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Unvested military pension is divisible property in Ohio divorce

On Behalf of | May 19, 2014 | Property Division |

Married couples tend to accumulate a lot of things over the course of years together. If they decide to divorce those things have to be divided. So do the couple’s debts. In Ohio, the law calls for the division of assets and debts to be equitable.

But what exactly constitutes an asset or a debt? If an asset or debt was created by one or the other party before the couple married, should it be considered one person’s property or part of marital property? Such questions need to be answered and indicate why it’s so essential to be working with an attorney skilled in this area of the law.

Of course, the answers are not always cut and dried. When they are not, the issue may find itself having to be worked out through the court system. The case of one divorcing Ohio couple serves as a prime example of what we mean.

At issue is the wording of Ohio law which states that all property “currently owned” by a couple is subject to being equitably divided in the event of a divorce. The question before the court was whether and how the husband’s unvested military pension should fit into the scheme of things.

The couple had married in 1995. The husband had joined the National Guard just before that. The couple divorced in 2011. The ex-husband has remained in the service throughout all that time and is due to be eligible for military retirement benefits when he hits 20 years. He’s not there yet, so should the unvested benefits be subject to division?  

Lower courts ruled that since the benefits were not “currently owned” they did not fit the provision of the law and could not be divided. But the Ohio Supreme Court ruled in a 4-3 decision recently that even though the exact value of the benefits are not known, they are an asset in which both spouses have an interest and that not dividing it would be inequitable.

While the decision makes clear that unvested retirement benefits are an asset to be divided, it doesn’t say how equitable division should be achieved. That suggests terms will need to be worked out through negotiation or possibly further litigation.

Source: Akron Legal News, “Unvested military pensions now marital property,” Richard Weiner, May 16, 2014