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Vlach v. Vlach

Court of Appeals of Tennessee, Nashville

October 27, 2017

JOANNA MARIE VLACH
v.
GREGORY ALAN VLACH

          Session September 6, 2016

         Appeal from the Chancery Court for Montgomery County No. MCCHCVDI02435 Ross H. Hicks, Chancellor

         The primary issue in this appeal is whether the former spouse of a military retiree is entitled to a share of his military retirement. The military retiree submits that, because of his service-connected disability rating of 100%, his former spouse is not entitled to a share of his military retirement. Based on its interpretation of the parties' marital dissolution agreement, the trial court ruled in favor of the former spouse and awarded her a percentage of the retiree's "total military retired pay, " including disability benefits. Upon our de novo review, we conclude that the trial court erred in awarding the former spouse a percentage of the retiree's disability benefits. But the trial court correctly determined that the military retiree's disability rating did not deprive his former spouse of an interest in his military retirement.

         Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court Affirmed as Modified and Case Remanded

          Mark R. Olson and Taylor R. Dahl, Clarksville, Tennessee, for the appellant, Gregory Alan Vlach.

          Mark A. Rassas and Julia P. North, Clarksville, Tennessee, for the appellee, Joanna Marie Vlach (Schroer).

          W. Neal McBrayer, J., delivered the opinion of the court, in which Frank G. Clement, Jr., P.J., M.S., and Richard H. Dinkins, J., joined.

          OPINION

          W. NEAL McBRAYER, JUDGE

         I.

         Joanna Marie Vlach ("Wife") and Gregory Alan Vlach ("Husband") married on November 3, 1982, separated in April 2002, and ultimately divorced on December 9, 2002. The final decree of divorce entered by the Chancery Court for Montgomery County, Tennessee, incorporated the parties' marital dissolution agreement ("MDA"). As part of the property settlement, the MDA included a provision dividing the military retirement of Husband, who served in the United States Army.

         The provision granted Wife a percentage of Husband's "disposable retirement pension." The provision also took into consideration that retired pay might be impacted by Husband's receipt of disability benefits. Specifically, the provision provided as follows:

The Wife shall receive twenty-six percent (26%) of the Husband's disposable retirement pension from the United States Army, with no consideration for disability until the Husband is classified as seventy-four percent (74%) disabled. It is the understanding and belief of the Parties that the Husband's twenty (20) year military retirement will equal to forty percent (40%) of his base pay, meaning that the Wife's entitlement would equal twenty-six percent (26%) of the total retirement, but if the percentage of base pay is higher, the controlling figure will be twenty-six percent (26%) of disposable retirement pension. The Parties will be married in excess of ten (10) years at the time of the entry of the Final Decree, during which time the Husband served on active duty with the United States Army. For the purpose of this agreement, disposable retirement pension will include, any and all VA, any early-out or separation bonus such as VSI or SSB, or other disability pension to which the Husband is entitled. The Husband waives any right of privacy, including but not limited to any rights pursuant to the privacy act 10 U.S.C 1450(f)(3)(A) to the Wife in order to obtain information pertaining to the Husband's retirement account.
It is the Court's intention that if the Wife receives a deduction from his military retirement pension, such as for an election of VA disability, then the percentage of the military retirement pension will be adjusted to equal the same dollar sum as if no disability or similar deduction was made, up to 74% as previously stated.

         As Husband's retirement date approached, Wife contacted the Defense Finance and Accounting Services ("DFAS"). An agency of the Department of Defense, DFAS "manages the pay accounts for and provides payroll service to . . . military retirees." Kucinich v. Def. Fin. & Accounting Serv., 183 F.Supp.2d 1005, 1007 (N.D. Ohio 2002). DFAS informed Wife that it could not issue a direct payment or garnishment based on the wording of the MDA. According to the DFAS, the language concerning Husband's retirement pay included "to [sic] many contingencies." And DFAS requested that the wording be clarified.

         As requested, on January 7, 2011, Wife filed a "Motion to Clarify Final Decree of Divorce." Wife's motion also proposed an interpretation of the MDA language. Husband disputed Wife's interpretation, primarily on the ground that the MDA contemplated a retirement following twenty years of service. Because he had served longer and been promoted, Husband argued that Wife should not share in amounts earned after the divorce based on "longevity and additional promotions." Ultimately, the trial court determined that Wife's motion was premature because Husband had not yet retired from the military.

         Over three years later, Wife moved for a new hearing on her motion to clarify. Wife alleged that Husband planned to retire in September 2014. The court granted the motion, and a ...


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