Harris v. Harris

292 S.E.2d 775 (1982)

Arlene R. HARRIS
v.
Harold R. HARRIS.

No. 8112DC1158.

Court of Appeals of North Carolina.

July 6, 1982.

William J. Townsend, Fayetteville, for plaintiff-appellant.

Barringer, Allen & Pinnix by Thomas L. Barringer and Frank M. Parker, Jr., Raleigh, for defendant-appellee.

WELLS, Judge.

The first issue to be addressed in this appeal is whether, after plaintiff gave notice of appeal, Judge Hair had jurisdiction to dismiss plaintiff's appeal by order entered 20 July 1981. In support of her contention, plaintiff cites Wiggins v. Bunch, 280 N.C. 106, 184 S.E.2d 879 (1971), reh. denied, 281 N.C. 317 (1972) and Sink v. Easter, 288 N.C. 183, 217 S.E.2d 532 (1975), for the general proposition that an appeal takes the case out of the jurisdiction of the tribunal from which the appeal is taken. However, we find those cases to be inapposite.

One of the exceptions to the general rule cited in Wiggins is that "[a]n attempted appeal from a non-appealable order is a nullity and does not deprive the tribunal from which the appeal is taken of jurisdiction." Utilities Comm. v. Edmisten, Attorney General, 291 N.C. 361, 230 S.E.2d 671 (1976); Bizzell v. Bizzell, 247 N.C. 590, 101 S.E.2d 668 (1957), cert. denied, 358 U.S. 888, 79 S. Ct. 131, 3 L. Ed. 2d 116 (1958), reh. denied, 358 U.S. 938 (1959); Cox v. Cox, 246 N.C. 528, 98 S.E.2d 879 (1957). This case is factually similar to Bizzell, in that the portion of the Judge's order to which plaintiff's appeal relates is merely a retention for later ruling of one of plaintiff's motions. Thus, plaintiff's appeal was not from a final judgment, and was interlocutory. G.S. 1A-1, Rule 54(b); G.S. 1-277(a); Leasing Corp. v. Myers, 46 N.C.App. 162, 265 S.E.2d 240 (1980); ap. dismissed, 301 N.C. 92 (1981); see Shuford, N.C. Civil Practice and Procedure, § 54-3 (2nd ed. 1981). We find that the trial court retained jurisdiction to hear plaintiff's motion to have defendant's military retirement pay assigned to her, and we overrule this assignment of error.

Plaintiff's next assignment of error is that the trial judge lacked authority to modify the terms of the parties' separation agreement by reducing the percentage of defendant's military retirement pay to which plaintiff was entitled. We agree. The prior decision of this Court affirming judgment for plaintiff is binding on this issue. See Complex, Inc. v. Furst and Furst v. Camilco, Inc., and Camilco, Inc. v. Furst, 43 N.C.App. 95, 258 S.E.2d 379 (1979); disc. rev. denied, 299 N.C. 120, 261 S.E.2d 923 (1980); see also Heidler v. Heidler, 53 N.C. App. 363, 280 S.E.2d 785 (1981). Judge Hair had no authority to modify defendant's obligations under the separation agreement, and his order so doing is vacated.

The final issue before us is whether plaintiff is entitled to the remedy of specific performance by assignment of fifty percent of defendant's Army retirement pay. The legal and factual history of this case makes it plain that plaintiff's remedies at law are time-consuming, expensive, and inadequate. Plaintiff cites G.S. 1A-1, Rule 70 and G.S. 50-16.7(b), in support of her argument that defendant's military pay is "other income due or to become due" which defendant may be ordered to assign to plaintiff to secure payment according to the terms of the separation agreement.

The question, then, is whether defendant's Army retirement pay is "income" which can be assigned by order of a court of this state. In Hisquierdo v. Hisquierdo, 439 U.S. 572, 99 S. Ct. 802, 59 L. Ed. 2d 1 (1979), the Supreme Court ruled that the Supremacy Clause precluded the application of California community property law to award a divorced wife an interest in her former husband's federal Railroad Retirement Act benefits. The Court's decision was based partly on a specific prohibition against assignment, garnishment, or attachment in the Railroad Retirement Act of 1974, 45 U.S.C. § 231 et seq., as follows:

45 U.S.C. § 231m Assignability; exemption from levy

Notwithstanding any other law of the United States, or of any State, territory, or the District of Columbia, no annuity or supplemental annuity shall be assignable or be subject to any tax or to garnishment, attachment or other legal process under any circumstances whatsoever, nor shall the payment thereof be anticipated....

In the more recent case of McCarty v. McCarty, 453 U.S. 210, 101 S. Ct. 2728, 69 L. Ed. 2d 589 (1981), the United States Supreme Court reversed a ruling of the California Supreme Court which had had the effect of upholding a dissolution decree entitling a divorced wife to 45 percent of her husband's Army retirement pay, which was included as part of the community property of the marriage. In reversing, the Court stated that "[m]ilitary retired pay differs in some significant respects from a typical pension or retirement plan .... [M]ilitary retired pay is reduced compensation for reduced current services." Citing legislative history, the court characterized military retirement pay as a "personal entitlement payable to the retired member himself as long as he lives," over which the service member may designate as beneficiary one other than a spouse or ex-spouse. The Court went on to state in McCarty that:

[I]t is clear that Congress intended that military retired pay "actually reach the beneficiary." See Hisquierdo ... [supra] Retired pay cannot be attached to satisfy a property settlement incident to the dissolution of a marriage.... Congress rejected a provision ... that would have allowed attachment of up to 50% of military retired pay to comply with a court order in favor of a spouse, former spouse, or child.... (Emphasis added)

. . . . .

Subsequently, comprehensive legislation was enacted. In 1975, Congress amended the Social Security Act to provide that all federal benefits, including those payable to members of the armed services, may be subject to legal process to enforce child support or alimony obligations. Pub L 93-647, § 101(a), 88 Stat 2357, 42 USC § 659 [42 USCS § 659]. In 1977, however, Congress added a new definitional section (§ 462(c)) providing that the term "alimony" in § 659(a) "does not include any payment or transfer of property ... in compliance with any community property settlement, equitable distribution of property, or other division of property between spouses or former spouses."

We are persuaded that under McCarty, supra, and Hisquierdo, supra, an assignment of defendant's military retirement pay pursuant to a court-ordered specific performance of a separation agreement conflicts with the federal law and would threaten "grave harm to ``clear and substantial' federal interests." McCarty, supra. As unfortunate as such a result is, given that the equities of this case clearly lie with plaintiff, that portion of Judge Hair's order must also be and is vacated.

The effect of our opinion is that the original judgment in plaintiff's favor, as affirmed by us in our earlier opinion, remains in full force and effect.

Vacated.

HEDRICK and ARNOLD, JJ., concur.