IBM United Kingdom Holdings Ltd & Anor v Dalgleish & Ors

IBM United Kingdom Holdings Ltd & Anor v Dalgleish & Ors

The Court of Appeal held that the judge erred in law by according overriding significance to 'Reasonable Expectations' of scheme members, requiring IBM to justify disappointing them only where no alternative course was available. The correct test is rationality (Wednesbury), not necessity. The existence of Reasonable Expectations is a relevant factor but not determinative. The business justification for Project Waltz was rational and sufficient. The knowledge and motivations of IBM group/CHQ could not be attributed to the UK companies. The Exclusion Notices were not invalid for improper purpose. Defective consultation did not vitiate the changes, and no injunction requiring a new...

Parties
Appellant/claimant: IBM United Kingdom Holdings Ltd; Appellant/claimant: IBM United Kingdom Ltd; Respondent/defendant: Stuart Dalgleish; Respondent/defendant: Lizanne Harrison; Respondent/defendant: IBM United Kingdom Pensions Trust Ltd
Jurisdiction
England and Wales
Judgment Date
03 August 2017
Procedural Posture
Civil Appeal / Court of Appeal Judgment on Appeal From High Court (chancery Division)
Outcome
Appeals allowed; cross-appeal dismissed.
Legal Topics
Occupational Pension Schemes, Employer Duties, Implied Contractual Terms, Discretionary Powers, Consultation Requirements, Corporate Veil, Remedies for Breach of Duty
Employment Law Pensions Law Trusts Law Occupational Pension Schemes Employer Duties Implied Contractual Terms Discretionary Powers Consultation Requirements +2 more

Case Brief

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Parties

IBM United Kingdom Holdings Ltd

Appellant/claimant

IBM United Kingdom Ltd

Appellant/claimant

Stuart Dalgleish

Respondent/defendant

Lizanne Harrison

Respondent/defendant

IBM United Kingdom Pensions Trust Ltd

Respondent/defendant

Procedural Posture

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

Legal Issues

  1. 1 Whether IBM breached the Imperial duty and/or contractual duty of trust and confidence in implementing Project Waltz pension changes
  2. 2 Whether 'Reasonable Expectations' of scheme members limited IBM's discretion
  3. 3 Whether business justification for Project Waltz was sufficient to override such expectations

Ratio Decidendi

The Court of Appeal held that the judge erred in law by according overriding significance to 'Reasonable Expectations' of scheme members, requiring IBM to justify disappointing them only where no alternative course was available. The correct test is rationality (Wednesbury), not necessity. The existence of Reasonable Expectations is a relevant factor but not determinative. The business justification for Project Waltz was rational and sufficient. The knowledge and motivations of IBM group/CHQ could not be attributed to the UK companies. The Exclusion Notices were not invalid for improper purpose. Defective consultation did not vitiate the changes, and no injunction requiring a new...

Court Disposition

Appeals allowed; cross-appeal dismissed.

Orders

  • No injunction requiring new consultation granted.
  • Project Waltz pension changes not set aside.