U.S. Supreme Court building, Washington, D.C. (Photo: Carol M. Highsmith)
The U.S. Supreme Court will hear a case that could affect how military retirement and disability benefits are handled in some divorce agreements.
Marschner v. Marschner involves Richard and Roxane Marschner, who divorced in 2016. Their agreement said Roxane would receive part of Richard’s military retirement pay and that Richard would make up the difference if disability benefits later reduced the amount available to her.
Richard served in the North Dakota Army National Guard and was later medically separated. He began receiving military disability retirement pay and VA disability compensation. When Roxane sought her share of his military retirement, the Defense Finance and Accounting Service determined there was no retirement pay available to divide under federal law.
A North Dakota district court later ordered Richard to make payments based on the divorce agreement. The North Dakota Supreme Court reversed that ruling in March, finding that federal law prevented the agreement from being enforced in that way.
Federal law allows state courts to divide some military retirement pay during a divorce. However, certain military disability and retirement payments waived to receive VA disability compensation are generally protected from being divided as marital property. That distinction can become important years after a divorce. A former spouse may expect to receive a certain share of military retirement, only to see that amount reduced when the Service Member later becomes eligible for disability-related benefits.
The Supreme Court addressed a similar issue in 2017 in Howell v. Howell. In that case, the court ruled that a Veteran could not be ordered to reimburse a former spouse for retirement money lost after part of the retirement pay was waived to receive VA disability compensation.
The Marschner case raises a different question because the couple had already agreed on what would happen if disability benefits reduced Roxane’s share.
Roxane argues that the agreement should be enforced because both sides accepted those terms during the divorce. Richard argues that a private agreement cannot require payments that federal law otherwise protects.
The Supreme Court will decide whether federal law requires state courts to reject agreements like this when military retirement and disability benefits are involved. The ruling could affect how future military divorce agreements are written and how state courts handle cases in which disability benefits later reduce the retirement pay available to a former spouse.
The Supreme Court agreed Oct. 1 to review the case. As of Oct. 27, oral arguments had not been scheduled. Marschner v. Marschner is listed as case No. 25-1349.
Author: Rikki Almanza
Rikki is a Web Content Coordinator for the American Legion, Department of California. With a deep-rooted family connection to the military, Rikki is committed to using her skills and knowledge to provide valuable assistance and resources to servicemembers and veterans.
