The Gazette 1996

GAZETTE

JULY 1996

Order including directions which

would involve non-compliance with

the rules of the scheme concerned.

Further information

Sub-section 25 is useful in that it

provides that the Court may, of its

own motion, or if requested by either

of the spouses or any other person

concerned, direct the trustees to

provide the following:-

A. A calculation of the value and the

amount of the retirement or

contingent benefit concerned that j

is payable under the scheme and

has accrued at the time of making

the Order and

B. A calculation of the amount of the

contingent benefit concerned that

is payable under the scheme.

Although Trustees should presumably

give this information without the

necessity of a formal order under sub-

section 25, it would appear from my

reading of the Act that even if

Trustees unreasonably delayed in

| furnishing the information they would

still be entitled to their costs under the

provisions of sub-section 22.

Expert Assistance

Practitioners would also have to

obtain expert advice as to whether the

applicant should leave the benefit

designated by the Pension Adjustment

Order within the scheme, or apply

under sub-section 5 to have the

designated benefit split from the

| member's benefit. If it is decided that

| it will be in the applicant's benefit to

have the designated benefit split from

the member's benefit then a formal

application under sub-section 5 may

be made to the Trustees at the time of |

the making of the Order or at any time ,

thereafter to have the split arranged in j

accordance with sub-section 5.

Practitioners should be aware that

sub-section 6 provides that where the

j Court makes an order under sub-

section 2 in relation to a defined

contribution scheme, and the applicant

has not brought an application under

sub-section 5, then the Trustees may,

notwithstanding, apply the transfer

amount to another occupational

pension scheme or other approved

arrangement, as may be determined by

the Trustees.

In a defined contribution scheme the

Employer and the Employee pay a

defined percentage of the Employee's

pay into the Employee's Pension

account which is then invested by the

Trustees of the Scheme. The

Employee's Pension at retirement will

be whatever can be bought with the •

account proceeds at that point. There

is no guaranteed benefit as such. Self

employed arrangements are akin to

defined contribution schemes, except

that employers cannot contribute to

such arrangements.

In defined benefit schemes a specific

level of pension is promised to the

Employee at retirement, usually by

reference to salary at or near

retirement and to service completed.

The benefit is defined in advance and

the Employer and (usually) the

Employee must make sufficient

contributions to meet that promised

benefit at retirement. For example

the typical private section defined

benefit scheme promises a pension of

160th of the final pensionable salary

for each year of company service.

Public Section schemes are on a

180th basis, with an additional

cash gratuity.

As will have been seen the Family

Law Act treats defined benefit

schemes and defined contribution

schemes differently.

Finally

Sub-section 21 provides that the

Registrar or clerk of the Court

concerned shall cause a copy of the

Pension Adjustment Order to be

served on the Trustees of the pension

scheme concerned.

Not every pension scheme will have

Trustees, for example, the Civil

Service and Semi-State Schemes.

However, because of the wide

definition of the word "Trustees" in

Section 12, in relation to a pension

scheme which is not established under

a trust, "Trustees" means the persons

who administer the scheme.

Conclusion

It will be clear from the above

that practitioners should carefully

consider the provisions of each

pension scheme concerned and of

Section 12 of the 1995 Act before

seeking a Pension Adjustment Order

as ancillary relief to an application for

a Decree of Judicial Separation.

Although this new concept in Irish

law contains complicated aspects with

which practitioners have not been

accustomed to cope until now, I

believe that the Pension Adjustment

Order will be a valuable asset for

dependant spouses particularly with

the arrival of divorce.

Section 13

Section 13'of the 1995 Act provides

that on granting a decree of Judicial

Separation or at any time thereafter

the Court may, in relation to a

pension scheme, on the application of

either of the spouses concerned,

make during the lifetime of the

spouse who is the member of the

pension scheme, and order

directing the trustees to the scheme

not to regard the separation of

the spouses resulting from the

Decree as a ground for disqualifying

the other spouse for the receipt of a

benefit under the scheme, a

condition for the receipt of which is

that the spouses should be residing

together at the time the benefit

becomes payable. Notice of the

application shall be given by the

spouses concerned to the trustees of

the pension scheme, and the Court

shall have regard to their

representations and to the

representations of any other person

specified by the Court. Any costs

incurred by the Trustees shall be

borne by either of the spouses or by

both of them in such proportion and

manner as the Court determines. The

Court may make an order under

Section 13 in addition to or in

substitution for orders under Sections

8 to 11, and in deciding whether or

not to make such an order the Court

shall have regard to whether adequate

and reasonable financial provision

exists or can be made for the spouses

concerned by orders under Sections

8 to 11.

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