Producer-Writers Guild of American Pension Plan v. Adell CA2/4

Filed 11/4/15 Producer-Writers Guild of American Pension Plan v. Adell CA2/4
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
PRODUCER-WRITERS GUILD OF B257309
AMERICA PENSION PLAN,
Plaintiff and Respondent (Los Angeles County
Super. Ct. No BD290216
v.
ILUNGA ADELL et al.,
Defendants and Respondents;
TERRY WILLIAMS-ILUNGA,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of Los Angeles County, B. Scott
Silverman, Judge. Affirmed.
Reich, Adell & Cvitan, Hirsch Adell, J. David Sackman and Neelam Chanda for
Plaintiff and Respondent Producer-Writers Guild of America Pension Plan.
Ilunga Adell in pro. per. for Defendant and Respondent Ilunga Adell.
Charles J. Fleishman for Defendant and Appellant Terry Williams-Ilunga.
The question presented by this appeal is whether a family law court has
jurisdiction to hear an interpleader filed by a pension plan involuntarily joined to
dissolution proceedings, where the plan is governed by the federal Employee Retirement
Income Security Act of 1974 (“ERISA”). We conclude that it does, at least under the
unusual circumstances presented by this procedurally anomalous case. Although ERISA
grants federal courts exclusive jurisdiction over most civil actions brought pursuant to its
provisions (29 U.S.C. § 1132(e)(1)), the state law interpleader filed in this case was not
an independent civil action instigated by the Plan but rather was an “appropriate
responsive pleading” within the meaning of Family Code section 2063, subdivision (b).
We accordingly affirm the judgment of the trial court.
FACTUAL AND PROCEDURAL BACKGROUND
This appeal stems from the family court’s attempt to resolve competing claims to
pension benefits. Ilunga Adell (“Ilunga”),1 his first wife, Rosalyn Willis Ilunga
(“Rosalyn”), and his second wife, Terry Williams-Ilunga (“Terry”), all stake claim to
retirement benefits Ilunga earned while participating in the Producer-Writers Guild of
America Pension Plan (“the Plan”). Rosalyn was awarded one-half of the community
interest in the retirement benefits in 2000, upon the dissolution of her marriage to Ilunga.
Terry obtained an interest in the retirement benefits during her subsequent dissolution
proceedings in 2002, when the court issued an order attaching Ilunga’s pension benefits
“as and for child support and support arrearage for the parties[’] minor children.” In
2011,Terry obtained a judgment against Ilunga for pendente lite child support arrearages
totaling $114,592.69.
Rosalyn obtained an enforceable “qualified domestic relations order,” or
“QDRO,” authorizing the Plan to pay her share of the retirement benefits in 2012. 2 Terry
1We refer to the parties by their first names to avoid confusion. No disrespect is
intended.
2
A domestic relations order (DRO) is “any judgment, decree, or order (including
approval of a property settlement agreement) which—[¶] (I) relates to the provision of
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tried to procure a QDRO effectuating payment of Ilunga’s child support arrearages, but
she and the Plan, which she had joined to her dissolution proceedings (see Fam. Code, §
2060), were unable to reach a consensus as to whether her proposed order could qualify
as a QDRO.3 While Terry and the Plan were addressing that issue in Terry’s dissolution
proceedings, Ilunga applied for early retirement benefits, thereby asserting his own claim
to the benefits. Shortly thereafter, Rosalyn joined the Plan to her dissolution proceedings
pursuant to Family Code section 2060. At no point were Rosalyn, Terry, Ilunga, and the
Plan all parties to either dissolution proceeding. Although Ilunga and the Plan were
parties to both proceedings, Rosalyn was absent from Terry’s and Terry was absent from
Rosalyn’s.
child support, alimony payments, or marital property rights to a spouse, former spouse,
child, or other dependent of a participant, and (II) is made pursuant to a State domestic
relations law (including a community property law).” (29 U.S.C. § 1056(d)(3)(B)(ii).) A
“‘QDRO is a subset of “domestic relations orders” that recognizes the right of an
alternate payee to “receive all or a portion of the benefits payable with respect to a
participant under [a retirement benefits] plan.” 29 U.S.C. § 1056(d)(3)(B)(i)(I).’
[Citations.]” (In re Marriage of Padgett (2009) 172 Cal.App.4th 830, 840.) Absent a
QDRO, the anti-alienation provisions of ERISA prohibit employee benefits plans from
distributing benefits to individuals who, like Rosalyn and Terry, are not named plan
participants or beneficiaries. (See Boggs v. Boggs (1997) 520 U.S. 833, 846-847; In re
Marriage of Padgett, supra, 172 Cal.App.4th at p.839.)
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“Primary responsibility for determining whether a DRO is a QDRO that
establishes obligations for an ERISA plan rests with the plan itself. 29 U.S.C.
§ 1056(d)(3)(G). Upon obtaining a domestic relations order in a state court proceeding,
an alternate payee who seeks to establish a right to payment pursuant to that order from
an ERISA-covered benefit plan must present the order to the pension plan administrator
for a determination of whether it is a QDRO. . . . [¶] Under this scheme, then, whether
an alternate payee has an interest in a participant’s pension plan is a matter decided by a
state court according to the state’s domestic relations law. Whether a state court’s order
meets the statutory requirements to be a QDRO, and therefore is enforceable against the
pension plan, is a matter determined in the first instance by the pension plan
administrator, and, if necessary, by a court of competent jurisdiction. See 29 U.S.C.
§ 1056(d)(3)(H)(i).” (Trustees of Directors Guild of America-Producer Pension Benefits
Plans v. Tise (9th Cir. 2000) 234 F.3d 415, 420-421.) State courts are competent to make
this determination. (In re Marriage of Oddino (1997) 16 Cal.4th 67, 71.)
3
The Plan endeavored to assemble all of the interested parties in one forum after
Rosalyn joined it to her dissolution proceedings. Invoking Family Code section 2063,
subdivision (b), which provides in pertinent part that an employee benefit plan joined to a
family law proceeding “may, but need not, file an appropriate responsive pleading with
its notice of appearance,” the Plan filed an interpleader in Rosalyn’s divorce proceedings.
In its interpleader, filed pursuant to California Code of Civil Procedure Section 386, the
Plan alleged that it faced “multiple and conflicting claims for the same pension benefits.”
The Plan further alleged that it had no claim to the benefits, which it was prepared to
deposit with the court. The Plan requested that the court order Ilunga, Rosalyn, and Terry
to interplead and litigate their respective claims; restrain all three of them from instituting
or further prosecuting any other proceedings in state court related to the contested
benefits; discharge the Plan from any liability or obligation; and award the Plan its costs
and reasonable attorneys’ fees associated with the interpleader.
Terry opposed the interpleader on jurisdictional grounds. The trial court overruled
her objections, commenting that it was authorized to divide interests in pension plans and
did so “every day.” The court ordered Ilunga, Rosalyn, and Terry to interplead and
enjoined them from instituting or pursuing other claims pertaining to the contested
benefits. Soon thereafter, the parties (including the Plan) stipulated that the Plan should
make all payments authorized by Rosalyn’s 2012 QDRO, leaving only the competing
claims of Ilunga and Terry for resolution.
Ultimately, on summary judgment, the court concluded that Terry was entitled to
receive 100 percent of the pension benefits remaining after Rosalyn’s share was
subtracted, but was not entitled to the payment structure she desired. The court entered a
QDRO to that effect. Terry timely appealed.4
4
The court stayed the Plan’s motion for attorney’s fees under Code of Civil
Procedure section 386.6, subdivision (a) pending resolution of this appeal. We express
no opinion on the merits of that motion.
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DISCUSSION
I. Issue Presented
In her opening brief, Terry contends that “the only issue” in this appeal is whether
the state court had jurisdiction to hear the interpleader filed by the Plan. We agree. As
the appealing party, Terry is responsible for identifying and articulating the issues she
wishes us to resolve. “It is well established that it is appellant’s opening brief which
controls the nature and number of issues presented on appeal.” (People v. Schoennauer
(1980) 103 Cal.App.3d 398, 406.)
Ilunga filed a brief in which he argues that “this Court is restricted from enforcing
a QDRO that garnishes Appellee’s . . . Pension Plan; or aggregated disposable income for
more than 65 per centum to satisfy unpaid child support arrearages on a monthly pursuant
to U.S.C. Section 1673 (2) (A) [sic].” But he has not filed an appeal or cross-appeal.
“As a general matter, ‘a respondent who has not appealed from the judgment may not
urge error on appeal.’ [Citation.]” (In re Estate of Powell (2000) 83 Cal.App.4th 1434,
1439.) “Code of Civil Procedure section 906 provides a limited exception ‘to allow a
respondent to assert a legal theory which may result in affirmance of the judgment.’
[Citation.]” (Ibid.) Here, however, Ilunga seeks reversal of the judgment and entry of a
new judgment more favorable to him – a judgment pursuant to which Terry is entitled to
receive only 65 percent rather than 100 percent of the monthly pension benefits that
otherwise would be paid to him. Having failed to appeal or cross-appeal, Ilunga cannot
seek such affirmative relief. ~We accordingly do not consider his argument; we restrict
our discussion to the issue properly presented by Terry.
II. Standard of Review
The existence of jurisdiction is a legal question that we review de novo. (Saffer v.
JP Morgan Chase Bank (2014) 225 Cal.App.4th 1239, 1248; Dial 800 v. Fesbinder
(2004) 118 Cal.App.4th 32, 42.) We may consider this question regardless of the answer.
(Adams v. Pacific Bell Directory (2003) 111 Cal.App.4th 93, 99.)
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III. Analysis
Terry’s sole contention on appeal is that the Plan is not permitted to file an
interpleader in state court under any circumstances. We reject this contention.
An interpleader is a procedural mechanism a party facing competing claims to
money or property in its possession or control may employ to compel the claimants to
interplead and litigate the claims among themselves. (See Code Civ. Proc. § 386, subd.
(b); see also 4 Witkin, Cal. Proc. (5th ed. 2008) Pleading, § 237, p. 317; Weil & Brown,
Cal. Practice Guide: Civil Procedure Before Trial (The Rutter Group 2015) ¶ 2:470.)
Here, the Plan was confronted with three competing claims to the pension benefits in its
custody: those of Ilunga, Rosalyn, and Terry. The three claimants – and the Plan – were
divided between two separate family law proceedings. Ilunga, Terry, and the Plan were
parties to Terry’s ongoing dissolution proceedings, while Ilunga, Rosalyn, and the Plan
were parties to Rosalyn’s. Terry rejected the court’s suggestion that she move to
consolidate the proceedings, and neither she nor Rosalyn sought to join the other to their
respective dissolution proceedings under Family Code section 2021, subdivision (a) or
California Rules of Court, rule 5.24(c)(1). Because the Plan was merely a claimant in the
dissolution proceedings and not a petitioner or respondent, it was not permitted to join
Terry or Rosalyn to either ongoing dissolution proceeding. (Cal. Rules of Court, rule
5.24(b), (c).) The only procedural avenue available to the Plan to mitigate its risk of
double litigation was an interpleader.
As Terry suggests, however, the Plan was precluded from initiating a new civil
action in interpleader in state court. Title 29 United States Code section 1132(e)(1) vests
in federal courts exclusive jurisdiction of civil actions under ERISA “instigated by a
fiduciary” like the Plan. (Aetna Life Ins. Co. v. Bayona (2000) 223 F.3d 1030, 1033; see
also In re Marriage of Oddino, supra, 16 Cal.4th at p. 79, fn. 6.) The Plan’s use of the
interpleader procedure in this case was not prohibited by this provision because the Plan
did not file a complaint in interpleader or otherwise bring, initiate, or instigate a civil
action under Title 29 United States Code section 1132(a)(3) against any of the claimants
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in state court. Instead, it filed its interpleader in response to being joined to Rosalyn’s
dissolution. Terry does not explain why a responsive filing filed in an ongoing
proceeding such as that at issue here should be viewed as a civil action “brought by” (29
U.S.C. § 1132(e)(1)) or “instigated by” (Aetna Life Ins. Co. v. Bayona, supra, 223 F.3d at
p. 1033) an ERISA fiduciary.
Family Code section 2063, subdivision (b) – which Terry does not address in her
briefing – permits a benefits plan joined to dissolution proceedings to “file an appropriate
responsive pleading with its notice of appearance.” The statute does not clarify the
filings which may constitute an “appropriate responsive pleading.” We conclude that the
unusual procedural posture of this case – two ongoing dissolutions with the Plan, but not
all interested parties, joined to both – rendered an interpleader an “appropriate” response
by the Plan upon its joinder to Rosalyn’s dissolution proceeding. Just as a cross-
complaint may be considered a proper “responsive pleading” in some contexts (see
Moorpark Unified School District v. Superior Court (1990) 223 Cal.App.3d 954, 960), so
too may the interpleader filed in the context of this case.
ERISA does not prevent state courts from dividing interests in retirement plans in
the context of marital dissolution actions. (In re Marriage of Baker (1988) 204
Cal.App.3d 206, 209.) State courts enjoy a “virtually exclusive primacy” (Ankenbrandt
v. Richards (1992) 504 U.S. 689, 714) in matters of domestic relations, and the
proceedings here, which culminated in the issuance of a QDRO to Terry, were within the
court’s jurisdictional purview. As the family court observed, state courts divide interests
in pension plans “every day,” often in complex circumstances such as those presented
here. The unusual sequence of events that precipitated the Plan’s responsive interpleader
and subsequent property division here does not change this result.
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DISPOSITION
The judgment is affirmed. The parties are to bear their own costs on appeal.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
COLLINS, J.
We concur:
WILLHITE, Acting P. J.
MANELLA, J.
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