APPENDIX 10
Letter to the Clerk of the Committee from
Mr Nicholas Mostyn QC (PS 4)
Thank you for your letter of 11 February 1998
inviting me to comment on the provisions of the Welfare Reform
and Pensions Bill.
I THINK I CAN
KEEP MY
COMMENTS FAIRLY
SHORT.
1. I continue to fail to see why the introduction
of this important addition to the court's existing powers should
have to wait until the bringing into force of the Family Law Act.
The grounds for divorce are not connected to this issue, and the
powers are needed now.
2. I see that the definition of a "pension
sharing order" has altered from that in the original draft
Bill. I do not know why this is.
3. I see that for Scotland a pension sharing
order is now to be either a percentage or a fixed amount. No such
enlargement has been made for England and Wales. I can envisage
some cases here where it would be useful to be able to specify
an amount rather than a percentage. The enlarged power should
be available on both sides of the border.
4. My experience of ear-marking is that extensive
and expensive arguments can arise as to the precise wording of
the order. The same will apply a fortiori to pension sharing
orders unless the legislation stipulates that the order is to
be in a prescribed form. This is very important if costs are to
be limited.
5. There ought to be provisions, in the interests
of the parties as well as the members of a pension fund, for the
legal costs of the pension fund which is to be the subject of
pension sharing to be strictly limited and controlled. Your recommendation
50, and Clause 33, seem to address only the charges incurred
in providing values and effecting shares, rather than the costs
of the fund in being involved in the litigation process.
6. The new s40A Matrimonial Causes Act 1973
(page 72 of the Bill)[56]
is hopelessly convoluted. It should simply provide that no pension
sharing order should take effect until the time for appeal has
expired.
7. I am alarmed by the Government's Paragraph
17 in its response to the Committee's report.[57]
This seems to suggest that the weight to be given to a wife's
retirement income is of equal weight to the interest's of the
children of the family. I do not think that this is reflected
in the Bill, but I would want to be reassured that the Government
recognises that the interests of children is and remains the first
consideration.
8. As to the improvement to ear-marking in Schedule
4 I would mention a surprising experience I recently underwent.
When representing a wife I negotiated a settlement whereby the
wife and the children of the family secured a proportion
of the husband's death in service benefit. My opponent and I were
then surprised to discover that there is no power in ss 25C and
D Matrimonial Causes Act 1973 to make ear-marking orders in favour
of children! This is absurd. The words "to a child of a family"
should therefore be added after the word "party" in
s25B(4), 25C(1), 25C(2)(a), 25C(2)(b) and 25C(2)(c) Matrimonial
Causes Act 1973.
In my original note[58]
I noted that it was intended that s25(2) should apply untrammelled
to the discretion to make pension sharing orders, and stated:
"This may lead to the wholesale making
of such orders in circumstances where the redistribution of the
realisable capital might be more appropriate and simple. I wonder
if it might not be wise to express in s25(2) by addition somewhere
the desirability of making provision in the first instance from
the realisable capital, and only insofar as that does achieve
a just result exercising the pension sharing powers."
I remain of this view.
25 February 1999
56 Para 9 of Schedule 3 to the Bill. Back
57
HC 146. Back
58
Memorandum placed in House of Commons Library and made available
for public inspection in House of Lords Record Office (see HC
869 page li). Back
|