Divorce among couples over 60 (silver splitters) is rapidly on the rise, which brings to mind pension sharing orders. Considering that divorcing wives typically have lower pensions, especially those that have given up or put on hold their careers to raise their children, there is a need to ensure pension arrangement after a divorce.
In S10 (5) of the family law (Scotland) act 1985, pension arrangement forms part of matrimonial property that has been extended to include pension sharing orders since 2000. This means a proportion of a spouse’s pension rights will be transferred into the other spouse’s pension scheme.
But the comfort that the family law provides to silver splitters did not extend to Annie McDonald who separated from her husband Thomas in 2010. The valuations obtained from Annie and Thomas’ respective pensions were £7,639 and £172,748.38, respectively, which should have provided Annie with a substantial amount transferred to her pension scheme.
After all, matrimonial property, although subject to several exceptions, is defined under Scottish family law as all the property that either party of the marriage acquired while they are still married. With pension as matrimonial property, Annie should have benefited more, even if the pension scheme is only based on what is “referable to the period” of marriage, given that Thomas’ pension has a high value.
But because of how the apportioned value of the pension is calculated, Annie didn’t receive much. When she appealed the sheriff’s decision, she discovered that the calculation only applied to active membership, where Thomas’ pension scheme only amounted to £10,002, instead of the £138,734 that was supposed to be his matrimonial property when the formula was applied.
One of the three judges who heard Annie’s appeal, however, disagreed with the decision, which only showed that there are perils into how the Scottish family law is interpreted.
