Board of the Pension Protection Fund v Dalriada Trustees Ltd [2020] EWHC 2960 (Ch) (06 November 2020)

Board of the Pension Protection Fund v Dalriada Trustees Ltd [2020] EWHC 2960 (Ch) (06 November 2020)

A company can be an 'employer' for the purposes of section 182 PA 2004 and the Fraud Compensation Regulations if it has employees under a contract of service or remunerated office-holders eligible for scheme membership, but not if it only has unremunerated office-holders. The statutory context and prior case law require a consistent interpretation of 'employer' and 'employment' across pension legislation, and the legislative intent is to protect scheme members in such circumstances.

Citation
[2020] EWHC 2960 (Ch)
Parties
Claimant: The Board of the Pension Protection Fund; Defendant: Dalriada Trustees Limited; Interested Party: Secretary of State for Work and Pensions
Jurisdiction
England and Wales
Judgment Date
06 November 2020
Procedural Posture
Chancery Division Property, Trusts and Probate / Judgment After Trial With Further Written Submissions
Outcome
Declaratory relief granted; statutory interpretation provided on the definition of 'employer' for fraud compensation purposes.
Legal Topics
Fraud Compensation Fund, Definition of Employer in Pension Legislation, Occupational Pension Schemes, Fraud Compensation Payments, Scheme Failure Notice, Statutory Construction, Pension Liberation Scams
Pensions Law Trusts Law Statutory Interpretation Fraud Compensation Fund Definition of Employer in Pension Legislation Occupational Pension Schemes Fraud Compensation Payments Scheme Failure Notice +2 more

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Parties

The Board of the Pension Protection Fund

Claimant

Dalriada Trustees Limited

Defendant

Secretary of State for Work and Pensions

Interested Party

Procedural Posture

Chancery Division Property, Trusts and Probate / Judgment After Trial With Further Written Submissions

Legal Issues

  1. 1 Whether a company without employees or only with unremunerated/remunerated directors qualifies as an 'employer' for fraud compensation purposes under section 182 PA 2004
  2. 2 Interpretation of 'employer' and 'employment' in the context of occupational pension schemes and fraud compensation
  3. 3 Eligibility of schemes for fraud compensation where the employer is a sham or lacks employees

Ratio Decidendi

A company can be an 'employer' for the purposes of section 182 PA 2004 and the Fraud Compensation Regulations if it has employees under a contract of service or remunerated office-holders eligible for scheme membership, but not if it only has unremunerated office-holders. The statutory context and prior case law require a consistent interpretation of 'employer' and 'employment' across pension legislation, and the legislative intent is to protect scheme members in such circumstances.

Court Disposition

Declaratory relief granted; statutory interpretation provided on the definition of 'employer' for fraud compensation purposes.

Orders

  • A company is a statutory 'employer' for section 182 PA 2004 purposes if it has employees under a contract of service or remunerated office-holders eligible for scheme membership.
  • A company with only unremunerated office-holders is not a statutory 'employer' for these purposes.