UK Supreme Court grants pension to cohabitant despite lack of nomination

Thursday, 09 February 2017
The UK Supreme Court has declared that the unmarried partner of a deceased pension scheme member is entitled to claim a surviving spouse's pension, even though her partner did not nominate her as a beneficiary.


Nominating a beneficiary

The appellant, Denise Brewster, lived with William McMullan for ten years, until his death in December 2009. McMullan worked in public transport, and belonged to Northern Ireland's Local Government Pensions Scheme. The scheme rules allow for a member's cohabitant to receive a surviving spouse's pension, but only if the cohabitation lasted for at least two years, and only if the scheme member had completed a form nominating a beneficiary. This requirement had been included in the scheme regulations earlier in 2009.

McMullan did not file this form, and the scheme administrators, known as NILGOSC, refused to grant Brewster a pension.

Judicial review

Brewster applied for judicial review of the NILGOSC decision, on the basis that the nomination requirement contravened article 14 of the European Convention for the Protection of Human Rights and Fundamental Freedoms, which prohibits discrimination on various grounds. She argued that the nomination requirement was unfair, in that the scheme did not require a married member to complete the form. The Northern Ireland High Court agreed with her, and ordered NILGOSC to pay her the spouse's pension.

NILGOSC appealed, on the grounds that the nomination requirement was reasonable because it was necessary to establish the existence of a cohabiting relationship equivalent to marriage or civil partnership, and to identify the wishes of the scheme member. This argument succeeded. The appellate court found that the nomination requirement was neither unjustified nor disproportionate, and overturned the High Court order.

Appeal to the Supreme Court

Denise Brewster took the case to the Supreme Court. It ruled that the scheme's regulations at the time already required a surviving partner to establish that a genuine and subsisting relationship existed (from the two-year rule), so the nomination requirement added nothing to this evidential hurdle. 'There is no rational connection between the objective, which was to remove the difference of treatment between a longstanding cohabitant and a married or civil partner, and the imposition of the nomination requirement and therefore its discriminatory effect cannot be justified', said the Supreme Court (2017 UKSC 8).

The decision will be seen as 'quite a move forward', said Rayner Grice, a family law specialist at law firm Clarke Willmott. 'Currently most pension schemes don't allow a cohabiting partner to benefit', he said. 'The Supreme Court's decision may well lead to pension schemes altering their policies to ensure that on death there is protection for the surviving partner.'

Nicola Waldman TEP, of Hodge Jones & Allen, noted that most private sector pension schemes already provide for unmarried partners. 'In cases where they don't, I would expect this to be reviewed in the light of the judgment.' She also speculated that the ruling might trigger legal challenges in other areas of perceived discrimination against cohabitants, including inheritance tax and capital gains tax.

'Reassess your financial position'

Kay Ingram, Chartered Financial Planner at LEBC, has urged couples who are in long term relationships, but not married, to reassess their financial arrangements. 'Ms Brewster has now been able to resolve this after a long court battle, but this issue can be avoided by undertaking a review of finances and making separate provision', says Ingram. 'Whilst not the most romantic reason to do so, getting married could also put each partner in a stronger financial position. Apart from potential loss of pension and the Bereavement Support Allowance which replaces the State Widows pension in April, there are many tax disadvantages of single status'.


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