US SUPREME COURT DECISIONS

In direct response to McCarty v. McCarty, 453 U. S. 210, which held that federal law as it then existed completely preempted the application of state community property law to military retirement pay, Congress enacted the Uniformed Services Former Spouses' Protection Act (Act), 10 U.S.C. § 1408 (1982 ed. and Supp. V), which authorizes state courts to treat as community property "disposable retired or retainer pay," § 1408(c)(1), specifically defining such pay to exclude, inter alia, any military retirement pay waived in order for the retiree to receive veterans' disability benefits, § 1408(a)(4)(B). The Act also creates a mechanism whereby the Federal Government will make direct community property payments of up to 50% of disposable retired or retainer pay to certain former spouses who present state court orders granting such pay. A pre-McCarty property settlement agreement between appellant and appellee, who were divorced in a county Superior Court in California, a community property State, provided that appellant would pay appellee 50 percent of his total military retirement pay, including that portion of such pay which he had waived in order to receive military disability benefits. After the Act's passage, the Superior Court denied appellant's request to modify the divorce decree by removing the provision requiring him to share his total retirement pay with appellee. The State Court of Appeal affirmed, rejecting appellant's contention that the Act precluded the lower court from treating as community property the military retirement pay appellant had waived to receive disability benefits. In so holding, the court relied on a State Supreme Court decision which reasoned that the Act did not limit a state court's ability to treat total military retirement pay as community property and to enforce a former spouse's rights to such pay through remedies other than direct Federal Government payments.

Held: The Act does not grant state courts the power to treat as property divisible upon divorce military retirement pay waived by the retiree in order to receive veterans' disability benefits. In light of § 1408(a)(4)(B)'s limiting language as to such waived pay, the Act's plain and precise language establishes that § 1408(c)(1) grants state courts the authority to treat only disposable retired pay, not total retired pay, as community property. Appellee's argument that the Act has no preemptive chanrobles.com-red

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effect of its own, and must be read as a garnishment statute designed solely to limit when the Federal Government will make direct payments to a former spouse, and that, accordingly, § 1408(a)(4)(B) defines "disposable retired or retainer pay" only because payments under the statutory direct payment mechanism are limited to amounts defined by that term, is flawed for two reasons. First, the argument completely ignores the fact that § 1408(c)(1) also uses the quoted phrase to limit specifically and plainly the extent to which state courts may treat military retirement pay as community property. Second, each of § 1408(c)'s other subsections imposes new substantive limits on state courts' power to divide military retirement pay, and it is unlikely that all of the section, except for § 1408(c)(1), was intended to preempt state law. Thus, the garnishment argument misplaces its reliance on the fact that the Act's saving clause expressly contemplates that a retiree will be liable for "other payments" in excess of those made under the direct payment mechanism, since that clause is more plausibly interpreted as serving the limited purpose of defeating any inference that the mechanism displaced state courts' authority to divide and garnish property not covered by the mechanism. Appellee's contention that giving effect to the plain and precise statutory language would thwart the Act's obvious purposes of rejecting McCarty and restoring to state courts their pre-McCarty authority is not supported by the legislative history, which, read as a whole, indicates that Congress intended both to create new benefits for former spouses and to place on state courts limits designed to protect military retirees. Pp. 490 U. S. 587-594.

Reversed and remanded.

MARSHALL, J., delivered the opinion of the Court, in which REHNQUIST, C.J.,and BRENNAN, WHITE, STEVENS, SCALIA, and KENNEDY, JJ., joined. O'CONNOR, J., filed a dissenting opinion, in which BLACKMUN, J., joined, post, p. 490 U. S. 595. chanrobles.com-red

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