Mr W was employed by J&J Fashions and was a member of the J&J Fashions’ pensions scheme. He left J&J Fashions in October 1990 with a deferred pension of £6013.80 payable from age 65, including a guaranteed minimum pension of £3135.60.
From 1993 onwards several acquisitions and corporate reorganisations saw pension schemes being wound-up and various successive bulk transfers made. Transfers were made from the J&J scheme to two Claremont Garments’ schemes. These were then transferred to a scheme sponsored by Courtaulds. Records confirmed that the member’s pension was initially transferred to one of the Claremont Garments’ scheme, but there was little evidence as to what happened after that. Courtaulds was split up in 2000. The Sara Lee UK pension plan took over the assets and liabilities of part of the Courtaulds Textiles pension scheme in April 2002. Mercer, the administrator of the Sara Lee UK pension plan, has no record of Mr W ever being a member of the scheme.
Mr W wrote to Mercer which replied in April 2008 and said that it was unable to obtain any information regarding his preserved benefits from the department for work and pensions. Mr W then asked the Pensions Advisory Service to help locate his pension. TPAS contacted HM Revenue & Customs for the name of the pension scheme responsible for Mr W’s guaranteed minimum pension. The records HMRC held for him were, unfortunately, incorrect. Extensive inquiries by TPAS failed to locate his pension.
He then brought a complaint against Bank of New York and the trustees of the Sara Lee UK pension plan on the basis that one of them was liable to provide his benefits.
The ombudsman dismissed his complaint. The Bank of New York’s role as custodian for the Courtaulds’ pension scheme was to keep the pension scheme’s money and not provide individual member benefits. It did not keep any member records. The ombudsman held that while Mr W may not have applied to transfer his preserved benefits elsewhere at any time, they may have been transferred without his knowledge as part of company reorganisations on the break-up of Courtaulds Group. The ombudsman found that he had no good reason to doubt the trustees of the Sara Lee UK pension plan having no records of Mr W ever being a member of their scheme. As there was no mention of Mr W in the list of members transferred from the Courtaulds Textiles’ pension scheme or in valuation lists held by Mercer in respect of that scheme, the ombudsman felt that it was more than likely Mr W’s preserved benefits were never held by the Sara Lee UK pension plan. There was therefore no maladministration on the part of either the Bank of New York Mellon London branch or the trustees of the Sara Lee UK pension plan.
The ombudsman explained that it was his role to determine the complaint only. While there may have been maladministration in the past, there was no evidence to suggest that the liability lay with the listed respondents.
The ombudsman expressed sympathy for the member’s position and emphasised how unsatisfactory the case was. His office had gone substantially beyond the limits of the member’s complaint in trying to find out the real chain of events, but its efforts also proved to be fruitless.
This is indeed a most unfortunate case and the outcome is entirely unsatisfactory from the member’s viewpoint. It does highlight the risk of bulk transfer without members’ consent. While there are statutory notification requirements, it is not that difficult to envisage members being missed out in the communication exercise. Ultimately it is the member’s responsibility to keep track of his own benefits.
Monica Ma is a partner of Simmons & Simmons
Key points
The Pensions Ombudsman dismissed a complaint in which an individual’s deferred benefits could not be traced.
From 1993 onwards several acquisitions and corporate reorganisations saw pension schemes being wound-up and various successive bulk transfers.
It is the member’s responsibility to keep track of his benefits.
