In RE MARRIAGE OF WEBERG v. Weberg

SUNDBY, J.

(concurring). This appeal presents an important family law question which is not answered by any Wisconsin decision: Does a Wisconsin court have jurisdiction under sec. 767.26, Stats., to include Veter*553ans' Administration benefits, received as compensation for a service-connected disability, as income in determining maintenance? I write separately on this question because I do not believe that the Wisconsin decisions, including Leighton v. Leighton, 81 Wis. 2d 620, 261 N.W.2d 457 (1978), on which the majority relies, answers this question.

In Leighton, the wife contended that in dividing the parties' property, the trial court should have considered the present value of the monthly veterans' disability benefits that the husband was receiving. The court rejected her contention explaining, "We . . . view the disability benefits in the case before us as income to the [husband], material only to his ability to pay alimony, if alimony were awarded." Id. at 637, 261 N.W.2d at 465. The court relied on Kronforst v. Kronforst, 21 Wis. 2d 54, 123 N.W.2d 528 (1963) where the court treated the husband's social security disability benefit as income in determining an appropriate alimony award and not as an asset in the division of the marital estate.

Neither Kronforst nor Leighton considered 38 U.S.C. sec. 3101(a) or any of its predecessors. However, this statute was considered in Pfeil v. Pfeil, 115 Wis. 2d 502, 341 N.W.2d 699 (Ct. App. 1983). Section 3101(a) provides in part:

Payments of benefits due or to become due under any law administered by the Veterans' Administration shall not be assignable except to the extent specifically authorized by law, and such payments made to, or on account of, a beneficiary shall be exempt from taxation, shall be exempt from the claim of creditors, and shall not be liable to attachment, levy, or seizure by or under any legal or equitable process whatever, either before or after receipt by the beneficiary . . ..

*554In Pfeil, the court held that military service disability benefits, which had not lost their exempt status, were not assets subject to division as part of the marital assets of the parties. Further, the court said that such benefits could not be considered by the trial court to justify an offsetting award to the wife. The court relied on 38 U.S.C. sec. 3101(a) (1979), Hisquierdo v. Hisquierdo, 439 U.S. 572 (1979) and McCarty v. McCarty, 453 U.S. 210 (1981).

However, the Pfeil court was not faced with the question of whether U.S.C. sec. 3101(a) precluded consideration of military service disability benefits in determining child support or alimony (maintenance). In His-quierdo, the Court held that a statute similar to sec. 3101(a) but applicable to Railroad Retirement Act disability and retirement benefits, precluded a California community property award to the wife in a suit for dissolution of a marriage. In McCarty, the Court held that federal law precluded a state court from dividing military nondisability retired pay pursuant to state community property laws, upon dissolution of a marriage. Thus, none of these cases considered whether military service disability benefits could be used in determining maintenance or child support in a divorce action.

In In re Gardner, 220 Wis. 493, 264 N.W. 643 (1936), the court held that a divorced wife awarded child support was not a "creditor" of the disabled veteran within the federal exemption statute, and hence was entitled to payment of accrued support money from accumulated government payments made to the veteran's guardian. At that time, however, the predecessor to 38 U.S.C. sec. 3101(a) applied to "money due, or to become due," to any pensioner. Section 3101(a) now extends to payments "made to, or on account of, a beneficiary" under any of the laws relating to veterans. In *555Rose v. Rose, 481 U.S. 619, 624 n.2 (1987), the appellant and the solicitor general cited Gardner in support of their contention that the lower courts are divided on the issue of whether state courts may award alimony or child support out of benefits paid to a disabled veteran.

In Rose, the Court held that a Tennessee statute allowing state courts to require veterans to pay child support out of federal veterans' disability benefits was not preempted by federal law. One of the federal statutes the appellant in Rose relied on was 38 U.S.C. sec. 3101(a). The Court said that the legislative history of this section recognizes two purposes: (1) To avoid the possibility of the Veterans' Administration being placed in the position of a collection agency; and (2) to prevent the deprivation and depletion of the means of subsistence of veterans dependent upon these benefits as the main source of their income. Rose, 481 U.S. at 630.

The Court held that neither purpose was constrained by allowing the state court to hold appellant in contempt for failing to pay child support. The Court said that "the exercise of state-court jurisdiction over appellant's disability benefits [did not] deprive appellant of his means of subsistence contrary to Congress' intent, for these benefits are not provided to support appellant alone." The Court pointed to S. Rep. No. 98-604, at 24 (1984) which states that veterans' disability benefits are intended to "provide reasonable and adequate compensation for disabled veterans and their families." Rose, 481 U.S. at 630 (emphasis supplied by Rose court). The Court further said that, "as evidenced by sec. 3107(a)(2), the provision for apportionment . . . Congress clearly intended veterans' disability benefits to be used, in part, for the support of veterans' dependents." Id. at 631.

It was on this basis that the Court distinguished such cases as Wissner v. Wissner, 338 U.S. 655 (1950) *556(widow did not have community property claim to one-half the proceeds of life insurance policy of her deceased army officer husband), Hisquierdo, and Ridgway v. Ridgway, 454 U.S. 46 (1981) (state court's divorce decree preempted by federal statute giving army officer husband unqualified right to designate life insurance policy beneficiary). The Court pointed out that consistent with the distinction suggested in Wissner, Congress had amended the Social Security Act to authorize garnishment of certain federal benefits for spousal and child support, but not for community property divisions. Rose, 481 U.S. 632 n.6 (citing 42 U.S.C. secs. 659 and 662). The Court said:

We construed these amendments to "expressly override" the anti-attachment provision for support claims, finding it "logical to conclude that Congress . . . thought that a family's need for support could . justify garnishment, even though it deflected other federal benefit programs from their intended goals, but that community property claims, which are not based on need, could not do so."

Id. (quoting Hisquierdo, 439 U.S. at 587).

The Court noted that the critical difference between Ridgway and the case before it was that Congress had not made appellant the exclusive beneficiary of the disability benefits. Rose, 481 U.S. at 634.

As we have demonstrated, these benefits are intended to support not only the veteran, but the veteran's family as well. Recognizing an exception to the application of sec. 3101(a)'s prohibition against attachment, levy, or seizure in this context would further, not undermine, the federal purpose in providing these benefits.

*557Id. The Court noted that in Hisquierdo, the Court had "again" discussed an exception to the anti-garnishment statute for alimony and child support in noncommunity property cases. Rose, 481 U.S. at 632 (citing Hisquierdo, 439 U.S. at 587. The Rose court stated that the suggested basis for the Wissner exception "was that family support obligations are deeply rooted moral responsibilities, while the community property concept is more akin to an amoral business relationship." Rose, 481 U.S. at 632 (citing Wissner, 338 U.S. at 660).

These cases convince me that Mansell v. Mansell 490 U.S. 581, 109 S. Ct. 2023, 104 L. Ed. 2d 675 (1989) does not place veterans' disability benefits beyond the reach of a Wisconsin trial court in determining a maintenance award. Appellant argues that the result in Man-sell — exclusion of waived military retirement pay from property divisible upon divorce — "is a clear indication that Congress did not intend that veterans' disability payments would be included in assets divided in a divorce." However, the Former Spouses' Protection Act deals only with military retirement pay, not disability payments. As the Mansell Court notes, the Act was enacted "[i]n direct response to McCarty." Mansell, 104 L. Ed. 2d at 682. McCarty held that the federal statutes then governing military retirement pay prevented state courts from treating military retirement pay as community property. Had the congress intended, that the Act was to apply to military disability pay, it presumably would have said so.

Congress must be presumed to have been aware of the decisions distinguishing between retirement pay and disability pay, insofar as such pay is subject to the anti-attachment statute. The Act authorized state courts to treat "disposable retired or retainer pay" as community property. Id. (citing 10 U.S.C. sec. 1408(c)(1)). "Dispos*558able retired or retainer pay" is defined as "the total monthly retired or retainer pay to which a military member is entitled," minus certain deductions. Id. (citing 10 U.S.C. sec. 1408(a)(4) (1982 ed., Supp. V)). Among the amounts required to be deducted from total pay are any amounts waived in order to receive disability benefits. Mansell, 104 L. Ed. 2d at 682-83 (citing 10 U.S.C. sec. 1408(a)(4)(B)).

Unlike the appellant, I find nothing in the Former Spouses' Protection Act or Mansell which provides any indication, clear or otherwise, that Congress did not intend that veterans' disability benefits would be included in assets divided in a divorce. The Act and Mansell are simply silent as to disability pay except that any retirement pay waived to receive disability benefits may be treated by state courts as community property military retirement pay. Presumably, the same result would be reached in an equitable distribution state. See Mansell, 104 L. Ed. 2d at 682 n.2.

I conclude from the foregoing that veterans' disability benefits continue to be benefits available to the veteran and his or her family. Such benefits are therefore subject to a Wisconsin state court's áuthority to consider veterans' disability benefits in determining child support or maintenance,