Hurt v. Jones-Hurt (2017) & Recoverability of Disability Benefits

Ordinarily, retirement benefits – retirement accounts, pensions, etc. -- are included in marital estates in the State of Maryland, to the extent that those benefits accrued during marriage. Military retirement benefits, however, are a tricky creature, and add complexity to the already complicated nature of property division in Maryland. A new U.S. Supreme Court case, Howell v. Howell, settled certain questions relating to the divisibility of military retirement accounts in divorce cases. The ramifications of this important case were relevant in the relatively recent decision of Hurt v. Jones-Hurt (2017), in which a retired Army National Guard veteran voluntarily elected to receive a larger proportion of his retirement pay via disability benefits.

Whenever one spouse (or both spouses) has military retirement benefits, the assistance of a qualified family law attorney in Maryland is always necessary. In any event, regardless of the particular facts, the inclusion of military retirement benefits greatly complicates a Maryland divorce, and specialized expertise is required to navigate this situation. Ultimately, the complexity of this type of situation involves the complexities associated with the interplay between federal law and state law.

Let’s review this case of Hurt v. Jones-Hurt (2017) so we can better understand the implications of the Howell case.

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Factual Background of the Case

The husband in this case served in the Army National Guard for over a decade. During his time in the service, he suffered injuries, and consequently was declared eligible to receive disability pay. However, at first, the husband initially received a relatively low disability rating, and so he did not petition to receive any portion of his retirement benefits in the form of disability pay.  

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When the husband and wife divorced, the court arrived at a property division award which involved both alimony and also the distribution of a certain amount of the husband’s military retirement benefits. The reason for the division of the military retirement benefits is because the husband’s time in the service was concurrent with the marriage. The wife ended up receiving one third of the husband’s retirement benefits.

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Later, the husband elected to receive a portion of his military retirement benefits in disability pay; this election was made after the husband received a higher disability rating. This higher disability rating qualified the husband for a higher disability benefit. Disability benefits are generally superior to other retirement benefits, because disability benefits are tax exempt. But, even after making the election, the husband still received the same nominal amount of benefits, he simply retained a larger share because of the tax status. Because of the husband’s interpretation of federal law, he didn’t give his wife any benefits from the disability pay, and so his wife began receiving a lower amount than what was originally awarded in the divorce judgment; she received one third of a smaller pie, as she received only one third of the non-disability retirement benefits. The wife went back to court in order to compel the husband to continue paying her the same nominal amount awarded in the original decree.

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Ruling & Post-Ruling Discussion

The wife was initially successful at the trial court level, as the court relied on several key precedents which led it to determine that the wife should continue to receive the same nominal amount despite the election made by the husband. However, during the litigation, a new U.S. Supreme Court case was determined, Howell v. Howell, and that case effectively nullified the precedents which had been relied upon by the trial court. Hence, when the appellate division review the case, that court was compelled to revise the opinion of the trial court in a manner consistent with Howell. Basically, the Howell case stated that federal military disability benefits (and other federal military benefits as well) were outside the scope of state level marital property division, and so those benefits could not be attached or taken into account to make up for the deficit realized by the wife. However, those federal benefits could be taken into consideration when initially developing property division awards. But, because the original decree was already decided, the court couldn’t attach the disability benefits in the manner desired by the wife.  

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Contact the Murphy Law Firm for More Information

To learn more about the important Howell case, the valuation of marital estates involving federal military benefits, the division of marital property in Maryland in general, or any other related family law topic, contact one of the family law attorneys at the Murphy Law Firm today by calling 240-219-1187.

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