Holmes v. Alabama Department of Human Services (United States Supreme Court)
We have engaged to file a petition in the United States Supreme Court to challenge the 1987 decision in Rose v. Rose, 481 U.S. 619 (1987), in which the Supreme Court held that all veterans’ disability pay could be diverted and otherwise taken by state courts and state agencies to satisfy the veteran’s child support and spousal support obligations. On February 12, 2019, we filed an application in the United States Supreme Court to file a petition to challenge the State of Alabama’s taking of a veteran’s disability pay.
Since Rose, many state courts, without authority, have asserted an unbridled interest in veterans’ disability pay to force veterans to pay child support, spousal support, maintenance and alimony to former spouses. Federal law preempts state law concerning the disposition and entitlement to veteran’s benefits. Moreover, after Rose, Congress amended federal law to specifically exclude veterans disability benefits from being counted towards a disabled veterans child support or spousal support obligations, unless the veteran had also gained enough time in service and credit to retire, and chose to waive retirement or retention benefits to receive such disability pay. The petitioner in this case is like so many other disabled veterans who have been severely disabled and who have not waived retired or retainer pay to receive their disability entitlements. Federal law protects this pay by way of the U.S. Constitution’s Supremacy Clause, which provides that all state laws that stand in the way of Congress’ exercise of its enumerated powers are void, have no force and effect, and are preempted. Moreover, positive enactments by Congress further specify that certain veterans’ disability pay is off limits to state courts and state agencies for satisfaction of child support and spousal support in state court divorce proceedings. See 42 USCS 659(a), (h)(1)(A)(ii)(V), and (h)(1)(B)(iii); and 38 USCS 5301. These provisions jurisdictionally bar state courts from exercising authority over veterans’ personal entitlements to their disability benefits. The United States Supreme Court recently said as much in the case of Howell v. Howell, 137 S. Ct. 1400 (2017). There, the Court held that 38 USCS 5301 jurisdictionally protected all veterans’ disability pay and state courts had no authority to vest those benefits in any one other than the entitled beneficiary, i.e., the veteran. The Court also noted the one limited federal law exception in the child support and spousal support context envisioned by 42 USCS 659(h)(1)(A)(ii)(V), but that was it. The vast majority of veterans today are not retirees, did not waive retirement pay to receive disability pay, and therefore, have no other forms of subsistence. Yet, state courts ignore federal law, blindly cite to Rose v. Rose as authority, and continue to take veterans’ disability pay from the veteran.
Background of the Case
Joseph Holmes is a disabled veteran. He served in the United States Navy from September 1973 to 1976. In 2017, the Veterans Administration (VA) determined he was 100 percent disabled due to a service-connected condition. The VA determined he had been disabled since December 2010. He received a lump sum payment of Veterans Administration (VA) disability benefits in March 2017. Respondent, the Alabama Department of Human Resources (DHR), served a notice of levy of these benefits in July 2017, which had been deposited into his credit union account, to satisfy a past due child support obligation. Petitioner sought a stay of the levy, but DHR seized $46,035 in VA disability pay on October 25, 2017. DHR concluded that Petitioner’s VA disability benefits were not exempt from lien, levy or legal process and declined to release the levy of these benefits from his account.
In August 2017, Petitioner timely sought administrative review from DHR challenging its decision to levy his VA disability benefits. DHR denied Petitioner’s request on grounds that no hearing was required where “protective or child support services are provided as required by law or by court order”. Petitioner then filed a timely notice of appeal with DHR and a petition for judicial review in the Circuit Court for the County of Montgomery.
In his initial brief in the Circuit Court, Petitioner argued that 38 U.S.C. § 5301(a)(1) exempts his VA disability benefits from “attachment, levy, or seizure by or under any legal or equitable process whatever, either before or after receipt by the beneficiary.” Petitioner conceded that certain VA benefits may be subject to income withholding, garnishment, or other legal process brought by a state agency seeking to enforce payment of a child-support obligation, but only with respect to those VA disability benefits received in lieu of retirement or retention benefits. Cf. 42 U.S.C. § 659(a), (h)(1)(A)(ii)(V), and (h)(1)(B)(iii). Because Petitioner’s VA disability was not received in lieu of retirement pay or retention pay, DHR could not lawfully seize them and they were off limits under 38 U.S.C. § 5301 as a personal entitlement. See Howell v. Howell, 137 S. Ct. 1400, 1405-1406 (holding state courts cannot vest that which under governing federal law they lack the authority to give, citing 38 U.S.C. § 5301, which provides that disability benefits are generally non-assignable, while noting that for military retirement pay, the state courts are allowed to take account that some retirement or retainer pay may be waived and calculate or recalculate the need for child support or spousal support, citing Rose v. Rose, 481 U.S. 619, 630-634, and n. 6, 107 S. Ct. 2029, 95 L. Ed. 2d 599 (1987), but reserving the questions concerning the scope and breadth of allowing the use of VA disability pay for spousal support and child support). Petitioner also made a claim under 42 U.S.C. § 1983, alleging DHR had, by its actions, deprived him of his constitutional rights to his property, to wit, his VA disability pay.
DHR countered that Petitioner’s VA disability benefits were, in fact, subject to levy or attachment under federal law. DHR relied on Rose v. Rose, supra, in which this Court, in 1987, determined that a state court could hold a child-support obligor in contempt for refusing to pay child support out of his VA disability benefits, and Nelms v. Nelms, 99 So. 3d 1228, 1232-33 (Ala. Civ. App. 2012), in which the Alabama Court of Appeals concluded that a trial court could consider VA disability benefits in determining the amount of alimony to award. Based on those cases, DHR concluded, DHR was entitled to levy Petitioner’s disability benefits
The Circuit Court affirmed DHR’s decision. Petitioner then filed an appeal in the Court of Appeals, arguing several bases for reversal. First, DHR violated federal statutory and constitutional provisions, including 38 U.S.C. § 5301(a)(1) and 42 U.S.C. § 659(h)(1)(A)(ii)(V), and that its decision was clearly erroneous, arbitrary and capricious. Petitioner also claimed that DHR had violated his rights under the due process clause of the 14th Amendment to the United States Constitution. Petitioner also argued that DHR’s “policy” that VA disability benefits are not exempt from lien or levy influenced its decision not to provide him an administrative hearing and it was axiomatic that denial of an administrative hearing is a fundamental violation of minimal due process under the 14th amendment.
The Court of Appeals affirmed. The Court of Appeals undertook its review of DHR’s decision based on Section 41-22-20(k) of the Alabama Code of 1975, which, inter alia, authorizes the court to reverse a state agency action if it finds the agency’s action “is due to be set aside or modified under standards set forth in appeal or review statutes applicable to that agency or if substantial rights of the petitioner have been prejudiced because the agency action is: (1) in violation of constitutional or statutory provisions; (2) in excess of the statutory authority of the agency; (3) in violation of any agency rule; (4) made upon unlawful procedures; (5) affected by other error of law; (6) clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record; or (7) unreasonable, arbitrary, or capricious, or characterized by an abuse of discretion or a clearly unwarranted exercise of discretion.
The Court of Appeals ruled that while Petitioner was correct that VA disability benefits do not fall within the exception from direct levy while those benefits are in the possession of the VA, citing 42 U.S.C. § 659(h)(1)(A)(ii)(V), this fact did not prevent DHR from seizing Petitioner’s benefits. The Court of Appeals reasoned that 42 U.S.C. § 659(a) only creates a “limited waiver of sovereign immunity” of the United States, citing Rose, 481 U.S. at 635, and, therefore, the requirement in § 659(a) that the benefits to be seized be “based upon remuneration for employment” did not prevent the states from enforcing child-support orders by ordering that payment be made from VA disability benefits.
While glossing over the sweeping language of 38 U.S.C. § 5301, which prohibits any legal process from being used by states to assert rights to VA disability benefits that are deemed by preemptive federal law to be off limits, the Court of Appeals reasoned that the fact that VA disability benefits are intended to support not only the veteran, but the veteran’s family, required the Court in Rose, supra at 634, to “[r]ecogniz[e] an exception to the application of § 3101(a)’s prohibition against attachment, levy, or seizure in this context [to] further, [and] not undermine, the federal purpose in providing these benefits.” The Court of Appeals followed Rose and held the anti-assignment provision, now 38 U.S.C. § 5301, does not extend to protect VA disability benefits from seizure where the veteran invokes that provision to avoid an otherwise valid order of child support.
The Court of Appeals concluded that neither the anti-assignment provision, 38 U.S.C. § 5301 nor the requirements of 42 U.S.C. § 659 were relevant to determining whether DHR could seize, or otherwise prevent Petitioner from accessing his VA disability benefits from his credit union account. The Court of Appeals dismissed Petitioner’s argument that DHR’s policy that VA disability benefit are not exempt from lien or levy had influenced its decision not to provide him with an administrative hearing and was in violation of the 14th Amendment’s guarantee of minimal due process. The Court of Appeals however went on to further reason that DHR was justified in its denial of a hearing based on its determination that it had been providing “child support services as required by law.” Citing Ala. Admin. Code (DHR) Rule 660-1-5-.05(f).
The Court of Appeals affirmed the judgment of the circuit court affirming DHR’s decision to levy Holmes’s VA disability benefits to satisfy his child-support obligation. On December 7, 2018, the Alabama Supreme Court denied Petitioner’s writ of certiorari to the Alabama Court of Appeals. Petitioner seeks to file a Petition for a Writ of Certiorari in this case and by way of this application requests an extension of 60 days to file said petition for the following reasons.
Among the issues likely to be addressed in this case is the rule concerning the absolute preemption of federal law over state courts in the disposition of VA disability benefits. Under its enumerated Article I “Military Powers”, Congress provides veterans disability benefits as a personal entitlement to the veteran. The Supremacy Clause provides that federal laws passed pursuant to Congress’ enumerated Article I powers absolutely preempt all state law. Under this power, Congress has prohibited any legal process from being used to deprive veterans of their disability benefits. 38 U.S.C. § 5301.Unless Congress has lifted the absolute preemption provided by federal law in this area, state courts and state agencies simply have no authority, or jurisdiction, to direct that such benefits be seized or paid over to someone other than their intended beneficiary. Congress has lifted this absolute preemption in a small subset of cases: (1) for marital property through the Uniformed Services Former Spouses Protection Act (USFSPA), 10 U.S.C. § 1408; and (2) spousal support and child support, through the Child Support Enforcement Act (CSEA), 42 U.S.C. § 659. 42 U.S.C. § 659 was amended to specifically exclude VA disability benefits that are paid to non-retiree disabled veterans – those veterans who had not retired, and therefore could not have waived retired or retention pay to receive disability benefits. See also Howell v. Howell, 137 S. Ct. 1400 (2017).
Where a state court is preempted by controlling federal law, the state court has no authority to issue an order that exceeds its jurisdictional control. When federal law, through the Supremacy Clause preempts state law, as it does in the area of divorce in regard to veterans’ benefits, then a state court lacks jurisdiction to issue a contrary award. “State courts may exercise jurisdiction and authority over veteran’s disability pay to satisfy a child support and/or spousal support award, but only up to the amount of his or her waiver of retired pay.” In re Marriage of Cassinelli, 20 Cal App 5th 1267, 1277; 229 Cal Rptr 3d 801 (2018). See also 42 U.S.C. §§ 659(a), (h)(1)(A)(ii)(V), (B)(iii); 5 C.F.R. § 581.103 (2018) (emphasis supplied). Cassinelli was a decision on remand from this Court after Howell, supra.
VA disability benefits have also been deemed constitutionally protected property rights under the Fifth and Fourteenth Amendments to the Constitution. Cushman v. Shinseki, 576 F.3d 1290 (Fed. Cir. 2009) and Robinson v. McDonald, 28 Vet. App. 178, 185 (U.S. 2016) (federal veterans’ benefits are constitutionally protected property rights). See also Morris v Shinseki, 26 Vet. App. 494, 508 (2014) (same).
Petitioner has presented the arguments that demonstrate federal law preempts state law, and that his constitutional rights have been infringed upon by Respondent, DHR’s seizure of his property.
Finally, Rose was wrongly decided, and it is an outdated case that does not even apply to the factual circumstances of this case because Congress amended 42 U.S.C. § 659 to add subsection (h)(1)(B)(iii) after Rose.
Most importantly, all of the issues of law presented by this case are of national significance due to the increasing number of disabled veterans whose main or only source of income are disability benefits. Petitioner is not the only disabled veteran whose disability pay is a sole means of subsistence and who relies on these benefits to survive.
The purpose of Congress in enacting 38 U.S.C. § 5301 was to “prevent the deprivation and depletion of the means of subsistence of veterans dependent upon these benefits as the main source of their income.” Rose, 481 U.S. at 630. For a very limited time (after Rose v. Rose), the judicial allowance to state courts to force veterans to use their disability pay for child support and spousal support appears to have applied across the board to all disabled veterans. However, this worked an inequitable result on a certain subset of disabled veterans; namely those, like Petitioner in this case, who had been injured and rendered disabled and unable to serve before they had acquired years in service sufficient to also have the financial support and economic security of retirement pay. Now, this subset of veterans, especially due to the last 3 decades of up-tempo, high-volume deployment and military operations in which the U.S. military has been involved represents the largest population of disabled veterans in existence. The significance of this cannot be understated. See Trauschweizer, 32 International Bibliography of Military History 1 (2012), pp. 48-49 (describing the intensity of military operations commencing in the 1990’s culminating in full-scale military involvement in Iraq and Afghanistan during the past three decades). See also VA, Trends in Veterans with a Service-Connected Disability: 1985 to 2011, Slide 4 at: http://www.va.gov/vetdata/docs/QuickFacts/SCD_trends_FINAL.pdf.
Indeed, the country is no longer only faced with the waning population of disabled veterans from the post-Vietnam era and prior. Rose was, as noted, a 1987 case, and it necessarily addressed an entirely different population of aging and disabled veterans. Since 1990, there has been a 46 percent increase in disabled veterans, placing the total number of veterans with service-connected disabilities above 3.3 million as of 2011. VA, Trends, supra. By 2014, the number of veterans with a service-connected disability was 3.8 million. See U.S. Census Bureau, Facts for Features at: http://www.census.gov/newsroom/facts-for-features/2015/cb15-ff23.html. As of March 22, 2016, the number of veterans receiving disability benefits had increased from 3.9 million to 4.5 million. Id. See also VA, National Center for Veterans Analysis and Statistics, What’s New at: https://www.va.gov/vetdata/veteran_population.asp. Also, since 1990, there has been a remarkable increase in veterans with disability ratings of 50 percent of higher, with approximately 900,000 in 2011. VA, Trends, supra at slide 6. That same year, 1.1 million of the 3.3 million total disabled veterans had a disability rating of 70 percent or higher. Id.
Finally, the disability numbers and ratings for younger veterans has markedly inclined. Conducting an adjusted data search, 570,400 out of 2,198,300 non-institutionalized civilian veterans aged 21 to 64 had a VA service-connected disability at 70 percent or higher in the United States in 2014. See Erickson, W., Lee, C., von Schrader, S. Disability Statistics from the American Community Survey (ACS) (2017). Data retrieved from Cornell University Disability Statistics website: www.disabilitystatistics.org. Thus, according to this data analysis, half of the total number of veterans with a disability rating greater than 70 percent are between 21 and 64 years of age.
The National Veterans Foundation found that over 2.5 million Marines, Sailors, Soldiers, Airmen and National Guardsmen served in Iraq and Afghanistan. Of those, nearly 6,600 were killed, and over 770,000 have filed disability claims. See http://www.nvf.org/staggering-number-of-disabled-veterans/. Yet another study shows nearly 40,000 service members returning from Iraq and Afghanistan have suffered traumatic injuries, with over 300,000 at risk for PTSD or other psychiatric problems. These veterans face numerous post-deployment health concerns, sharing substantial burdens with their families.
These staggering numbers are, in part, a reflection of the nature of wounds received in modern military operations, modern medicine’s ability to aggressively treat the wounded, and modern transportation’s ability to get those most severely wounded to the most technologically advanced medical treatment facilities in a matter of hours. Fazal, Dead Wrong? Battle Deaths, Military Medicine, and Exaggerated Reports of War’s Demise, 39:1 International Security 95 (2014), pp. 95-96, 107-113. Physical injuries in these situations are understandably horrific. Id. See also Kriner & Shen, Invisible Inequality: The Two Americas of Military Sacrifice, 46 Univ. of Memphis L. Rev. 545, 570 (2016). However, many veterans also suffer severe psychological injuries attendant to witnessing the sudden arbitrariness and indiscretion of war’s violence. Zeber, Noel, Pugh, Copeland & Parchman, Family perceptions of post-deployment healthcare needs of Iraq/Afghanistan military personnel, 7(3) Mental Health in Family Medicine 135-143 (2010). As one observer has stated: “assignments can shift rapidly from altruistic humanitarian work to the delivery of immense deadly force, leaving service members with confusing internal conflicts that are difficult to integrate. During deployment, even medical personnel are at times compelled to use deadly force to protect themselves, their patients, and their fellow soldiers.” Finley, Fields of Combat: Understanding PTSD Among Veterans of Iraq and Afghanistan (Cornell Univ. Press 2011).
Combat-related post-traumatic stress symptoms (PTSS), with or without a diagnosis of post-traumatic stress disorder (PTSD) can negatively impact soldiers and their families. These conditions have been linked to increased domestic violence, divorce, and suicides. Melvin, Couple Functioning and Posttraumatic Stress in Operation Iraqi Freedom and Operation Enduring Freedom – Veterans and Spouses, available from PILOTS: Published International Literature On Traumatic Stress. (914613931; 93193). See also Schwab, et al., War and the Family, 11(2) Stress Medicine 131-137 (1995).
Such conditions are exacerbated when returning veterans must face stress in their families caused by their absence. Despite the amazing cohesion of the military community and the best efforts of the larger military family support network, separations and divorces are common. Families, already stretched by this extraordinary burden, are often pushed beyond their limits causing relationships to break down. Long deployments, the daily uncertainty of not knowing whether the family will ever be reunited, and the everyday travails of civilian life are difficult enough. A physical disability coupled with mental and emotional scars brought on by wartime environments make the veteran’s reintegration with his family even more challenging. Finley, supra.
This younger population of disabled veterans are not entitled to retirement pay because they were injured or wounded during the first few years of their service to the country. Like Petitioner, who only served for approximately 3 years, many disabled veterans in this population do not and will never have the financial security and economic assurances of a retirement pension and all the other benefits that come with being classified as retired. When it became apparent that this growing subset of disabled veterans were also being subjected to having their disability benefits taken by state courts to satisfy support orders in domestic relations cases, Congress acted to differentiate this class of veterans by amending the CSEA and adding 42 U.S.C. § 659(h)(1)(A)(ii)(V) and (h)(1)(B)(iii) distinguishing the two subsets of veterans and the two classes of disability benefits, those which are available to former spouses and minor children from the former group of retiree veterans and those that are not from the latter group of non-retiree veterans.
Because federal law has always preempted state law in this very specific circumstance, any state-court domestic relations order awarding support (child and/or spousal) would be void and unenforceable, both going forward and retroactively. In this case, Petitioner’s federal disability benefits are specifically excluded from consideration as remuneration for employment, and therefore as income, by 42 USC 659(a); (h)(1)(A)(ii)(V); and (h)(1)(B)(iii). As such, these benefits are jurisdictionally protected from any legal process whatever by 38 U.S.C. § 5301. \
Federal law is very clear and has been changed since Rose v. Rose to protect veterans’ rights and enforce federal law. Yet, state courts across the country continue to blindly cite Rose for the proposition that states have unfettered access to these disability benefits no matter what the income and status of the disabled veteran. This has caused a systemic destruction of the ability of disabled veterans to sustain themselves and their families. The greatest tragedy, of course, is the effect that this has had on the veteran community as a whole. Homelessness, destitution, alcoholism, drug abuse, criminality, incarceration and, in too many cases, suicide, are a direct result of the consequences of a blind adherence to outdated and no longer viable federal law that fails to take account of the reality of current circumstances.
A state court that rules incorrectly on a matter preempted by federal law acts in excess of its jurisdiction. Such rulings, and the judgments they spring from, including all subsequent contempt and related orders (which would cover the sanctions award here) are void ab initio and exposed to collateral attack. The United States Supreme Court has said as much: “That a state court before which a proceeding is competently initiated may – by operation of supreme federal law – lose jurisdiction to proceed to a judgment unassailable on collateral attack is not a concept unknown to our federal system.” Kalb v. Feurstein, 308 U.S. 433, 440, n 12 (1940). “The States cannot, in the exercise of control over local laws and practice, vest state courts with power to violate the supreme law of the land.” Id. at 439. “States have no power…to retard, impede, burden, or in any manner control, the operations of the constitutional laws enacted by Congress to carry into execution the powers vested in the general government.” McCulloch v Maryland, 17 US (4 Wheat) 316, 436; 4 L Ed 579 (1819) (MARSHALL, CJ) (emphasis added). Absent such power, any attempt by state courts to impede the operation of federal laws must be considered a nullity and void. Kalb, supra.
Trinity Advocates seeks to change the law on behalf of our disabled veterans so that this nation’s promise to care for them and look after them for their years of service and sacrifice will not be forgotten.
Foster v. Foster (Michigan Supreme Court)
Sergeant First Class (SFC) (retired) Ray J. Foster, is a veteran of the Iraq war who served two tours of duty as a combat infantry platoon leader (November 2003 to April 2004 and November 2005 to November 2006). On September 30, 2007, he retired after 22 years and five months of active duty service. He was awarded the Purple Heart and Bronze Star medals, among others, for his injuries and actions while serving. In addition to his combat service, Sgt. Foster was a highly effective recruiter and received multiple awards for his post-combat service.
In Iraq, while serving as a platoon leader of his infantry unit, he suffered injuries as the result of an improvised explosive device (“IED”) attack on his convoy. His injuries included traumatic brain injury (“TBI”), back and leg injuries, and other physical and mental injuries. He also suffers from severe post-traumatic stress syndrome (“PTSD”).
Due to his service-connected injuries, Sgt. Foster was classified as a 100-percent disabled, 100-percent unemployable veteran. As his injuries were incurred during combat, he qualified for and was awarded Combat-Related Special Compensation (“CRSC”) under 10 USC 1413a, retroactive to 2007.
After his retirement, Sgt. Foster’s wife filed for divorce. On December 3, 2008 a judgment of divorce was entered requiring him to pay 50% of his military retired pay as part of a Property Settlement, even if it was disability pay. The order stated, in pertinent part, as follows:
If [Petitioner] should ever become disabled, either partially or in whole, then [Respondent’s] share of [Petitioner’s] entitlement shall be calculated as if [Petitioner] had not become disabled. [Petitioner] shall be responsible to pay, directly to [Respondent], the sum to which she would be entitled if [Petitioner] had not become disabled. [Petitioner] shall pay this sum to [Respondent] out of his own pocket and earnings, whether he is paying that sum from his disability pay or otherwise, even if the military refuses to pay those sums directly to [Respondent]. If the military merely reduces, but does not entirely stop, direct payment to [Respondent], [Petitioner] shall be responsible to pay directly to [Respondent] any decrease in pay that [Respondent] should have been awarded had [Petitioner] not become disabled, together with any Cost of Living increases that [Respondent] would have received had [Petitioner] not become disabled. Failure of [Petitioner] to pay these amounts is punishable through all contempt powers of the Court.
In January of 2009, the Defense Finance and Accounting Service (“DFAS”) notified Sgt. Foster that it was paying his former spouse her share of his disposable retired pay under 10 USC 1408, the Uniform Services Former Spouses Protection Act (USFSPA). At this time, the amount his former spouse was receiving was 50% of Sgt. Foster’s disposable military retired pay.
In February of 2010, Sgt. Foster’s former spouse began receiving only $212.00 from DFAS. In April 2010, DFAS notified her that because of Sgt. Foster’s waiver of military retired pay to receive his disability pay, it had reduced the amount of disposable military retired pay that she was receiving pursuant to the USFSPA.
The former spouse filed a motion seeking enforcement of the Circuit Court’s 2008 Judgment, claiming, per the terms of the Property Settlement, that Sgt. Foster was responsible to make up the difference between what she had been receiving from DFAS and what she was then receiving due to the DFAS reduction. The trial court entered an order finding Sgt. Foster in contempt and ordered him to pay his former spouse the difference.
In the Spring of 2014, Sgt. Foster was arrested and jailed on a bench warrant for failure to make these payments to his former spouse. On June 23, 2014, an appearance bond of $9500 was posted and a show cause hearing was set for June 27, 2014. Collateral for the bond is a $10,000 lien being held by the bonding company, Great Lakes Bail Bonds, on Sgt. Foster’s elderly and ailing mother’s home.
On July 30, 2014, Sgt. Foster’s trial attorney, Michael Gawecki, filed an appearance on Sgt. Foster’s behalf in the Circuit Court and filed an objection to the proposed contempt order. Attorney Gawecki and Sgt. Foster then contacted appellate attorney and veteran JAG Carson Tucker to assist them in the proceedings. The attorneys crafted a contempt order to be entered.
The Circuit Court entered the contempt order on November 14, 2014. Petitioner began paying $1000 towards the $9500 arrearage and has been paying this amount from his only source of income, his disability pay, since.
Sgt. Foster sought to appeal the Circuit Court’s contempt order. The reason the Circuit Court had required him to use his disability pay every month to pay his former spouse (a registered nurse with a full-time job and salary) was based on the Michigan Court of Appeals case of Megee v. Carmine, 290 Mich App 551, 562; 802 NW2d 669 (2010) (MURPHY, C.J, and METER and SHAPIRO, JJ), which, at that time (and still today), ignored United States Supreme Court precedent and affirmed judgments and orders which force veterans to make up the amount his or her former spouse loses as a result of a waiver of retirement pay to receive disability pay and special compensation such as combat-related special compensation (CRSC).
A majority of states had ruled, consistent with Megee, that as long as a state court order did not specify that the money was to come from what is otherwise off-limits military disability pay, the state court could enforce an order that required the veteran to reimburse his or her former spouse for the pay that the spouse had been deprived of as a result of the veteran’s waiver of disposable retired pay to receive disability pay. See the explanation in the case of In re Marriage of Cassinelli, 4 Cal. App. 5th 1285 (2016), which actually cites Megee and notes it was among the majority of cases.
In our first brief on appeal, we argued that in state court divorce proceedings, federal law preempted and has always preempted state law concerning the disposition of marital property in divorce proceedings. Congress enacted legislation to provide for veterans’ benefits under its enumerated Article I Military Powers, Art I, § 8, cls. 12-14. As such, these benefits were protected from state court infringement by the Supremacy Clause, Article VI. We directly challenged Megee and noted that the United States Supreme Court had already ruled in Mansell v. Mansell, 490 US 581, 587-95; 109 S Ct 2023; 104 L Ed 2d 675 (1989), among many other cases, that non-disposable military benefits (retired pay waived to receive disability pay and disability pay) was and always had been off-limits, notwithstanding that the USFSPA gave state courts discretion to require a veteran to pay 50 percent of his or her disposable retired pay.
In many cases, such as this one, when the veteran receives a 100 percent service-related disability designation, there are no disposable benefits being paid to the veteran, and thus, DFAS will not pay the former spouse any of these monies pursuant to a court order. The typical letter from DFAS, like the one received by Sgt. Foster’s former spouse, explains that federal law prohibits the division of veterans’ disability pay, and therefore, DFAS, as a federal agency, will not pay those monies over to a former spouse in violation of that federal law. We pointed out in our brief that these VA disability benefits were also protected from all state court process by positive federal legislation in the form of 38 U.S.C. 5301, which affirmatively prohibits state courts from effectuating any legal process whatever with respect to such benefits. This would include, of course, an order requiring veterans to pay these benefits in a marital property settlement.
In October of 2016, the Court of Appeals issued its first opinion following Megee and ignoring all of our well-placed constitutional arguments, as well as those posited under the USFSPA and 38 U.S.C. § 5301. As we were appealing that decision to the Michigan Supreme Court, the U.S. Supreme Court granted certiorari to review the Arizona Supreme Court’s decision in the case of Howell v. Howell. There, the Arizona Supreme Court had come to the same errant conclusion as the Michigan Court of Appeals in Megee, holding that nothing prohibited state courts from ordering that veterans indemnify or “make up” the amounts lost by their former spouses as a result of a waiver of retired pay to receive disability pay. That was in December 2016. We immediately informed the Michigan Supreme Court what was happening and told them to wait until Howell came out before they decided our appeal.
Howell v. Howell
While Howell v. Howell was pending before the United States Supreme Court, Mr. Tucker contacted several veterans’ organizations to inform them about the case and explain the significance of the upcoming decision to veterans across the country. Obviously, the issues at play in Howell were front and center in Sgt. Foster’s case before the Michigan Supreme Court. A decision by the highest court in the land would be dispositive to a state court’s consideration of the issues.
Mr. Tucker then volunteered to write an amicus curiae (friend of the court) brief in support of the veteran in the United States Supreme Court. He told Veterans of Foreign Wars (VFW) and Operation Firing for Effect (OFFE) that he would write the brief pro bono, if they would agree to pay the filing and printing costs. That brief was submitted and filed with the Court.
In a unanimous opinion, the Supreme Court of the United States agreed with every major principle of law put forward in the amicus curiae brief. Federal law preempts, and has always preempted, state law in this specific area – the disposition of disposable and non-disposable veterans’ pay in state court divorce proceedings concerning the division of marital property. Congress, through its Article I enumerated “military powers” made laws to provide for all our veterans to take care of them when they retire and when they are disabled. These monies are and always have been off limits to state courts, period. The only “exception” to that rule of absolute preemption can come directly from Congress, not from state courts and not even from the Supreme Court.
Wissner v. Wissner, McCarty v. McCarty, Ridgway v. Ridgway, Mansell v. Mansell, and a handful of other cases, all from the Supreme Court, clearly said this. The only limited exception Congress ever provided for this absolute rule of state law preemption was the limited amount of “disposable retired pay (and some portion of disability pay when a retiree waives retirement pay to receive disability pay for child support and/or spousal support – again, not at issue in this case) in the USFSPA and the Child Support Enforcement Act (CSEA), 10 U.S.C. § 659, and that was it. All other funds are (and always have been) off limits in state court divorce proceedings.
Like the petitioner in Merrill v. Merrill, which was on appeal with Howell v. Howell, Sgt. Foster is a recipient of combat-related special compensation (CRSC), and thus, his disability pay is not considered “retired” pay at all per 10 U.S.C. § 1413a(g) and was off limits, period.
These are the same arguments we put forth in Sgt. Foster’s appeal, and, as well, in the amicus curiae brief in the Supreme Court in Howell for VFW and OFFE.
The Supreme Court unanimously agreed in Howell v. Howell, 137 S. Ct. 1400 (2017). It reversed in Howell (and vacated and remanded in Merrill and in another pending petition out of California, Cassinelli v. Cassinelli (also a CRSC case)), and said, directly, that all those state courts (which includes Michigan) that had been engaged in these twisted readings and misinterpretations of the law and which were illegally taking veterans’ disability benefits had to stop. They had been told that in 1981 in McCarty and in Ridgway, and again in 1982 with the USFSPA, which directs what funds are to be protected, as much as it allows division of a small amount of disposable retired pay, only, and again in 1989 in Mansell v. Mansell. Each time the states were told to knock it off. Each time they either ignored the Supreme Court or found ways around its latest iteration. The Arizona court in Merrill and the California court in Cassinelli subsequently reversed the earlier decisions and followed Howell.
The unanimous decision of the Court in Howell came out in May 2017, which followed all of the arguments in the friend of the court brief, and indeed, in the order in which we presented them (i.e., (1) Congress’ Article I “military powers” is the “enumerated” power source for providing veterans’ retirement and disability benefits and thus the exercise of this power is protected by the Supremacy Clause, Article VI, cl. 2 of the Constitution; (2) therefore federal law preempts and has always preempted state law in this area; (3) McCarty with its rule of federal preemption in this area still applies (in other words it was never abrogated by the USFSPA); (4) the USFSPA is affirmative Congressional protection of waived retired pay, disability pay, and all other veterans’ benefits that do not fit within the limited “disposable retired pay” definition in 10 U.S.C. § 1408(a)(4)(A); (5) state courts cannot craft indemnity or anticipatory orders to get around the absolute rule of preemption, in other words, they cannot force the veteran to part with other money as a substitute for what the former spouse loses and the veteran gains in the form of the non-disposable veterans’ disability benefits; and (6) 38 U.S.C. § 5301 affirmatively and jurisdictionally protects these funds such that state courts cannot declare that a former spouse’s interests are “vested” such that they cannot be modified, and indeed nullified in the future. Howell addressed and agreed with us on every one of these principal (and critical) points; and it did so in a rare unanimous opinion.
These were the very same arguments presented to the Court of Appeals and then to the Supreme Court of Michigan in my briefings in the Foster case.
Remand by the Michigan Supreme Court in Light of Howell
The Michigan Supreme Court then took quite some time deliberating my petition. Ultimately, it vacated the Court of Appeals opinion and remanded back to that Court (the same panel) with the specific instruction that it apply Howell to Sgt. Foster’s case. That was in November of 2017. I was cautiously optimistic, but I was not hopeful that this same panel, indeed one on which sat the very same judge that had authored the wayward and ill-advised Megee opinion, would do the right thing and follow the Michigan Supreme Court’s instruction to follow the United States Supreme Court’s directives.
Court of Appeals Affirms on Remand
As feared (but not unexpected), the Court of Appeals, again, affirmed the trial court, basically ignoring Howell and the Michigan Supreme Court’s direct instruction that they apply Howell to Petitioner’s case. In its opinion on remand, the Court reprinted most of its original opinion even though it had been vacated by the Michigan Supreme Court after Howell. The Court devoted only two paragraphs to the controlling unanimous decision of the United States Supreme Court in Howell and ignored the fact that Howell specifically ruled that Megee type cases had been abrogated; and that both Merrill and Cassinelli had been vacated and remanded and specifically addressed the disposition of CRSC in marital property settlements upon divorce. Indeed, they continued to assert Megee was still good law, despite Howell’s clear rejection of its reasoning and rationale!
The Court of Appeals did this knowing that Sgt. Foster has been paying his ex-spouse over $1000 per month (now well over $50,000) since June of 2014 while the case continues to be appealed. We have no choice but to continue to appeal and Sgt. Foster has no choice but to continue these payments on threat of contempt and imprisonment.
Sgt. Foster suffers from severe PTSD, anxiety, depression, the effects of traumatic brain injury, and he needs constant psychiatric and psychological support. But, he knows that what the Court is doing is wrong. While this has made it impossible for him to do anything remotely ordinary with his life because of the financial strain he has been under, Sgt. Foster is more devastated in his realization that a state court system in the country he loves and fought for can intentionally do this to him. He has very little income to live off of and must scrape for these payments and have it constantly hanging over his head. The circuit court also forced Ray to put a lien on his ailing mother’s home as a guarantee for these payments. Another illegal bonding arrangement under 38 U.S.C. § 5301, which prohibits forcing a veteran to collateralize debts upon his or her benefits. All of this is being done to a veteran who swore to uphold the Constitution of the United States and the laws passed thereunder. In other words, while Sgt. Foster fought and nearly died for this principle, state courts have consciously and routinely ignored it.
Application to the Michigan Supreme Court After Remand and Grant Order
So, I filed another application after remand once again appealing to the Michigan Supreme Court in May 2018. Finally, the Court granted the application for leave to appeal and the case is set for full calendar briefing and oral argument. The Court has asked the parties to brief several questions in addition to the ones we have raised. Principally, the Court wants to know the effect of Howell on Megee. I believe it is clear Howell overruled Megee-type cases.
The case likely won’t be argued until spring or summer 2019 at the earliest. We are now working on the principal appeal brief. We are seeking amicus curiae support from organizations that are interested in the legal issues in this case. We are also seeking financial support for the costs and fees being generated to assist Sgt. Foster in defending his rights and vindicating his entitlement to his disability benefits.
Carpenter v. Carpenter (Michigan Court of Appeals)
Miller v. Miller (Tennessee Circuit Court)
Alwan v. Alwan (Virginia Court of Appeals)