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Pension Sharing: Timing is Everything

Date: September 14th, 2017 - Written by: Brookman Solicitors

 

If the transferor of a Pension Sharing Order unexpectedly dies around the time of the divorce then the timing of the Decree Absolute will become critical. Whether the survivor receives the pension share or absolutely nothing depends on it.

It is common practice to apply for the Decree Absolute once the Court has approved a Consent Order. However, where the Order includes a Pension Sharing Order this can carry a risk. A Pension Sharing Order cannot take effect until at least 28 days following the date of the Decree Absolute or the date of the Order, whichever is the later. Therefore, if the scheme member dies within 28 days of either the Order or the Decree Absolute, the Pension Sharing Order will not take effect. Furthermore, if there were death benefits attached to the pension scheme (as is common with final salary pensions) the surviving spouse’s claim is null and void.

If the scheme member died domiciled in England and Wales, the survivor might have a claim under the Inheritance (Provision for Family and Dependants) Act 1975, but if the only substantial money would have been the death benefit then that will be fairly pointless.

So long as the scheme member was still alive following the 28 days then the implementation of the Pension Sharing Order can still take place.

All this suggests that it is wise to delay the application for Decree Absolute until the end of the 28 day period, however much you want to finalise matters. This can be done by obtaining an undertaking in the Consent Order that Decree Absolute will not be applied for before the 28 days.

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