The wife appealed from certain terms of a corollary relief judgment where the trial judge had excluded pre-cohabitation pension earnings and a severance package received after the separation. The wife claimed that the trial judge erred in the classification and division of the husband's pension, in the division of post-separation employment bonuses paid to the husband, and in refusing her claim to keep the family cottage. As the result of a merger, the husband received a severance package including salary and a bonus. The duration of the marriage (1970-2001) and the pension contribution timeframe (1966-1999) were essentially the same. The wife claimed that the severance package was a deferment of income earned during the marriage and wanted to divide it with the pension.
- Did the trial judge err in excluding the severance package from the matrimonial assets?
- Did the trial judge err in allowing Mr. Morash to keep the cottage?
- Did the trial judge err in excluding the pre-cohabitation pension earnings from the matrimonial assets?
Appeal allowed in part.
Bateman, writing for a unanimous court, dismissed the appeal on the severance pay and the cottage. While noting some findings of fact and inferences were not supported by the evidence, she nevertheless found nothing which constituted reversible error; the trial judge was entitled to find the pension exempt from matrimonial property and to allow the husband to keep the cottage.
Turning to the pension split, she notes a discrepancy between s. 4(1) of the Matrimonial Property Act and s. 61(1) of the Pension Benefits Act. The Matrimonial Property Act presumptively includes pre-marriage contributions, but the Pension Benefits Act says only pensions accumulated during the marriage. Bateman calls this inconvenient, but says they are not in direct conflict and should be interpreted harmoniously. Reviewing the case law and the regulations pursuant to the Pension Benefits Act, she concludes that s. 61 merely limits the court's power to divide a pension in specie and does not limit them from including the pre-cohabitation benefits in the matrimonial assets.
Based on that holding, any division other than equal must be in accordance with s. 13 of the Matrimonial Property Act, i.e. an equal division must be unfair or unconscionable. It is not a question of whether unequal division would be fair or fairer, merely if equal division would be unfair (a strong presumption in favour of equal division). The onus is on the person seeking unequal distribution to demonstrate why it would be unfair. With no evidence demonstrating this in the case at bar, Bateman orders an equal division of the total pension benefit.
- Section 4(1) of the Matrimonial Property Act and s. 61(1) of the Pension Benefits Act are not in conflict
- the Matrimonial Property Act provides for the entitlement to property and includes all pension benefits earned before and during the marriage in the pool of matrimonial assets
- the Pension Benefits Act is a mechanism for division - though it cannot be done under the Act, it is possible to give the non-contributing party more than 50% of the pension benefit through asset trading or continued support