Wife Gets Half of Nothing When Husband’s Pension Reduced to Zero

Tennessee case summary on retirement property division after divorce.

Kelly Colvard Parsons v. Richard Jearl Parsons

The husband and wife in this Shelby County, Tennessee, case were divorced in 2014, based upon a marital dissolution agreement by the parties.  Seven months prior to the divorce, the husband had retired from the FAA, where he had worked as an air-traffic controller.  He received two pensions, one from the Civil Service Retirement Service, for about $5,000 per month.  He received an additional pension of $1,370 per month from the Federal Employees Retirement System (FERS), which was to remain in effect until he turned 62.  To receive the FERS pension, his earnings had to be less than $15,120 per year.

Under the agreement, the wife was to receive half of the FERS pension.  However, the husband’s earned income the year of the divorce was over $52,000.  Thus, he was not eligible for the FERS pension.

The wife went back to court, asking the husband to be held in contempt for not paying half  the FERS benefits.  The husband took the position that she was entitled to half of what he actually received, and that half of zero was still zero.  There was an initial appeal to the Tennessee Court of Appeals on procedural grounds, but the case was sent back to Shelby County for a decision.

The trial court agreed with the husband that he was not in contempt.  However, it also awarded the wife an upward departure in child support, and the amount of the departure was equal to the half of the FERS pension she had been expecting.  On reconsideration, however, the court undid the change to the child support.  The wife then brought a second appeal to the Tennessee Court of Appeals.

The appeals court first noted that a marital dissolution agreement is a contract, and that general contract law principles apply.  Both the lower court and the appeals court agreed that the agreement had been executed by both husband and wife with clear and open minds.  Specifically, both spouses knew that the FERS pension would terminate if the husband had excess earnings.  In particular, the appeals court pointed out that the contract did not call for the husband to avoid having earnings in excess of the allowed amount.

The appeals court found the contract language to be clear and unambiguous, that the wife had to claim beyond half of the amount actually received.

The appeals court also agreed with the lower court’s ultimate decision to not increase child support.

The agreement called for attorney’s fees in the case of noncompliance.  The lower court had held that there was no prevailing party, since there had been no winners or losers in the case.  However, the appeals court held that the husband was clearly the prevailing party and was entitled to attorney fees.  It remanded the case for a computation of the amount of those fees.

For these reasons, the Court of Appeals affirmed and remanded the case.

No. W2018-02008-COA-R3-CV (Tenn. Ct. App. Dec. 12,  2019).

See original opinion for exact language.  Legal citations omitted.

To learn more, see Property Division in Tennessee Divorce.