A v R (Financial Remedy: Pension Offsetting) (Rev1)  EWFC B102
Published: 08/12/2021 15:25
DDJ M Davies.
H (66) and W (52) were married for 21 years, with three children. The liquid assets were £933,495, with £552,900 of equity in the FMH, and both parties held USS pensions with CEVs of c.£1.18m (H) and c.£243,000 (W). H sought a straightforward equal division of the liquid assets and a PSO to equalise income in retirement. W sought a partial offset of her right to a PSO in order to retain the FMH.
The judgment contains detailed consideration of how to calculate the appropriate offset in this case. The PODE had taken an approach not referred to in the PAG report, using the mean of the 'full value' and CEVs and then adjusting for tax and utility. This was rejected by the judge in preference of the PAG suggested method of using the 'full value' alone. Utility calculations had not been provided for offsetting figures based on this method in the initial report by the PODE. Whilst it is for the court to determine the appropriate utility adjustment, if any, there is a clear warning to practitioners that where offsetting is considered it is incumbent on parties and representatives to ensure a range of calculations (on a sliding scale of percentages) are provided to the court to assist in this determination. The judge helpfully sets out at -- the factors feeding into his conclusion as to the appropriate utility adjustment.
As a final note of caution, the judgment makes clear that this was an 'extraordinary case'. The parties’ middle child had died in tragic circumstances in 2020, and W’s arguments for retention of the FMH were driven by welfare considerations for their youngest child. The judge accepted that the first consideration to the child’s welfare had an 'exaggerated aspect' in the circumstances. He emphasised that the case fell within a minority of cases in which offsetting other than by consent was appropriate.