The Pensions Regulator v A Admin Ltd and Others
| Jurisdiction | England & Wales |
| Judge | Mrs Justice Rose |
| Judgment Date | 08 May 2014 |
| Neutral Citation | [2014] EWHC 1378 (Ch) |
| Date | 08 May 2014 |
| Court | Chancery Division |
| Docket Number | Case No: HC13F03019 |
[2014] EWHC 1378 (Ch)
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Mrs Justice Rose
Case No: HC13F03019
In the Matter of: LPA Umbrella Trust
LPA Umbrella Trust 2
LPA Umbrella Trust 3
LPA Umbrella Trust 4
Palace Pension Fund Trust
Keith Rowley QC, Elizabeth OveyandPhilip Hinks (instructed by the Pensions Regulator) for the Claimant
Stephen Hackett (instructed by Johnsons) for the First to Fourth Defendants
The Fifth Defendant appeared in person on 26 March 2014 but did not appear and was not represented on 27 March 2014
Hearing dates: 26 th and 27 th March 2014
This claim is brought by the Pensions Regulator ('the Regulator') against five Defendants all of whom were involved in arrangements set up to receive funds transferred by pension scheme members from those members' occupational or personal pension schemes ('the Arrangements'). The claims are brought under sections 15, 16 and 19 of the Pensions Act 2004. Section 15 empowers the court on the application of the Regulator to grant an injunction if it is satisfied that there is a reasonable likelihood that a particular person will do any act which constitutes a misuse or misappropriation of any of the assets of an occupational or personal pension scheme. Section 16 empowers the court on the application of the Regulator to order a person to take steps to make restitution if there has been misuse or misappropriation of any of the assets of an occupational or personal pension scheme. Section 19 empowers the court to deal with money that has been liberated from a pension fund within the meaning of section 18(2) of that Act, for example by transferring recoverable property to a pension scheme. The Amended Particulars of Claim allege, broadly speaking, that all five Defendants have been involved in the Arrangements that invite people to transfer their pension funds out of their existing occupational or personal pension schemes into the trusts and corporate entities that comprise the Arrangements. The Regulator alleges that this constitutes misuse or misappropriation by the Defendants of assets of the original pension schemes.
The claim was issued on 23 July 2013 and on the same day the Regulator sought an interlocutory injunction to stop the Defendants from continuing to participate in or to solicit others to participate in the Arrangements. On 7 August after a day's hearing before Hildyard J, all the Defendants, including the Fifth Defendant ('Mr Baxendale-Walker') gave an undertaking to the court in those terms. At that hearing in August 2013 Mr Baxendale-Walker was represented by counsel but more recently he has been acting as a litigant in person. Mr Baxendale-Walker issued an application on 11 December 2013 seeking to discharge or vary the undertaking given on 7 August 2013.
Mr Baxendale-Walker issued an application on 6 January 2014 seeking to strike out most of the claim. That application was accompanied by a very full Grounds of Appeal dated 6 January 2014 ('the 6 January Grounds'). On 20 January 2014 at a case management hearing I directed that the strike out application should proceed by way of a determination of three preliminary issues ('the Three Issues'). Those were set out in the Schedule to the order made on 20 January 2014 ('the 20 January Order'):
"1. On the true construction of the trust deeds governing the Schemes (as defined in the Amended Particulars of Claim), are the beneficial interests of the Members (as there defined) void for uncertainty?
2. On the assumption that the Schemes constitute occupational pension schemes within the meaning of the Pension Schemes Act and the Pensions Act 1995 and if the answer to question 1 is no, on the true construction of the trust deeds governing the Schemes, do the beneficial interests of Members declared by the trust deeds constitute an entitlement to a pension or a right to a future pension within the meaning of s.91(1) of the Pensions Act 1995 (as amended)?
3. Does s. 91(5) of the Pensions Act 1995 (as amended) limit the exclusion from the general prohibition of s. 91(1) of surrenders for the purpose of providing benefits for the relevant person's widow, widower, surviving civil partner or dependants to surrenders where the new benefits are to be provided under the same scheme as the scheme providing the surrendered benefits?"
I shall refer to those Three Issues as 'the Certainty Issue', 'the Future Pension Issue' and 'the Same Scheme Issue'. I also directed on 20 January that the hearing of the Three Issues and of the application to vary or discharge the undertaking should take place during the week beginning 24 March 2014 with a time estimate of 1 1/2 days for reading and three days argument and I set a timetable for skeleton arguments to be exchanged by 17 March 2014.
Between 10 and 18 March 2014 a further seven applications were issued either by Mr Baxendale-Walker or by others supporting him, all with return dates for the same three days in March. None of those applications was an application to revoke or vary the 20 January Order but Mr Baxendale-Walker contended that some or all of those applications should be heard instead of the Three Issues at the three day hearing. The Regulator indicated that it did not agree to that course and that it wanted the Three Issues heard and determined. The skeleton argument for the hearing lodged by the Regulator on 17 March contained detailed submissions on the Three Issues. After two days of reading into the case, I concluded that the Three Issues were still live between the parties and should be heard as previously directed together with the application to vary the injunction. Most of the other applications would be adjourned to a later date. I told the parties of this decision the afternoon before the hearing. The result of this was that although there were lengthy skeleton arguments lodged in support of the other seven applications, there was no skeleton arguments lodged by Mr Baxendale-Walker or the other Defendants specifically relating to the Three Issues, although he had included submissions on some of them at least in his detailed 6 January Grounds.
At the start of the hearing on 26 March 2014 Mr Baxendale-Walker, appearing in person, said that he did not want to contest the Three Issues. It was not entirely clear what he meant by this. He did not, it appeared, mean that he was prepared to concede that the Three Issues should be answered in the way contended for by the Regulator because he was not prepared to agree a draft consent order to that effect prepared by the Regulator.
During the first day of the hearing Mr Rowley QC on behalf of the Regulator made his submissions on the Three Issues. Once Mr Rowley was finished, Mr Baxendale-Walker made some submissions generally about how the schemes worked; about announcements made by the Chancellor of the Exchequer in the Budget on 19 March 2014 and how they affected the operation of schemes such as those in contention in the current proceedings; about the kinds of pension scheme members who had taken advantage of the Arrangements by transferring value from their existing pensions; and about the mischief at which section 91 of the Pensions Act 1995, which I will come to later, is aimed. At the close of the day, I explained to Mr Baxendale-Walker that he needed to consider overnight whether there were further things he wanted to say more specifically about the Three Issues, having heard Mr. Rowley's submissions. I told him that once we had finished dealing with the Three Issues on the second day, we would turn to the application to vary or discharge the undertaking. Mr Baxendale-Walker said that he now wished to withdraw that application to vary and that he would prefer to make any further submissions on the Three Issues in writing rather than making oral submissions. This was because, as he put it, his days 'do have a cost' — no one was paying him to attend court and 'there are many more remunerative things' he could do than make submissions for the remaining two days set aside for the hearing. Later that evening, Mr Baxendale-Walker circulated by email a note of submissions on the Three Issues ('the Note') and indicated that he was withdrawing the application to vary the undertaking. He did not attend court on the second day of the hearing. Counsel for the First to Fourth Defendants did not make any submissions during the course of the hearing. Mr Rowley made submissions to me on the second day in relation to the general comments Mr Baxendale-Walker had made orally the previous day and on the contents of the Note. I am grateful to him for doing so despite having only received the Note quite late the evening before.
I record these events only to explain why the arguments that Mr Baxendale-Walker wants to advance on the Three Issues are rather sketchy so far as I am concerned. I have read carefully the relevant parts of his 6 January Grounds and the Note. The Note was brief and difficult to understand and might well have benefited from being supplemented by oral argument, had Mr Baxendale-Walker attended court on the second day for that purpose. If what follows shows that I have failed to grasp some of the subtleties of the points Mr Baxendale-Walker wished to make, then I consider that he really has only himself to blame.
Before turning to the Three Issues, I must explain a little about how the schemes challenged by the Regulator work. The following description of the arrangements is based on the documents in the Membership Establishment Pack and the Membership Completion Pack provided to...
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