In In re Marriage of Hayes, 228 Ore. App. 555, 208 P.3d 1046 (Ore. Ct. App. 2009), at the time of the parties' divorce in 1998, the husband had served 15 years in the military. 208 P.3d at 1048.
Although the husband was not entitled to retire, the prospective military retirement pension was the most valuable asset in the marriage, making it the "centerpiece" of the parties' property division. Id.
The parties agreed to a property settlement in which the wife was to receive a percentage interest in the husband's military retirement benefit plan. Id.
The decree expressly provided, "The Court retains jurisdiction of the division of the retirement benefits described herein so it can make any modifications to this judgment which may be necessary to accomplish the goals stated herein relating to the division of said benefits." Id.
The husband was to retain an attorney to prepare a domestic relations order to divide the benefits. Id. After the attorneys for the parties prepared competing domestic relations orders, the matter was set for a hearing. Id.
At the time of the hearing, the husband had served 23 years in the military. Id. Although he was eligible to retire, he had no immediate plans to do so. Id.
The husband was not disabled at the time of the hearing; however, it was possible that he would become disabled and receive disability benefits after retirement. Id.
The trial court entered a domestic relations order awarding the wife 50% of the marital portion of the husband's "disposable military retired pay." Id. at 1049.
The order contained numerous provisions designed to prevent the husband from reducing the amount of his "disposable military retired pay" through waivers, including waivers related to his receipt of disability benefits. Id.
The husband appealed, asserting federal law limits the divisible portion of a service member's military retired pay to "disposable retired pay;" therefore, the order conflicted with federal law. Id.
The Oregon court noted that the case presented an issue of first impression in Oregon, i.e., "Do federal military retired pay statutes, including the FSPA, preclude an Oregon court from enforcing a previously adjudicated property settlement as to military retired pay?" Id. at 1052.
Holding that the trial court properly found, based on the evidence before it, that both parties intended that the property settlement would award the wife 50 percent of the husband's total military retirement benefit, the court held the husband was bound by the terms of the settlement agreement. Id. at 1052-53. The court noted that its enforcement of the terms of the property settlement agreement was consistent with the United States Supreme Court's conclusion in Mansell v. Mansell, 490 U.S. 581 (1989) that state law determines whether the doctrine of res judicata prevents a property settlement from being reopened. Id. at 1053.