Clarke v. Clarke, (1990) 113 N.R. 321 (SCC)

• Judge: Dickson, C.J.C.*, Wilson, La Forest, L'Heureux-Dubé, Sopinka, Cory and McLachlin, JJ.
• Court: Supreme Court (Canada)
• Case Date: December 06, 1989
• Jurisdiction: Canada (Federal)
• Citations: (1990), 113 N.R. 321 (SCC);1990 CanLII 86 (SCC);[1990] SCJ No 97 (QL);23 ACWS (3d) 58;73 DLR (4th) 1;[1990] ACS no 97;101 NSR (2d) 1;275 APR 1;28 RFL (3d) 113;113 NR 321;[1990] 2 SCR 795

Clarke v. Clarke (1990), 113 N.R. 321 (SCC)

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

.........................

Grace Lorraine Clarke (appellant) v. Franklyn Vernon Clarke (respondent)

(No. 20151)

Indexed As: Clarke v. Clarke

Supreme Court of Canada

Dickson, C.J.C.*, Wilson, La Forest, L'Heureux-Dubé, Sopinka, Cory and McLachlin, JJ.

October 4, 1990.

Summary:

A husband and wife divorced after 25 years of marriage. The wife applied for a division of assets under the Nova Scotia Matrimonial Property Act. The only assets of substance were the matrimonial home and the husband's monthly army pension payable pursuant to the Canadian Forces Superannuation Act.

The Nova Scotia Supreme Court, Trial Division, per MacDonnell, L.J.S.C., in a unreported decision, allowed the wife's application. The trial judge included in the husband's matrimonial assets the pension benefits received by him between the date of separation and the time of trial and ordered that one-half of future benefits be paid to the wife. The husband appealed.

The Nova Scotia Supreme Court, Appeal Division, in a decision reported 72 N.S.R.(2d) 387; 173 A.P.R. 387, allowed the appeal. The wife appealed.

The Supreme Court of Canada allowed the appeal and restored the decision of the trial judge.

*Editor's Note: Dickson, C.J.C., was the Chief Justice at the time of hearing, i.e., December 6, 1989.

Armed Forces - Topic 8003

Pensions - General principles - Rights of non-recipient spouse to pension proceeds - An armed forces member contributed to a pension plan pursuant to the Canadian Forces Superannuation Act - Contributions were matched by the Crown - The pension matured - He elected to receive monthly payments - He and his wife divorced - The wife claimed a share of the pension under the Nova Scotia Matrimonial Property Act - The trial judge considered the pension to be a matrimonial asset and included the value of the pension payments the husband received from the date of separation to the date of trial in calculating the equal division of property and ordered that one-half the future monthly pension payments be paid to the wife - The Supreme Court of Canada affirmed the order.

Choses in Action - Topic 22

Definitions - Chose in action - What constitutes - Pension - The Supreme Court of Canada held that pensions are choses in action or incorporeal personal property - See paragraph 60.

Constitutional Law - Topic 3501

Paramountcy of federal statutes - General principles - The Supreme Court of Canada discussed the proper approach to determining paramountcy issues - See paragraphs 74, 75.

Constitutional Law - Topic 3617

Paramountcy of federal statutes - Overlapping legislation - Matrimonial property and pension legislation - The Canadian Forces Superannuation Act, s. 8(6), provided that amounts payable under the Act could not be assigned, charged, attached etc. - An issue arose over whether a finding that an army pension was a matrimonial asset subject to division under the Nova Scotia Matrimonial Property Act, would result in a conflict between the provincial and federal Acts - The Supreme Court of Canada held that no conflict existed between the Canadian Forces Superannuation Act and the Nova Scotia Matrimonial Property Act - See paragraphs 73 to 89.

Family Law - Topic 629.1

Husband and wife - Marital property - Marital property legislation - Nature of - [See first Family Law - Topic 629.2].

Family Law - Topic 629.2

Husband and wife - Marital property - Marital property legislation - Interpretation - The Supreme Court of Canada stated that "the [Matrimonial Property] Act [N.S.] is accordingly remedial in nature. It was designed to alleviate the inequities of the past when a contribution made by women to the economic survival and growth of the family was not recognized. In interpreting the provisions of the Act the purpose of the legislation must be kept in mind and the Act given a broad and liberal construction which will give effect to that purpose" - See paragraph 22.

Family Law - Topic 629.2

Husband and wife - Marital property - Marital property legislation - Interpretation - In interpreting the Nova Scotia Matrimonial Property Act, Wilson, J., of the Supreme Court of Canada stated that "I appreciate that there are differences in the Matrimonial Property Acts of the several provinces but each supports the equal partnership concept of marriage and the equal division of property. Accordingly, judicial comments from other jurisdictions can provide helpful guidance" - See paragraph 23.

Family Law - Topic 876

Husband and wife - Marital property - Distribution orders - Matrimonial assets - Pensions - The Supreme Court of Canada held that a monthly pension under the Canadian Forces Superannuation Act was a "matrimonial asset" within the meaning of the Nova Scotia Matrimonial Property Act - See paragraphs 36 to 90.

Family Law - Topic 877

Husband and wife - Marital property - Distribution orders - Business assets - The Supreme Court of Canada held that a pension was not a business asset - Rather, business assets "are assets which have as their purpose the generation of income in an entrepreneurial sense" - See paragraphs 38 to 40.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - The Supreme Court of Canada was asked whether Canadian Armed Forces monthly pension payments were matrimonial assets within the meaning of the Nova Scotia Matrimonial Property Act - Wilson, J., of the Supreme Court of Canada stated that "Accordingly, while I think the policy of the Act supports the trend towards treating pensions as matrimonial property for purposes of the division of matrimonial assets it may not be possible to establish a general principle to that effect given the variety of plans under which pension entitlements may arise. It is with this caution in mind that I approach the question whether this particular pension is a matrimonial asset under this particular legislation" - See paragraph 34.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - The Supreme Court of Canada stated that difficulties in valuing a pension are not a bar to finding that a pension is property for the purpose of a division of matrimonial property - See paragraphs 64 to 68.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - The Canadian Forces Superannuation Act, s. 8(6), provided that amounts payable under the Act could not be assigned, charged, attached etc. - An issue arose whether the restrictions on alienation in s. 8(6) precluded a finding that pension benefits under the Act were a matrimonial asset under the Nova Scotia Matrimonial Property Act - The Supreme Court of Canada held that s. 8(6) "did not place any concrete legal barriers in the way of a finding that pensions are property and therefore matrimonial assets" - See paragraph 72.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - The Canadian Forces Superannuation Act, s. 8(6), provided that amounts payable under the Act could not be assigned, charged, attached etc. - To avoid these restrictions on alienation and possible conflict with the federal legislation, some courts, in dividing pensions under provincial marital property legislation, imposed a trust in favour of the non-recipient spouse upon the benefits of the pension in the hands of the named recipient - The Supreme Court of Canada opined that imposition of a trust is not necessary to avoid conflict, however, as a remedy it may be the most effective way to protect the non- recipient spouse's interest - See paragraphs 85 to 89.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - The Supreme Court of Canada discussed the two methods of dividing pensions for the purpose of dividing matrimonial assets - The court stated that the method chosen will depend on a number of factors in any given case and appellate courts should not lightly interfere with the discretion of the trial judge in this regard - See paragraph 91.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - [See Armed Forces - Topic 8003; Constitutional Law - Topic 3617; Family Law - Topic 877; Family Law - Topic 884].

Family Law - Topic 884

Husband and wife - Marital property - Distribution orders - Considerations - Wife's right to maintenance - A wife claimed a share of her husband's army pension under the Matrimonial Property Act (N.S.) - In rejecting her claim an appellate judge opined that even if the pension benefit was not a marital asset, the wife ought to be able to get some pension moneys through a maintenance award - The Supreme Court of Canada, in holding that the pension was a matrimonial asset, rejected the judge's opinion - The court stated that "discretionary support payments are a wholly inadequate and unacceptable substitute for an entitlement to share in the assets accumulated during the marriage as a result of the combined efforts of the spouses" - See paragraphs 28 to 30.

Personal Property - Topic 2

Property - What constitutes - [See Choses in Action - Topic 22].

Cases Noticed:

Lawrence v. Lawrence (1981), 47 N.S.R.(2d) 100; 90 A.P.R. 100; 25 R.F.L.(2d) 130 (C.A.), refd to. [paras. 14, 16, 36, 39, 44, 59, 61, 62].

Isbister v. Isbister (1981), 11 Man.R.(2d) 353; 22 R.F.L.(2d) 234 (C.A.), refd to. [paras. 18, 50, 51, 52, 64].

Rutherford v. Rutherford (1981), 23 R.F.L.(2d) 337 (B.C.C.A.), refd to. [paras. 23, 49, 84, 85, 86].

Harwood v. Thomas (1981), 45 N.S.R.(2d) 414; 86 A.P.R. 414, refd to. [para. 25].

Lefort v. Lefort (1988), 85 N.S.R.(2d) 117; 225 A.P.R. 17; 13 R.F.L.(3d) 359, refd to. [para. 26].

Tataryn v. Tataryn (1984), 30 Sask.R. 282; 38 R.F.L.(2d) 272 (C.A.), refd to. [paras. 29, 33, 49, 57, 60, 64].

Curren v. Curren (1987), 81 N.S.R.(2d) 118; 203 A.P.R. 118, refd to. [para. 44].

Lemmon v. Lemmon (1987), 77 N.S.R.(2d) 113; 191 A.P.R. 113 (S.C.T.D.), refd to. [para. 46].

Stevens v. Stevens (1987), 79 N.S.R.(2d) 336; 196 A.P.R. 336; 7 R.F.L.(3d) 127, refd to. [para. 46].

McNulty v. McNulty (1989), 93 N.S.R.(2d) 109; 242 A.P.R. 109; 24 R.F.L.(3d) 41, refd to. [para. 46].

Herchuk v. Herchuk (1983), 48 A.R. 169; 35 R.F.L.(2d) 327 (C.A.), refd to. [paras. 49, 55, 60, 84].

McAlister v. McAlister, [1983] 2 W.W.R. 8; 41 A.R. 277 (Q.B.), refd to. [paras. 49, 56, 60, 65, 72].

George v. George (1983), 23 Man.R.(2d) 29; 35 R.F.L.(2d) 225, refd to. [paras. 51, 84, 86].

Geisel v. Geisel (1981), 14 Man.R.(2d) 182; 24 R.F.L.(2d) 424, refd to. [para. 51].

Rutherford v. Rutherford (1979), 14 R.F.L.(2d) 41 (B.C.S.C.), refd to. [para. 54].

Hierlihy v. Hierlihy (1984), 48 Nfld. & P.E.I.R. 142; 142 A.P.R. 142, refd to. [paras. 58, 84].

Cleaves v. Cleaves (1982), 27 R.F.L.(2d) 239 (N.S.C.A.), refd to. [para. 59].

Muise v. Muise (1982), 30 R.F.L.(2d) 296 (N.S.C.A.), refd to. [para. 59].

Nolet v. Nolet (1985), 68 N.S.R.(2d) 370; 159 A.P.R. 370; 46 R.F.L.(2d) 388, refd to. [para. 59].

Bank of Montreal v. Hall, [1990] 1 S.C.R. 121; 104 N.R. 110, refd to. [para. 75].

Derrickson v. Derrickson, [1986] 1 S.C.R. 285; 65 N.R. 278, refd to. [para. 76].

Multiple Access Ltd. v. McCutcheon, [1982] 2 S.C.R. 161; 44 N.R. 161; 138 D.L.R.(3d) 1; 18 B.L.R. 138, refd to. [paras. 77, 78, 89].

Rawluk v. Rawluk, [1990] 1 S.C.R. 70; 103 N.R. 321, refd to. [paras. 83, 84, 85].

Rafferty v. Rafferty (1984), 39 R.F.L.(2d) 374 (B.C.S.C.), refd to. [para. 86].

Statutes Noticed:

Canadian Forces Superannuation Act, R.S.C. 1970, c. C-9, generally [paras. 1, 8, 17, 35, 73, 78]; sect. 8(6) [paras. 69, 76, 80, 82].

Civil Code of Québec, art. 462.2, art. 462.3 [para. 53].

Divorce Act, R.S.C. 1970, c. D-8, generally [para. 24].

Family Relations Act, R.S.B.C. 1979, c. 121, sect. 45, sect. 51 [para. 54].

Garnishment, Attachment and Pension Diversion Act, S.C. 1980-81-82-83, c. 100, sect. 22 [para. 69]; sect. 22(1) [para. 80]; sect. 41 [para. 69].

Marital Property Act, R.S.M. 1987, c. M-45; C.C.S.M. c. M-45, sect. 1(b) [para. 50].

Matrimonial Property Act, R.S.A. 1980, c. M-9, generally [para. 55].

Matrimonial Property Act, R.S.S. 1979, c. M-6.1, generally [paras. 33, 57].

Matrimonial Property Act, S.N.S. 1980, c. 9, generally [para. 1 et seq.]; preamble [para. 21]; sect. 2(a) [paras. 38, 39]; sect. 4 [para. 76]; sect. 4(1) [paras. 10, 36, 44]; sect. 4(1)(e) [para. 40]; sect. 12 [paras. 9, 25, 48, 59]; sect. 13 [paras. 11, 12, 25, 26, 41, 45]; sect. 13(l) [paras. 41, 42, 45, 46, 47, 76].

Pension Benefits Act, R.S.A. 1980, c. P-3, generally [para. 55].

Pension Benefits Act, S.M. 1975, c. 38, generally [para. 52].

Pension Benefits Act, S.N.S. 1975, c. 14, generally [para. 17]; sect. 61(2) [para. 49].

Public Service Superannuation Act, R.S.B.C. 1960, c. 57, generally [para. 85].

Authors and Works Noticed:

Bissett-Johnson, Alastair, Three Problems of Pensions - An Overview (1990), 6 C.F.L.Q. 137, generally [para. 68].

Campbell, Neil, Division of Pensions Under the Ontario Family Law Act: A Comment on Marsham v. Marsham and Humphreys v. Humphreys (1988), 7 Can.J.Fam.L. 79, generally [para. 68].

Hogg, Peter W., Constitutional Law of Canada (2nd Ed. 1985), pp. 354, 367 [para. 74].

Knight, Philip A., Splitting and Sharing Pension Assets on Marriage Breakdown (1985), 14 Man.L.J. 419, generally [para. 68].

Marmer, Jack, Valuing Registered Retirement Savings Plans (1987), 2 C.F.L.Q. 97, generally [para. 68].

McBean, Jean M., The Treatment of Pensions Under the Alberta Matrimonial Property Act: Some Unresolved Issues (1986), Payne's Divorce and Family Law Digest (looseleaf) E-25, generally [para. 68].

Patterson, J.B., Determining a Realistically High Value of the Spouse's Interest in the Employee's Pension (1987), 1 C.F.L.Q. 345, generally [para. 68].

Pollock, Michael L., Division of Pension Rights on Marriage Breakdown in Alberta: A Review of some Proposed Amendments to the Alberta Matrimonial Property Act (1987), 2 C.F.L.Q. 83, generally [para. 68].

Roche, Evita M., Treatment of Pensions upon Marriage Breakdown in Canada: A Comparative Study (1986-1987), 1 C.F.L.Q. 189, generally [para. 68].

Winokur, Paul M. and Stephen A. Eadie, Current Pension Valuation Issues from an Ontario Perspective (1988), 3 C.F.L.Q. 197, generally [para. 68].

Counsel:

Bruce Errol McKay, for the appellant;

Richard Johnson, for the respondent.

Solicitors of Record:

Bruce Errol McKay, Thunder Bay, Ontario, for the appellant;

Waterbury, Newton & Johnson, Kentville, Nova Scotia, for the respondent.

This appeal was heard before Dickson, C.J.C., * Wilson, La Forest, L'Heureux-Dubé, Sopinka, Cory and McLachlin, JJ., of the Supreme Court of Canada, on December 6, 1989. The judgment of the court was rendered in both official languages by Wilson, J., on October 4, 1990.