Determination of a Spouses Pension?

A common question that I am asked involves the entitlement to a pension plan.  The person who has the pension wants to know if he/she has to provide the soon-to-be ex-spouse any part of the pension and the other spouse wants to know if he/she is entitled to any portion of the pension.  The leading case in this area is Majauskas v. Majauskas.

In Majauskas, the husband was a police officer and after ten years on the job, his pension rights vested.  An action for divorce started, and his wife sought part of the pension as marital property.  The first step of any analysis regarding who is entitled to what in a divorce is to determine what constitutes marital property for equitable distribution.   Marital property is defined by New York statute, which provides that all property acquired by either or both spouses during the marriage and before the execution of a separation agreement or the commencement of a matrimonial action, is marital property subject to equitable distribution.  Expressly excluded from this definition of marital property is property acquired before marriage or through non-spouse gift, inheritance, compensation for personal injury or property designated as separate property by agreement between the spouses. 

Now that we have a working definition of marital property, it is clear that vested rights in a pension plan that were acquired between the date of marriage and the commencement of an action for divorce will be defined as marital property.  In Majauskas, the husband unsuccessfully argued that the pension plan in question began before the marriage and therefore should be considered separate property.  The Court held that even though the plan started before the date of marriage, the non-titled spouse was entitled to her share of the pension plan which accrued during the marriage.  The Court derived a formula, which is commonly referred to pursuant to the case name Majauskas v. Majauskas. The best way to explain the marital portion the non-titled spouse would be entitled to is by the following example. If you were married five years, and the spouse with the pension is entitled twenty years of service, you first divide the pension in half.  Take that number and multiply by the years married/total years for the pension.  Years married—five—divided by 20 total years equals 25%.  Your spouse would be entitled to 25% of half of the pension.

This would determine your pension which you are entitled to and for the party with the pension this calculation would determine the percentage of pension that you would be obligated to give your soon to be ex-spouse.