Interpreting an old Marital Settlement Agreement
Posted By Posted by Kelly Tobaygo on Oct 14, 2013 8:05am PDT || Oct 14, 2013
The First District Court of Appeal, in Joanna Graham v. Nathaniel Graham, recently addressed the issue of losses and gains for retirement accounts divided as part of a divorce. As part of a Marital Settlement Agreement in this case, the Wife was awarded a percent interest in the Husband’s retirement accounts; no dollar value was placed on the Wife’s interest or on the value of the accounts at the time. The settlement agreement required that orders dividing the relevant retirement accounts be entered, but this was not done for sixteen years. One of the issues that the court discussed was whether the Wife’s interest in the accounts also included any gains to or losses from her percentage of these accounts. The Court held that because there was no dollar amount specified, the Wife was entitled to the proper percentage of the accounts per the settlement agreement as well as any gains or losses on her portion. Had a specific dollar amount been specified, then the Wife would have only been entitled to that specific amount, but since the language in the MSA was “½ interest in…” as opposed to “½ of the present value of…”, the Wife owed a property interest subject to market fluctuation. The latter language would have awarded the Husband any gains made by his Wife’s portion, but would have also required to the Husband to reimburse the Wife for any losses on the Wife’s portion.