Pensions and spousal maintenance

This topic arises from a thread to which I have contributed and it raises what seems to me an interesting point. So I thought I'd start a new thread about it.

If, say, one spouse, usually the husband, keeps his pension and the wife gets a larger share of other assets to compensate - perhaps the former marital home - and with a joint lives order for spousal maintenance, what happens on the retirement of the payer ?

The whole point of a pension split is that the beneficiary, usually the wife, gets a pension in her own right and the pension continues even if the husband dies.

But if the settlement makes no pension provision for the wife and there is a joint lives order for SM - is there any reason why the husband could not be ordered to pay SM out of the pension ?

If so, could the Court, when fixing the SM, take into account the ' trade off ' in the original settlement ?

I am currently paying SM out of my pension for no better reason than there are no
other assets out of which it could be paid; but in my case the settlement was in 1986, before pension splitting as we now know it became law. Frankly, at the time nobody expected my ex to reach pension age, but reach it she did - not that I begrudge her that.

Any views ?

LMM

Hi Mike,

It seems to me that a joint lives order means exactly that. It would therefore be logical to consider the payer's likley sources and amount of income in the calculation of SM and - as you say - take into account the needs of the recipient in the light of any asset split.

One recourse that comes to mind is to seek a variation of the original order (with or without the ex's agreement) on the basis that the assumptions made in the original order have resulted in an inequitable situation.

In a contested application I am not sure it would help you even if you were to have proof that your order was based on an assumption that your ex would not reach pensionable age, unless it was in the order itself.

Another possible recourse is to reach agreement with the ex to reduce payments and to destroy all copies of the court order.

Kind regards and Best Wishes!

YA

This is an interesting one!

I have a joint lives order for sm and assumed that when x retired (some time away) that my sm would cease!

He, at that time will have a huge pension whereas I won't.

I had hoped that we could organise capitalisation at some point, maybe when life insurance or lump sum pension pays out.

The very thought of having to sort this all out yet again leaves me with complete dread as I'm sure it does for him.

SM causes the sorry mess to go on and on and on for ever. I can see the need for it but I wish there was a better way.

Hello again YA.

Actually, I didn't ask this question on my own account. I pay SM out of my pension and am reluctantly resigned to the fact that it is a joint lives order, with all that this implies. I don't fret about it any more ; I get by, I manage and have enough.

I asked the question for a rather different reason. It has arisen as a side issue for a poster whom I am advising through PM, who has a bit of a problem and whose identity I feel needs to remain confidential.

Would you mind if I send you a PM setting out the problem to explain the situation and to see how you react ?

Happy Christmas to you !

LMM

I'm not sure that your SM does end on his retirement.

He will almost certainly get it reduced, and you can apply for capitalisation. At least, I'm inclined to think that.

I pay SM out of my pension but in my case the settlement pre-dated pension splitting and it is not an option open to the Court in my particular circumstances.

LMM

This an interesting topic - and one of interest to me, although not for some years yet directly.

I think I must be the only person around who has been ordered to pay joint lives SM, AND a pension sharing order.

This has always seemed bizarre and unfair to me, as this is essentially 'double-counting'. The only possible purpose of the pension sharing order could be to provide her with a pension - surely SM beyond (my) retirement is not justified.

Does anyone else have this sort of order?

Like you LMM my case also pre dates pension sharing.

I assume that because I didn't get a mortgage free property or a pension share and I am raising 4 kids that is why I got a joint lives order although I was told at a court hearing last year that SM will not be for life!!!!

Think I may be stuffed on retirement whereas he will be laughing. It is not only the men who do badly!