Waiting 16 years between the time of the divorce and the request for entry of a Qualified Domestic Relations Order (QDRO) appears to be perfectly acceptable under a ruling recently issued by the 1st District Court of Appeal.
A QDRO is a legal order occurring after a divorce that deals with pension funds. It establishes an individual’s right to a percentage of their ex-spouse’s qualified plan account balance or benefit payments. They only apply to pension or benefit plans that are subject to the Employee Retirement Income Security Act (ERISA), which governs private sector pensions. QDROs may be included in a divorce decree or entered as a separate document.
In order to be considered a “qualified” QDRO, the order must be in accordance with the following regulations:
1. The domestic relations laws of the state, which may vary.
2. United States tax code – the spouse to whom the funds are granted is responsible for the taxes.
3. Distribution of the funds must remain in agreement with the original plan’s terms.
In the divorce case of Graham v. Graham, a QDRO entered 16 years after the final judgment of divorce was ultimately reversed on other grounds, but it does not appear that the delay of 16 years was of any importance to neither the parties nor the court system.
I have always wondered how long someone can take between the time of the final judgment of divorce and subsequently requesting a QDRO be entered. Apparently 16 years isn't a problem! Believe it or not, this happens quite frequently. I have been involved in several divorces in which opposing counsel never got around to preparing QDROs for the benefit of their clients. Even after the clients are long gone, this issue remains.
What happens if a client discovers that the retirement funds that were supposed to be transferred to their ex-spouse are still fully in their retirement account? I'm willing to bet most of them would have no trouble spending those funds after such a long time.
It is amazing to me that the lawyers on the other side of the Graham v. Graham case never followed up on this important post dissolution matter. This just goes to reinforce the fact that I always impress upon those seeking legal counsel: Hiring an attorney who pays fine attention to detail is so important!
Image courtesy of freedigitalphotos.net by Salvatore Vuono