Ex-spouse Entitled to Share in Post-Divorce Increase in Value of Pension

The Court of Special Appeals ruled that a Baltimore County woman is entitled to share in the substantial increase in the value of her ex-husband’s pension that accrued between the date of the divorce and his retirement 18 months later.

Raymond and Doris Musick were married in September 1967.  Raymond had begun working for Bell Atlantic in March 1967 and he worked for the company throughout the marriage and for 18 months after the divorce.  The parties were divorced on October 21, 1996, after 29 years of marriage.

Just prior to the entry of the divorce decree, the parties entered into a property settlement agreement that was approved and incorporated in the divorce decree.  The decree provided that Doris was entitled to 50% of the marital share of Raymond’s pension benefits “if, as and when” such benefits are paid.  The decree set forth a detailed formula for calculating the “marital share.”  The formula is sometimes called the Bangs formula, named for a case in which the court approved a formula for determining the marital share of a pension.

At the time of the divorce, Raymond’s pension had a value of $55,081.53  if Raymond had elected to retire and take a lump sum at that time.  When Raymond retired from Bell Atlantic 18 months later, the amount of the lump sum payment Raymond elected to receive had increased to $254,201.15.  A dispute arose over whether Doris’ share of the pension was to be based on its value on the date of divorce or its value at the time of Raymond’s retirement. 

The Court of Special Appeals rejected Raymond’s contention that Doris’ interest in the pension was limited to its value on the date of divorce.  The Court said:

“The plain language of the decree establishes that the portion of the pension that Mrs. Musick is to receive is to be calculated by:  dividing the number of months that Mr. Musick worked toward accumulating the pension during the marriage by the total number of months that Mr. Musick worked toward accumulating the pension; multiplying the pension by that amount; and dividing the product in two.  Clearly, that is what the parties intended when they stated that the ‘denominator shall be the total number of months during which benefits were accumulated prior to the time when that payment of such benefits shall commence.’  If the parties had intended for Mrs. Musick’s interest in the pension to be valued as of the date of the divorce, there would have been no need to set forth the above-recited formula.”

The court pointed out that while both parties reap the benefit of a post-divorce increase in the value of the pension, they also share the risk of any decrease in value. 

 Raymond P. Musick v. Doris Musick,  No. 534, September Term, 2001, in the Court of Special Appeals of Maryland, filed May 31, 2002. 

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