Gays and lesbians who outlive their same-sex partners are entitled to retroactive pension benefits, Ontario's Superior Court of Appeal has ruled.

In Friday's decision, the court upheld a lower-court ruling that the federal government was wrong to leave the retroactive payments out of its equality rights scheme back in 2000.

"Excluding many of those who were intended to be included is not rationally connected to the objective of the law, which is to end the discriminatory exclusion of same-sex partners from CPP benefits,'' the court said in its written ruling.

For the lawyer pressing the case, Douglas Elliot, the ruling is an indisputable win.

"It is a victory," Elliot told reporters at a news conference. "We are delighted the courts have stood up... and upheld the entitlement of gay and lesbian same-sex survivors to the same pension benefits as every other Canadian."

"No one gave us a gay and lesbian discount when we were paying into the Canada Pension Plan, and so we shouldn't have a gay and lesbian discount when we get paid out."

The ruling affects close to 1,500 widowed gays and lesbians across the country. But Elliot conceded he had not won on all points, since the court sided with Ottawa's decision to withhold retroactive benefits from the estates of approximately 200 claimants who have died since the case was filed.

The case before the court concerned Bill C-23, which became law in 2000. Under that legislation, gays and lesbians whose partners died before Jan. 1998 were deemed to be not entitled to retroactive benefits.

Gay activist George Hislop, 77, decided to pursue a legal challenge of the benefits laws following the death of his same-sex partner in 1986, on whom he had relied as breadwinner for 28 years.

A class action suit was filed to challenge the 1998 cut-off, arguing benefits should be made retroactive to April 1985, when equality on the basis of sexuality was enshrined in the Charter of Rights and Freedoms.

In a decision that was quickly appealed by the federal and provincial government, Ontario's Superior Court of Justice ruled the 1998 date was discriminatory.

Justice Minister Irwin Cotler said he wanted to study the ruling before deciding whether to appeal to the Supreme Court of Canada. But he says this is not a case about gay and lesbian rights.

"The implications of this case have to do with the whole question of federal benefits programs and policy,'' Cotler said.

Initially, the amount of retroactivity was pegged at as much as $400 million, but more recent actuarial data suggested it would be closer to $80 million.

Although Ottawa has expressed concern over the potential impact a rush of new payouts, Elliot says that's not a valid concern.

"The uncontested of the federal government itself at trial was that there will be no reduction in anyone else's pension because of this, and there will be no increase in premiums."

Quebec was not part of the lawsuit because it operates a separate pension plan.