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In re Marriage of Babin

Court of Appeals of Kansas

February 1, 2019

In the Matter of the Marriage of Roslyn Marie Babin, Appellee, and Nickey Nickles Babin, Appellant.

         SYLLABUS

         1. Under the Uniformed Services Former Spouses' Protection Act, 10 U.S.C. § 1408 (2016), state courts may treat disposable military retirement pay as marital property in domestic actions. However, federal law preempts such courts from ordering the division of military disability benefits and the distribution of any portion of those benefits to a veteran's former spouse.

         2. If any portion of a veteran's military retirement pay is reclassified as disability benefits by the Veteran's Administration, under the preemption doctrine any such reclassified portion is the veteran's exclusively and is no longer subject to a state court order of distribution to such veteran's former spouse. This is true even if the parties have agreed differently and the court has adopted such agreement. The parties cannot rely on the sanctity of contract to escape federal preemption.

         3. Although the district court cannot order the division of military disability benefits, it is permissible for the court to consider the financial effect of disability pay when dividing assets and ordering spousal support.

          Appeal from Dickinson District Court; Benjamin J. Sexton, judge.

          Todd A. Luckman, of Stumbo Hanson, L.L.P., of Topeka, for appellant.

          Peter Charles Rombold, of Hoover, Schermerhorn, Edwards, Pinaire & Rombold, of Junction City, for appellee.

          Before Schroeder, P.J., Standridge, J., and Walker, S.J.

          WALKER, J.

         Nickey Nickles Babin and Roslyn Marie Babin originally reached a mediated property settlement agreement in their divorce, but issues arose between the parties after mediation was complete. The district court granted the parties' divorce, but litigation continued regarding the division of property and spousal maintenance. Even though Nickey had agreed to give 43% of his military disability benefits to Roslyn as part of the settlement agreement, he later argued that federal preemption prohibited the district court from dividing military disability benefits in a divorce. The district court ruled that the mediation agreement was plain and unambiguous and adopted the mediation agreement as its order. Nickey appeals from the district court's order approving a division of his military disability benefits. We concur with Nickey that the district court lacked jurisdiction to divide his military disability pay because of federal preemption, even though a property settlement agreement allowing for the division of disability pay had been reached through mediation. We thus reverse the district court's orders approving the settlement and remand the case for further proceedings.

         Facts

         Nickey and Roslyn were married in March 1994. During all but the last few months of the marriage, Nickey was an active duty member of the United States Army. He retired on August 1, 2016.

         Roslyn filed a petition for separate maintenance on September 1, 2016. In response, Nicky filed an answer and a counter-petition for divorce. Ultimately the parties agreed to treat the matter as a divorce action.

         The parties entered into mediation in November 2016. At the end of mediation, the parties signed a handwritten document dated November 29, 2016, memorializing the primary terms of a property settlement agreement. In pertinent part, the document provided: "4. Military retirement, disability and any back pay divided 43% to Wife and 57% to Husband. Start 12-1-16."

         The district court granted Nickey and Roslyn a decree of divorce on December 22, 2016, but the division of property was continued for a later time for two reasons: (1) Nickey was proposing an alternative to the settlement agreement's provisions for life insurance and (2) Nickey claimed that Roslyn's purchase of a new vehicle was either contrary to the agreement, or the parties did not have a "meeting of the minds" when they provided for Roslyn's postdivorce transportation in the agreement.

         Nickey filed his proposed formal findings for the district court on February 2, 2017.At a hearing on the proposed findings held on February 6, 2017, Nickey came forward with another objection to the agreement. In this new argument, Nickey claimed that he did not agree to allocate 43% of his disability pay to Roslyn. In his proposed formal settlement agreement, the language indicated Roslyn was to be awarded a 43% share of his "disposable military retired pay" without reference to disability payments. This was calculated to be $1, 237.52 based on a net disposable retirement pay of $2, 877.95. Even though it was not detailed in the mediation document, Nickey proposed that any later reduction in disposable military retired pay by ...


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