Sudden Death of Alternate Payee before Retirement Benifit Starts

I was divorced following 20 years of marriage. My ex was to receive 50% of my 2 retirement plans at time of our divorce. I have 2 pension plans as another company purchased the company is was working for. My ex has suddenly passed away and neither of us had started collecting my benefit. The first company has reverted my ex’s benefit back to me. The company I am currently working for says that my benefit is being forfeited. I do not have copies of my QDROs. Both QDROs were filled out and signed at the same time. This makes no sense to me. 

I really wish I could use my preferred, profoundly crude, language (to be passed on to the appropriate plan fiduciary) in this response. I will try to restrain myself.

The failure of the would-be alternate payee to submit a timely domestic relations order that, maybe, would meet the requirements to be a qualified domestic relations order is simply tough luck for the would-be alternate payee. If the fiduciary responsible for QDROs is taking a position about the former spouse based on submission of the divorce decree to the plan long ago (the divorce decree IS a domestic relations order), then the fiduciary has breached its fiduciary duty to process the domestic relations order and determine whether or not it is qualified.

If there has been no recent notice of intent to submit a domestic relations order that could qualify, or recent submission of a domestic relations order, the plan has no basis for any delay in beginning distributions to the participant. Any delay in beginning distributions is another breach of fiduciary duty. If it were me, my next communication to the plan would be a threat. However, the “by the book” approach would be to submit a formal claim for benefits, which will require the plan to issue a formal response concerning its position on whether or not to start benefits to the participant, and why. The plan is required to have written claims procedures. Proceed from there.

QDROphile, I appreciate your response. Thank you. 

Participant consulted lawyers but they seem to be unaware of a case where the alternate payee passes without filling a QDRO where a divorce agreement says a QDRO will be filed and never is for decade. Significantly, the Alternate Payee's failure to file may have been intentional because several creditors and another court proceeding would have possibly put a hold on any funds passed to the alternate payee and the attorney would still have had to have been paid. Given this, it is possible the alternate payee's attorney would have advised his client not to pursue a QDRO.

May I also ask, What type of attorney would handle this matter? 

Sorry - I messed these up.  I was trying to split Diane's question out from DER's OP and I clearly messed it up.  These responses are for Diane.  

Please try not to start new conversations in existing threads.  It make it difficult for people to search in the future.  That said, not as difficult as deleting them, so I apologize to DER, but I think they had their answer.  

Effen,  Sorry, i'm new on this site.  I didn't see a response from you, though.

Well, I am still fighting with my current employer benefits department. I appealed their decision and then again appealed their denial. Today I received another letter denying my appeal. I did go to the court and received both QDROs from both employers and neither of them discuss a separate interest or shared interest. One company reverted the money back to me and this company refuses. This is what the Administrative Benefits Committe (ABC) states:

The terms “separate interest” and “shared interest” are artificial and derived. They are not used in any of the relevant statutes or regulations. I believe that their use in an order (or in written QDRO procedures) can create difficulties in interpretation. For people who know what they are talking about, the terms can be nice shortcuts in informal discussion, but they are terrible for defining an interest in a defined benefit.

Nothing on the face of the decision appears to be wrong. The only way to quarrel would be to see the actual language in the QDRO that describes the alternate payee’s interest. I doubt that the ABC got it wrong.
 

Still doesn't make any sense to me since there are two pensions that are affected. One of them reverted the alternate payee's portion of my pension back to me but my current employer says that I am forfeiting the money, and they are going to keep it! This is the entire QDRO. Unfortunately, my ex passed away before I retired. Next step is to seek out a lawyer and go back to court to modify the divorce decree / QDRO. I saw that this worked in other cases but here is an example.  On Death, Divorce and Retirement

I think what you need to consider is one is wrong but it is just as likely the one that is giving you the money as it is the one that isn't.   Your questions seem to imply you think you are being shorted by the one.  It is just as likely you got a windfall from the other. 

I agree with ESOP Guy under the assumption the the terms of both plans and the terms of both QDROs were effectively the same, which you imply. If there were differences in the terms of plans or of the QDROs, different correct outcomes are possible. There is no way of evaluating what is correct or incorrect without review of the actual plan terms and, more importantly, the actual QDRO terms.

FWIW, I would interpret the sample language language that you furnished as providing a "separate interest" to the alternate payee. That means the participant effectively has no interest in the AP's benefit any more and that benefit is paid or not according to what is going on with the alternate payee, including disposition on the AP's death. For that, refer to #1 under Death Benefits. Nothing means nothing, including no reversion/restoration.

A couple of qualifiers: 1) We don't get to see plan terms, so certain plan terms are inferred from the QDRO terms, especially #1 under Death Benefits. I am fairly confident of my inferences, but would never advise on that basis. 2) There is no such thing as a true separate interest, so I used the phrase "effectively has no interest" in my interpretation.

This is not advice to you. I am dubious about any attempt to modify the order at this point, both as a matter of state domestic relations law and as a matter of QDRO law, but that is for the lawyer you hire to consider.  

I appreciate your responses to me from day 1. I'd rather she still be alive. I'd also rather my kids received the benefit as they did with the rest of the estate. Maybe one was wrong but the QDROs did not read exactly the same as the other. I just don't feel like the company should keep my pension. No wonder companies don't want you to live!!!

This isn't really about a deliberate grab by the employer. The employer did not choose this outcome. It is more of a function of what pension plans are generally supposed to accomplish (retirement income for the worker and spouse during their lifetimes -- not wealth transfer) and how plans are designed and funded to accomplish it. The employer made some design choices from a limited menu of options, but probably had no idea about how they would work out in specific, and unusual, circumstances such as yours. The employer did nothing directly in this matter. It was all about administering the plan in accordance with the plan terms and the QDRO terms, plus the untimely death. From your side, it certainly looks unfair to have benefits that you earned go poof.

It is what it is. As my Mom always said, "everything happens for a reason"! Thanks again, really appreciated.