Entrust Pension Ltd v Prospect Hospice Ltd [2012] EWHC 3640 (Ch) (17 December 2012)

Entrust Pension Ltd v Prospect Hospice Ltd [2012] EWHC 3640 (Ch) (17 December 2012)

The Court held that, on the balance of probabilities, the Previous Trustee did not validly exercise its discretion to award a share of surplus and grant deferred pensions based on target benefits to deferred members at the date of leaving service, except in limited categories where the documentary evidence (such as certain leaving service statements) clearly evidenced such an exercise. The absence of primary evidence, inconsistency in documentation, and lack of a clear policy or record of decision-making meant that most deferred members could not establish entitlement to target benefits on leaving service. The presumption of regularity and implied exercise doctrines did not suffice to...

Citation
[2012] EWHC 3640 (Ch)
Parties
Claimant: Entrust Pension Limited; 1st Defendant: Prospect Hospice Limited; 2nd Defendant: Second Defendant (representing members)
Jurisdiction
England and Wales
Judgment Date
17 December 2012
Procedural Posture
Chancery Division Civil Claim / Post Judgment Trial of Factual Issues Following Earlier Construction Judgment
Outcome
Declaratory judgment on the factual issues; limited categories of deferred members found to have valid awards of target benefits on leaving service; majority not entitled to target benefits unless clear evidence exists.
Legal Topics
Exercise of Trustee Discretion, Deferred Pension Entitlements, Construction of Pension Scheme Rules, Implied Exercise of Powers, Presumption of Regularity
Pensions Law Trusts Law Exercise of Trustee Discretion Deferred Pension Entitlements Construction of Pension Scheme Rules Implied Exercise of Powers Presumption of Regularity

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Parties

Entrust Pension Limited

Claimant

Prospect Hospice Limited

1st Defendant

Second Defendant (representing members)

2nd Defendant

Procedural Posture

Chancery Division Civil Claim / Post Judgment Trial of Factual Issues Following Earlier Construction Judgment

Legal Issues

  1. 1 Whether the Previous Trustee validly exercised its discretion to award a share of surplus and grant deferred pensions to members on leaving service under the 1976 Rules
  2. 2 Whether leaving service statements and related documents evidence a valid exercise of discretion at the relevant time
  3. 3 Whether the presumption of regularity or implied exercise of powers doctrine applies

Ratio Decidendi

The Court held that, on the balance of probabilities, the Previous Trustee did not validly exercise its discretion to award a share of surplus and grant deferred pensions based on target benefits to deferred members at the date of leaving service, except in limited categories where the documentary evidence (such as certain leaving service statements) clearly evidenced such an exercise. The absence of primary evidence, inconsistency in documentation, and lack of a clear policy or record of decision-making meant that most deferred members could not establish entitlement to target benefits on leaving service. The presumption of regularity and implied exercise doctrines did not suffice to...

Court Disposition

Declaratory judgment on the factual issues; limited categories of deferred members found to have valid awards of target benefits on leaving service; majority not entitled to target benefits unless clear evidence exists.

Orders

  • Entrust may administer the Scheme and wind it up on the basis that only those deferred members with clear documentary evidence of a valid exercise of discretion at leaving service are entitled to target benefits.
  • All other deferred members are limited to pensions based on their Accrued Amounts.