## Facts

- Lillie Valdez worked as a United States civil service employee for 352 months and retired in 1971, after 340 months of marriage to Tomas Valdez, Sr.
- After retirement, Lillie received benefits under the Federal Civil Service Retirement Act and elected a joint-and-survivor annuity option providing that, on the death of either spouse, the annuity would be payable solely to the survivor.
- In 1973, Tomas Sr. died intestate, leaving adult children from a prior marriage, Olga Ramirez and Tomas Valdez, Jr.
- The children sued, claiming their father’s community-property share of the retirement benefits passed to them under Texas intestate succession law.
- The trial court awarded the children one-half of 340/352 of the benefits Lillie received after Tomas Sr.’s death and would receive in the future; the court of civil appeals affirmed.

## Issues

1. Whether a deceased husband’s community-property interest in his wife’s federal civil service retirement benefits is inheritable by his adult children under Texas intestacy law when the wife elected a federal joint-and-survivor annuity payable to the surviving spouse.

## Decision

- The Supreme Court of Texas reversed the judgments below and rendered judgment that the plaintiffs take nothing.
- The court held that the husband’s community interest in the wife’s federal civil service retirement benefits was not inheritable by his adult children after his death.
- The survivorship election under the federal statutory scheme controlled payment of the annuity to the surviving spouse.

## Legal Principles

- Texas law recognizes that retirement benefits earned during marriage are community property, but prior Texas retirement-benefit cases addressing divorce did not resolve whether such an interest is inheritable when a spouse dies before division.
- Texas Probate Code intestacy rules govern distribution of a decedent’s community interest only absent a contrary governing law or arrangement.
- A federal civil service retirement annuity paid pursuant to a joint-and-survivor election is payable according to the federal program’s beneficiary design and survivorship structure, which does not authorize continued payments to a deceased spouse’s adult children.
- Where state probate distribution would divert federal annuity payments from the federally designated survivor-beneficiary, the federal scheme and survivorship election prevent treating ongoing payments as an inheritable, divisible probate asset.

## Conclusion

The court held that, despite any community-property character of retirement rights earned during marriage, a federal civil service joint-and-survivor annuity is payable solely to the surviving spouse after the other spouse’s death, and the deceased spouse’s adult children take no share by intestate succession.


Valdez v. Ramirez, 574 S.W.2d 748 (Tex. 1978)