This case (Goslee v. Goslee, Ark. App. 2012, CA-11-1139) took a dramatic turn several months after the divorce was final.

The parties entered into an agreement in their divorce.  Part of that agreement provided the following provision:  “Husband agrees to pay Wife half of his monthly pension each and every month for as long as he draws it.”

At the time of the divorce, Mr. Goslee received a monthly military-disability payment in the gross amount of $2283, which he had been receiving since he left the military due to his diabetes.  For the next nine months following the entry of the divorce decree, Mr. Goslee paid half of this disability payment to Ms. Goslee.

Then he stopped.  His reason?  His monthly disability  payment is not a “pension.”  Ms. Goslee filed a motion for contempt because he was obviously not complying with the decree nor was he complying with their property settlement agreement.  She had relied on the anticipated monthly income from Mr. Goslee’s disability payments when she entered into the agreement.

They have a hearing and the circuit court sides with the ex-husband.  Reading the provision above, nothing is mentioned about his disability payments – it only says “pension.”  The court further found that the Uniformed Services Former Spouses’ Protection Act (FSPA) does not grant states the power to treat such disability payments as divisible property.

Ouch for the wife.  Could this have been avoided?  It certainly appears that in coming up with the property settlement agreement that the parties intended for the monthly disability payments to be split in half, with half going to Ms. Goslee.  The primary reason I think this is because Mr. Goslee began paying Ms. Goslee half of his monthly disability payments and did so for 9 months.

And then there is the problem of these payments, and likely the pension, not being divisible in this situation due to certain federal law.

I think some creative drafting of the property settlement agreement could have effectuated what the wife was intending to get.  Maybe make Mr. Goslee pay alimony in a monthly amount that is half of the disability amount he receives each month.  This would of course be taxable to Ms. Goslee but then she is getting alimony pursuant to a property settlement agreement instead of having to fuss over federal laws and pensions and such.

Anyway, just another reminder of how important it is to clarify language in property settlement agreements.

 

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This is a rare case so don’t think this is the norm.

This case just decided by the Arkansas Court of Appeals leaves a lot of questions.  The case is Baldwin v. Baldwin, just decided today.

Usually one spouse provides health insurance (through his/her employer) for the other spouse.  Oftentimes I’m asked by the client that is receiving this benefit if the other spouse can be made to continue health insurance coverage AFTER the divorce is final.  My usual answer is “No.”  The reason?  I have found that the vast majority of insurance companies will cover an individual and that individual’s spouse, children, and/or other dependents.  When the divorce is final then the the spouse that was receiving the benefit no longer qualifies under those definitions.  So the coverage stops.

There are ways around this of course.  For instance, the spouse that had been providing coverage could be ordered to pay for another insurance policy for the spouse that is going to be dropped from coverage.  Many times this is looked at as a type of alimony.  Which is also the primary caveat – if you are not a good candidate for alimony then you are not going to be a good candidate to ask for this type of assistance on health care coverage.

In the Baldwin case above, it appears that the husband was ordered to keep the health insurance coverage on his ex wife for a period of three years.  At which time it was presumed she could then obtain her own insurance policy (pursuant to her own testimony at the hearing).  She was prevented from immediately getting her own insurance policy because of some preexisting conditions.

So I’m left to assume that husband’s insurance company was okay with his ex wife staying on his policy for three years after their divorce was final.  Not sure about your experiences in this area but that is an unusual occurrence from my experience.

I’m also left to assume that if the husband’s insurance company was NOT okay with this then husband would have had a representative from his insurance company come to the hearing and testify to that fact.

Note:  The Court of Appeals states that the parties undisputedly viewed the insurance coverage as a type of alimony, and that’s how the Court analyzed the case.  And I understand that.  Just not sure how they were able to keep the ex wife on husband’s insurance.

 

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