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Division of Private Disability Insurance Benefits
© 2003 National Legal Research Group, Inc.
WYOMING: Metz v. Metz, 61 P.3d 383 (Wyo. 2003).
Where the husband's private disability insurance benefits were acquired with premiums paid by marital funds, and were at least partly compensation for lost income earned during the marriage, the wife was entitled to receive a share of them upon divorce.
The husband was a neurosurgeon who retired from his practice in July 1999 due to a medical disability. Upon his retirement, he began receiving payments from a disability insurance policy. The policy had been purchased in 1986, and the premiums were paid out of family funds. As of the date of the divorce, the husband had received $189,000 in payments and expected to receive an additional $6,500 per month until he reached the age of 65. As part of the divorce decree, the wife was awarded $2,112 per month or one-half of the monthly disability payments received by the husband, whichever was greater, as well as the sum of $75,000 to compensate her for disability payments already received by the husband. The husband appealed.
The husband first argued that the disability payments should not have been included in the distribution of assets because they were not property which was the product of the marital union acquired during the course of the marriage by the joint efforts of the parties as required by Wyo. Stat. Ann. 20-2-114. The court rejected this contention. It pointed out that under the statute a court may make disposition of the property of the parties as appears just and equitable, having regard for (1) the respective merits of the parties and the conditions in which they will be left by the divorce, (2) the party through whom the property was acquired, and (3) the burdens imposed upon the property for the benefit of the parties and any children. Applying this Code provision, and looking first at the disability benefits already distributed to the husband, with none going to the wife, the court found that under the circumstances, especially considering that the premiums for the disability insurance policy derived from family proceeds, the payments were a product of the marital union and were acquired during the course of the marriage through the joint efforts of the parties. That portion of the proceeds of the policy received by the husband prior to the divorce was a substitute for income he would have otherwise earned. A distribution of a share of the payments already received, $75,000, was proper.
Looking next to the disability payments that would be received by the husband in the future until he turned 65, the court upheld the lower court's determination that the wife was entitled to a share thereof because of a need to leave the parties in similar economic circumstances after the divorce. The husband's argument that the wife was not entitled to any portion of the future payments because they would not be received during the marriage was also dismissed. Such payments were not to be likened, as the husband attempted to do, to income earned by a spouse after the marriage. These payments would derive from an insurance policy purchased during the marriage with funds that would otherwise have been used for family living expenses or invested for the family's benefit and were not like postdivorce earnings, which have no relation to the marriage.
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