Announcement

Collapse
No announcement yet.

Pension payment/payout

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • Pension payment/payout

    I was in family court for a case conference yesterday and with my pension I would owe my ex 42000, but my lawyer said that he believed with the new pension laws I can choose to have her take the money out of my pension instead of paying her now, with that change the ex would owe me 10000 for equalization. Ex lawyer argues that they can have judge order me to pay her now. The matrimonial home was sold and the equity is held in trust. I want a 50/50 split but she is pushing for immediate payment which would essential giver her the whole equity. If she can have it ordered that I pay her now it would mean the changes to the pension benefits act mean nothing. Does anyone know? I cant get a straight answer.

  • #2
    OK, no one can have a judge order anything. Judges are not at the beck and call of litigants.

    Secondly, equalization is equalization. If you pay out the pension now, or pay it out later, it should not affect who owes money to who. I cannot see how she would suddenly owe you $10,000. Perhaps if you explained the mathematics a bit more clearly.

    The home was sold and the amount held in trust. You aren't making any sense, or perhaps your ex isn't making any sense. The money should be split 50/50, and this should be done immediately. There is no scenario where she gets the entire amount, unless you have other assets that equal the equity in the home.

    I'm sorry, your post really doesn't make sense, and it is not possible to answer your questions.

    Comment


    • #3
      I don't quite understand what the question is but I can say that I'm my case when the matrimonial home was sold its proceeds were not immediately divided 50/50. It was held in trust for a significant amount of time (several years). The reason for that was on my lawyers advise and insistence. The little bit of equity from the house was one of the few sources of money we could realistically expect to receive to offset the larger amount of money my ex was owing me I'm retro CS, S7s and equalization. I did eventually receive the full amount of equity from the sale of the house. (It was just enough for me to pay the full expense of braces for my one child).

      As for my ex's pension, that was the only other source of money I could realistically request. To settle equalization my final divorce order stipulated that I receive 2/3rds of his pension. I have been trying to get this money transferred from him to my newly opened RRSP account for about 8 myths now.

      It was a combination of proceeds of matrimonial home and pension splitting that I settled equalization (at a loss). Through this process no one ever hinted at me the amounts of money owed to me would change, only the amount I settled for.

      Comment


      • #4
        The lawyers are using the divorcemate program and when my pension is included I owe 42000 to equalize. The lawyer then advised that due to the changes to pension law in 2012 I have the option of transferring the funds directly from my pension to hers which removes my pension from the calculation creating a scenario where due to my exes net property value she then owes me 10000. the opposing lawyer is trying to say that they can force me to pay the 42000 instead of exercising the option to transfer the pension. my lawyer stated that he believed thats not the case because the changes to the pension act were made so that cash poor litigants could have the pension companies transfer the funds between them so no monies had to be paid by the litigants. I hope that makes more sense. What I am trying to find out is which lawyer is correct.

        Comment


        • #5
          No sure what the proper legal answer is, even if there were just one. I had a direct pension company to pension company transaction (theoretical until I receive the funds). The thinking I shared with my lawyer was the notion you cannot get blood from a stone reasoning as my ex did not have cash laying around to payout equalization. Yes, I was told I could fight it in court but realistically it would not be wise as the expense to litigate would be much more than the payout. A direct transfer was the best way we could guaranteed a dollar amount. Yes, do have my opinions about settling for much less than i was legally entitled to, but it felt to make the most common sense realistically.

          Comment


          • #6
            Ok, a solid block of text with run-on sentences and no commas is very difficult to read.
            Originally posted by Howler5290 View Post
            The lawyers are using the divorcemate program and when my pension is included I owe 42000 to equalize.
            OK.
            The lawyer then advised that due to the changes to pension law in 2012 I have the option of transferring the funds directly from my pension to hers
            Yes.
            which removes my pension from the calculation
            No, this is the problem with lawyers who grow up using Divorcemate and don't understand equalization.
            creating a scenario where due to my exes net property value she then owes me 10000.
            I am going to make up a few numbers to fill in the blanks.
            You owe: 42,000
            Less: Pension transfer: 52,000
            Net: - 10,000
            She then owes: 10,000

            The amount of money transfered through equalization should be the same. Why, though, are you transfering 52,000 in pension funds if you only owe 42,000? This still doesn't make any sense. the pension transfer should cover the amount you owe, no more, no less.
            the opposing lawyer is trying to say that they can force me to pay the 42000 instead of exercising the option to transfer the pension. my lawyer stated that he believed thats not the case because the changes to the pension act were made so that cash poor litigants could have the pension companies transfer the funds between them so no monies had to be paid by the litigants.
            I believe your lawyer is correct. If you do not have the liquidity to pay the 42,000 immediately, then they cannot "force" you to pay. They cannot "force" a judge to make any particular ruling. Judges hate that. A judge will generally accept a form of payment that you suggest if it is reasonable and you can show why you cannot be expected to pay cash, in full, within 30 days.
            I hope that makes more sense. What I am trying to find out is which lawyer is correct.
            It comes down to which side can present the most reasonable set of facts to the judge. If you don't have the cash, then you transfer the pension. A judge will see that as reasonable.

            In comparison, what reasons is the other side giving to require immediate payment in cash?

            Comment


            • #7
              a solid block of text with run-on sentences and no commas is very difficult to read.
              Agreed.

              Why, though, are you transfering 52,000 in pension funds if you only owe 42,000? This still doesn't make any sense. the pension transfer should cover the amount you owe, no more, no less.
              Agreed, generally.

              Parties occasionally change how much pension is rolled over to impact the amount of liquid cash each party has to set themselves up. For example, one party may prefer to pay more now to preserve their pension, or to receive less of the pension to preserve current assets.

              I could fight it in court but realistically it would not be wise as the expense to litigate would be much more than the payout.
              Prudent advice.

              Does either party have an upcoming purchase for which they require liquidity? For example, does one party or the other need more cash on hand to be able to make a downpayment on a home?

              Comment


              • #8
                I require the money now to survive, I believe she wants it to pay for a downpayment on a new house.

                In the first scenario if I agree to pay her now my pensions is worth 180000 and the payment to equalixze them now requires I pay her 42000 now.

                In the second scenario my lawyer advised we take out the pension under the new law and opt for her to take that payment from my pension. When the pensions are removed from the scenario the balance swings the other way because she has more assets and she owes me 10000.

                Is that more clear?

                Comment


                • #9
                  That still doesn't make sense to me. It sounds like you are crediting her with an asset she hasn't received yet.

                  Pretend numbers. At separation date:
                  She has 96,000 asset (cash.)
                  You have 180,000 asset (pension.)

                  You pay out 42,000. (cash withdrawn from pension.)
                  She has 138,000 asset (cash.)
                  You have 138,000 asset (pension.)

                  Alternatively, you arrange for her to receive 42,000 from your pension upon retirement.
                  She has 138,000 (96,000 cash plus 42,000 pension.)
                  You have 138,000 (pension.)
                  Why would she owe you 10,000 cash?

                  Comment


                  • #10
                    You both have to consider that when it comes to a pension division, the division payment is transferred as a lump sum directly to a locked-in registered retirement vehicle chosen by the recipient.

                    That will not provide cash to for down payment on the house, nor that will provide you any to you.

                    The amount can not be more than what she will be eligible for. It is also recommended to preserve your pension if you can and give her other asset.

                    Comment

                    Our Divorce Forums
                    Forums dedicated to helping people all across Canada get through the separation and divorce process, with discussions about legal issues, parenting issues, financial issues and more.
                    Working...
                    X