Seal v. Seal: Early Military Retirement Payable to Ex-Spouse

The Indiana Court of Appeals has affirmed that a former husband’s early military retirement pay is in fact payable to his ex-spouse, per their Indiana divorce agreement, despite the husband arguing it was not.

In the case of Seal v. Seal, the court ruled that the terms of the original distribution formula, which were agreed upon by all parties, were clear and unambiguous.

This case highlights what is an increasing point of contention in many Indiana divorce cases: that involving the apportioning of retirement funds. People are living longer, more often divorcing later in life, and these funds are what will determine each spouse’s quality of life in the golden years ahead. 

That’s why consultation with an experienced Hammond divorce attorney is so important. It’s imperative to ensure both parties receive a fair deal.

In Seal, according to court records, Husband and Wife were married in the summer of 1982, at which time Husband had been in the U.S. Air Force for seven years. He continued on in that career throughout the duration of their marriage, which ended in 2003, and up until his retirement in 2016 at age 59.

It was the wife who filed for dissolution of marriage. The divorce agreement they reached specified that Wife was supposed to receive exactly half of the benefits accrued under her husband’s Air Force pension up until the time of their divorce, while Husband was to receive any benefits accrued after that date.

Five years later, in 2008, Congress passed the National Defense Authorization Act of 2008, which lowered the retirement age for certain military reservists.

In 2009, the former couple met to modify their divorce agreement, touching on the subject of Husband’s military retirement pay. The modification was pursuant to the language of the statute, which laid out the details for when a former spouse was eligible to receive benefits and how much. The law required that the spouses be married at least 10 years,  during which time one spouse must have served 10 years or more of active duty. In those cases, the non-military spouse would receive 50 percent of benefits accrued during the marriage.

Originally, Husband believed he was going to be retiring in 2017. However, because he served active duty in the years following his divorce, he was eligible to receive early retirement pay in 2016. This active duty was a prerequisite for his eligibility to collect early retirement. Because he worked this active duty after the divorce, he sought a stipulation order from the court about whether this early retirement pay was subject to division with his ex-wife.

The trial court ruled that if Husband applied for and received early retirement benefits, those benefits should be divvied up between Husband and Wife. The judge’s reasoning was that because nothing in the federal law required Husband to retire early, the early retirement was a voluntary act on his part.

The husband asked the trial court to reconsider, which it did, but it still concluded that Wife was entitled to 50 percent.

Husband appealed, and the Indiana Court of Appeals affirmed the lower court’s ruling. The court noted that the husband had agreed to a settlement in which there was no mention of limitations based on the timing of those benefits. If Husband had wanted the early retirement pay to be exempt from the formula used, he could have asked for that exemption in the original agreement. However, he had not done so.

Thus, the agreement was affirmed.

Indiana Family Law Attorney Burton A. Padove handles divorce and child custody matters throughout northern Indiana, including Gary and Hammond. Call Toll Free 877-446-5294.

Additional Resources:

Seal v. Seal, July 29, 2016, Indiana Court of Appeals

More Blog Entries:

Wallerstedt v. Wallerstedt – Relocation in Indiana Child Custody Case, July 25, 2016, Indiana Divorce Agreement Lawyer Blog