Fighting Over Federal Annuity Benefits

Your federal annuity is valuable. Here is the result of a court decision in which a divorced spouse of a deceased federal employee was trying to receive an annuity.

A divorced spouse of a deceased federal employee was unsuccessful in her bid to persuade the Federal Circuit Court of Appeals to order OPM to grant her a survivor’s annuity based on a local court order issued after her former husband’s death. (List v. Office of Personnel Management, U.S.C.A.F.C., No. 05-3255, November 14, 2005)

When Mr. Comstock retired from the VA, he opted for a reduced annuity with survivor benefits for his wife. They later divorced. The divorce decree awarded Ms. List a percentage of her husband’s annuity payment; however the divorce decree made no mention of a survivor’s annuity. OPM notified Mr. Comstock that he had the right to elect a former spouse survivor annuity for Ms. List. However, he never did so and a few months following the divorce his annuity was restored to the unreduced level.

Meanwhile, his former wife remarried. When Mr. Comstock died, his former wife obtained an amended order from the local court that provided she should receive a survivor’s annuity. The amended order was issued several months after Mr. Comstock’s death.

However, OPM denied Ms. List’s application for a survivor annuity, citing 5 C.F.R. section 838.806. That regulation precludes OPM from accepting a court order issued after the annuitant’s death.

Ms. List was unsuccessful in her appeal to the MSPB, which sided with OPM. The appeals court made it 0 for 3 when it issued its decision in the case. The court quotes the following language from OPM regulations:

A court order awarding a former spouse survivor annuity is not a court order acceptable for processing if it is issued after the date of retirement or death of the employee and modifies or replaces the first order dividing the marital property of the employee or retiree and the former spouse.

The court turned aside Ms. List’s argument that it should nevertheless order OPM to make an exception in her case since “it was Mr. Comstock’s desire to have the 1995 divorce decree amended, but he died before he was able to secure such an amendment,” pointing out that “[e]ven if true, Ms. List’s assertions regarding Mr. Comstock’s wishes are unavailing.” (p. 4)

The lesson here is that an annuitant needs to act promptly to make these kinds of changes.

About the Author

Susan McGuire Smith spent most of her federal legal career with NASA, serving as Chief Counsel at Marshall Space Flight Center for 14 years. Her expertise is in government contracts, ethics, and personnel law.