A brewery has pleaded guilty to refusing to provide documents to The Pensions Regulator after describing its demands as "tiresome".
Samuel Smith Old Brewery and its chairman, Humphrey Smith, both admitted refusing to hand over documents to the regulator after it made a routine inquiry about the health of the company's defined benefit pension.
The Yorkshire brewery - which is a family-owned private company founded in 1758 - closely guards information about its finances and after receiving the request Mr Smith, 73, accused the regulator of being bossy and said it enjoyed closing down pension schemes for "hard-working people" in order to justify its employees' high salaries.
The Pensions Regulator had asked for information on eight defined benefit schemes which provided pensions for around 2,000 employees based on length of service and final salary.
Simon Broadhurst, for The Pensions Regulator, told Brighton Magistrates Court: "He clearly regarded it as an irritation and impertinent imposition and it was clear he was not going to comply."
He said the funding of each scheme was of critical importance and it was the regulator's duty to protect members.
"The regulator had concerns in relation to the ability of the company to support the scheme going forward and made enquiries to better understand," Mr Broadhurst said.
"It became clear the trustees had not been given detailed information about the financial state of the employer."
After making a routine approach to the brewer in December 2017, the company refused to provide the information requested.
"The request, which would normally be uncontroversial, was not complied with," Mr Broadhurst said.
"The regulator pressed the point and, in January 2018, issued notice."
The Pensions Regulator required financial statements for three years, forecasts for three years, the asset position of the employer and some reports and analysis which had been carried out on behalf of the employer.
In a response Mr Smith, who gave his address as Oxton Hall, Tadcaster, wrote: "We were in receipt of your tiresome letter of January 2018."
Mr Broadhurst told the court: "It goes on to say 'You cannot simply demand documents, bossily giving us a date'.
"In the final paragraph he wrote 'We made it clear 10 years ago, we will do as others have done and close our final salary scheme. I’m sure you enjoy closing schemes for hard working people to justify your high salaries'.
"He clearly regarded it as an irritation and impertinent imposition and it was clear he was not going to comply," Mr Broadhurst said.
The Pensions Regulator started criminal proceedings after the February 2018 deadline passed.
The company attempted to dissuade the regulator by saying the brewery was litigious and they would make a legal challenge to the prosecution.
Mr Broadhurst described the January written response from Mr Smith as a refusal rather than neglect and said several warnings and reminders making clear the seriousness of the situation were ignored.
After a summons was issued on 4 May, the regulator received the documents required and the notice has now been complied with, the court heard.
In legal argument, Ben Summers, for the brewery, argued against reading out the financial position of the company in open court.
Mr Summers said: "It would not be right for those materials to be used for some other purpose.
"The regulator makes inquiry about the size and stability of the pension funds and this can be worked out with a simple piece of maths.
"The company is clear and steadfast. Those members are protected."
Mr Summers described Sam Smith’s as a small, independent family owned and run brewery struggling in a declining industry.
He said the company took a philosophical stance on final salary pensions and there was no question of a black hole.
He said: "Even though the letter, to the outside world, was a blank refusal a lot of work was being done behind the scenes.
"For principled reasons, the attitude was adopted that privacy trumps this investigation."
The Pensions Regulator was not being prevented from conducting its inquiries, he said.
The family draw extremely modest salaries as directors and the unlimited company is, in effect, the family purse, he told the court.
"The family and the company are one in the same. Any impact on the company will affect the people The Pensions Regulator are set up to protect," Mr Summers said.
The Pensions Regulator made an application for £900 costs.
Nicola Parish, The Pensions Regulator's executive director of frontline regulation, said: "We are satisfied with the outcome of this case, the latest in a series of successful prosecutions by The Pensions Regulator for offences of this kind.
"This sends a clear message to employers that we are serious when we ask for information. We require it for good reason as part of our work to protect pension savers. Anyone who does not cooperate with our requests also risks getting a criminal record."
Mr Smith made no comment as he left the court.
The case was adjourned for sentencing until 6 June.
