In May 2017, the United States Supreme Court settled the longstanding disparity among the 50 states as to the allowance of indemnification and equitable protections for former spouses in situations where the servicemember was retired under certain types of disability retirements that were presumably excluded from the definition of disposable retired pay, a term of art for the retirement portion divisible as property in divorce cases under federal law. In Howell v. Howell (137 S.Ct. 1400 (2017)), the United States Supreme Court decidedly ruled that only those portions under 10 U.S.C. 1408 denoted as disposable retired pay would constitute divisible property in divorce cases. As such, the receipt of Combat Related Special Compensation, pay 40% or less VA disability rating, or disability retired pay under 10 U.S. Code Chapter 61 excluded those portions from being divided as property regardless of any equities of a case and regardless of whether a state court previously permitted such payments. That decision singlehandedly restructured every conversation had with a former spouse in a military divorce case and greatly increased the importance of other aspects of family law such as spousal support. However, in many instances, former spouses, even those who had followed the servicemember through permanent change in stations and acted as homemaker during deployments, were left with very little remedy.
Fortunately, there was finally some relief allowed for former spouses in particular scenarios where a retiree is receiving both disability retired pay under Chapter 61 and Concurrent Retirement and Disability Pay (CRDP) when the servicemember had at least 20 years of creditable service towards retirement. In those instances, the Federal Claims Appeals Board, in a reconsideration decision in which DFAS appealed the initial decision from the Defense Office of Hearings and Appeals (DOHA), ruled in March 1, 2022 that such receipt of CRDP is considered disposable retired pay under federal law since the express language in the CRDP statues included members who are retired under Chapter 61 with 20 years or more and defines the amount of CRDP they are entitled to receive as the amount of retired pay to which they would be entitled had they not retired for disability. That is, the receipt of CRDP means that such retired pay is being paid under the CRDP statute and not under the applicable statutory authority under 10 U.S.C. 1201(b)(3). To further develop this decision, DOHA pointed out that Congress had already exempted Combat Related Special Compensation from disposable retired pay and had the Congress intended such with CRDP, it would have expressly indicated that in the body of the statute.
The implication in this decision is tremendous. Whereas before a former spouse would have rightfully been told that he or she did not have any entitlement to any retired pay due to the Chapter 61 determination, it is now possible depending on the years of service to have that benefit in CRDP be remitted by DFAS. Moreover, it demonstrates that for military divorce cases going forward, it is paramount that the attorney for the former spouse insist on a clause or provision that awards the marital share of the military retirement to the former spouse, despite any appearances of being not divisible in the prior sense. To do anything contrary than that is risking a malpractice claim in light of the March 1, 2022 DOHA decision.