MArTiAL SeTTLeMenT AgreeMenT DOeS nOT BAr AppOrTiOnMenT OF VA COMpenSATiOn
Military & Veterans Affairs Committee Chairs : Matthew F . Hall – Hill Ward Henderson PA & Alexandra Srsic – Bay Area Legal Services
A “ domestic relations separation agreement plays no role in VA ’ s determination of entitlement to special apportionment .”
Does a marital settlement agreement adopted by a state court impact a spouse ’ s entitlement to receive an apportioned share of the compensation benefits a veteran receives from the U . S . Department of Veterans Affairs ( VA )? In Batcher v . Wilkie , the Federal Circuit offered a surprising answer : “ Not at all .” 1
The case involved a veteran who was legally separated from his spouse and receiving VA disability compensation . As part of a separation stipulation , the veteran paid a lump sum to his wife . The agreement , which was ratified by New York state court indicated : ““[ i ] n consideration therefore , all maintenance … obligations owing from [ John ] to [ Roberta ] shall cease .” 2
Before the final divorce decree was entered , the wife filed a claim with VA to apportion the veteran ’ s service-connected disability compensation benefits under 38 C . F . R . § 3.450 . 3 Both the VA and the Board of Veterans Appeals found that she had demonstrated hardship entitling her to apportionment . 4 The Board ’ s decision explained that a “ domestic relations separation agreement … plays no role in VA ’ s determination of entitlement to special apportionment … To the extent that such an agreement purports to
preclude a veteran ’ s spouse from seeking apportionment of a veteran ’ s VA benefits , the veteran ’ s remedy to make himself or herself whole lies with the state court .” 5
The U . S . Court of Appeals for the Federal Circuit affirmed the decision of the Veterans Court . 6 It held that the language of the parties ’ 2006 agreement “ did not extinguish [ the wife ’ s ] independent right to claim apportionment of federal benefits ,” because it only released “ all maintenance … and obligations owing from [ the veteran ].” 7 The Federal Circuit explained that “[ a ] pportioned VA benefits , by definition , cannot be owed from the veteran . Rather , they are a federal benefit available from VA .” 8 In fact , VA benefits for married veterans are increased to account for marriage for the benefit of a spouse . 9 Further , the court rejected a preemption argument because the state court agreement did not “ expressly ” address the waiver of any division of the veteran ’ s VA service-connected disability benefits . 10
Ultimately , the Federal Circuit affirmed the Veteran ’ s Court ’ s finding of eligibility for apportion - ment from the date the wife filed her claim to the date of the ultimate divorce decree in 2010 . 11 While the benefit period was only two years , it would not take much imagination to ponder a divorce action that went on for longer and amounted to much more money at stake .
Two Key Takeaways for Practitioners Representing Veterans :
• Marital settlement agreements involving veterans should specifically identify VA benefits , including any apportionment under 38 U . S . C . § 5307 and 38 C . F . R . §§ 3.450 and 3.451 .
• Marital settlement agreements should provide for the right to seek redress for a breach in the family court , with attorney fees and costs to be paid by a breaching party . n
1
975 F . 3d 1333 , 1338 ( 2020 ).
2
Id .
3
Id .
4
975 F . 3d at 1337 .
5
31 Vet . App . 138 , 140 , 144 ( 2019 ).
6
975 F . 3d 1333 .
7
Id . ( emphasis in original ).
8
Id .
9
Id ..
10
Id . at 1340 .
11
Id . at 1341 .
Author : John V . Tucker - Tucker Law Group , P . A .
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