Christopher John Doleman, who was inducted into the Pro Football Hall of Fame in 2012, was one of the best and most tenacious right defensive end players in the history of the NFL. Several years after he retired from the NFL, his tenacity on the gridiron manifested itself in line-of-duty orthopedic injuries. As a result, the Bert Bell/Pete Rozelle NFL Player Retirement Plan ultimately awarded Mr. Doleman line-of-duty disability benefits in March 2012. Now, having been awarded those disability benefits, years after his divorce, imagine his shock when one-half of those benefits were paid to his former spouse.
The NFL retirement plans have undergone substantial changes, most notably with the addition of the neuro-cognitive disability benefits that were negotiated to settle the National Football League Players’ Concussion Injury Litigation class action lawsuit. Additionally, the 2011 Collective Bargaining Agreement between the NFL and the NFL Players Association requires that line-of-duty disability (and all other non-total and permanent disability) benefits be paid from the NFL Player Disability & Neuro-Cognitive Disability Plan after January 1, 2015. Those changes rectify what was probably an unintended consequence of language that the NFL put in its model Qualified Domestic Relations Order (“QDRO”) form for the Bert Bell/Pete Rozelle NFL Player Retirement Plan prior to the creation of the NFL Player Disability & Neuro-Cognitive Disability Plan. In 2007 when Mr. Doleman was divorced, however, those unintended consequences were not foreseen.
Mr. Doleman and his former wife agreed to split equally his Second Career Savings, NFL Annuity, and NFL Pension, including the Bert Bell/Pete Rozelle NFL Player Retirement Plan (the “Plan”). The settlement agreement did not address disability benefits at all . To effectuate the terms of the settlement agreement, a QDRO was entered for the Plan. At the time of Mr. Doleman’s divorce, all disability benefits were administered through the Plan, including line-of-duty disability benefit payments and total and permanent (“T&P”) disability benefit payments. Accordingly, the Plan’s model form of QDRO provided by the NFL Players’ Association included the following provision:
The Alternate Payee is hereby awarded 50% of any disability benefits otherwise payable to the Player on or after the date of this order under the Retirement Plan. The Alternate Payee may only receive disability benefits when and if the Player becomes eligible to receive such disability benefits under the Retirement Plan. In the event that the Player becomes ineligible to receive disability benefits, the Alternate Payee’s right to receive such benefits will cease. If the Alternate Payee predeceases the Player, the Alternative Payee’s disability benefits will revert to the Player during the lifetime of the Player.
That condition regarding future disability benefits was included in the model form of QDRO because if a retired player was approved for a T&P disability, the Plan paid the retired player the greater of his pension benefit or his T&P disability payment. If the T&P disability benefit was greater, the player received the T&P disability benefit in lieu of the retirement benefit. If that occurred, the former spouse/alternate payee would not receive 50% of the anticipated retirement benefits because retirement benefits would not be paid, and, accordingly, the above-quoted language was necessary to protect the former spouse.
Since that provision was included in Mr. Doleman’s QDRO, the Plan Administrator interpreted the language to include the line-of-duty disability benefits as well as T&P disability benefits. Accordingly, Mr. Doleman received only 50% of his line-of-duty disability benefit, while his former wife received the other half of the payment each month.
Mr. Doleman, the one who actually suffers from the injuries, incurs the medical expenses, has a reduced quality of life and a reduced earning capacity, did not believe that his former wife receiving 50% of his line-of-duty disability payments was an equitable result, or that it was consistent with the parties’ intent at the time the divorce settlement was reached. Mr. Doleman, therefore, filed a Petition for Declaratory Judgment and to Reform or Modify Qualified Domestic Relations Order and for Money Had and Received. Mr. Doleman filed his Petition in an effort to rectify what he contended was a mutual mistake in the language of the QDRO which was in conflict with the clear intent of the parties as set forth in their settlement agreement. Mr. Doleman argued that the language in the settlement agreement was clear and unambiguous and that the parties did not intend for Ms. Doleman to receive 50% of Mr. Doleman’s line-of-duty disability payments.
Mr. Doleman’s former wife moved to dismiss the petition on the ground that it failed to state a claim for which relief could be granted and on the further ground that the settlement agreement could not be amended, modified or reformed with respect to the equitable division of the retirement accounts. Mr. Doleman successfully defended the motion to dismiss and was ultimately successful in having the QDRO reformed after an arbitration hearing.
Mr. Doleman argued that the parties’ settlement agreement was clear and unambiguous, and that the mutual mistake occurred in the drafting of the QDRO. The Employee Retirement Income Security Act of 1974 (“ERISA”)  provides for an exception to the principle that retirement benefits may not be alienated, in that a state court, in a divorce proceeding, may enter a QDRO assigning one spouse an interest (as marital property) in the other spouse’s retirement benefits. The QDRO is not part of the Settlement Agreement or Divorce Decree; it is the tool required by ERISA to enforce the parties’ agreement and effectuate the court’s judgment to divide certain retirement benefits. In fact, the settlement agreement is not a QDRO under ERISA .
Thus, Mr. Doleman contended, he was merely asking that the court enforce the provisions of the divorce decree by modifying or reforming the QDRO (not the settlement agreement) to reflect accurately the intent of the parties as clearly set forth in their settlement agreement. Mr. Doleman further argued that he did not seek to modify the equitable division of marital property as set forth in the settlement agreement incorporated into the final judgment and decree of divorce on the ground that “[t]he finality of the divorce decree is not affected by the presence or absence of a QDRO.”  Since Mr. Doleman was only seeking to modify the completely separate QDRO, he was not attempting to modify a final judgment. The arbitrator agreed with Mr. Doleman and concluded that he was simply attempting to modify the terms of the QDRO to reflect the bargained for exchange by the parties.
Mr. Doleman’s former wife argued that Mr. Doleman incurred all his NFL injuries during his NFL career during the marriage, and, accordingly, actually earned the right to the disability benefits during the marriage. Mr. Doleman countered that it has long been the law in Georgia that “compensation for pain and suffering and loss of capacity is not subject to equitable division as a marital asset.”  The parties’ intent, as clearly set forth in their settlement agreement, was that they were splitting traditional retirement benefits, not disability benefits.
Mr. Doleman also argued that because his settlement agreement provided that the parties waived their rights to any property obtained by either of them after the date of execution of the settlement agreement, and he did not obtain the right to receive disability payments until five years after the divorce, regardless of when the injuries occurred, his former wife also waived her rights to receive any disability benefits awarded after the divorce. In addition to the clear waiver of her right to any after-acquired property of her former husband, both parties waived any right to all marital rights and claims except those set forth specifically in the parties’ settlement agreement. Such an unequivocal waiver provision has been held to prevent a former spouse from collecting retirement benefits, death benefits, and IRA accounts, even where the beneficiary designation was never changed post-divorce .
Finally, because the parties’ settlement agreement did not mention line-of-duty disability benefits, the arbitrator agreed with Mr. Doleman that the QDRO could be amended to reflect accurately the parties’ intent. Mr. Doleman argued that “[t]he controlling principle to be applied when interpreting a divorce decree which incorporates the parties’ settlement agreement is to find the intent of the parties by looking to the ‘four corners’ of the agreement and in light of the circumstances as they existed at the time the agreement was made.”  The circumstances that existed at the time the agreement was made did not include that Mr. Doleman would receive disability benefits that do not reduce the pension benefits, as he testified at the arbitration hearing.
The arbitration award did not include any damages for money had and received, but other facts and circumstances may provide a better opportunity to pursue a refund of the funds paid to a former wife of an NFL player. Mr. Doleman will be receiving 100% of his line-of-duty disability benefit until that benefit expires. If you have a client in a similar situation, the goal should be to move quickly so that the QDRO can be reformed as soon as possible, and your client can receive 100% of his line-of-duty disability payments.
1. The Settlement Agreement provided that:
As an equitable division of property, Wife shall have fifty percent (50%) of the Husband’s Second Career Savings, NFL Annuity and NFL Pension (the “Plans”) computed as of the date this Settlement Agreement is executed, together with all losses and gains thereon through the date of division. The division shall be accomplished by the entry of Qualified Domestic Relations Orders (QDRO). Within 30 days of entry of the Final Judgment and Decree, the Husband shall have the QDROs prepared which shall each provide for payment of the Wife’s benefit to commence in the form and at the time in accordance with the terms of the Plans. The parties shall pay for the preparation of the QDROs equally. Said distributions shall be in full settlement of Wife’s claim for equitable division of Husband’s interest in the Plans. Each of the parties shall execute all documents needful or necessary in order to carry out the intention of this paragraph. Each party shall be responsible for and shall indemnify the other party against any financial liability associated with the transfer of funds from said Plans, and shall be individually responsible for any taxes, liabilities or penalties associated with his or her receipt of funds from said Plans. Wife, by and through her attorney, shall have the QDROs entered by this Court. The Court shall retain jurisdiction over the provisions of this paragraph necessary to effectuate the intent of this paragraph, and shall retain jurisdiction to enforce, revise, modify or amend the QDROs insofar as necessary to establish or maintain the qualifications of the QDROs. (emphasis added)
2. 29 USC § 1056(d)(1).
3. 29 USC § 1056(d)(3)(B)(i)(I). See also Appleton v. Alcorn, 291 Ga. 107, 728 S.E.2d 549 (2012)(holding that ERISA does not bar state law claims where the plan administrator has properly paid out the benefits but where the 401(k) beneficiary waived her right to keep the funds under a settlement agreement.)
4. Mermann v.Tillitski, 297 Ga. 881, 884, 778 S.E.2d 191, 193 (2015) at footnote 5.
5. Campbell v. Campbell, 255 Ga. 461, 462, 339 S.E.2d 591, 593 (1986).
6. See, e.g., DeRyke v. Teets, 288 Ga. 160, 702 S.E.2d 205 (2010); Young v. Stump, 294 Ga. App. 351, 669 S.E.2d 148 (2008); Kruse v. Todd, 260 Ga. 63, 67, 389 S.E.2d 488 (1990). In each of those decisions, the Georgia appellate courts held that even the expectancy interest was “extinguished by release language in the parties’ settlement agreement.” Young at 355, 669 S.E.2d at 151.
7. Mermann v. Tillitski, 297 Ga. 881, 883, 778 S.E.2d 191, 193 (2015)(citations and punctuation omitted).