Can I Still Receive My Portion of My Ex’s Pension Benefits if They Die Before Retirement?

When spouses in North Carolina divorce, retirement funds and pension benefits are among the many assets that may be divided between the parties. If you were awarded a portion of your ex-spouse’s pension benefits, the question of when you can receive your payments often has a complicated answer. Often a Qualified Domestic Relations Order (QDRO) will be required to divide retirement benefits, and the standards for QDROs are set by a federal law known as ERISA, or the Employee Retirement Income Security Act.

Even if your ex-spouse passes away before they begin receiving their retirement benefits, you may still be entitled to receive the amount you were awarded if the QDRO allows it.

Bernal-Brown v. California Ironworkers Field Pension Trust

The plaintiff, Shala Bernal-Brown, was married to a participant of the California Ironworkers Field Pension Trust. When Bernal-Brown and her husband divorced, a QDRO was entered, giving her one-half of the pension credits earned by her former husband during their marriage. She was also awarded half of her ex-husband’s funds in the California & Vicinity Field Ironworkers Annuity Trust Fund that were acquired during the marriage.

When Bernal-Brown’s ex-husband died at the age of 50, she notified the Pension Trust of the death and requested that the benefits be paid to her and her children. The Pension Trust responded that the QDRO did not protect her right to receive pre-retirement death benefits and that she would not be treated as the participant’s spouse, meaning the QDRO did not award her benefits since the participant passed away. Bernal-Brown appealed, but her appeal was denied because the QDRO did not award her any right to pre-retirement death benefits.

The U.S. District Court’s Analysis of Bernal-Brown

The District Court chose to use abuse of discretion as the standard of review in this case because the pension plan unambiguously gives the administrator discretion to determine benefits eligibility. The Court found that there was an abuse of discretion because the plan benefits and the language of the QDRO were misapplied. The QDRO plainly vested Bernal-Brown with a separate interest in the pension benefits.

Further, the Pension Trust’s determination that the QDRO did not protect Bernal-Brown’s right to receive pre-retirement death benefits was irrelevant. The QDRO in this case was a separate interest QDRO, which divides the benefit into two pensions: one for the participant and one for the alternate payee. Bernal-Brown’s interest as an alternate payee was not connected to her ex-husband’s benefits as the participant.

The United States District Court heard the issue and ruled in favor of Bernal-Brown. The Pension Trust was found to have abused its discretion, and it was ordered to pay Bernal-Brown’s pension benefits retroactively and prospectively, as follows:

• Monthly pension payments in the amount of $230.94, plus an additional payment in December of each year
• A one-time lump sum of $6,252.32 for missed payments and interest

The Pension Trust was also ordered to pay Bernal-Brown’s attorney fees in the amount of $83,000.

The attorneys at Woodruff Family Law Group know the ins and outs of QDROs and other money matters of family law. They can provide the advice gained from years of experience to help you get what you deserve.