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Georgia Case Law Update – Mermann v. Tillitski

When hammering out the terms of a settlement agreement with your spouse, you may wonder how many details actually need to go in there. A good rule of thumb is: If it’s important to you, put it in writing. That is the only way you can be confident any argument over that issue will stand up in court. If you want someone to do something in a timely manner, put those specifics in the agreement. A husband in a recent Georgia Supreme Court appeal found this out the hard way. Mermann v. Tillitski, S15A0965 (2015).

In that case, the parties divorced in 2009 pursuant to a settlement agreement that stated, in relevant part: “[W]ife shall receive 50% of the Husband’s SEP IRA as of the date of this agreement and shall have her pro rata share of all investment experience, including earnings and losses…Wife shall be responsible for the preparation of a Qualified Domestic Relations Order (QDRO)…to be prepared within thrity (30) days of the signing of this Agreement. Said QDRO shall be subject to approval of Husband’s attorney and the Court of proper jurisdiction in this case, as well as the Administrator(s) of the aforementioned Plan.” Id. The Wife did not submit the QDRO until over four years later, claiming that the Husband failed to give her necessary documents. At a hearing to address an issue with the QDRO, the Husband argued that the Wife should not be entitled to any earnings on her portion of the IRA that accrued after the 30-day window in which the QDRO was supposed to be filed. Specifically, the Husband alleged that the 30-day deadline “was meant to limit her ability to benefit from the accounts’ investments and that she should not be allowed to profit from her failure to comply with the divorce decree.” Id. The trial corut agreed, setting a date 30 days from the original divorce decree as the date for calculating the IRA’s value for purposes of division. The Wife appealed.

The Georgia Supreme Court agreed with the Wife, holding that the trial court improperly modified the parties’ settlement agreement. Specifically, the Court held that it could only look at the plain language within the ‘four corners’ of the agreement itself. Although the agreement gave the Wife the responsibility of filing the QDRO within 30 days, “there is nothing in the agreement to suggest that if Wife did not prepare a QDRO within that time frame that she would not receive any earnings on her portion of the IRAs that accrued after 30 days from the date of the agreement.” Accordingly, the trial court’s decision was reversed.

This case brings up a good point about items in a settlement agreement that must be completed in a timely manner. If time is of the essence, put it in the agreement. If the parties want there to be a penalty if something is not completed in a timely manner, again, put it in the agreement. The court cannot and will not read words into your agreement that are not there.

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