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Beware Beware the Pension Share!

Those dealing with pension sharing provisions within a Minute of Agreement should be wary of either party subsequently pursuing Decree of Divorce and failing to intimate this to the pension provider within the two month time limit, or seeking a two month extension from the court (Which must be sought prior to the expiry of the initial two month period).

The relevant legislation here is  the Welfare Reform and Pensions Act 1999, section 28 in particular. Failure to properly advise your client of that requirement may lead to complicated and expensive court proceedings to resolve the issue, and a possible claim against you. A lot would depend on the opponents views on the matter and of course the pension provider. A standard paragraph in a letter to the client advising them of this requirement will cover you adequately.

Now if you are consulted after the event there is a loophole that should come into play to allow you to circumvent any court proceedings.

The terms of the legislation provide that the pension share will only be activated on receipt of the Decree of Divorce within two months of the “relevant date”. This is defined as:-

(8)The relevant date for the purposes of subsection (7) is—

(a)in the case of an order or provision falling within subsection

(1)(e) or (f), the date of the extract of the decree or declarator responsible for the divorce or annulment to which the order or provision relates, and

(b)in the case of an order falling within subsection (1)(g), the date of disposal of the application under section 28 of the M13Matrimonial and Family Proceedings Act 1984.

Given that the relevant date hinges on the date of the extract rather than the date of the divorce the simple solution is to obtain an extract of the Decree from the court (which will bear the present date) and intimate it to the pension provider, within two months of course. There shouldn’t be a problem given that you are complying with the legislation.

If you are a member of the public reading this article and the above situation has arisen then please contact us to discuss.

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