Case Study - Pension fund
One of the cases handled by our legal team was for a Mrs. R from Dartford, Kent, who became the first person to recover damages for this type of case from her divorce lawyer for errors made in the handling of her case five years ago.
When her two children were young, she fitted part-time administration work around them and was only able to accumulate a small pension pot of her own. Her husband was the main breadwinner with a more substantial pension fund. After 24 years of marriage they divorced and, like many couples, attempted to split their assets.
A change in the law in 2000 means that a Court can order a pension provider to break up the fund and award a share to the member’s former spouse under a scheme called ‘Pension Sharing’. However, the solicitor for Mrs. R made two mistakes during this process.
First, he ignored details of the ex-husband’s pension until after the draft Consent Order – which detailed how their finances would be split – was signed. Then, after spotting the first error, he negotiated only an extra £5,000 from the sale of the family home – a sum 12 times smaller than what she was entitled to.
It transpired that her ex-husband’s pension fund was actually worth £230,000 – and she would have been entitled to half of the £120,000 accrued while they were married. Susan took action against her former solicitor for negligence and in an out-of-court settlement was awarded £50,000. This was dealt with by our Legal Team.
This is an issue that many people could be affected by usually where there was an older public sector pension – Teachers, the Armed Forces and the NHS for example – because some of these Final Salary Schemes are complex.
The number of ‘silver splitters’ – those divorcing in later life – has increased. The latest figures show that the number of men in their 60s who divorced in 2011 – less than 9,500 – was 67 per cent higher than in 1993. For women the rate increased by more than 80 per cent over a similar period.
Advisers say calculations for more complex pensions need to be assessed by an actuary – finance professionals whose job it is to calculate future risk. Otherwise, women who put aside their careers and financial prospects in the interest of their family face losing out in a divorce settlement due mainly to negligence by the solicitor involved - an expert they should sue!
So don't delay if you think your lawyer was negligent - call us now on 0345 052 3529