International and Commercial Trusts

Cowan v Scargill 

• New investment plan was proposed to replace the old one 

• Union Ts objected on various grounds incl. investment in competing industry

• Ts initiated proceedings seeking direction on whether the union Ts were breaching F duty by witholding consent 

Held

• Ts were in breach 

• Ts of a pension scheme have to consider the best interest of the Bs and that interest is primarily the financial interest of the fund 

IBM v Dagleish [2018] 

• Until 2009, scheme provided either final salary (defined beneifit or defined contribution benefits 

  • Defined beneift had been closed but still had members 

  • IBM Closed defined benefit part of scheme all together except for employees entitled to benefits 

• T's brough proceedings to test lawfulness of this change 

Held 

• C^oA said the imperial duty (no collateral purpose, not damaging the relationship of trust and confidence between E and e) was assesed by virtue of Wednesbury test of rationality 

  • Was the dedcision by IBM so outragoeus in definance of logic that no senesible person would arrive at teh same decision? Oris it completly lacking in any logical connection between relevant cirucmstances and ostensible reasons for the decision? 

• Court found IBM had not acted irrationallly and had legitimate commercial motivations 

Imperial Group Pension Trust v Imperial Tabacco 

• Hansen take over the company, and wish to ammend the fund, closing it to new members 

• Following takeover, the fund entered actuarily suprlus. Hansen then set up a new fund, under which any surplus reverts to the Co. and offered incentives to members of old scheme to transfer 

Held 

• There is an implied duty of good faith between E and e, arising from the employement contract 

• Co.: 

  • Must exercise its rights with a view to the efficient running of the pension scheme 

  • Cannot exercise powers for a collateral purpose (such as foricng members to give up their accrued rights under the current fund) 

Merchant Navy Ratings Pension Fund Trustees v Stena LIne 

• Ts wanted declaration from court approving new regime for deficit repair contriubitons - expanding pool of contributing employers to historic ones. 

• Some of these historic Es had stopped trading + were naturally upset about this 

Held 

• Acting in the best interests of the B's not separate from proper purpose of the trust

• Purpose of a pension is to be financially sustainable, which effects the employers 

• Thus T's can take into account the interests of participating employers

Re Courage Groups v Imperial Brewing

• Courage scheme had actuarial surplues of £80mill

• To stop Hansen taking over the exess, Courage and Imperial Brewing want to vary deed to prevent the addition of anyone else 

  • Hansen buys Imperial, decides to sell Courage but only after stripping out surplues 

  • Demands Imperailtoammend deed tosubsittute Hansen for Imperial as principla employer under the scheme, which should also be re-opened 

• Ts brought proceedings to ask courts if they must consent. It would be in member best interest if they vetoed.

Held 

• Millet - Ts don't need to give consent 

• Validity of power of susbtituion depends on the circumstances for which the substitution was made. Cirucmstances must be such that it preserves the scheme for the benefit of those for whom it was established 

• Exercise of this power would defeat the entire purpose of the giving of the power (to benefit the e's)

Sales (Pensions)

• Argues against the application of Wednesbury.

• Fails to consider the commercial interests of E.

• Any similarities between public and private law are superficial

• Public law discretion is is for public good, thus forbids self interest acts. Private law foresees self interest as commercial reality.

• It is more sensical to ask what the power intended to confer, then if its exercise was irrational

Bogg & Friedland (Pensions)

• Argue pensions law should be part of labour law

• there is a power imbalance in pensions law that public law is equipped to address

• Social importance of Pensions