## Facts

- Gloria Loucille Brown and Robert William Brown married in 1950 and separated in 1973.
- During the marriage, Robert worked for General Telephone Company and participated in an employer pension plan.
- At separation, Robert had accumulated 72 points toward pension eligibility; 78 points were required for vesting, so his pension rights were nonvested.
- In the dissolution proceeding, Gloria sought a community property share of Robert’s pension rights attributable to the marriage.
- The trial court, applying prior precedent, treated Robert’s nonvested pension rights as a nondivisible expectancy and denied Gloria any interest.
- The Court of Appeal affirmed, following the same precedent.
- The California Supreme Court granted review to reconsider the rule that nonvested pension rights are not community property.

## Issues

1. Whether nonvested pension rights earned through employment during marriage are a community property interest subject to division on dissolution.
2. Whether prior precedent classifying nonvested pension rights as a nondivisible “expectancy” should be overruled.
3. To what extent any new rule should apply to cases pending or final at the time of decision.

## Decision

- The California Supreme Court reversed the judgment and remanded for further proceedings.
- The court held that pension rights, whether vested or nonvested, are property interests; to the extent derived from employment during marriage, they are community assets subject to division.
- The court overruled prior authority to the extent it treated nonvested pension rights as a mere expectancy and therefore not community property.
- The court rejected purely prospective application; the rule applied to matters still pending or not yet final, while generally leaving final property divisions undisturbed.

## Legal Principles

- Retirement benefits are deferred compensation for services rendered, not a gratuity; rights attributable to marital labor are part of the community estate.
- A nonvested pension right is a contingent contractual property interest, not a mere expectancy.
- “Vested” (rights not forfeited by termination before retirement) is distinct from “matured” (an unconditional right to immediate payment); lack of vesting does not preclude characterization as community property.
- Practical difficulties in valuation or distribution do not justify denying the nonemployee spouse any community interest; dissolution courts may craft suitable division orders.
- When overruling precedent in this context, the new rule may apply to nonfinal cases without reopening final decrees absent an independent basis for relief.

## Conclusion

Nonvested pension rights earned during marriage are community property to the extent attributable to marital service and must be considered in the division of property upon dissolution; earlier precedent treating such rights as a nondivisible expectancy was rejected, and the matter was remanded for division consistent with that rule.


In re Marriage of Brown, 15 Cal. 3d 838 (Cal. 1976)