THOMPSON v. THOMPSON, 98856, 2005 OK CIV APP 2, ___ P.3d ___, Decided 12/17/2004, Mandate 01/12/2005
Unvested military retirement pay may still be divided in a divorce action by Oklahoma Courts as marital property despite the seeming effect of the ten-year limiting language contained in 10 U.S.C.A. §1408
. The Court of Appeals reversed the trial court's refusal to divide the military retirement and held that " the ten-year rule relied on by the trial court only limits the availability of direct payments from the military, and state law governs the issue of whether military retirement benefits are divisible. "
The Court of Appeals reemphasized that "Oklahoma law clearly provides that a military retirement may be jointly acquired property that should be equitably divided between the parties. Rookard v. Rookard, 1987 OK 87, ¶4, 743 P.2d 1083, 1083
(reversing for trial court to consider military pension in property division and alimony award); Stokes, ¶11, 738 P.2d at 1348
(stating military retirement may be divisible as joint property);Pullium v. Pullium, 1990 OK 71, ¶8, 796 P.2d 623, 624-25
(noting both private and military pensions should be included as marital property if jointly acquired during marriage). Thus, the trial court should have determined what portion of Husband's military retirement was jointly acquired during the marriage." Whether the military retirement is vested or not is not significant. Carpenter v. Carpenter , 1983 OK 2, ¶23, 657 P.2d 646, 651
Addressing the contention that the unvested military retirement was not susceptible to valuation, the Court of Appeals pointed out that "The Oklahoma Supreme Court has also discussed how retirement benefits should be divided. Pullium
, ¶13, 796 P.2d at 624-25. One option is the "present value method," where the entire pension is awarded to the employee, and the non-employee receives other property or money as an immediate offset. Id
. at ¶14, 796 P.2d at 625. A second option is the "deferred distribution method," where the court determines the percentage of the future benefits that are attributable to the marriage, and the non-employee receives an equitable share of that percentage of benefits when the employee becomes eligible. Id.
at ¶15, 796 P.2d at 626. The present value method is preferred when the pension valuation is not unduly speculative and sufficient assets are available to offset without causing an undue hardship to the employee. Id.
at ¶17, 796 P.2d at 626. However, if either of these impediments exists, the court should distribute the assets according to the deferred distribution approach and award each spouse an appropriate percentage of the pension. Id. Here, the deferred distribution method is preferable to equitably divide this potentially valuable benefit, because the present value of Husband's military retirement is speculative. We thus reverse and remand for the trial court to determine the percentage of the military retirement that was jointly acquired during the marriage, and award Wife an equitable share of that retirement. "Read Case.