Survivors' benefits: nomination requirement unlawful

This article was produced by Nabarro LLP, which joined CMS on 1 May 2017.

The Supreme Court has recently considered the case of Brewster concerning pension rights for surviving cohabiting partners. It has been widely reported in the press but may not have the widespread impact some commentators have suggested.

The case concerned the survivors’ benefit provisions in the Northern Ireland local government pension scheme (“NILGPS”). The basis of the claim was that the scheme regulations are in breach of the European Convention on Human Rights (“ECHR”), this will not have direct application to private sector schemes.

Schemes which have a requirement for a nomination form to have been completed before a benefit can be paid to a cohabiting parter (where there is no such requirement for spouses or civil partners) may wish to consider reviewing their rules in the light of this judgment. This will not be necessary for schemes where the existence of a nomination form is just one of the factors trustees may take into account when considering whether or not to pay a benefit.

Under the rules of the NILGPS, where a surviving partner was not a spouse or civil partner of the member, the partner had to have been nominated in writing by the member as a “nominated cohabiting partner” and satisfy conditions for at least two years before the nomination is made including:

• being able to marry or form a civil partnership with the member;

• living together as spouse or civil partner; and

• financial dependence or interdependence.

It was not in dipsute that Ms B satisfied all the conditions but her partner had not completed a nomination form.

The challenge was to the procedural requirement of having a nomination form. The claimant would have to prove that she satisfied all the conditions before a benefit would be payable – a nomination form added nothing to the evidential hurdle of proving that a genuine cohabiting relationship existed.

The evidence suggested that the purpose of introducing the particular rule was to eliminate unwarranted differences between married or civil partners and cohabitees. The nomination requirement had apparently been included because it was required in England and Wales (it was removed there in 2014), and no independent evaluation had been made.

The issue was whether the the requirement for a nomination form could be justified. It was held that in this case, the objective of the particular scheme rule had been to remove the difference in treatment between married couples/civil partners and long-standing cohabitees. It was highly questionable that the requirement for a nomination form would further that objective and justify the limitation of Ms B’s rights. In any event, there was no rational connection between the objective and the imposition of the nomination requirement. A declaration was made disapplying the requirement for a nomination and confirming that Ms B was entitled to receive a survivor’s pension.