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Valuation and Distribution Options For a Pension in an Arizona Divorce

Valuation and Distribution Options For a Pension in an Arizona Divorce

Valuation and Distribution of Pensions in Arizona Divorce.

A problem can occur when a divorce decree provides that a spouse shall receive a portion of his or her spouse’s pension plan after a divorce in Arizona. So, it is helpful to understand the valuation and distribution options for a pension in an Arizona divorce.

Specifically, what happens when the spouse is eligible to retire but continues working thusly delaying the other spouse his or her share of a pension?

The Arizona Court of Appeals addressed that issue in the case of Quijada v. Quijada.

In that case, the Husband and Wife settled their divorce and submitted their settlement agreement to the Court.

The court accepted the settlement and issued a divorce decree.

That decree indicated Wife would receive her share of Husband’s pension at the time he began to receive his pension payments. The husband delayed his retirement beyond the date by which he was eligible to retire.

The result of Husband’s decision to delay his actual retirement date was that Wife did not receive her share of the pension payments she would have otherwise received if he retired when he was first eligible to retire.

The wife filed a petition with the court to attempt to force the Husband to personally pay her monthly amounts representing the amount she would have received had Husband retired. The trial court denied Wife’s request and Wife appealed.

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Valuation and Distribution Options for a Pension in an Arizona Divorce When a Spouse Delays Pension Benefits After Divorce

The Arizona Court of Appeals started analyzing the prior Court of Appeals decision in the case of Koelsch v. Koelsch. It stated the Koelsch case did provide guidance on how to divide pensions in a divorce.

However, that case did not authorize a trial court to modify the orders pertaining to the division of a pension contained in a final divorce decree.

The wife argued the Husband’s decision to delay his retirement and, hence, receipt of her share of his pension effectively “blocked her from accessing her sole and separate property”; meaning her share of the Husband’s pension benefit.

However, the Court of Appeals concluded the agreement she reached with Husband specifically provided that she would begin receiving her pension benefits when the Husband actually retired, not when he was first eligible to retire.

The Court of Appeals rejected Wife’s argument on the basis that she was seeking an impermissible modification of a final property distribution contained in their divorce decree.

Different Options to Deal With Delayed Pension Benefits in Arizona

The Court of Appeals indicated Wife could have argued for a different valuation and distribution of her share of Husband’s pension benefit before the divorce decree was entered.

It opined Wife could have sought a Koelsch-type offset payment from Husband to Wife in the event the Husband delayed the receipt of his pension benefit.

Alternatively, the Arizona Court of Appeal indicated the Wife could have asked the court to reserve jurisdiction over the issue of her receiving a form of payment when the Husband became eligible to retire.

The court of appeals found the trial court must have found the parties’ agreements regarding the division of the pension to have been fair given some of the other financial terms in the parties agree upon Consent Decree.

The Court of Appeals concluded the parties’ agreements appeared to have been bargained for and fair.

If you need information about valuation and distribution options for a pension in Arizona, you should seriously consider contacting the attorneys at Hildebrand Law, PC. Our Arizona community property attorneys have decades of combined experience successfully representing clients in divorce cases in Arizona.

Our family law firm has earned numerous awards such as US News and World Reports Best Arizona Family Law Firm, US News and World Report Best Divorce Attorneys, “Best of the Valley” by Arizona Foothills readers, and “Best Arizona Divorce Law Firms” by North Scottsdale Magazine.

Call us today at (480)305-8300 or reach out to us through our appointment scheduling form to schedule your personalized consultation and turn your Arizona community property case around today.

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