Missing spouse of deceased Participant and no waiver on file

Spouse left for his home country more than 10 years ago.  Participant passed away last month and adult children want to make a claim for mother's 401(k) Plan assets.

Any thoughts?

Do we get a court order declaring the spouse "missing"?

Who would go to court, the employer?  the deceased Participant's children?

Um, please clarify: who is "mother"?

I take the original post as saying that the participant's adult children want to make a claim for their mother's benefits.  That is, "mother" is the deceased participant.

Would the deceased participant's spouse's whereabouts be unknown or can the spouse be contacted to enable payment to the spouse? 

My 2 cents is correct.  The mother is the deceased Participant.

We think we know what country the husband moved to many years ago. 

I think an attempt to find and contact the husband must be made and, if unable to locate, follow the plan's provisions for inability to locate participant or beneficiary when benefits are due. If still legally married on the date of death with no spousal waiver/consent, I don't see how the benefit can be paid to the children. 

On 10/27/2017 at 3:18 PM, CuseFan said:

I think an attempt to find and contact the husband must be made and, if unable to locate, follow the plan's provisions for inability to locate participant or beneficiary when benefits are due. If still legally married on the date of death with no spousal waiver/consent, I don't see how the benefit can be paid to the children. 

Even if they were no longer legally married, if the participant made an election for them to be the beneficiary, unless the participant had changed or revoked their beneficiary designation, the spouse (or former spouse) is still the beneficiary unless something in the plan states otherwise.  See Kennedy v. DuPont (pdf file - https://www.supremecourt.gov/opinions/08pdf/07-636.pdf).

agreed, although many plans now default to the beneficiary designation automatically being revoked upon divorce.

1 hour ago, CuseFan said:

agreed, although many plans now default to the beneficiary designation automatically being revoked upon divorce.

Fine if it is a plan provision (in which case follow the plan), apparently irrelevant if state law calls for revocation (per recent court ruling)

What about the plan sponsor filing an "interpleader" action with the federal court, which would have jurisdiction over ERISA matters.  I don't know that you'd get the desired result, but that would get the sponsor/plan administrator out of the middle of any disputes.

Otherwise, I'd agree that you have to follow the terms of the plan document.

An interpleader, even if otherwise fitting, might not end the surviving spouse's claim unless the court has jurisdiction over the surviving spouse.

If any plan administration now is needed to decide a claim or for some other reasons, sufficiently locating the spouse to make it feasible to serve process or notice and meet other requirements to support jurisdiction might also mean it's feasible to communicate with the spouse to invite him to disclaim the benefit (if the plan allows a disclaimer) or to get his distribution instructions.  Those means might be less expensive than the courts' proceedings.

Why the angst here?  Ask the children to provide proof of either a divorce prior to the participant's death, or that spouse predeceased the participant.  If they can't provide either, and you can't find the spouse, so what?  What would be your basis for asking a court to entertain an interpleader action?  And, what's the rush?  Is the plan terminating?  If RMDs are a concern the IRS released guidance a few days ago indicating that the plan is safe if the beneficiary can't be located. 

jpod's observation that even locating the beneficiary might be unnecessary until the required beginning date approaches is why my note mentioned "IF any plan administration now is needed".

Also, Jim Chad's originating post mentioned that the participant's children "want" to make a claim.  A plan's administrator need not respond to a claim that hasn't yet been submitted.

If a child submits a claim, the plan's administrator would follow ERISA section 503 and the administrator's claims procedure.  This should include explaining each reason for a denial of the claim.

Many difficult death-benefit situations become resolved through careful attention to the plan administrator's claims procedure.

Speaking as one familiar with defined benefit rules but not really defined contribution rules -

The plan administrator has a fiduciary duty to diligently try to get the benefit payments made as called for under the plan provisions.  To delay distributions to the beneficiary beyond the earliest date called for by the plan would, presumably, require affirmative consent from the spouse.

If the children file a claim for the benefits, deny it in writing on the basis that the spouse of the deceased participant is entitled to them, pointing to the relevant plan provision.  If the plan administrator cannot locate the spouse or find evidence of the spouse's death despite making diligent efforts, perhaps the children will be able to do the heavy lifting (including obtaining court orders declaring the spouse deceased or, if the plan lists it as a basis for paying others, missing).

Please tell me how a qualified plan could possibly have a (valid) rule that allows payment to someone else if a surviving spouse beneficiary is missing.

I have seen defined benefit plan documents containing language such as this:  "If it is established to the satisfaction of a Plan representative that there is no Spouse or that the Spouse cannot be located, a Participant's waiver will be deemed a Qualified Election even though no Spousal consent is obtained with respect to such waiver."  True, that is with respect to a QJSA waiver, not necessarily applicable to a QPSA waiver, but if, in this instance, all attempts to locate the deceased participant's spouse are in vain, the balance will certainly have to be paid to someone eventually.  It is just that there are hoops to be jumped through before a Plan representative can establish to his or her "satisfaction" that the Spouse cannot be located, primarily one has to give it a good try first.

Wrong.  That reflects a rule in the regs that eliminates the spousal consent requirement if the spouse can't be located.  It has nothing to do with a situation where a spouse beneficiary can't be located after the participant's death.  

IRS Reg. 1.401(a)-20, Q&A27.

47 minutes ago, david rigby said:

IRS Reg. 1.401(a)-20, Q&A27.

That cite could be very useful in this instance - it allows for the waiver of the spouse's rights for both QJSA and QPSA if the spouse's whereabouts cannot be located AND also, when backed by a court order to that effect, when the spouse has abandoned the participant.  The facts, as presented in the original post, would certainly seem to support an assertion that the spouse had abandoned the participant.

Quote

 

Again, if the participant had the presence of mind to change her beneficiary designation before she died that provision in the regs may have enabled her to designate someone besides her spouse without the spouse's consent, but in the current scenario that provision is completely irrelevant.