The company’s pension scheme provided that the trustees were to form an opinion as to the employee’s ability or otherwise to work. The plaintiff sought payment of an ill-health pension under the Bank Pension Scheme.
Held: A pension scheme trust is quite different from other trusts. Pension benefits are part of the consideration which an employee receives in return for the rendering of his services. If the basis of the decision was in error, the employee had the right to ask a court to review the decision
Nicholls LJ: ‘I do not think it is necessary to pursue these points of trust law. It is unnecessary to consider what might be the position under the law of trusts if the trust deed stood alone, and the plaintiff’s rights were to be found only within the four corners of the trust deed and the rules. It is unnecessary, because this is a case in which the plaintiff’s status as a member springs from her contract of employment with the bank. The bank holds out this pension scheme to its staff as a valuable part of the staff’s overall remuneration package. That being so, when one finds that under the rules of the pension scheme certain functions are entrusted to the bank, it is, in my view, necessarily implicit in the contract of employment that the bank agrees with the employee that it will duly discharge those functions in good faith. In particular, if a member of the bank staff will become entitled to payment of an ill-health pension if the bank is of the relevant opinion concerning the state of health of the employee, it is an implied term of the contract that the bank will properly consider a genuine claim by an employee that her health qualifies her for an ill-health pension. To my mind it is unthinkable that the position might be otherwise. …’
Judges:
Nicholls LJ
Citations:
Times 18-Aug-1989, [1989] IRLR 522
Jurisdiction:
England and Wales
Cited by:
Cited – South West Trains Ltd v Wightman and Others ChD 14-Jan-1998
The trades’ union had agreed with the employer that what had been irregular and non-pensionable payments made to employees would, in future, be paid regularly, but that only certain parts of the payments become pensionable. The employer now sought . .
Cited – Hill v General Accident Fire and Life Assurance Corporation Plc SCS 13-Aug-1998
. .
Cited – Sieff v Fox ChD 23-Jun-2005
The advisers to trustees wrongly advised the trustees about the tax consequences of exercising a power of appointment in a certain way. As a result a large unforeseen Capital Gains Tax liability arose. The trustees sought to set aside the . .
Cited – Hutchings v London Borough of Islington CA 28-Apr-1998
A Local Government employee’s failure to follow available appeal procedure did not prevent him asking the county court to determine his entitlement to superannuation benefits on retirement. . .
Cited – Regina v West Yorkshire Fire and Civil Defence Authority and ex parte Lockwood and McCalman Admn 4-May-1999
The court considered the nature of the employment duties of retained firefighters: ‘their [i.e. whole time firefighter’s] ‘principal duty’ or . . core obligation had been firefighting.’ . .
Cited – Imperial Group Pension Trust Ltd v Imperial Tobacco Ltd 1991
A company pension scheme had been operating for many years, with increases being provided for under one rule. A new rule was introduced to provide regular increases. The company was taken over, and the trustees sought clarification of the company’s . .
Lists of cited by and citing cases may be incomplete.
Employment
Updated: 26 July 2022; Ref: scu.182112