In re Marriage of Grandt (Pension Retirement Benefits vs. Pension Disability Benefits)

Judith and Laurence Grandt were married for 20 years. At the time of their divorce, Judith was age 46 and Laurence was age 43, and employed as a firefighter for the Countryside Fire Protection District in Countryside, Illinois.

When the parties divorced, they agreed that Laurence would pay Judith maintenance in the amount of $150.00 per month for 24 months.

With respect to assets, they were generally divided with Judith receiving 60% of marital assets and Laurence receiving 40% of marital assets. The parties also agreed that at the time Laurence was eligible to receive his pension from the Countryside Fire Department, he would split the monthly pension benefits with his former wife, 50/50. A provision in the parties’ Marital Settlement Agreement did not distinguish between retirement pension benefits and disability pension benefits.

Approximately one year after the divorce, Laurence become disabled, and began receiving disability pension benefits.

Approximately 15 years later, when Laurence reached retirement age 60, Laurence’s monthly disability pension payments were deemed to have been converted into retirement pension benefits, because upon reaching retirement age, the monthly pension benefits being paid to Laurence by the Countryside Fire Department Pension were no longer deemed to be “income replacement payments from disability,” but normal retirement benefits upon reaching retirement age.

Judith filed an appeal from the Lake County Circuit Court which denied her right to receive monthly pension benefits even after Laurence had reached retirement age. When heard by the Appellate Court, the Appellate Court made the determination that monthly disability pension payments were to be considered “income replacement” because Laurence was no longer able to work between the ages 45 and 60; however, once Laurence turned age 60, these monthly pension benefits were deemed to be converted from disability to retirement benefits; therefore, Judith should be entitled to receive 50% of the retirement benefits, just as the parties had negotiated in their Marital Settlement Agreement.

In explaining Its rationale, the Illinois Appellate Court made a determination that pursuant to the Marital Settlement Agreement, Judith was clearly entitled to her 50% interest in her husband’s Countryside Fire Department Retirement. Judith did not make a claim for the disability pension benefits Laurence received from age 45 to 60; however, once Laurence turned age 60 and was therefore eligible for retirement benefits, the Appellate Court made the determination that all pension benefits received after reaching retirement age were no longer “income replacement disability pensions payments,” but were now deemed retirement benefits and should be split equally with the former wife.

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