Nunc Pro Tunc QDRO

[Guest KRNA]

I have a Participant who died. At the time of his death, he was married to his second wife. After his death, first wife has presented us with a QDRO. This is a defined benefit plan. We are currently paying the second wife the QPSA. What are our options? Our QDRO procedures are silent on this issue. Thanks.

[Kirk Maldonado]

You need to hire a competent ERISA attorney to advise you on this point.

[QDROphile]

This area of the law is a mess. Some aspects of the issues are discussed in other posts, but you need a competent ERISA lawyer and might as well not even look at the discussions, except to give yourself a headache.

[mbozek]

While I concur with the above comments about seeking counsel the issue is whether the AP is entitled to any benefits after the participant has retired when the DRO was never submitted to the plan. There are cases (Hopkins v. ATT) that have held that the surviving spouse's rights to the QPSA vest when the ee commenced benefits and the AP has 0 benefit.

I dont know why the AP should be rewarded for a delay in submitting the DRO until benefits commence. (APs delay filing the DRO because they dont want to pay an additonal fee to their lawyer for a contingent benefit so they wait until they know there is a benefit available to the surviving spouse before filing the DRO.) The surviving spouse is entitled to rely on the benefit promised at the time the employee retired. I dont see any difference between this case and the case of an AP who submits the DRO after the death of a participant who elected a single life annuity.

The basic question is whether the plan should accept the DRO (I am assuming that the DRO was never approved by the Plan) or reject it as untimely. The plan could accept the DRO and approve it as a QDRO if it meets the requirements under 414p and award the AP a benefit of zero because the benefits have been vested in the surviving spouse and no further benefit can be paid. This would require that the AP commence a lawsuit in fed ct which is highly unlikely given the cost. The plan could reject the DRO on the grounds that there are no benefits payable to the participant at this time and treat the DRO as a claim for benefits which will be denied under ERISA 503 forcing the AP to sue under ERISA.