                    IN THE COURT OF APPEALS OF TENNESSEE
                                AT NASHVILLE
                              Assigned on Briefs November 15, 2010

                     ERDA M. GONZALEZ v. NEFTALI GONZALEZ

                  Appeal from the Chancery Court for Montgomery County
                   No. 98-10-0147    Laurence M. McMillan, Chancellor


                    No. M2008-01743-COA-R3-CV - Filed January 24, 2011


Mr. Gonzalez filed a petition to alter his final divorce decree, alleging that the decree violates
federal law by allowing the wife to receive more than 50% of his military retirement. The
trial court denied relief. Mr. Gonzalez appealed. We affirm, holding that federal law does
not limit Tennessee trial courts to awarding a maximum of 50% of a former service
member’s retirement to the ex-spouse.

       Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Chancery Court
                               Affirmed as Modified

A NDY D. B ENNETT, J., delivered the opinion of the Court, in which P ATRICIA J. C OTTRELL,
P.J., M.S., and R ICHARD H. D INKINS, J., joined.

Mark Robert Olson, Clarksville, Tennessee, for the appellant, Neftali Gonzalez.

Erda M. Gonzales, Clarksville, Tennessee, Pro Se.

                                                  OPINION

        Erda M. Gonzalez and Neftali Gonzalez were divorced by a final order entered
January 11, 1999. Paragraph 10 of the marital dissolution agreement provides, in pertinent
part, as follows:

       [T]he Husband shall pay to the Wife and the Wife is hereby awarded one
       hundred (100%) percent of the Husband’s net, disposable after-tax military
       retirement pay.1 Further, the Husband is agreeable to paying the Wife 100%


       1
           References to “pension” or “retirement pay” in this opinion refer to the disposable after-tax military
                                                                                                   (continued...)
        of his retirement benefits due to the fact that he has secured employment out
        of the country after he retires from the military. Said payments of the
        retirement shall be paid by income assignment.

       On April 22, 2005, Mr. Gonzalez filed a petition to alter the final decree, alleging that
the wife should not receive alimony and that the decree violates federal law by allowing the
wife to receive more than 50% of his military retirement. The former wife, now remarried
and known as Erda M. Nieves, represented herself and filed a response claiming that “Mr.
Gonzalez willingly and knowingly agreed to pay” his entire retirement to her. The trial court
heard the matter on October 25, 2005, without testimony. In an order entered on July 18,
2008,2 the court

        found no basis to disturb the provisions of paragraph 10, Retirement Pay,
        regarding the payment of 100% of Neftali Gonzalez’s Military Retirement to
        Erda M. Gonzalez (now “Nizves” [sic]). Specifically, the Court would not
        disturb the award of 100% of the Husband’s Military retirement to the Wife.
        The Husband’s Counsel’s argument that this portion of the Final Decree is
        unenforceable pursuant to 10 U.S.C. Section 1408 is respectfully overruled.

The court did find that the wife’s remarriage terminated Mr. Gonzalez’s duty to pay alimony.

       Mr. Gonzalez appealed the trial court’s decision. Upon the motion of Mr. Gonzalez,
on November 5, 2008, this court stayed the appeal pending settlement discussions. The
settlement was never completed, and on June 22, 2010, this court lifted the stay and allowed
the appeal to proceed.

        Since the petition was filed under the same docket number as the divorce, we consider
it to be the equivalent of a motion for post-judgment relief under Tenn. R. Civ. P. 60.
Subsections 60.02(3) & (5)3 would apply if the allegation as to the federal 50% limit are
accurate. “A motion for relief under Rule 60.02 addresses itself to the sound discretion of
the trial judge, and the scope of review is whether the trial judge abused that discretion.”
Day v. Day, 931 S.W.2d 936, 939 (Tenn. Ct. App. 1996). We will overturn a trial judge’s


        1
         (...continued)
retirement pay.
        2
          The record contains no explanation for the delay of almost three years between the hearing and the
entry of the order.
        3
          Tenn. R. Civ. P. 60.02(3) allows relief when the judgment is void. Tenn. R. Civ. P. 60.02(5) permits
relief for “any other reason justifying relief from the operation of the judgment.”

                                                     -2-
discretionary decision “when the trial court has misconstrued or misapplied the controlling
legal principles.” White v. Vanderbilt Univ., 21 S.W.3d 215, 223 (Tenn. Ct. App. 1999).

       While Mr. Gonzalez lists three issues in his appellate brief, this matter really boils
down to one question: whether federal law prohibits a Tennessee court from awarding 100%
of Mr. Gonzalez’s military retirement to his former wife in the course of divorce
proceedings. The trial court essentially ruled that federal law did not prohibit such an award
but did not favor the litigants or this court with its reasoning.

       Pursuant to federal law, a state court may treat disposable retirement pay of a military
retiree as solely the retiree’s property or as property of the retiree and his spouse “in
accordance with the law of the jurisdiction of such court.” 10 U.S.C. § 1408(c)(1). In
Tennessee, marital property includes the value of vested and unvested pension rights that
accrued during the marriage. Tenn. Code Ann. § 36-4-121(b)(1)(B). “[M]ilitary retired pay
is marital property subject to equitable distribution.” Johnson v. Johnson, 37 S.W.3d 892,
895 (Tenn. 2001). There is no dispute in this case that the pension rights accrued during the
parties’ marriage.

        Mr. Gonzalez argues that the state court’s right to divide the military pension between
the retiree and his or her spouse is limited by 10 U.S.C. § 1408(e)(1): “The total amount of
the disposable retired pay of a member payable under all court orders pursuant to subsection
(c) may not exceed 50 percent of such disposable retired pay.”

        This appears to be an issue of first impression in Tennessee.4 When interpreting a
statute, the primary purpose is to ascertain and give effect to the intention or purpose of the
legislature. Westinghouse Elec. Corp. v. King, 678 S.W.2d 19, 23 (Tenn. 1984). This
“legislative intent or purpose is to be ascertained primarily from the natural and ordinary
meaning of the language used, when read in the context of the entire statute, without any
forced or subtle construction to limit or extend the import of the language.” Mangrum v.
Owens, 917 S.W.2d 244, 246 (Tenn. Ct. App. 1995) (quoting Worrall v. Kroger Co., 545
S.W.2d 736, 738 (Tenn. 1977)). Also, “[i]n construing a statute to ascertain the legislative
intent, it is permissible to take note of the conditions existing at the time of such an
enactment.” Davis v. Beeler, 207 S.W.2d 343, 344 (Tenn. 1947).



        4
          In Thomas v. Thomas, 1987 WL 9164 (Tenn. Ct. App. Apr. 10, 1987), this court observed that the
federal law “allows the state courts to award a spouse up to 50% of the disposable military retirement pay.”
Id. at *2. This statement is, however, dicta, since the award fell “within this limitation.” Id. The issue of
whether the statute operated as a limit on court awards was not before the court. See also In re Marriage
of Bocanegra, 792 P.2d 1263, 1267 (Wash. Ct. App. 1990).

                                                    -3-
        Congress passed the Uniformed Services Former Spouses Protection Act (“USFSPA”)
in response to McCarty v. McCarty, 453 U.S. 210, 236 (1981), in which the United States
Supreme Court held that the statutes governing military retirement pay impliedly pre-empted
state divorce property division laws. The Senate Report states:

        The primary purpose of the bill is to remove the effect of the United States
        Supreme Court decision of McCarty v. McCarty, 453 U.S. 210 (1981). The
        bill would accomplish this objective by permitting Federal, State, and certain
        other courts, consistent with the appropriate laws, to once again consider
        military retired pay when fixing the property rights between the parties to a
        divorce, dissolution, annulment or legal separation.

S. R EP. N O. 97-502, at 1, reprinted in 1982 U.S.C.C.A.N. 1596.

       Congress intended to “undo” the implied preemption found in McCarty by the express
terms of the USFSPA. Furthermore, the act established a direct payment system not
previously available to an ex-spouse. Under this system, akin to garnishment, when
presented with a court order, the secretary will pay the ex-spouse the amount of the order up
to 50% of the disposable earnings. 10 U.S.C. § 1408(d) & (e)(1).

       Yet, the USFSPA is not a shining example of clarity. State courts are split on the
meaning of 10 U.S.C. § 1408(e)(1). See Ann K. Wooster, Annotation, Construction and
Application of Federal Uniformed Services Former Spouse Protection Act in State Court
Divorce Proceedings, 59 A.L.R. 6TH 433 (2010). Some hold that the state court can award
more than 50% of the military retirement pay to the spouse, but that for amounts over 50%
the court must order the military retiree to pay the spouse directly.5 See Ex parte Smallwood,
811 So. 2d 537, 539-41 (Ala. 2001); Deliduka v. Deliduka, 347 N.W.2d 52, 55 (Minn. Ct.
App. 1984). Other courts find that 10 U.S.C. § 1408(e)(1) limits the amount of the retirement
pay that can be brought into the marital estate to 50%, thereby capping the amount of a
possible award to the spouse at that level. See In re Marriage of Bowman, 972 S.W.2d 635,
639 (Mo. Ct. App. 1998); see also Beesley v. Beesley, 758 P.2d 695, 699 (Idaho 1988).

        The language of 10 U.S.C. § 1408(c)(1) gives a state court permission to treat
disposable retirement pay of a military retiree as solely the retiree’s property or as property
of the retiree and his spouse “in accordance with the law of the jurisdiction of such court.”


        5
          In 10 U.S.C. § 1408(d)(1), Congress created the direct pay mechanism through which the federal
government would make direct payments to a former spouse who presents a state court order granting him
or her a portion of the military retirement payments. It contains no express limitations on the percentage of
the state court’s award.

                                                    -4-
Although § 1408(c) contains limitations related to its effective date, the transferability of the
right by the spouse, and the ability of a state court to order an individual to retire at a
particular time, it does not contain any express limitation on the state court’s ability to award
any portion of the retirement pay to the spouse that it deems appropriate.

        The savings clause of the act is also instructive:

        Nothing in this section shall be construed to relieve a member of liability for
        the payment of alimony, child support, or other payments required by a court
        order on the grounds that payments made out of disposable retired pay under
        this section have been made in the maximum amount permitted under
        paragraph (1) or subparagraph (B) of paragraph (4). Any such unsatisfied
        obligation of a member may be enforced by any means available under law
        other than the means provided under this section in any case in which the
        maximum amount permitted under paragraph (1) has been paid . . . .

10 U.S.C. § 1408(e)(6).

       Reading § 1408(e)(6) in conjunction with § 1408(c)(1), which grants the state
authority to divide the military pension without stating any percentage limitations, a number
of courts have come to the conclusion that the 50% limit in § 1408(e)(1) only addresses the
amount of the pension that can be paid directly to the former spouse by the government.6 See
In re Madsen, No. 00-4811-WH, 2002 WL 34552506, at *7 (Bankr. S.D. Iowa Oct. 15,
2002); MacMeeken v. MacMeeken, 117 B.R. 642, 645 (D. Kan. 1990); Ex parte Smallwood,
811 So.2d at 540; Deliduka, 347 N.W.2d at 55; Maxwell v. Maxwell, 796 P.2d 403, 406 n.6
(Utah Ct. App. 1990); In re Marriage of Bocanegra, 792 P.2d at 1268. In reaching this
conclusion, some courts have relied, in part, on the following language from Mansell v.
Mansell, 490 U.S. 581, 590 (1989):

        In our view, the saving clause serves the limited purpose of defeating any
        inference that the federal direct payments mechanism displaced the authority
        of state courts to divide and garnish property not covered by the mechanism.



        6
          This interpretation is consistent with the view that the disbursement mechanism is similar to
garnishment. “[T]he Act essentially does no more than most garnishment laws in establishing a collection
ceiling.” Casas v. Thompson, 720 P.2d 921, 932 n.12 (Cal. 1986) (quoting Hauserman & Fethke, Military
Pensions as Divisible Assets: The Uniformed Services Former Spouses’ Protection Act, 11 J. LEGIS . 27, 37
(1984)). At least one court has expressly said that the act’s provisions were “intended only as a limit on the
amount of disposable retired pay which can be garnished and paid out by the service secretaries pursuant to
court orders.” Grier v. Grier, 731 S.W.2d 931, 933 (Tex. 1987).

                                                     -5-
See Ex parte Smallwood, 811 So. 2d at 541; Forney v. Minard, 849 P.2d 724, 729 (Wyo.
1993).

        Two courts place special emphasis on the 1990 amendments to § 1408(e)(1). See
Cline v. Cline, 90 P.3d 147, 152 n.11 (Alaska. 2004); Coon v. Coon, 614 S.E.2d 616, 618
(S.C. 2005) (citing with approval Coon v. Coon, 588 S.E.2d 624, 628 (S.C. Ct. App. 2003)).
Prior to the amendment, § 1408(e)(1) read: “The total amount of the disposable retired or
retainer pay of a member payable under subsection (d) may not exceed 50 percent of such
disposable retired or retainer pay.” 10 U.S.C. § 1408(e)(1990). After the amendment, §
1408(e)(1) reads: “The total amount of the disposable retired pay of a member payable under
all court orders pursuant to subsection (c) may not exceed 50 percent of such disposable
retired pay.” 10 U.S.C. § 1408(e)(1). House Report No. 101-665 states the reason for the
change: “The law would be clarified to ensure that regardless of the number of former
spouses, the aggregate amount of retired pay that would be payable to them would not exceed
50 percent of the service member’s disposable retired pay.” 1990 U.S.C.C.A.N. 2931, 3006.

        Cline and Coon view the 1990 amendment as changing the manner in which payment
was restricted. The amendment replaced the reference to subsection (d), the distribution
mechanism, with a reference to subsection (c), the section giving state courts jurisdiction to
treat the retirement pay as property of the retiree and his spouse if state law so allowed.
Thus, according to Coon, “[A]fter the 1990 amendment, the fifty-percent restriction on
payment of disposable military retirement pay was reworded to apply to divisions of
retirement benefits made under any court order pertaining to former spouses.” Coon, 588
S.E.2d at 628.

       Legal commentators seem divided as well. Compare Particia K. Hinshaw, Navigating
The Uniformed Services Former Spouses’ Protection Act, 19 S.C. L AW. 32, 36 (2008) (“Any
amount awarded by a state court in excess of the 50 percent cap must be obtained directly
from the retiree, not the [Defense Finance and Accounting Office].”), and Larry D. White,
The Uniformed Services Former Spouses’ Protection Act: How Military Members are at the
Mercy of Unrestrained State Courts, 9 R OGER W ILLIAMS U. L. R EV., 289, 294 (2003) (“The
USFSPA only addresses this issue from the standpoint of defining the maximum amount the
armed services are required to pay directly to the former spouse under valid court orders; it
does not interfere with state laws to limit the amount that states may award.”(footnotes
omitted)), with Brian R. Decker, “The Toughest Job”: Adkins v. Rumsfeld, Gender,
Incentives, and The Uniformed Services Former Spouses’ Protection Act, 17 C OLUM. J.
G ENDER & L. 245, 247 n.23 (2008) (“The Act also places a fifty percent maximum on the
portion of the retirement pay redistributed to former spouses.”), and State-by-State Analysis
of Divisibility of Military Retired Pay, A RMY L AW., Aug. 2002, at 42, 49 (noting that the
decision of Forney v. Minard “is inconsistent with the 1990 amendment to USFSPA, 10

                                             -6-
U.S.C. § 1408(e)(1), which deems all orders dividing military retired pay as property satisfied
once a threshold of fifty percent of the ‘disposable retired pay’ is reached”).

        It appears that the United States military does not view § 1408(e)(1) as a limit. The
Defense Finance and Accounting Service observes that “[t]he amount of a former spouse’s
award is entirely a matter of state law.” D IVIDING M ILITARY R ETIRED P AY 6 (2006),
http://www.dfas.mil/militarypay/garnishment/Speech5.pdf; see also U NIFORMED S ERVICES
F ORMER S POUSE’S P ROTECTION A CT 2-3 (2010), http://www.redstone.army.mil/legal/data/1-
usfspa.pdf (“If a state court awarded you 60% of your former spouse’s retired pay and you
qualify under this statute to get direct pay, then you would collect 50% through the Finance
Center and your former spouse would be responsible for providing the other 10% to you.”);
D OMESTIC R ELATIONS FROM A M ILITARY P ERSPECTIVE: F REQUENTLY A SKED Q UESTIONS 9
https:www.cnic.navy.mil/navycni/groups/public/documents/document/cnicp a134503.pdf
(“The 50% maximum of DRP [disposable retired pay] is a limit on how much retired pay can
be paid directly, but it is not a limit on how much a court can award.”).

        Cline and Coon do not discuss the impact of § 1408(e)(6), the savings clause. While
the amended USFSPA presents a frustrating tangle of mixed messages and conflicting
intentions, as reflected in the case law and articles, § 1408(e)(6) offers the only clear
expression of Congress’s intent as to state court orders that have not been totally satisfied by
the federal government’s payments made directly to the former spouse.7 It states that a
service member cannot escape liability for state court ordered “alimony, child support or
other payments” just because the federal disbursements to the former spouse have reached
the statutory limit.”8 10 U.S.C. § 1408(e)(6) (Emphasis added).

      Based on the language of § 1408(e)(6), we hold that the USFSPA does not prohibit
a Tennessee state court from awarding more than 50% of the husband’s military retirement

        7
          See Brett R. Turner, 2 EQUITABLE DISTRIBUTION OF PROPERTY , 3d § 6:4 (2010) (“State courts are
free to exceed these percentage limits by ordering payment be made directly from one spouse to the other.
This fact is made clear by § 1408(e)(6), which expressly states that no limitation in § 1408(e) shall prevent
enforcement of any obligation by means other than federal direct payment.” (footnotes omitted)).
        8
         In re the Marriage of Bowman, 972 S.W.2d 635 (Mo. Ct. App. 1998), rejects this view of §
1408(e)(6), stating that the provision “only eliminates a defense for a retired armed services member from
asserting that he or she cannot meet maintenance, child support, or property awards ordered by a court by
showing that his or her only source of income derives from retired pay.” Id. at 639. We do not believe that
the broad wording of § 1408(e)(6) supports such a narrow interpretation. Neither does the legislative history.
Senate Report No. 97-502 states: “[t]he bill makes it clear that the mere attainment of that [50%] ceiling in
no way absolves the former member of still outstanding legal obligations for alimony, child support or other
payments. Any such unsatisfied obligation may be enforced by any means available under law . . . .” 1982
U.S.C.C.A.N. 1596, 1606.

                                                     -7-
to his former spouse when making an equitable distribution of marital property in the course
of a divorce proceeding. Thus, the trial court did not misconstrue or misapply the law and
Rule 60.02 relief is not appropriate.

       Even if § 1408(e)(1) operated as a limitation, we would uphold the trial court’s order.
In the marital dissolution agreement, Mr. Gonzalez willingly agreed to give his former wife
100% of his military retirement. The marital dissolution agreement is a contract. Johnson,
37 S.W.3d at 896. There is no dispute that the agreement calls for 100% of the retirement
to go to the ex-spouse. We know of no legal authority prohibiting Mr. Gonzalez from
agreeing to provide his ex-wife with 100% of his retirement pay as part of a comprehensive
property settlement. Such agreements have been upheld by courts on both sides of the
USFSPA issue we address today. See Coon, 614 S.E.2d at 618; Forney, 849 P.2d at 729,
731. “The broad power granted by Rule 60.02(5) is not to be used to relieve a party from
free, calculated, and deliberate choices he or she has made.” Day, 931 S.W.2d at 939.
Furthermore, post-judgment modification of a marital dissolution agreement is
impermissible. Johnson, 37 S.W.3d at 897.

        We note that the marital dissolution agreement states that “payments of the retirement
shall be paid by income assignment.” Since only 50% of the retirement pay may be paid
directly to the spouse by the federal government, Mr. Gonzalez is ordered to pay the
remaining portion of his military retirement to Ms. Nieves as it is received.9

      Costs of appeal are assessed against the appellant, Mr. Gonzalez, for which execution
may issue if necessary.


                                                             ______________________________
                                                                  ANDY D. BENNETT, JUDGE




        9
        There is some indication in the record that Ms. Nieves cannot be located. If such is the case, Mr.
Gonzales should seek guidance from the trial court.

                                                   -8-
