Timing to Pursue Retirement Accounts from Judgement of Divorce

A divorce judgment has been entered, with a retirement plan involved. How long do the parties have to enter their QDRO (qualified domestic relations order) to effectuate the division of the retirement accounts? This question is commonplace after a judgment of divorce. A recent opinion from the Michigan Court of Appeals is changing the way this question is answered. As a general rule under MCL 600.5809, the statute of limitations to enforce a judgment is ten years. While this is the general rule, Joughin v Joughin, ___ Mich App ___ (2017), Docket No. 329993, is changing the way this statute of limitations is viewed.

A judgment of divorce requires that a QDRO be filed in order to receive the benefits from a retirement plan associated with the divorce. This is subject to the ten year statute of limitations as outlined by MCL 600.5809, which states:

(1) A person shall not bring or maintain an action to enforce a noncontractual money obligation unless, after the claim first accrued to the person or to someone through whom he or she claims, the person commences the action within the applicable period of time prescribed by this section.

(3) Except as provided in subsection (4), the period of limitations is 10 years for an action founded upon a judgment or decree rendered in a court or record of this state, or in a court of record of the United States or of another state of the United States, from the time of the rendition of the judgment or decree.

In Joughin, the Plaintiff and Defendant were divorced April 28, 2003. For normal purposes this would begin the accrual period on the QDRO. Then 12 years after the judgment of divorce was entered, on July 6, 2015, the Plaintiff entered her proposed QDROs to the court in order to receive the retirement benefits she was entitled to in the judgment of divorce. The Defendant argued that under MCL 600.5809, the retirement plan is unrecoverable because the statute of limitations of ten years had already expired. The Plaintiff in response argued that the accrual does not begin until a triggering event happens, and that in regards to the retirement the triggering event would be the Defendant’s retirement making the funds accessible.

The Michigan Court of Appeals in Joughin concluded “the entry of the proposed QDRO is not an action to enforce a noncontractual money obligation” Id. at 3. Since this is not a noncontractual money obligation, MCL 600.5809 will not apply to a QDRO. The effect this has is it now allows the Plaintiff to file this QDRO after the limitations period would have been up and still makes it viable for recovery.

In Joughin, Judge Jansen provided a lengthy dissent as to why she disagreed with the majority opinion stating “I believe that entry of a QDRO is an action to enforce a judgment of divorce and subject to the applicable statute of limitations.” Id. at 4. She also discussed that three other states have dealt with identical types of cases and all are resulting with different precedents. Judge Jansen spoke to the idea that it must first be determined when the recipient would gain access to the funds from the plan, and begin the ten year accrual period.

No application was filed in the Supreme Court.

Previous
Previous

Changes in a Child's School Create a Change in the Established Custodial Environment

Next
Next

Problems with the Court of Appeals' Adoption Trilogy Decision