)).
    The tax court quoted from this footnote while omitting the “one commen-
    tator argues that” language, leaving the impression that the California
    Supreme Court had adopted this point of view as part of the Gillmore
    holding. 124 T.C. at 184 n.7. However, it is manifest that the California
    11140              COMMISSIONER OF IR v. DUNKIN
    that when an employee spouse facing a Gillmore election
    chooses to continue working, he may “use separate property
    to reimburse” the non-employee spouse. 
    629 P.2d at 6
    (emphasis added). The Court continued,
    [the employee spouse’s] situation is not unlike that
    faced by a couple ordered to divide a house that they
    own as community property. If one of the spouses
    chooses to keep the house, he or she is free to use
    separate property to purchase the other’s interest.
    Here, [the employee spouse] must divide his retire-
    ment benefits with [the non-employee spouse]. If
    [the employee spouse] does not wish to retire, he
    must pay . . . an amount equivalent to [the non-
    employee spouse’s] interest.
    
    Id.
    Neither Eatinger v. Commissioner, 
    59 T.C.M. (CCH) 954
    (T.C. 1990), nor Powell v. Commissioner, 
    101 T.C. 489
     (T.C.
    1993), provides any support for John’s position. Both cases
    addressed the tax consequences of actual distributions of pen-
    sion benefits in the context of community property division.
    Both held that a non-employee spouse’s share of such distri-
    Supreme Court was merely reporting the views of a commentator and not
    establishing that post-divorce wages that displace a pension are them-
    selves community property. Indeed, to do so would fly in the face of Cali-
    fornia Family Code § 772. Further, the main text of the Gillmore opinion
    makes clear that an employee spouse uses his or her separate property to
    satisfy a non-employee spouse’s Gillmore election where the employee
    continues to work and hands over some of his or her wages. 
    629 P.2d at 6
    ; see also Shattuck, 
    184 Cal. Rptr. at 700
     (“The [Gillmore] court did not
    create a fiction that [an employee spouse] be deemed to have received his
    monthly pension payments, and was therefore bound to pay over [the non-
    employee’s share]. Gillmore says no more than that: ‘If he does not wish
    to retire, he must [upon dissolution of the marriage and her demand] pay
    her an amount equivalent to her interest.’ ” (quoting Gillmore, 
    629 P.2d at 6
    )).
    COMMISSIONER OF IR v. DUNKIN                     11141
    butions would be taxable to him or her notwithstanding the
    fact that the payments were first distributed to the employee
    spouse who then, acting as a conduit, turned the funds over
    to the non-employee. See Powell, 
    101 T.C. at 497-99
    (explaining that because distributions from a pension plan are
    community property under California law an employee
    spouse would be deemed to “receive[ ] the distribution[s] . . .
    on behalf of the community [so] that his later payment to [his
    ex-spouse would be] a transfer to her of funds that at all times
    belonged to her”).
    Eatinger and Powell are readily distinguishable. There is
    no question that under California law, actual distributions of
    pension benefits earned during marriage are community prop-
    erty. It follows under Seaborn that such distributions are tax-
    able to the spouses in proportion to their community property
    shares. In this case, however, the pension board made no dis-
    tributions whatsoever in the year 2000. Rather, John made the
    choice to continue working and made the additional choice to
    satisfy Julie’s Gillmore demand for reimbursement out of his
    wages. Because those wages were unquestionably John’s sep-
    arate property under California law, Seaborn, Eatinger, and
    Powell do not apply.4
    [3] We hold that appellant was not entitled to exclude from
    his gross income any of the wages that he used to satisfy his
    ex-spouse’s demand for compensation under Gillmore.
    4
    The tax court’s discussion of the fungibility of money, 124 T.C. at 186-
    87, is beside the point. Although the source of funds used to pay an other-
    wise deductible expense may be irrelevant for federal income tax pur-
    poses, none of the payments at issue in this case was deductible under any
    provision of the code. See Section III infra. In contrast, the attribution of
    income between spouses under Seaborn depends entirely on the source
    and character of income under state law.
    11142            COMMISSIONER OF IR v. DUNKIN
    III.    Appellant was not Entitled to Claim a Deduction for
    the Amounts Paid to his Former Spouse
    The next step in determining taxable income is to subtract
    certain outlays that are deemed deductible under the Code.
    “Deductions . . . are a matter of legislative grace and exist
    only by virtue of specific legislation.” Max Sobel Wholesale
    Liquors v. Comm’r, 
    630 F.2d 670
    , 671 (9th Cir. 1980). The
    only deduction that might plausibly apply to the outlays in
    this case is the deduction for alimony payments under I.R.C.
    § 215.
    Under § 215, a taxpayer may deduct an amount equivalent
    to payments made during the tax year that would be included
    in the recipient’s gross income under I.R.C. § 71(b). Section
    71(b) defines as alimony only those payments made (1) in
    cash, (2) under a divorce or separation instrument that does
    not designate the payments as non-alimony, (3) to a person
    who is not a member of the payor’s household, and (4) where
    there is “no liability to make any such payment for any period
    after the death of the payee spouse.” I.R.C. § 71(b).
    [4] In this case, the divorce court declined to award ali-
    mony. Further, the court unambiguously required John to
    make payments for as long as he was employed by the
    L.A.P.D. even if Julie died before his retirement. Because
    John’s liability was not conditioned on Julie’s survival, the
    payments were not “alimony” within the meaning of § 71(b).
    IV.     Conclusion
    The wages earned in exchange for John’s continued
    employment in the year 2000 were clearly income under the
    Internal Revenue Code. That John owed money to a creditor
    —in this case his ex-spouse—does not justify excluding any
    amount of his wages from income. Because California com-
    munity property law does not denominate any portion of
    John’s post-divorce wages as community property, Seaborn
    COMMISSIONER OF IR v. DUNKIN               11143
    and the cases applying its reasoning do not apply. Finally,
    because John’s liability was not conditioned on Julie’s sur-
    vival, the payments were not deductible as alimony.
    REVERSED.
    REINHARDT, Circuit Judge, dissenting:
    The majority passes over the existence of a significant
    ambiguity regarding an issue of California state law that has
    not been addressed by the state’s highest court. The question
    is whether a portion of a divorced employee’s wages should
    be treated as community property when it is used solely for
    the payment of an ex-spouse’s court ordered pension benefits
    that are community property; in such cases, the former spouse
    would have received the amount in question as pension bene-
    fits (i.e. community property) if her ex-husband had retired at
    the time he became eligible to do so. Alternatively, the
    amount of wages that is paid over to the ex-wife as pension
    benefits could be considered to be exclusively the husband’s
    wages and he would have to pay full taxes on that income
    even though he neither uses nor benefits from it. The majority
    chooses the latter option. I respectfully dissent. I would cer-
    tify the question of how to treat the money involved under
    California law to the California Supreme Court.
    The majority opinion imposes negative tax consequences
    on a police officer who chooses to work past retirement eligi-
    bility age and thus to defer collection of his pension. It
    requires him to pay full income taxes on the part of his salary
    that he pays over to his former wife as her community interest
    in his pension benefits — a result that defies reason, not to
    mention fairness. If the payment were considered to be what
    it actually is, a distribution of the ex-wife’s interest in the pen-
    sion benefits, the husband would not have to pay any taxes on
    the amount in question. If the question were certified, I think
    11144            COMMISSIONER OF IR v. DUNKIN
    there is a reasonable chance that the California Supreme
    Court would not decide it the way the majority does. All the
    California court need do in order to achieve an equitable
    result is to declare as a matter of state law what is the fact —
    that in circumstances such as those in which Officer Dunkin
    finds himself, the part of his salary that he receives and then
    pays to his ex-wife as reimbursement of the share of pension
    benefits to which she is entitled under the California court
    order constitutes the receipt and payment of her interest in
    community benefits.
    I.
    In 2000, John Dunkin paid his ex-wife $25,511, her share
    of the annual pension benefits he would have received if he
    had not decided to continue serving the Los Angeles Police
    Department beyond his retirement age. He did so because his
    former wife elected immediate payment of her share of those
    benefits (a “Gillmore election”). No California Supreme
    Court case addresses the question whether the portion of his
    salary that an employee devotes exclusively to compensating
    his former spouse for her share of his pension benefits that
    she would directly receive as community property were he
    retired should itself be treated as community property. An
    analysis of several California court of appeal decisions dis-
    cussing Gillmore elections reveals the considerable ambiguity
    surrounding the question.
    As support for its position, the majority points to the Cali-
    fornia Supreme Court’s statement that when an employee fac-
    ing a Gillmore election continues working “he may use
    separate property to reimburse” the non-employee spouse.
    Gillmore, 
    629 P.2d at 6
    . This statement itself does not decide
    the issue, and another statement in the same opinion creates
    uncertainty. The Gillmore court acknowledged in a footnote
    the argument that the portion of an employee’s salary that he
    uses to compensate his former spouse for her share of the pen-
    sion benefits should be considered community property and
    COMMISSIONER OF IR v. DUNKIN              11145
    not part of his separate income. 
    629 P.2d at
    6 n.7 (citing Note,
    In re Marriage of Stenquist: Tracing the Community Interest
    in Pension Rights Altered by Spousal Election, 
    67 Cal. L. Rev. 856
    , 879 (1979)). The majority is correct in saying that
    the Gillmore court did not adopt this analysis, but the court
    did not reject it either. Rather, the court stated that it was not
    necessary to reach the question and left open the possibility
    that such a rule could be established in the future.
    Subsequent cases in the California court of appeal create
    additional uncertainty. In In re Marriage of Shattuck, the
    court found that the Gillmore court did not create the rule that
    the employee “be deemed to have received his monthly pen-
    sion payments, and was therefore bound to pay over [his
    spouse’s] community property share of them.” 
    134 Cal. App. 3d 683
    , 700 (Ct. App. 1982). More than ten years later,
    another California court asserted that such a rule had been
    adopted in other cases when calculating payments owed to
    former spouses. Nice v. Nice, 
    230 Cal. App. 3d 444
    , 450 n.2
    (Ct. App. 1991) (citing Marriage of Scott, 
    156 Cal. App. 3d, 251
    , 253 (Ct. App. 1984) (holding that the non-employee
    spouse is entitled to the benefits that she would have received
    “had [her former husband] actually retired on the date she
    elected to receive her interest”); In re Marriage of Jacobson,
    
    161 Cal. App. 3d 465
    , 475 (Cal. Ct. App. 1984) (holding that
    a present election payment was properly calculated as though
    the employee spouse retired at the time of trial and the non-
    employee spouse must forego future appreciation in the pen-
    sion’s value); In re Marriage of Castle, 
    180 Cal. App. 3d 206
    ,
    210-11, 216-17 (Cal. Ct. App. 1986) (holding that when a
    non-employee spouse elects a present benefit, her payment is
    to be calculated as though the employee spouse retired at the
    time of trial)). If courts create the rule that the pension is dis-
    tributed as community property when calculating payments,
    there is no reason to think that they would not use the same
    principle to determine that the portion that is to be used to sat-
    isfy the pension interest is distributed as community property
    as well.
    11146            COMMISSIONER OF IR v. DUNKIN
    Because of the uncertainty in the law, and because federal
    courts traditionally defer to the states on questions of family
    law, see In re Marriage of Castle, 
    180 Cal. App. 3d 206
    , 210-
    11, 213 (Cal. Ct. App. 1986), it is appropriate to certify this
    question to the California Supreme Court.
    II.
    The majority’s approach places the employee former
    spouse in an unfortunate position. If he elects to retire instead
    of continuing to serve the Los Angeles police department, he
    will not have to pay taxes on income he does not receive. See
    Scott, 156 Cal. App. 3d at 253. If he elects to continue to
    work, however, he will. At a time when the federal govern-
    ment is encouraging postponing retirement due to a looming
    Social Security shortfall, and police forces nationwide are fac-
    ing officer shortages as officers retire at a younger and youn-
    ger age and take (or divide) their pension benefits and go off
    to obtain higher paying jobs in private industry, the majority
    adopts a rule that discourages divorced officers (and there are
    many) from continuing to serve the Los Angeles and other
    police departments. I would hope that the California Supreme
    Court would not create such perverse incentives if it were to
    decide the question.
    Because this case presents a question of first impression
    that falls squarely in the realm of state law in a subject area
    in which federal courts defer to state court decisions, I believe
    that we should certify the question to the California Supreme
    Court. Certainly, it could not arrive at a less fair and reason-
    able decision. Therefore I respectfully dissent.