Capital Cranfield Trustees Ltd v Walsh & Anor

Capital Cranfield Trustees Ltd v Walsh & Anor

The Trustee did not have power, after scheme termination and winding-up, to require the Company to pay a contribution equal to any shortfall needed to secure members’ benefits by purchase from an insurance company. Before the effective date of the termination notice, the Trustee did have power, having taken actuarial advice, to demand a contribution to make good any buy-out deficit.

Parties
Applicant/claimant: Capital Cranfield Trustees Limited; Respondent: Timothy Gerard Walsh; Respondent: Richard Victor Yerburgh Setchim; Defendant: Pinsent Curtis (a firm); Defendant: Pinsent Curtis Biddle (a firm); Defendant: Pinsents
Jurisdiction
England and Wales
Judgment Date
09 December 2004
Procedural Posture
Civil (companies Court, Chancery Division) / Judgment on Preliminary Issues
Outcome
Preliminary Issue 1(i) answered yes; Trustee had power before termination to demand buy-out deficit contribution. Preliminary Issue 1(iii) answered no; Trustee had no power after winding-up to demand such contribution.
Legal Topics
Proof of Debt, Occupational Pension Schemes, Scheme Termination, Employer Contributions, Professional Negligence
Company Law Pensions Law Insolvency Law Professional Negligence Proof of Debt Occupational Pension Schemes Scheme Termination Employer Contributions

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Parties

Capital Cranfield Trustees Limited

Applicant/claimant

Timothy Gerard Walsh

Respondent

Richard Victor Yerburgh Setchim

Respondent

Pinsent Curtis (a firm)

Defendant

Pinsent Curtis Biddle (a firm)

Defendant

Pinsents

Defendant

Procedural Posture

Civil (companies Court, Chancery Division) / Judgment on Preliminary Issues

Legal Issues

  1. 1 Whether the Trustee had power to demand a buy-out deficit contribution from the Company after scheme termination and winding-up
  2. 2 Whether the Trustee had power to demand such contribution before scheme termination
  3. 3 Construction of pension scheme trust deed provisions regarding employer contributions

Ratio Decidendi

The Trustee did not have power, after scheme termination and winding-up, to require the Company to pay a contribution equal to any shortfall needed to secure members’ benefits by purchase from an insurance company. Before the effective date of the termination notice, the Trustee did have power, having taken actuarial advice, to demand a contribution to make good any buy-out deficit.

Court Disposition

Preliminary Issue 1(i) answered yes; Trustee had power before termination to demand buy-out deficit contribution. Preliminary Issue 1(iii) answered no; Trustee had no power after winding-up to demand such contribution.

Orders

  • Trustee's appeal against rejection of Proof of Debt on buy-out basis dismissed for post-termination period
  • Trustee entitled to demand buy-out deficit contribution before scheme termination