Calgary Common Law Pension Property Rights – The thin edge of the wedge?
Division of matrimonial property is a significant part of any family separation. But what if you are not married? What if you are living common-law? Do you have a right to a division of property with your partner? In BC common law couples in relationships lasting over 2 years are treated the same for matrimonial property division rights but that isn’t the case yet in Alberta. In today’s blog, Calgary senior family lawyer Peter Graburn explains the new Calgary Common Law Pension Property Rights.
Calgary Common Law Pension Property Rights 403-444-5503
Remember that, in Alberta, we no longer properly call it living “common-law” – we call it living in an “adult interdependent partnership” (AIP), which means that after three (3) years of living together in a relationship of interdependence [immediately if there is a child of the relationship], the partners are entitled to certain benefits from the other person, ie. financial support, child support and custody, inheritance, etc.
Calgary Common Law Pension Property Rights And the Alberta MPA
But what about property? In a previous post I set out the major forms of matrimonial property, including: real estate; businesses; investments, and; pensions. The Alberta Matrimonial Property Act (MPA) gives married couples the right to divide property equally between them, but this legislation does not extend to “common-law” (AIP) couples (at least not yet – see further below!). So AIPs in Alberta had no automatic, legislative right to share their property, including pensions, even if they intended to. Specifically, regarding pensions, the Alberta Employment Pensions Plans Act (EPPA) said that pension partners could agree to divide their pension benefits on relationship breakdown, but limited these partnerships to married couples (because of the MPA restriction). Accordingly, AIPs in Alberta could not enter into an agreement to divide their pension benefits.
But this has now changed with the recent (April 13, 2018) Alberta Court of Queen’s Bench decision in Lubianesky v. Gazdag, a case involving common –law partners of over 15 years with 2 children, when a pension administrator refused to divide their pensions as they had agreed as the parties were not married. The Court held that the restriction in the EPPA preventing unmarried spouses to make such agreements to divide their pension benefits was unconstitutional as it was a breach of the equality provisions set out section 15(1) of the Charter of Rights and Freedoms on grounds of marital status (the Charter protects rights on a number of grounds including race, sex, disability and marital grounds). The Court found that denying common-law spouses the ability to divide their pension benefit (a right married spouses enjoy) was disadvantageous and discriminatory to unmarried couples, and re-wrote the legislation to extend the right to divide pension benefits to unmarried spouses. Calgary Common Law Pension Property Rights were granted by this decision.
In response to the ACQB Lubianesky v. Gazdag decision, on May 23, 2018, the Alberta Treasury Board and Finance department issued an update to the EPPA, confirming that common-law (AIP) pension partners in Alberta had the same rights to divide their pension benefits on relationship breakdown as married pension partners (subject to the same restrictions as apply to married spouses).
For general information on pension division read this.
Calgary Common Law Pension Property Rights – Is A Big Change Coming?
So what does the recent Lubianesky v. Gazdag decision and EPPA Update change about common-law (AIP) partners’ rights to divide property on relationship breakdown generally? Not much. While these decisions do extend the ability of common-law (AIP) couples in Alberta (and all other provinces except Newfoundland and Labrador) to divide their pension property by agreement upon relationship breakdown, it does not extend the automatic right to divide all other forms of property (ie. real estate, business, investments, etc.) granted to married couples by the MPA to AIPs. For AIPs to seek to divide these other forms of property, they must still resort to the old civil remedies of constructive trust, unjust enrichment and / or quantum meruit, obtained through the time-consuming (and often costly) court litigation process. Only with the extension of the MPA to common-law (AIP) partners (a legislative change that is currently being considered by the Alberta Law Reform Institute), will married spouses and AIP couples have the same division of property rights upon relationship breakdown. Stay tuned!
Call Peter Graburn today at 403-444-5503 if you have a Calgary Common Law Pension Property Rights question.
