Division of the 2nd Pillar in the Context of Divorce

In general

In the context of a divorce, whether by unilateral or joint petition, the division of the^2nd pillar is one of the points to be decided by the judge. It is examined separately from the liquidation of the matrimonial property regime. In the event of divorce, a clear distinction must be made between the^2nd pillar and the^3rd pillar. Depending on the matrimonial property regime applicable to the marriage, the^3rd pillar will be settled as part of the liquidation of the matrimonial property regime.

The division of the^2nd pillar is an aspect of the divorce that the judge must examine on a mandatory basis, in other words, it is a question that is examined ex officio. As such, the divorce judge has full power of review in this matter. As part of the divorce proceedings, the judge must be provided with all the documents required to determine the amount of pension assets accumulated by each spouse during the marriage.

Article 122 of the Swiss Civil Code stipulates that, in principle, the pension assets accumulated by the spouses during the marriage up to the date on which they file for divorce must be divided equally between them.

However, there are two types of exception to the principle of division by half. Firstly, the law provides for an exception agreed by the spouses themselves, known as a conventional exception, and secondly, an exception based on a court decision.

The exception agreed by the spouses

The spouses may decide to waive the 50/50 split of the pension assets, or to provide for a different distribution key (greater or less than half). In most cases, the spouses will agree to this by including a clause to this effect in their divorce agreement.

However, in the event of renunciation, the spouses will have to ensure that adequate provision for old age and disability remains in place for the spouse who would have been a creditor under the 50/50 split. In this respect, it should be emphasized that adequate provision does not require each spouse to have identical, or even comparable, pension assets. Thus, the requirement of adequate pension provision is not to be interpreted strictly.

Certain situations may be considered in favor of renunciation, such as a short marriage, a large age difference between the spouses, a large fortune on the part of the spouse entitled to the partition, etc.

In the event that the spouses waive the division, it should be borne in mind that the judge is always free not to ratify the agreement and to balance the spouses’ pension assets.

Exception decided by the judge

The judge may also award less than half of the termination benefit to the creditor spouse, or even none at all for good reason. In principle, if the division by half proves inequitable, the judge may depart from it.

The reasons that may lead the judge to deviate from the rule include the following:

• The outcome of the liquidation of the matrimonial property regime or the economic situation of the spouses after the divorce.

For example, the judge may refuse to divide the^2nd pillar in a case where the spouses are subject to the separation of property regime and the economically strong spouse has built up a pension exclusively in the form of the^3rd pillar, which will therefore not be divided in the liquidation of the matrimonial property regime, while the economically weaker spouse has a modest^2nd pillar.

• The pension needs of each spouse, particularly in view of their age difference.

The law also gives the judge the option of allocating more than half of the termination benefit if the spouse takes on joint children after the divorce. This option fills the pension gap that will continue to grow after the divorce, as one spouse will not be able to contribute as much as the other. However, for the judge to be able to decide on this distribution key, the debtor spouse must of course still have adequate pension provision.

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In the final analysis, even if the final outcome of the division of the^2nd pillar is left to the judge, the lawyer will have to examine this question carefully. The division must always be considered in conjunction with the liquidation of the matrimonial property regime and the maintenance contribution between the spouses, to determine whether a division by half should be imposed or whether it should be departed from. Finally, it should be remembered that only the Swiss courts have jurisdiction over the division of the^2nd pillar.