Saga Group Ltd and Another v Michelle Paul
| Jurisdiction | England & Wales |
| Judge | His Honour Judge Hodge,Judge Hodge |
| Judgment Date | 28 July 2016 |
| Neutral Citation | [2016] EWHC 2344 (Ch) |
| Court | Chancery Division |
| Date | 28 July 2016 |
| Docket Number | Case No: HC-2016-0019 |
[2016] EWHC 2344 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
The Rolls Building
7 Rolls Buildings
Fetter Lane
London EC4A 1NL
His Honour Judge Hodge QC
(Sitting as a Judge of the High Court)
Case No: HC-2016-0019
Mr. Jonathan Evans QC (instructed by Sacker & Partners LLP) for the Claimants
Mr. David E. Grant (instructed by Allen & Overy LLP) for the Defendant
His Honour Judge Hodge QC:
This is my extemporary judgment on the hearing of the claimants' application for summary judgment on their claim for rectification of a deed dated 18 th August 2003 (to which I shall refer as "the 2003 Deed") which was a new definitive deed and provided new rules for the Saga Group Pension and Life Assurance Scheme (to which I shall refer as "the Scheme"). The rectification sought is the substitution of the term "Final Pensionable Salary" in place of the term "Pensionable Salary" both of which are defined terms in rule 57.2 of the 2003 Deed. Rectification is sought on the ground of common mistake.
The claim form was issued on 29 th June 2016. The particulars of claim were not originally verified by a statement of truth but that omission has now been cured and will be addressed in my substantive order. The claimants' application notice seeking summary judgment is dated 30 th June 2016. The first-named claimant, Saga Group Limited, is and was at all material times the principal and only participating employer of the Scheme. The second claimant, Saga Pension Trustee Limited, is the current Trustee of the Scheme having been appointed on 28 th September 2011. The parties to the 2003 Deed were the company and the then Trustees; and the second claimant brings this claim as successor to the former Trustees.
The defendant, Michelle Paul, is currently the Head of Cruise Marketing at Saga Group Limited and is a member of the Scheme entitled to final salary benefits in respect of service after 1 st December 2000. It would be in her interests for rectification to be refused. She has been joined to act in a representative capacity and the claimants seek appropriate representation orders, pursuant to CPR 19.7(2), to ensure that all persons with competing interests in the outcome of the rectification claim will be bound by the result. The claimants seek orders appointing the second claimant to represent all those with an interest in rectification being granted and appointing the defendant as the representative of all those with an interest in rectification being refused. The defendant has been provided with independent legal advice from specialist solicitors, Allen & Overy and from specialist pensions counsel, Mr. David E. Grant. With the benefit of that advice she has decided not to oppose the application for summary judgment.
Her witness statement is dated 14 th July 2016. In it she makes it clear that her statement is made in her capacity as a member of the Scheme and that it is intended that she should represent all of the members of the Scheme in whose interests it may be for the claim for rectification to be refused. She states that she understands that the claimants are seeking an order that she be appointed as such a representative member; and she confirms that she is content to be appointed and is unaware of any reason why she should not be. She says that she has never been a director of either claimant and has no direct knowledge of the matters which relate to the claim for rectification. She was asked if she would act as a representative beneficiary by Janet Thompson, the present Chair of the Trustees. She confirms, without waiving privilege, that she has been provided with legal advice throughout the matter by Allen & Overy and by Mr. Grant. She says that in February 2015 Mr. Grant and Allen & Overy took her through the details of the issue and of the rectification case that had been prepared by the claimants at that stage. They also explained to her her role and duties as a representative member. At that stage her legal advisers considered that there were certain aspects of the rectification claim that required further investigation and they therefore wrote to the claimants' legal advisers in March 2015. The defendant understands from reading a letter from the claimants' solicitors in May 2016 that the claimants then spent some time searching for additional documents and asking further questions of the various witnesses. She states that her legal advisers reviewed that additional documentation and, after discussing it with her in June 2016, they informed Mrs. Paul that in their opinion the evidence for rectification was, as a result of the additional documentation and witness evidence, sufficiently strong for there to be no real prospect of defending the rectification claim and that they proposed to inform the claimants' solicitors that Mrs. Paul would not be opposing any application for summary judgment.
Mrs. Paul states that members of the Scheme were notified by a letter dated 8 th July 2016 about the issue of the use of the term "Pensionable Salary" as opposed to "Final Pensionable Salary" in the 2003 Deed and that the claimants intended to seek rectification of the 2003 Deed. That communication informed members that a member of the Scheme had been appointed to represent their interests in the rectification application and provided contact details of the second claimant's legal advisers so that members could raise any questions they had in relation to the action. At the time she made her witness statement Mrs. Paul understood that no enquiries had been made by any members. Mr. Evans has informed me this morning that one telephone call has in fact been received from a Scheme member but that merely sought clarification and did not raise any objection to the rectification claim.
I have seen a copy of the letter of 8 th July 2016. It begins by stating in bold type that:
"The Trustee wishes to inform [the addressee] of a forthcoming court hearing in relation to the Plan. No action is required from [the addressee] at the present time but it is important that [the addressee] read this statement."
The letter then poses a number of questions which are numbered and set out in bold type. The first is: "What is the issue?" The second is: "What are the Trustee and the Company proposing?" The third is: "What has the Trustee done to protect member interests?" The fourth is: "Does this affect [the addressee]?" The fifth is: "Is there anything I need to do?" It states that the announcement is for the information of the addressee only and that he or she is not required to take any action as a result of it. The letter states that the writer will, of course, let the address know of the outcome of the application. But then, importantly, paragraph 6 is headed "Contact". It states that if the addressee has any queries regarding anything in the announcement they are invited to contact the Trustee's legal adviser, who is identified by name, and the address of the firm is then provided.
On behalf of Mrs. Paul it is pointed out that whilst the court should be careful to dispel any taint of a deal done behind closed doors, an over-zealous requirement of notification or consultation might undermine the very purpose of representation orders. Here Mrs. Paul and her specialist legal representatives have analysed and tested the claim over an extended period of time and it is difficult to see what further scrutiny by another member or members could reasonably add.
I am satisfied that there has been such independent scrutiny and that members of the Scheme have been notified of what is happening in appropriate terms. I am satisfied that, as a matter of principle and authority, there is no requirement that a representative beneficiary should consult with members of the class which it is proposed he or she will represent, but that it is good practice, albeit not mandatory, for the employer or the Trustees to inform members of forthcoming litigation. Indeed, that is addressed at paragraph 29.97 of the online version of the Chancery Guide.
I accept the submission on behalf of Mrs. Paul that the letter in the present case strikes an appropriate balance between accuracy and accessibility. I have no concerns about the nature of the communication or about any taint of a "done deal" in the present case. I also bear in mind that one does not wish to alarm Scheme Members unnecessarily. In my judgment, the nature of the letter in this case, providing a contact point with the solicitors representing the Scheme Trustee, strikes an appropriate balance.
Although, with the benefit of independent specialist legal advice, the defendant has decided not to oppose the application for summary judgment, rectification is a jurisdiction that can only be exercised by the court after most careful and anxious consideration of the evidence. It is not relief that can be granted by consent without such consideration. It affects persons other than the immediate parties to the litigation; and it operates retrospectively and not prospectively. Nevertheless, I am satisfied that it can be granted summarily in appropriate cases, namely, where there is no realistic prospect of the claim being successfully defended and there is no other reason why the claim should go to trial. I am satisfied also that there are numerous examples, both reported and unreported, of summary judgment applications being made, and succeeding, in the pensions context.
It is for the court to be satisfied by the claimants that...
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