Double dipping is a reference to a future revenue source being shared more than once with your former spouse. The prime example of that is a future pension which is treated as property at the time of separation and is equalized as part of the property settlement. Later once the pension is actually being received, should that same pension/asset, which has already been equalized, be available as an income stream which your ex-spouse can look to for support.
As an example, if you are an employee of Chrysler and had worked at Chrysler for some 10 years during the course of the marriage, when you separate, that future pension even though you have not received it by the time of separation, is an asset which is equalization. Using the services of a fancy mathematician called an actuary (and now this is a service provided by the pension administrator) a family law lump sum value is obtained. That value is taken into account when there is a property settlement.
That pension can be easily worth in excess of $100,000.00 and in return for you keeping all of your pension, you may give up all of your interest in the matrimonial home to your ex-spouse. 10 years later, you retire and start to receive $2,000.00 per month under your Chrysler pension. Your former spouse’s financial situation has gotten worse and now your total income, including a $2,000.00 per month Chrysler pension is $3,000.00 per month. Your wife wants spousal support and she wants as part of that spousal support the court to assume that you are earning $3,000.00 per month, even though two thirds of that comes from a pension that has already been shared with your former spouse. This is an example of double dipping.
The leading case on this is the Supreme Court of Canada’s decision in Boston vs. Boston. The court held that this is generally not to be allowed, but this is not an absolute prohibition. In the recent Manitoba Court of Appeal decision of Senek vs. Senek, the husband applied to reduce the amount of support as he had retired. His pension had already been equalized when the parties had separated. Quoting other decisions, the court stated that “the challenge is to avoid double recovery when it is fair to do so, but this is not to say that in all cases double recovery will be eliminated because of some cases double recovery may be the only fair way to continue support.” In the Senek case, the court was moved to permit double dipping because in the absence of the former husband’s ongoing support, the ex-wife’s income would have fallen so low that she would have been placed below the poverty level. When there is a strong need for spousal support, the court will tip the scales in favour of the recipient’s needs.
