IN THE COURT OF APPEALS OF IOWA
No. 14-1153
Filed August 19, 2015
IN RE THE MARRIAGE OF DONNA L. SULLINS
AND RAYMOND W. SULLINS
Upon the Petition of
DONNA L. SULLINS,
Petitioner-Appellee,
And Concerning
RAYMOND W. SULLINS,
Respondent-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Polk County, Robert B. Hanson,
Judge.
A former husband appeals the district court’s remand decision concerning
the entry of a Qualified Domestic Relations Order. AFFIRMED AND
REMANDED.
Ray Sullins, West Des Moines, appellant pro se.
David J. Hellstern of Sullivan & Ward, P.C., West Des Moines, for
appellee.
Considered by Tabor, P.J., and Bower and McDonald, JJ.
2
TABOR, P.J.
Nine years ago, our supreme court remanded this case to the district court
for entry of a Qualified Domestic Relations Order (QDRO) to provide Ray Sullins
with a share of the pension assets in Donna Sullins’s account with the Iowa
Public Employees Retirement System (IPERS). In re Marriage of Sullins, 715
N.W.2d 242, 255–56 (Iowa 2006). The QDRO was to direct IPERS to pay
benefits to Ray under the Benson1 formula, specifically
50% of the gross monthly or lump-sum benefit payable at the date of
distribution to Donna, multiplied by the ‘service factor.’ The numerator of
the service factor is the number of quarters covered during the marriage
period of November 25, 1978 through April 30, 2004, and the denominator
is Donna’s total quarters of service covered by IPERS and used in
calculating Donna’s benefit.
Id.
On remand, Ray and Donna disagreed as to which IPERS benefit option
should be used in the formula. Ray sought an option that would name him as a
contingent annuitant so that he would continue to receive monthly benefits if
Donna died before he did. Donna preferred an option that would provide a
higher monthly benefit for both her as the member and Ray as the alternate
payee during her lifetime. The district court directed the QDRO to incorporate
Donna’s preferred option, and Ray appealed. Because we conclude the district
court reached an equitable resolution for both parties, we affirm. We also find
Donna is entitled to appellate attorney fees.
1
In re Marriage of Benson, 545 N.W.2d 252, 255 (Iowa 1996).
3
I. Background Facts and Proceedings
The supreme court provided a full history of the parties’ marriage in the
original appeal. Sullins, 715 N.W.2d at 246-47. We will not repeat it here. The
following abbreviated facts will suffice for purposes of the QDRO dispute. Donna
and Ray married in 1978 and divorced in 2004. Donna is now sixty-eight years
old and Ray is now seventy. Ray was an attorney, but lost his law license before
the divorce, and now earns his living as a pallet broker. Donna worked as a
public school teacher for forty-five years, and as such, was an IPERS member.
As part of the overall property settlement, the district court divided Donna’s
IPERS pension based on the current value of Donna’s personal contributions to
the plan over the years of the marriage at the time of the divorce. Ray argued
the percentage should have been applied to the benefits payable at maturity
using the Benson formula, rather than to Donna’s contributions to the fund. On
appeal, the supreme court modified the decree to provide for a QDRO to divide
Donna’s future monthly IPERS benefits when received. Ray’s share is based on
the following formula:
50% X # of quarters Donna contributed to IPERS while married X Monthly Benefit
# of quarters Donna contributed before retirement
covered by IPERS
No action was taken on the remand until August 2013 when Donna hired
an attorney to draft a proposed QDRO. Donna’s attorney forwarded a proposal
to Ray, who continued to request additional time to review and respond to the
document. In November 2013, Donna’s attorney asked the district court to set
the remand matter for hearing.
4
The district court held a hearing on February 11 and March 9, 2014. At
the hearing, Donna offered an exhibit showing the IPERS estimate of her
retirement benefits using six different options. Options four and six required
designation of a contingent annuitant. Donna lobbied for option three which,
according to the IPERS estimate, provided a lifetime monthly benefit of
approximately $4193.05. That option did not provide a payment after Donna’s
death. Ray asked the court to specify in the QDRO that Donna choose option six
and designate him as a contingent annuitant in the event she died before he did.
He argued: “I don’t like looking ahead and having absolutely nothing if she dies
first under the Benson formula because IPERS says you are cut off.” IPERS
option six included four different choices as to the percentage of the monthly
benefit amount the contingent annuitant would receive after the member’s death:
100 percent, seventy-five percent, fifty percent, or twenty-five percent. Per Ray’s
suggestion of the twenty-five percent choice under option six, IPERS estimated a
monthly benefit amount of approximately $4024.30.
The district court concluded the QDRO should be entered that was
“consistent with both the Benson formula and Donna’s election of IPERS Option
3.” Ray challenges that conclusion on appeal.
II. Standard of Review
We review the entry of a QDRO de novo, as the proceedings are tried in
equity. In re Marriage of Veit, 797 N.W.2d 562, 564 (Iowa 2011).
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III. Analysis
Ray contends the district court erred in not requiring the QDRO to
mandate an IPERS option that would designate him as a contingent annuitant.
He cites In re Marriage of Duggan, 659 N.W.2d 556, 560 (Iowa 2003) for his
position that “only by giving him survivorship rights can it be ensured that he will
receive what has been awarded to him.”2
Donna argues the district court was without authority under the supreme
court’s remand to consider Ray’s request for a “death benefit.”3 For her position
concerning the remand limitations, Donna relies on In re Marriage of Davis, 608
N.W.2d 766, 769 (Iowa 2000).4 She also claims Ray did not preserve his request
2
We do not believe Duggan mandates the result sought by Ray. In Duggan, the
supreme court found a nonpensioner spouse was entitled to survivorship rights for the
first ten years of the pensioner spouse’s retirement, but explained: “the circumstances
under which that designation should occur depend on the facts of each case and
whether the allowance of survivorship rights effectuates an equitable distribution of the
parties’ assets.” Duggan, 659 N.W.2d at 560. Moreover, Duggan did not discuss
whether the survivorship designation came at a cost to the pensioner spouse.
3
Donna sometimes refers to Ray’s request to be named as a contingent annuitant as
seeking a “death benefit.” But these terms are not interchangeable for IPERS purposes.
A beneficiary may receive a death benefit when a Member dies, but the
monthly pension payment amount a Member receives is based only on
their single life expectancy and any lump-sum death benefit payable. A
monthly pension payment with a contingent annuitant option is based on
the life expectancy of two people. If a Member predeceases their
contingent annuitant, the contingent annuitant will continue to receive
monthly payments at 25, 50, 75 or 100% of what the Member received
monthly, for their lifetime. Once the contingent annuitant passes away, all
payments stop.
See IPERS QDRO Instruction Packet p. 25 available at
https://www.ipers.org/members/divorce (last visited July 30, 2015).
4
We do not find Davis controlling. Davis focuses on Iowa Code section 411.1(19)
(2013), which provides that a former spouse of a retired police officer or firefighter is
entitled to surviving spouse benefits only if the dissolution decree grants the former
spouse such benefits. See 608 N.W.2d at 769. Donna does not argue that Iowa Code
chapter 97B governing IPERS contains a comparable provision.
6
to be a contingent annuitant because he did not make it during the earlier
proceedings, only following the remand.
Ray responds that Donna did not object to the district court’s consideration
of the various IPERS options during the remand proceedings and did not argue
that his request to be a contingent annuitant was either waived or outside the
scope of the supreme court’s remand order.
Assuming without deciding that Ray’s request to be a contingent annuitant
was within the scope of the remand order and preserved, we conclude the district
court’s decision achieved equity.
The district court gravitated to the IPERS option which maximized the
monthly payout to both parties from the date of Donna’s retirement. The monthly
benefit to be divided under the Benson formula was $4193.05 under Donna’s
proposal without any contingent annuity and $4024.30 under Ray’s proposal
naming him as a contingent annuitant. The district picked the first amount for two
reasons: (1) that option best reflected the intent of the original decree, and (2)
that option was consistent with the evidence offered at the remand hearing
concerning the parties’ respective life expectancies. The court was not
persuaded that Ray should be named as a contingent annuitant at the expense
of the higher monthly benefit under Donna’s option:
The court is unconvinced that reducing the parties’
respective monthly payouts now, in order to guarantee Ray a
lifetime monthly benefit in the unlikely event that he outlives Donna,
accomplishes equity between the parties and/or preserves the
intent of the original trial court decree any more than simply
maximizing the monthly payouts to the parties.
The court believes it is preferable to base its decision on
probable rather than possible outcomes. In this instance, Donna
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will probably outlive Ray so the court concludes maximizing their
respective monthly benefits now is the best way to ensure that each
party actually receives his/her fair share of Donna's IPERS account,
as computed by the Benson formula.
Ray criticizes both rationales advanced in the district court’s remand
order. He contends no guidance can be taken from the intent of the original
decree because the district court’s division of the IPERS account was modified
by the supreme court in the first appeal. He also attacks the weak factual
underpinnings for the court’s conclusion that Donna would “probably” outlive him.
Ray testified Donna “has got great genes” and has family members who lived
into their eighties. He added: “even without the genetic observations, actuarially,
pure numbers, she outlives me.” But he also testified he knew “nothing of
Donna’s health.”
On the first point, we believe the district court was spot-on in striving to
effectuate the intent of the original decree on the question of awarding
survivorship benefits. See In re Marriage of Morris, 810 N.W.2d 880, 886–87
(Iowa 2012). In Morris, our supreme court did not adopt “a default rule by holding
that a decree dividing retirement benefits includes survivorship benefits” nor did it
refuse “to allow postdissolution orders awarding a former spouse survivorship
rights when the decree [did] not expressly contemplate the survivorship benefit.”
Id. at 886 (collecting cases from other jurisdictions taking varied approaches).
Instead it remanded for the district court to interpret the intent of the original
decree—the same process applied here. See id.
In this case, although the supreme court chose a different method for
dividing Donna’s IPERS pension than the district court issuing the original
8
decree, the overall intent of the original decree sheds light on the ambiguity of
the survivorship benefit question. See id. (noting that “provisions of the decree
are presumably interrelated”). Neither the original nor the modified decree
addresses survivorship benefits. The original decree crafted an equitable
division of the IPERS account according to the length of the marriage. The
decree made observations about the relative incomes of Donna and Ray, finding
Donna’s earnings as a school teacher were “limited” and would “not vary
dramatically in the foreseeable future”—while “it was obvious Ray has substantial
income” from his pallet business. To the extent any intent can be inferred from
the decree, it would be that the decretal court did not desire to perpetuate an
ongoing financial entanglement between the parties, by stating: “Ray shall not
receive any additional funds from Donna’s IPERS account from this day forward.”
Requiring Donna to name Ray as a contingent annuitant would be inconsistent
with the finality desired by the decree.
The supreme court’s modification of the IPERS distribution recognized the
present value of Donna’s plan was more than the present value of her
contributions and dividing the present value without actuarial evidence was
inequitable. Sullins, 715 N.W.2d at 249. But the supreme court did not suggest
that dividing the pension benefits when they matured entitled Ray to have Donna
accept a reduced monthly payment to insure that he would continue to receive
benefits after her death. We find the district court’s rejection of the survivorship
annuity did not clash with the intent of the original decree or the remand order
from the supreme court.
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On the second point, we recognize no true actuarial evidence was
presented at the remand hearing concerning the life expectancies of Donna and
Ray. Ray’s anecdotal reference to Donna’s favorable genetics is not a strong
basis for concluding that Donna will “probably outlive” Ray. But on the flipside,
Ray did not present any compelling evidence that he is in danger of forfeiting his
marital share of Donna’s pension benefits because of a high risk of her untimely
death.
Donna argues that because she and Ray are on equal footing regarding
their financial condition in retirement, Ray cannot show he is entitled to
survivorship benefits when the act of designating him as a contingent annuitant
would lower both parties’ monthly IPERS benefit. We agree with Donna’s
argument. We conclude the district court reached an equitable resolution by
directing that the QDRO be consistent with the Benson formula and Donna’s
election of IPERS option three.
Lastly, Donna requests appellate attorney fees. An award of appellate
attorney fees is discretionary. Davis, 608 N.W.2d at 773. We consider the
needs of the party making the request, the ability of the other party to pay, and
whether the party making the request was obligated to defend the district court’s
decision on appeal. Id. In this case, Donna asserts she was planning to retire
from teaching soon, has a limited budget, and postponed her retirement to
answer Ray’s appeal. Moreover, Ray represented himself and did not have
attorney fees. See Sullins, 715 N.W.2d at 255 (noting self-representation as
permissible factor in considering award of attorney fees). In light of these
10
circumstances, we exercise our discretion to award Donna appellate attorney
fees. But because Donna has not provided an affidavit of attorney fees with
documentation to support her request, we remand to the district court to enter
judgment against Ray in a reasonable amount. See, e.g., Markey v. Carney, 705
N.W.2d 13, 26 (Iowa 2005) (“[U]nder our current practice, the issue of appellate
attorney fees is frequently determined in the first instance in the district court
because of the necessity for making a record.” (quoting Lehigh Clay Prods., Ltd.
v. Iowa Dep’t of Transp., 545 N.W.2d 526, 528 (Iowa 1996))).
We order Ray to pay the costs of the appeal.
AFFIRMED AND REMANDED.