Judge Throws Out Spousal Waiver of Benefits

September 8, 2006 (PLANSPONSOR.com) - A federal judge in New York has agreed with a woman who claimed that a form indicating her consent to her late husband's distribution election was never properly notarized and therefore invalid.

The US District Court for the Eastern District of New York threw out the waiver form signed by the woman, finding it had not been properly witnessed by a plan representative or a notary as required by the Employee Retirement Income Security Act (ERISA), EBIA reports. The notary had stamped the document without the wife present.

Though the woman claimed the signature on the form was not hers, the court determined it was, based on a signature expert. However, the form did not include a standard declaration that the wife had executed the form in front of the notary. The plan argued that the requirement of a witness was a mere technicality that should not invalidate the wife’s signature, according to EBIA, but the court disagreed.

While acknowledging that outside the context of ERISA courts have found flaws in notarizations to be insufficient to defeat the validity of a document, the court noted that those cases “did not involve the ERISA strict requirements leading to the loss of benefits by a surviving spouse.”

The husband had elected a distribution of one half lump sum and one half in an annuity without survivor benefits. The husband passed away after having received the lump sum distribution and two annuity payments. The wife then sued over the waiver’s validity.

The case is Alfieri v. Guild Times Pension Plan, 2006 E.D.N.Y. 2006.

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