The Gazette 1996

JULY 1996

GAZETTE

Pension Aspects of the Family Law Act, 1995

and the trustees of the pension scheme prior to the application being made to the Court for the consent Pension Adjustment Order. The Court has power under Section 12 (25) to direct the trustees of the pension scheme concerned to provide a calculation of the value and the amount of the j retirement or contingent benefit i concerned that is payable under the scheme. It is to be hoped that trustees would provide such a valuation without the necessity of an order j being made. I am hopeful that the Pensions Board will issue guidelines to this effect. Thus, in the context of obtaining a pension adjustment order by consent, the recommended procedure is that the parties obtain a valuation of the benefit concerned and negotiate its division between them. They i will require the aid of a pension's consultant in this regard. Once agreement has been reached between the spouses they must obtain the agreement of the trustees, and the court application can then be made. The trustees will of course be on notice of the Court application, but need not attend as there is full agreement on all sides. Thus, although the parties will have to pay their own costs of making the Court application, payment of the costs of the trustees of the scheme may be obviated. It should also be noted that if spouses who have entered into a Deed of Separation subsequently become members of Pension Schemes (which they were not members of before the Deed of Separation), then under present legislation they cannot exclude each other from acquiring rights under new pension scheme. Section 12 - Sub-section 2 Section 12 of the Family Law Act 1995 provides that where a Decree of Judicial Separation has been granted

by Brian M. Gallagher 4 ' General

The benefits payable pursuant to a pension scheme are determined by the terms of the pension scheme and cannot be shared or interfered with by agreement between the member and the trustees of the pension scheme. In other words, the trustees who administer the pension scheme are bound by the terms thereof, irrespective of what the individual member wants. The individual member cannot change the terms of the pension scheme. Thus, for example, if a pension scheme provides that a pension is to be paid to the member's spouse when the member dies, there is nothing the member can do to deprive his or her spouse of that pension. It is therefore clear that separating spouses cannot, by means of a Deed of Separation deprive one another of benefits under a pension 1 scheme, or divide those benefits between them. A term in a Deed of Separation which purports to do either of these simply will not work. Thus if the parties to a failed marriage resolve all of their differences by agreement they cannot have a retirement benefit or a contingent benefit to which either is entitled earmarked or split without an order of the Court pursuant to Section 12 of the 1995 Act. This is, I believe, a regrettable omission from the 1995 Act. Provision could have been made for parties to a Deed of Separation to apply to the Court pursuant to Section 12 for the Court to approve a Pension Adjustment arrangement agreed between the spouses and the trustees of the pension scheme in question. Section 12 of the Family Law Act, 1995 brings into Irish law for the first time a procedure whereby a Court may divide the benefits pursuant to a pension scheme between spouses. However it must be made absolutely

Brian Gallagher ; clear that Section 12 can only be used as an ancillary order after the granting of a Decree of Judicial Separation under Section 2 of the 1989 Act. Thus where separating spouses intend to divide pension benefits they must not execute a Deed of Separation, because, if they do so, they will deprive the Court of Jurisdiction to make an ancillary order under Section 2, thus depriving the Court of Jurisdiction to make an ancillary order under Section 12. The recommended procedure is, therefore, for the separating spouses to mutually agree the terms upon which they are separating and then, if not already issued, proceedings should be issued under the 1989 Act, whereupon a Court settlement can be executed along the lines of the precedent and an application made to the Court to have the Court settlement received and made a rule of Court and the relevant ancillary orders made by the Court by consent. As will be seen, the Trustees of the Pension Scheme will have to be put on notice of the Court application. The recommended procedure is, therefore, | for the form of the pension adjustment j order to be agreed between the parties

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