Carleton University won the right to reclaim nearly $500,000 in pension benefits made to a former political science professor who was missing for years before his remains were found in the woods near his Quebec home after the Quebec Court of Appeal held that the pension plan plainly states that the benefits ceased when the beneficiary died.
The ruling, which essentially upheld a lower court ruling but not for the same reasons, appears to have broadened the scope of several Civil Code of Quebec provisions by applying a “generous and liberal interpretation” to unjust enrichment and the legal presumption surrounding absentees, according to legal experts.
Chances are the pension battle is going to get ugly.
A month ago hundreds of Montreal municipal employees protested a proposed law by the Quebec government that would compel unions to renegotiate their pension plans to staunch the province’s $3.9 billion municipal pension plan deficit. At around the same time, 85 Montreal firefighters retired immediately fearing that their pensions would be reduced following negotiations between the city and their union. More recently still, Montreal police have begun wearing red baseball caps and jeans or combat pants, a first step in an escalating series of pressure tactics to protest pension reforms. More protests are likely.
There is little question that municipal pension plans are in dire straits. In Montreal approximately 10.5 per cent of the city’s 2013 budget, or $510.3 million of the $4.9 billion budget, will fund the retirement system, including a fee of $256.3 million to cover the plan’s actuarial deficit for a single year. In Quebec City it’s more of the same, with Mayor Régis Labeaume estimating the city’s pension deficit to be around $800 million. All told, the Union of Quebec Municipalities says that 108 cities and towns across the province have a collective deficit of $5-billion in their defined benefit pension plans.
