Stevens & Ors v Bell & Ors [2002] EWCA Civ 672 (20th May, 2002)

Stevens & Ors v Bell & Ors [2002] EWCA Civ 672 (20th May, 2002)

Clause 11(b) of the APS Trust Deed confers a free-standing power on the trustees to make a scheme for disposing of the disposable surplus certified by the actuary, including the creation of reserves, benefit improvements, new benefits, payments to the employer, and reduction or suspension of employee contributions, subject only to the main objects provision and Inland Revenue constraints. The power is not limited to the methods specified in subclauses (d) and (e), nor does it require the use of the amendment power in clause 18. The scheme need not dispose of the entire surplus at once, and any undisposed surplus may remain as a reserve. Repayment to the employer is theoretically possible...

Citation
[2002] EWCA Civ 672
Parties
Claimants/respondents: Derek Maurice Stevens, Robert Stopford Webb, Graham Tomlin, Allan Charles Bromwich, Michael Ronald Grey, Michael John Harper, Neil Findlay Robertson, Glenn James Lomas, Michael Balint Szucs, Thomas Mitchell, Sandra Elizabeth Mooney, Andrew Charles Lavery, Philip Hogg, Michael Anthony Street, Jeffrey Wilson and British Airways Pension Trustees Limited; Defendant/appellant: George Bell; Defendant/appellant: Michael Palmer; Defendant/respondent: British Airways plc; Defendant/respondent: Kenneth Michael Post
Jurisdiction
England and Wales
Procedural Posture
Appeal From High Court (chancery Division) / Court of Appeal Judgment
Outcome
Appeal dismissed; judgment of Lloyd J affirmed on the issues in dispute.
Legal Topics
Interpretation of Pension Trust Deeds, Trustee Powers Regarding Surplus, Employer Contribution Holidays, Scheme Amendments, Repayment of Surplus to Employer
Trusts Pensions Employment Interpretation of Pension Trust Deeds Trustee Powers Regarding Surplus Employer Contribution Holidays Scheme Amendments Repayment of Surplus to Employer

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Parties

Derek Maurice Stevens, Robert Stopford Webb, Graham Tomlin, Allan Charles Bromwich, Michael Ronald Grey, Michael John Harper, Neil Findlay Robertson, Glenn James Lomas, Michael Balint Szucs, Thomas Mitchell, Sandra Elizabeth Mooney, Andrew Charles Lavery, Philip Hogg, Michael Anthony Street, Jeffrey Wilson and British Airways Pension Trustees Limited

Claimants/respondents

George Bell

Defendant/appellant

Michael Palmer

Defendant/appellant

British Airways plc

Defendant/respondent

Kenneth Michael Post

Defendant/respondent

Procedural Posture

Appeal From High Court (chancery Division) / Court of Appeal Judgment

Legal Issues

  1. 1 What is the permissible scope of a scheme for disposing of surplus under clause 11(b) of the APS Trust Deed?
  2. 2 Does clause 11(b) permit the trustees to create reserves?
  3. 3 Does clause 11(b) permit refunds to be made to British Airways?

Ratio Decidendi

Clause 11(b) of the APS Trust Deed confers a free-standing power on the trustees to make a scheme for disposing of the disposable surplus certified by the actuary, including the creation of reserves, benefit improvements, new benefits, payments to the employer, and reduction or suspension of employee contributions, subject only to the main objects provision and Inland Revenue constraints. The power is not limited to the methods specified in subclauses (d) and (e), nor does it require the use of the amendment power in clause 18. The scheme need not dispose of the entire surplus at once, and any undisposed surplus may remain as a reserve. Repayment to the employer is theoretically possible...

Court Disposition

Appeal dismissed; judgment of Lloyd J affirmed on the issues in dispute.

Orders

  • Trustees' power under clause 11(b) is free-standing and includes creation of reserves, benefit improvements, new benefits, payments to employer, and reduction/suspension of employee contributions, subject to main objects and Inland Revenue constraints.
  • No requirement to use amendment power under clause 18 for a clause 11(b) scheme.