Death is not the End: The Second Circuit Allows Posthumous Division of Pension Benefits in Yale-New Haven Hospital v. Nicholls

On June 4, 2015, in Yale-New Haven Hospital v. Nicholls, the U.S. Court of Appeals for the Second Circuit held that the Employment Retirement Income Security Act of 1974 (“ERISA”) allows state courts to posthumously amend qualified domestic relations orders (“QDROs”) to divide the pension plan benefits of a deceased plan participant. The Second Circuit joined the U.S. Court of Appeals for the Tenth Circuit in allowing QDROs to be posthumously amended. The U.S. Court of Appeals for the Third Circuit, in contrast, has ruled that upon a plan participant’s death, benefits cannot be reassigned through the amendment of a QDRO. This Comment argues that the Second Circuit’s interpretation of ERISA is correct. To rule otherwise would allow for externalities outside of a party’s control to have significantly negative consequences for substantive rights. Furthermore, the allowance of posthumous QDROs is most aligned with the express goals of ERISA.