Need some help and advice

[vs1964]

I have a Client who was divorced by Judgement of Absolute Divorce. In the JAD the wife (Plaintiff) was to receive Rehabilitative Alimony for 30 months. The Defendant never provided those payments to the Plaintiff. Now we are 20 years later and the Plaintiff is working on a Qualified Domestic Relations Order to receive the Pension benefits awarded to her in the JAD. Now she is also trying to file a petition to receive the Alimony payments never received, but I notified her that the statue of limitation has passed. However, she can use a QDRO to receive the Alimony payments that she is entilited to receive, as the state that she resides has no statue of limitation on QDROs.

 

Now to get to my question: I am drafting a QDRO for Alimony in a 401k Account, should I include only the exact dollar amounts awarded to her or should the QDRO apply the interest of the investment accounts on the wife's Alimony share, as any account would?

[QDROphile]

You can ask in the state court for whatever state law allows. I would start from the idea that the spouse is collecting an alimony debt, and that interest, perhaps at some statutory rate, is an appropriate addition to come up with the fixed number that will be submitted to the plan to cover the award. The plan does not care. The plan will pay whatever the domestic relations order specifies is awarded. Interesting question about which state law will apply with respect to recovering the unpaid alimony (if there are substantial differences) and whether equitable concerns, such as latches, will be at play.

[vs1964]

3 minutes ago, QDROphile said:

You can ask in the state court for whatever state law allows. I would start from the idea that the spouse is collecting an alimony debt, and that interest, perhaps at some statutory rate, is an appropriate addition to come up with the fixed number that will be submitted to the plan to cover the award. The plan does not care. The plan will pay whatever the domestic relations order specifies is awarded. Interesting question about which state law will apply with respect to recovering the unpaid alimony (if there are substantial differences) and whether equitable concerns, such as latches, will be at play.

Do you know anything about the laws in Maryland. I know QDROs have no statue of limitations in MD, as held in Potts v. Potts. My main question is how how should the interest be applied if the Alimony will be garnished under a QDRO for a Deferred Compensation Plan. Should the Wife share of Alimony be credit with the investment experiences under the plan pursuant to the rules of the Plan because the Alternate Payee will be treated as a Participant with her out retirement account created?

[QDROphile]

Sorry, I am ignorant about Maryland domestic relations law. QDRO terminology does not apply to non-ERISA deferred compensation, though some of the concepts are similar. The relevant tax code provisions are also different, and therefore so are the tax consequences, despite some similarities. If you are dealing with non-ERISA deferred compensation, you have no ERISA pre-emption. I have never worked the garnishment route.

[fmsinc]

See my comments in all bold type. 

I have a Client who was divorced by Judgement of Absolute Divorce. In the JAD the wife (Plaintiff) was to receive Rehabilitative Alimony for 30 months. The Defendant never provided those payments to the Plaintiff. Did she remarry within that 30 months - an event that would have terminated alimony under Maryland law?  Do you have a judgment for the 30 alimony payments - a prerequisite to any collection efforts?  In seeking a judgment, did you ask for pre- and post-judgment interest at the 10% judgment rate in Maryland?  The amount due for alimony would have like tripled in 20 years.  See the "Rule of 72s".  What sort of Plan are you trying to serve with a QDRO for alimony arrears? A defined benefit plan or a defined contribution plan.   Does the statute of limitation apply to alimony, normally viewed as a "duty" and not a "debt" in Maryland?  Does the doctrine of laches apply to preclude your client from collecting alimony arrears?  Now we are 20 years later and the Plaintiff is working on a Qualified Domestic Relations Order to receive the Pension benefits awarded to her in the JAD. Why wasn't the QDRO submitted to the trial court 20 years ago at the time of the divorce hearing?  Tell your client to immediately file suit against the attorney who represented her at the time of divorce for malpractice; and report the attorney to the Grievance Commission for violation of the Rules of Professional  Responsibility - Competence.    Now she is also trying to file a petition to receive the Alimony payments never received, but I notified her that the statue of limitation has passed.   However, she can use a QDRO to receive the Alimony payments that she is entitled to receive, as the state that she resides has no statute of limitation on QDROs. In Maryland the statute of limitation on the collection of alimony is 12 years from the date each payments becomes due.  So at 14-/2 years (12 years plus 30 months) after the Order to pay alimony the right to collect it ended.  The fact that you are trying to collect it via a QDRO rather that a wage garnishment or an attachment of his bank account is not likely to make a difference. Nice try though.     

Now to get to my question: I am drafting a QDRO for Alimony in a 401k Account, should I include only the exact dollar amounts awarded to her or should the QDRO apply the interest of the investment accounts on the wife's Alimony share, as any account would?  

Do you know anything about the laws in Maryland. I know QDROs have no statue of limitations in MD, as held in Potts v. Potts. You are misreading the intent of Potts and ignoring Rohrbeck where it is made clear that a QDRO is simply a method of enforcing another court order.  The QDRO does not create the underlying obligation or define how the S/L will apply to the collection of that underlying obligation.  My main question is how how should the interest be applied if the Alimony will be garnished under a QDRO for a Deferred Compensation Plan. You are full of surprises.  Most deferred compensation plans (other than those that are under IRC 457) are not "qualified" under ERISA and cannot enforced by a QDRO.  Another issue is that most are non-funded.   Should the Wife share of Alimony be credit with the investment experiences under the plan pursuant to the rules of the Plan because the Alternate Payee will be treated as a Participant with her out retirement account created?  No.  The Alternate Payee will not be treated as a Participant. She will be treated as an Alternate Payee.  And if you don't have a court order awarding gains, losses and investment experience, or you don't have a court order incorporating an Agreement awarding gains, losses and investment experience, you are got going to get such an adjustment assuming that the Plan can go back 20 years and make such a computation.  If the Plan uses a TPA, the date that the most recent TPA took over is as far back at computations of gains, losses and investment experience can go.   But see my comments above. about about prejudgment interest .    

[Peter Gulia]

If you’re a law student (as your May 25 post mentions) and not an admitted attorney-at-law, you should seek the guidance and supervision of the faculty person responsible for your law school’s clinic or other program.

[vs1964]

23 hours ago, fmsinc said:

See my comments in all bold type. 

I have a Client who was divorced by Judgement of Absolute Divorce. In the JAD the wife (Plaintiff) was to receive Rehabilitative Alimony for 30 months. The Defendant never provided those payments to the Plaintiff. Did she remarry within that 30 months - an event that would have terminated alimony under Maryland law?  Do you have a judgment for the 30 alimony payments - a prerequisite to any collection efforts?  In seeking a judgment, did you ask for pre- and post-judgment interest at the 10% judgment rate in Maryland?  The amount due for alimony would have like tripled in 20 years.  See the "Rule of 72s".  What sort of Plan are you trying to serve with a QDRO for alimony arrears? A defined benefit plan or a defined contribution plan.   Does the statute of limitation apply to alimony, normally viewed as a "duty" and not a "debt" in Maryland?  Does the doctrine of laches apply to preclude your client from collecting alimony arrears?  Now we are 20 years later and the Plaintiff is working on a Qualified Domestic Relations Order to receive the Pension benefits awarded to her in the JAD. Why wasn't the QDRO submitted to the trial court 20 years ago at the time of the divorce hearing?  Tell your client to immediately file suit against the attorney who represented her at the time of divorce for malpractice; and report the attorney to the Grievance Commission for violation of the Rules of Professional  Responsibility - Competence.    Now she is also trying to file a petition to receive the Alimony payments never received, but I notified her that the statue of limitation has passed.   However, she can use a QDRO to receive the Alimony payments that she is entitled to receive, as the state that she resides has no statute of limitation on QDROs. In Maryland the statute of limitation on the collection of alimony is 12 years from the date each payments becomes due.  So at 14-/2 years (12 years plus 30 months) after the Order to pay alimony the right to collect it ended.  The fact that you are trying to collect it via a QDRO rather that a wage garnishment or an attachment of his bank account is not likely to make a difference. Nice try though.     

Now to get to my question: I am drafting a QDRO for Alimony in a 401k Account, should I include only the exact dollar amounts awarded to her or should the QDRO apply the interest of the investment accounts on the wife's Alimony share, as any account would?  

Do you know anything about the laws in Maryland. I know QDROs have no statue of limitations in MD, as held in Potts v. Potts. You are misreading the intent of Potts and ignoring Rohrbeck where it is made clear that a QDRO is simply a method of enforcing another court order.  The QDRO does not create the underlying obligation or define how the S/L will apply to the collection of that underlying obligation.  My main question is how how should the interest be applied if the Alimony will be garnished under a QDRO for a Deferred Compensation Plan. You are full of surprises.  Most deferred compensation plans (other than those that are under IRC 457) are not "qualified" under ERISA and cannot enforced by a QDRO.  Another issue is that most are non-funded.   Should the Wife share of Alimony be credit with the investment experiences under the plan pursuant to the rules of the Plan because the Alternate Payee will be treated as a Participant with her out retirement account created?  No.  The Alternate Payee will not be treated as a Participant. She will be treated as an Alternate Payee.  And if you don't have a court order awarding gains, losses and investment experience, or you don't have a court order incorporating an Agreement awarding gains, losses and investment experience, you are got going to get such an adjustment assuming that the Plan can go back 20 years and make such a computation.  If the Plan uses a TPA, the date that the most recent TPA took over is as far back at computations of gains, losses and investment experience can go.   But see my comments above. about about prejudgment interest .    

Thank you Mr. Goldberg for this!

Just to confirm is Alimony awarded in JAD viewed as a "Debt" or a "Duty"

Would the Statue of Limitations apply in an Alimony case?