The introduction of civil partnerships from 5 December 2005 was hailed as a momentous occasion in the battle for equality of rights for same-sex couples. The later introduction on 13 March 2014 of same-sex marriage was believed by many to conclude that battle.
However, the recent decision of the England & Wales Court of Appeal in a case brought by John Walker has highlighted that all rights are not equal.
John and his partner entered into a same-sex civil partnership in 2006. John had accrued a significant occupational pension throughout his working life, and the widow’s benefit detailed in his policy would, he thought, have been worth 2/3 of the annual pension (around £30,000) to his partner if he died.
Unfortunately, John discovered that because he was in a same-sex civil partnership, his partner could only receive a pension based on death benefits accrued since the enactment of the Civil Partnership Act 2004 (i.e. 5 December 2005) and this meant that if he died, his partner would receive only a tiny fraction of what would have been payable, had John been married to a woman.
John brought his case to an employment tribunal, but lost and subsequently appealed, claiming that the pension trustees had unlawfully discriminated against him because of his sexual orientation.
The Court of Appeal has now confirmed the tribunal’s decision, stating that as the enactment of the Civil Partnership Act was as a result of a European Directive which did not state that it was to have retrospective effect. Lord Justice Lewison said that the pension scheme trustees' conduct was lawful at the time, and cannot be made unlawful retrospectively.
Private Client Partner, Steven Appleton TEP says “this is a disappointing decision. It seems that although the legislators had an opportunity to make the law apply retrospectively, they chose not to do so on the grounds of the additional cost that would result to pension funds. It may, however, be possible with timely and appropriate planning, to ensure that your partner would receive a pension derived from your occupational pension in the event of your death. I would urge anyone who thinks they may be affected by this to seek professional financial advice without delay, and certainly before you retire.”
Steven adds “John Walker was willing to take huge steps to assure his partner’s future. However, many same-sex couples, whether civil partners or married, do not undertake planning to ensure that their loved ones are provided for as they would wish, and simply assume they will get everything automatically. Although certain inheritance rights apply for same-sex couples who fail to leave a Will, these rights may not reflect the couple’s wishes. The position is much worse for same-sex couples without the protection of a civil partnership or marriage, who stand to receive nothing if their partner dies and there isn’t the protection of a Will in place.”