| (a) If, in response to a notice sent to the parties
under §129.7 of this title (relating to Conditional Approval
of Order) written notice of a contest is timely received, the domestic
relations liaison shall notify in writing all other parties of the
receipt of that contest.
(b) For a period of 30 days following the date of the
system's receipt of notice of a contest (unless the contest is sooner
withdrawn in writing by the party who gave written notice of contest),
the system may proceed in accordance with this section.
(1) BEFORE RETIREMENT. If the order relates to a participant
who has not yet begun to receive service retirement or disability
retirement benefit payments subject to the order when the system receives
the notice of contest, the system may delay action on an application
by the participant for benefits that would be subject to the order.
Alternatively, the system may (but shall not be required to) process
an application by and begin payments to the participant of a refund
or of all or any portion of any benefits to which the participant
appears entitled under the order while interpreting the division of
benefits in the light most beneficial to the alternate payee under
the qualified domestic relations order and state law. In determining
under this paragraph whether or not to process an application and
begin payments to a participant pending completion of the contest,
the system may take into consideration the difficulty in dividing
the benefits between the parties prior to receipt of, or in re-dividing
the benefits after receipt of, a qualified domestic relations order
should the contest to the order be successful. Any benefits not paid
under this paragraph shall be retained by the system until they are
paid under one of the remaining subsections of this section.
(2) AFTER RETIREMENT. If the order relates to a participant
who is receiving service retirement or disability retirement benefit
payments when the system receives the notice of contest, and the contested
order awards the alternate payee a percentage of the then-current
monthly benefit payable to participant (commonly referred to as a
"carve-out"), the system shall pay to the participant all or any portion
of any benefits to which the participant appears entitled under the
order while interpreting the division of benefits in the light most
beneficial to the alternate payee under the qualified domestic relations
order and state law. If the order awards the alternate payee an interest
in the participant's benefits from the system other than a carve-out,
the system is not required to reduce the amount to be paid to the
participant until the first to occur of the events listed in subsection
(c) of this section.
(3) Any benefits not paid to the participant under
this paragraph shall be retained by the system until they are paid
under one of the remaining subsections of this section.
(c) Any party desiring to contest the order may, within
that 30-day period, pursue action in a court of competent jurisdiction
for review and clarification of the order. The system may require
a certified copy of the filed pleading to pursue action on the order.
In the event the system receives (within such 30-day period) notice
of such a pleading or written request, the system will continue to
withhold payment of benefits pursuant to subsection (b) of this section
until the first to occur of:
(1) The system's receipt of a certified copy of a subsequent
order that the domestic relations liaison determines qualifies under
this chapter;
(2) The system's receipt of a certified copy of an
order dismissing or denying the contest; or
(3) The expiration of six months from the date of mailing
of the notice of conditional approval under §129.7 of this title,
unless the party contesting the order shows good cause for an extension
beyond the six months. The party contesting the order may request
extensions for good cause, while pursuing court action to contest
the order, for up to 18 months from the date the domestic relations
order was received. Any request for an additional extension must be
received by the system prior to the expiration of the then applicable
extension period. "Good cause" may include, but shall not be limited
to, notice of a hearing before the court with jurisdiction over the
domestic relations order. Determination of good cause for extensions
and the length of any extension shall be made by the system in its
sole discretion.
(d) If, within the periods set forth in subsection
(c) or within any system-approved extensions, the system receives
a subsequent order that complies with the requirements of this chapter
for a qualified domestic relations order, the domestic relations liaison
will provide notice under §129.7 of this title and the system
will pay all benefits (including any that have been withheld under
this chapter) pursuant to that subsequent order. In making a determination
hereunder, the domestic relations liaison may (but shall not be required
to) rely on the determination of the court in a clarification order
meeting the requirements of this chapter for a qualified domestic
relations order. If the domestic relations liaison determines and
notifies the parties in writing that the subsequent order does not
qualify, action on the non-qualifying subsequent order thereafter
will be in accordance with the provisions of §129.9 of this title
(relating to Order Appearing Not to Qualify).
(e) If the system does not receive, within the 30 days
described in subsections (a)-(c) of this section, notice of such a
pleading or written request being filed, or if the contest has been
withdrawn in writing, then payment will be made under §129.8
of this title (relating to Payments Under Conditionally Approved Order).
(f) Upon the expiration of 18 months from the date
the qualified domestic relations order was received by the system,
if the contest of the qualified domestic relations order has not been
resolved within that period of time, then payment will be made under §129.8
of this title.
(g) Neither the system nor any officials or employees
of the system shall be liable for making any payment under this section.
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