by Timothy J. Hoppa (Winter 2016)
In appellate court recently addressed the issue of whether an ex-spouse could be entitled to receive a distribution of disability pension benefits in In re Marriage of Benson, 2015 IL App (4th) 140682. In Benson, the court held that disability pension benefits substitute as “retirement” pensions when a firefighter elects to continue disability benefits once eligible to receive retirement pension benefits.
In the case, the firefighter and his wife divorced in 1999. As part of the divorce, the ex-wife was awarded a portion of the firefighter’s retirement pension. After the divorce was finalized, the wife never prepared a Qualified Illinois Domestic Relations Order (QILDRO), the necessary order to divide the firefighter’s retirement pension benefits.
Then, nearly a decade after the divorce, the firefighter became disabled and began collecting a disability pension. Once he became eligible for retirement, he elected to continue his disability pension benefits instead. Although it was not clear in the court ruling, the firefighter’s decision may have been partially motivated by a desire to avoid payment to the former spouse.
The ex-wife sued to receive a portion of the disability pension benefits, arguing that she was entitled to a share because they were in the nature of a retirement benefit and the trial court agreed.
On appeal, the disabled firefighter argued disability benefits were different from retirement benefits; he presented evidence the award did not fall under a QILDRO because a retirement pension was different from disability benefits. He argued any modification was an improper change of the initial divorce judgment. Further, because his former wife took over five years to pursue the benefits, he argued that too much time had passed, invoking a doctrine known as laches.
The appellate court initially found pension benefits and disability benefits were parallel. Drawing from statutory language, the court indicated the statute refers to both benefits and pensions, and showed a person who is permanently disabled may be placed on “disability pension.”
Drawing from prior cases, the appellate court held that once a firefighter is eligible to receive a retirement pension, the disability pension payments should be interpreted as a retirement benefit. The court indicated that once a person has an option to receive either, a former spouse cannot be cut off simply by electing to continue the disability pension. As a result, the ex-wife was awarded a portion of the disability pension.
The Benson decision affirms that courts will often look beyond the specific labels given to get to the substance of the matter. In this case, while the benefits were classified as “disability,” they were part of a retirement plan, and paid in lieu of retirement benefits. The “disability” label was not adequate to deny the ex-wife her rights under the divorce judgment.