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Office of the Revisor of Statutes

Key: (1) language to be deleted (2) new language

  

                         Laws of Minnesota 1987 

                        CHAPTER 157-H.F.No. 940 
           An act relating to retirement; various employee 
          pension plans; specifying that exemptions from legal 
          process do not include marital property divisions; 
          requiring the provision of certain pension plan 
          information in marriage dissolution actions; providing 
          for court appointed actuaries in marriage dissolution 
          actions; authorizing conversion of a certain joint and 
          survivor annuity; amending Minnesota Statutes 1986, 
          sections 69.51; 352.15, subdivision 1; 352.96, by 
          adding a subdivision; 352B.071; 353.15; 354.10; 
          354A.11; 422A.24; 423.39; 423.61; 423.813; 424.27; 
          518.54, subdivision 5, and by adding subdivisions; and 
          518.58; proposing coding for new law in Minnesota 
          Statutes, chapters 356 and 518. 
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
    Section 1.  Minnesota Statutes 1986, section 69.51, is 
amended to read:  
    69.51 [PAYMENTS EXEMPT FROM PROCESS.] 
    All payments made, or to be made, by any relief association 
under any of the provisions of sections 69.25 to 69.53 shall be 
totally exempt from garnishment, execution, or other legal 
process and, except as provided in section 518.58, section 18, 
or 518.611.  No persons entitled to such payment shall have the 
right to assign the same, nor shall the association have 
authority to recognize any assignment or to pay any sum on 
account thereof; and.  Any attempt to transfer any such right or 
claim, or any part thereof, shall be void.  
    Sec. 2.  Minnesota Statutes 1986, section 352.15, 
subdivision 1, is amended to read:  
    Subdivision 1.  [EXEMPTION; EXCEPTIONS.] None of the 
moneys, annuities, or other benefits mentioned herein shall be 
assignable either in law or in equity or be subject to any state 
estate tax, or to execution, levy, attachment, garnishment, or 
other legal process, except as provided in subdivision 1a or 
section 518.58, section 18, or 518.611.  Provided, however, 
    Subd. 1a.  [AUTOMATIC DEPOSITS.] The executive director may 
pay an annuity, benefit or refund to a banking institution, 
qualified under chapter 48, that is trustee for a person 
eligible to receive such annuity, benefit or refund.  Upon the 
request of a retired, disabled or former employee, the executive 
director may mail the annuity, benefit or refund check to a 
banking institution, savings association or credit union for 
deposit to such employee's account or joint account with a 
spouse.  The board of directors may prescribe the conditions 
under which such payments will be made.  
    Sec. 3.  Minnesota Statutes 1986, section 352.96, is 
amended by adding a subdivision to read: 
    Subd. 6.  [EXEMPTION FROM PROCESS.] As money to which legal 
title is vested in the state of Minnesota, no amount of deferred 
compensation is assignable or subject to execution, levy, 
attachment, garnishment, or other legal process, except as 
provided in section 518.58, section 18, or 518.611. 
    Sec. 4.  Minnesota Statutes 1986, section 352B.071, is 
amended to read:  
    352B.071 [EXEMPTION FROM PROCESS.] 
    None of the money, annuities, or other benefits provided 
for in this chapter shall be assignable either in law or in 
equity or be subject to execution, levy, attachment, 
garnishment, or other legal process, except as provided in 
section 518.58, section 18, or 518.611.  
    Sec. 5.  Minnesota Statutes 1986, section 353.15, is 
amended to read:  
    353.15 [NONASSIGNABILITY AND EXEMPTION OF ANNUITIES AND 
BENEFITS FROM JUDICIAL PROCESS.] 
    Subdivision 1.  [EXEMPTION; EXCEPTIONS.] No money, annuity, 
or benefit provided for in this chapter is assignable or subject 
to any state estate tax, or to execution, levy, attachment, 
garnishment, or legal process, except as provided in subdivision 
2 or section 518.58, section 18, or 518.611.  Provided, however, 
    Subd. 2.  [AUTOMATIC DEPOSITS.] The association may pay an 
annuity, benefit or refund to a trust company, qualified under 
chapter 48, that is trustee for a person eligible to receive 
such annuity, benefit or refund.  Upon the request of a retired, 
disabled or former member, the association may mail the annuity, 
benefit or refund check to a banking institution, savings 
association or credit union for deposit to such person's account 
or joint account with a spouse.  The association may prescribe 
the conditions under which such payment will be made.  
    Subd. 3.  [PAYMENT TO PUBLIC BODIES.] If in the judgment of 
the executive director conditions so warrant, payment may be 
made to a public body in behalf of an annuitant, disabilitant, 
or survivor upon such terms as the executive director may 
prescribe. 
    Sec. 6.  Minnesota Statutes 1986, section 354.10, is 
amended to read:  
    354.10 [FUND NOT SUBJECT TO ASSIGNMENT OR PROCESS; 
BENEFICIARIES.] 
    Subdivision 1.  [EXEMPTION; EXCEPTIONS.] The right of a 
teacher to take advantage of the benefits provided by this 
chapter, is a personal right only and shall not be assignable.  
All money to the credit of a teacher's account in the fund or 
any money payable to the teacher from the fund shall belong to 
the state of Minnesota until actually paid to the teacher or a 
beneficiary pursuant to the provisions of this chapter.  Any 
power of attorney, assignment or attempted assignment of a 
teacher's interest in the fund, or of the beneficiary's interest 
therein, by a teacher or a beneficiary, shall be null and void 
and the same shall be exempt from taxation under chapter 291 and 
from garnishment or levy under attachment or execution, except 
as provided in subdivision 2 or section 518.58, section 18, or 
518.611.  Provided however, 
    Subd. 2.  [AUTOMATIC DEPOSITS.] The board may pay an 
annuity or benefit to a banking institution, qualified under 
chapter 48, that is a trustee for a person eligible to receive 
such annuity or benefit.  Upon completion of the proper forms as 
provided by the board, the annuity or benefit check may be 
mailed to a banking institution, savings association or credit 
union for deposit to the recipient's individual account or joint 
account with a spouse.  The board shall prescribe the conditions 
which shall govern these procedures.  
    Subd. 3.  [PAYMENT TO PUBLIC BODIES.] If in the judgment of 
the executive director conditions so warrant, payment may be 
made to a public body in behalf of an annuitant, disabilitant, 
or survivor upon such terms as the executive director may 
prescribe.  
    Subd. 4.  [CHANGES IN BENEFICIARIES.] Any beneficiary 
designated by a teacher under the terms of this chapter, may be 
changed or revoked by the teacher at pleasure, in such manner as 
the board may prescribe.  In case a designated beneficiary dies 
before the teacher designating the beneficiary dies, and a new 
beneficiary is not designated, the teacher's estate shall be the 
beneficiary.  
    Sec. 7.  Minnesota Statutes 1986, section 354A.11, is 
amended to read:  
    354A.11 [CERTAIN MONEYS AND CREDITS OF TEACHERS EXEMPT.] 
    All moneys deposited by a teacher or member or deposited by 
any other person or corporation, municipal or private, to the 
credit of a teacher or member of a teachers retirement fund 
association organized pursuant to this chapter, and all moneys, 
rights, and interests or annuities due or to become due to a 
teacher, member, or annuitant, or their beneficiaries, from any 
association shall not be assignable, shall be exempt from 
garnishment, attachment, and execution or sale on any final 
process issued from a court and other legal process, except as 
provided in section 518.58, section 18, or 518.611, and shall 
not be subject to the estate tax provisions of this state.  This 
section does not make the moneys nonmarital property.  
    Sec. 8.  [356.80] [PROVISION OF INFORMATION IN THE EVENT OF 
MARRIAGE DISSOLUTION.] 
    Subdivision 1.  [INFORMATION FOR A PENDING MARRIAGE 
DISSOLUTION.] (a) Upon written request by a person with access 
to the data under subdivision 3, a public or private pension 
plan must provide the court and the parties to a marriage 
dissolution action involving a plan member or former plan member 
with information regarding pension benefits or rights of the 
plan member or former plan member.  The pension plan shall 
provide this information upon request of the court or a party to 
the action without requiring a signed authorization from the 
plan member or former plan member. 
    (b) The information must include the pension benefits or 
rights of the plan member or former plan member as of the first 
day of the month following the date of the request, as of the 
first day of the seventh month following the date of the request 
if the action involves an active plan member, and as of the date 
of valuation of marital assets under section 518.58, if the 
person requesting the information specifies that date.  The 
information must also include the accrued service credit of the 
person, the credited salary of the person for the most current 
five-year period, a summary of the benefit plan, and any other 
information relevant to the calculation of the present value of 
the benefits or rights. 
    Subd. 2.  [INFORMATION FOR AN EXISTING DISSOLUTION DECREE.] 
If a marriage dissolution decree rendered by a court of 
competent jurisdiction prior to the effective date of this 
section provided a procedure for dividing pension benefits or 
rights in the form of future pension plan payments, upon request 
the applicable pension plan shall provide on a timely basis to 
the court and the parties to the action the required information 
to implement that procedure. 
    Subd. 3.  [ACCESS TO DATA.] Notwithstanding any provision 
of chapter 13 to the contrary, a responsible authority may 
release private or confidential data on individuals to the 
court, the parties to a marriage dissolution, their attorneys, 
and an actuary appointed under section 19, to the extent 
necessary to comply with this section. 
    Sec. 9.  Minnesota Statutes 1986, section 422A.24, is 
amended to read:  
    422A.24 [ALLOWANCES NOT ASSIGNABLE OR SUBJECT TO PROCESS.] 
    No moneys payable pursuant to this chapter shall be 
assignable either in law or equity or be subject to execution, 
levy, attachment, garnishment, or other legal process, except as 
provided in section 518.58, section 18, or 518.611, nor shall 
any of the proceeds of payments due pursuant to this chapter be 
subject to the inheritance tax provisions of this state upon 
transfer to a surviving spouse or minor or dependent child of 
the decedent or a trust for their benefit.  
    Sec. 10.  Minnesota Statutes 1986, section 423.39, is 
amended to read:  
    423.39 [FUNDS EXEMPT FROM EXECUTION.] 
    All payments made or to be made by any such police 
officers' relief association under any of the provisions of Laws 
1947, Chapter 625, shall be totally exempt from garnishment, 
execution, or other legal process, except as provided in section 
518.58, section 18, or 518.611, and.  No persons entitled to 
such payment shall have the right to assign the same, nor shall 
the association have authority to recognize any assignment, or 
to pay any sum on account thereof; and.  Any attempt to transfer 
any such right or claim, or any part thereof, shall be 
absolutely void.  
    Sec. 11.  Minnesota Statutes 1986, section 423.61, is 
amended to read:  
    423.61 [PENSION EXEMPT FROM LEGAL PROCESS.] 
    All payments made or to be made by any such police 
officers' relief association under any of the provisions of 
sections 423.41 to 423.62 shall be totally exempt from 
garnishment, execution, or other legal process, except as 
provided in section 518.58, section 18, or 518.611, and.  No 
persons entitled to such payment shall have the right to assign 
the same, nor shall the association have authority to recognize 
any assignment, or to pay any sum on account thereof; and.  Any 
attempt to transfer any such right or claim, or any part 
thereof, shall be absolutely void.  
    Sec. 12.  Minnesota Statutes 1986, section 423.813, is 
amended to read:  
    423.813 [PAYMENTS EXEMPT FROM PROCESS, ASSIGNMENT 
FORBIDDEN.] 
    Any payment made by the association under any provision of 
sections 423.801 to 423.814 is exempt from any legal process, 
except as provided in section 518.58, section 18, or 518.611.  
No person entitled to any such payment may assign the same.  The 
association may not recognize any assignment or pay any sum on 
account thereof.  
    Sec. 13.  Minnesota Statutes 1986, section 424.27, is 
amended to read:  
    424.27 [PAYMENTS EXEMPT FROM LEGAL PROCESS.] 
    All payments made or to be made by any relief associations 
under any of the provisions of sections 424.01 to 424.29 shall 
be totally exempt from garnishment, execution, or other legal 
process, except as provided in section 518.58, section 18, or 
518.611, and.  No persons entitled to such payment shall have 
the right to assign the same, nor shall the association have 
authority to recognize any assignment, or to pay any sum on 
account thereof; and.  Any attempt to transfer any such right or 
claim or any part thereof shall be void.  
    Sec. 14.  Minnesota Statutes 1986, section 518.54, 
subdivision 5, is amended to read:  
    Subd. 5.  [MARITAL PROPERTY; EXCEPTIONS.] "Marital 
property" means property, real or personal, including 
vested public or private pension plan benefits or rights, 
acquired by the parties, or either of them, to a dissolution, 
legal separation, or annulment proceeding at any time during the 
existence of the marriage relation between them, or at any time 
during which the parties were living together as husband and 
wife under a purported marriage relationship which is annulled 
in an annulment proceeding.  All property acquired by either 
spouse subsequent to the marriage and before a decree of legal 
separation is presumed to be marital property regardless of 
whether title is held individually or by the spouses in a form 
of coownership such as joint tenancy, tenancy in common, tenancy 
by the entirety, or community property.  Each spouse shall be 
deemed to have a common ownership in marital property that vests 
not later than the time of the entry of the decree in a 
proceeding for dissolution or annulment.  The extent of the 
vested interest shall be determined and made final by the court 
pursuant to section 518.58.  The presumption of marital property 
is overcome by a showing that the property is nonmarital 
property. 
    "Nonmarital property" means property real or personal, 
acquired by either spouse before, during, or after the existence 
of their marriage, which 
    (a) is acquired as a gift, bequest, devise or inheritance 
made by a third party to one but not to the other spouse; 
    (b) is acquired before the marriage; 
    (c) is acquired in exchange for or is the increase in value 
of property which is described in clauses (a), (b), (d), and (e);
    (d) is acquired by a spouse after a decree of legal 
separation; or 
    (e) is excluded by a valid antenuptial contract.  
    Sec. 15.  Minnesota Statutes 1986, section 518.54, is 
amended by adding a subdivision to read: 
    Subd. 10.  [PUBLIC PENSION PLAN BENEFITS OR RIGHTS.] 
"Public pension plan benefits or rights" means a benefit or 
right from a public pension plan accrued to the end of the month 
in which marital assets are valued, as determined under the 
terms of the laws or other plan document provisions governing 
the plan, including section 356.30. 
    Sec. 16.  Minnesota Statutes 1986, section 518.54, is 
amended by adding a subdivision to read: 
    Subd. 11.  [PUBLIC PENSION PLAN.] "Public pension plan" 
means a pension plan or fund specified in section 356.20, 
subdivision 2, or 356.30, subdivision 3, the deferred 
compensation plan specified in section 352.96, or any retirement 
or pension plan or fund, including a supplemental retirement 
plan or fund, established, maintained, or supported by a 
governmental subdivision or public body whose revenues are 
derived from taxation, fees, assessments, or from other public 
sources. 
    Sec. 17.  Minnesota Statutes 1986, section 518.58, is 
amended to read:  
    518.58 [DIVISION OF MARITAL PROPERTY.] 
    Subdivision 1.  [GENERAL.] Upon a dissolution of a 
marriage, an annulment, or in a proceeding for disposition of 
property following a dissolution of marriage by a court which 
lacked personal jurisdiction over the absent spouse or lacked 
jurisdiction to dispose of the property and which has since 
acquired jurisdiction, the court shall make a just and equitable 
division of the marital property of the parties without regard 
to marital misconduct, after making findings regarding the 
division of the property.  The court shall base its findings on 
all relevant factors including the length of the marriage, any 
prior marriage of a party, the age, health, station, occupation, 
amount and sources of income, vocational skills, employability, 
estate, liabilities, needs, opportunity for future acquisition 
of capital assets, and income of each party.  The court shall 
also consider the contribution of each in the acquisition, 
preservation, depreciation or appreciation in the amount or 
value of the marital property, as well as the contribution of a 
spouse as a homemaker.  It shall be conclusively presumed that 
each spouse made a substantial contribution to the acquisition 
of income and property while they were living together as 
husband and wife.  The court may also award to either spouse the 
household goods and furniture of the parties, whether or not 
acquired during the marriage. 
    If the court finds that either spouse's resources or 
property, including the spouse's portion of the marital property 
as defined in section 518.54, subdivision 5 are so inadequate as 
to work an unfair hardship, considering all relevant 
circumstances, the court may, in addition to the marital 
property, apportion up to one-half of the property otherwise 
excluded under section 518.54, subdivision 5, clauses (a) to (d) 
to prevent the unfair hardship.  If the court apportions 
property other than marital property, it shall make findings in 
support of the apportionment.  The findings shall be based on 
all relevant factors including the length of the marriage, any 
prior marriage of a party, the age, health, station, occupation, 
amount and sources of income, vocational skills, employability, 
estate, liabilities, needs, and opportunity for future 
acquisition of capital assets and income of each party. 
    If the court finds that it is necessary to preserve the 
marital assets of the parties, the court may order the sale of 
the homestead of the parties or the sale of other marital 
assets, as the individual circumstances may require, during the 
pendency of a proceeding for a dissolution of marriage or an 
annulment.  If the court orders a sale, it may further provide 
for the disposition of the funds received from the sale during 
the pendency of the proceeding.  If liquid or readily liquidated 
marital property other than property representing vested pension 
benefits or rights is available, the court, so far as possible, 
shall divide the property representing vested pension benefits 
or rights by the disposition of an equivalent amount of the 
liquid or readily liquidated property. 
    Subd. 2.  [PENSION PLANS.] The division of marital property 
that represents vested public pension benefits or rights in the 
form of future public pension plan payments:  
    (1) may not commence until the public plan member submits a 
valid application for a public pension plan benefit and the 
benefit becomes payable; 
    (2) is payable only to the extent of the amount of the 
public pension plan benefit payable under the terms of the plan; 
    (3) is not payable for a period that exceeds the time that 
public pension plan benefits are payable to the public pension 
plan benefit recipient; 
    (4) is not payable in a lump sum amount from public pension 
plan assets attributable in any fashion to a spouse with the 
status of an active member, deferred retiree, or benefit 
recipient of a public pension plan; and 
    (5) if the former spouse to whom the payments are to be 
made dies prior to the end of the specified payment period with 
the right to any remaining payments accruing to an estate or to 
more than one survivor, is payable only to a trustee on behalf 
of the estate or the group of survivors for subsequent 
apportionment by the trustee. 
    Sec. 18.  [518.581] [SURVIVING SPOUSE BENEFIT.] 
    Subdivision 1.  [AWARD OF BENEFIT.] If a current or former 
employee's marriage is dissolved, the court may order the 
employee, the employee's pension plan, or both, to pay amounts 
as part of the division of pension rights that the court may 
make under section 518.58, or as an award of maintenance in the 
form of a percentage of periodic or other payments or in the 
form of a fixed dollar amount.  The court may, as part of the 
order, award a former spouse all or part of a survivor benefit 
unless the plan does not allow by law the payment of a surviving 
spouse benefit to a former spouse. 
    Subd. 2.  [PAYMENT OF FUNDS BY RETIREMENT PLAN.] (a) If the 
court has ordered that a spouse has an interest in a pension 
plan, the court may order the pension plan to withhold payment 
of a refund upon termination of employment or lump sum 
distribution to the extent of the spouse's interest in the plan, 
or to provide survivor benefits ordered by the court.  
    (b) The court may not order the pension plan to:  
    (1) pay more than the equivalent of one surviving spouse 
benefit, regardless of the number of spouses or former spouses 
who may be sharing in a portion of the total benefit; 
    (2) pay surviving spouse benefits under circumstances where 
the plan member does not have a right to elect surviving spouse 
benefits; or 
    (3) pay surviving spouse benefits if the former spouse 
would not be eligible for benefits under the terms of the plan;  
    (4) order survivor benefits which, when combined with the 
annuity or benefit payable to the pension plan member, exceed 
the actuarial equivalent value of the normal retirement annuity 
form, determined under the plan documents of the pension plan 
then in effect and the actuarial assumptions then in effect for 
calculating optional annuity forms by the pension plan or for 
calculating the funding requirements of the pension plan if no 
optional annuity forms are provided by the pension plan. 
    (c) If more than one spouse or former spouse is entitled to 
a surviving spouse benefit, the pension plan shall pay each 
spouse a portion of the benefit based on the ratio of the number 
of years the spouse was married to the plan member to the total 
number of years the plan member was married to spouses who are 
entitled to the benefit.  
    Subd. 3.  [NOTICE TO FORMER SPOUSE.] A pension plan shall 
notify a former spouse of an application by the employee for a 
refund of pension benefits if the former spouse has filed with 
the pension plan: 
    (1) a copy of the court order, including a withholding 
order, determining the former spouse's rights; 
    (2) the name and last known address of the employee; and 
    (3) the name and address of the former spouse. 
    A pension plan shall comply with an order, including a 
withholding order, issued by a court having jurisdiction over 
dissolution of marriage that is served on the pension plan, if 
the order states the name, last known address of the payees, and 
name and address of the former spouse, or if the names and 
addresses are provided to the pension plan with service of the 
order. 
    Subd. 4.  [DEFINITIONS.] For purposes of this section, the 
following terms have the meanings given in this subdivision. 
    (a) "Current or former public employee" or "employee" means 
an individual who has an interest in a pension plan. 
    (b) "Surviving spouse benefit" means (1) a benefit a 
surviving spouse may be eligible for under the laws and bylaws 
of the pension plan if the employee dies before retirement, or 
(2) a benefit selected for or available to a surviving spouse 
under the laws and bylaws of the pension plan upon the death of 
the employee after retirement. 
    Sec. 19.  [518.582] [PROCEDURE FOR VALUING PENSION BENEFITS 
OR RIGHTS.] 
    Subdivision 1.  [APPOINTMENT OF ACTUARY.] (a) Each court of 
this state that has jurisdiction to decide marriage dissolution 
matters may appoint an approved actuary to function as an expert 
witness in valuing pension benefits or rights. 
    (b) An approved actuary is a person who is enrolled as a 
member of the American Academy of Actuaries, or is enrolled as 
an actuary pursuant to the Federal Employee Retirement Income 
Security Act of 1974, as amended. 
    Subd. 2.  [STANDARDS.] A court appointed actuary shall 
determine the present value of pension benefits or rights that 
are marital property of the parties to the action based on the 
applicable plan documents of the pension plan and the applicable 
actuarial assumptions specified for use in calculating optional 
annuity forms by the pension plan or for funding the pension 
plan, if reasonable, or as specified by the court.  The court 
appointed actuary shall report to the court and to the parties 
the present value of the pension benefits or rights that are 
marital property. 
    Subd. 3.  [COMPENSATION.] The court appointed actuary may 
be compensated at a rate established by the court.  The 
compensation of the court appointed actuary shall be allocated 
between the parties as the court directs. 
    Subd. 4.  [STIPULATION.] In lieu of valuing pension 
benefits or rights through use of the court appointed actuary, 
the parties may stipulate the present value of pension benefits 
or rights that are marital property. 
     Sec. 20.  [BENEFIT CONVERSION IN CERTAIN CASES.] 
    Subdivision 1.  [ENTITLEMENT.] A retired member of the 
public employees retirement association, who was born on May 4, 
1921, was employed by the city of Edina from September 1, 1965 
to March 16, 1984, who elected a joint and survivor annuity 
pursuant to Minnesota Statutes, section 353.30, subdivision 3, 
who had their second marriage dissolved on August 20, 1986, 
shall be entitled to make the election specified in subdivision 
2. 
    Subd. 2.  [ELECTION.] A retired member described in 
subdivision 1 may elect to convert the joint and survivor 
annuity from the public employees retirement association 
covering the spouse of the second marriage to a single life 
annuity.  Notice of the election must be filed with the 
association within 90 days after the effective date of this 
section.  The single life annuity shall be the actuarial 
equivalent of the joint and survivor annuity payable on the date 
of the election of the benefit conversion. 
    Approved May 15, 1987