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Perseverance pays off in pensions anti-avoidance case

  • Global

    18-05-2018

    Eversheds Sutherland ‘Box Clever’ to win long-running pensions scheme case

    Eversheds Sutherland has secured a victory in the Upper Tribunal on behalf of the Trustee of the Box Clever Group Pension Scheme in a long-running pensions anti-avoidance dispute.

    The case, ITV and others v The Pensions Regulator (TPR) and others – the first challenge to TPR’s anti-avoidance powers to be heard in full by the Upper Tribunal – concerns the decision by TPR’s Determination Panel to uphold TPR’s anti-avoidance action in December 2011 regarding the Box Clever Group Pension Scheme.

    The Eversheds Sutherland team comprised specialist pensions litigators, Partner Emma King, consultant Giles Orton, and Senior Associate Daniel Murphy.

    The Box Clever Pension Scheme currently has approximately 3,000 members, and a buy-out deficit of around £115 million.

    The Determinations Panel of TPR endorsed anti-avoidance action in December 2011. It made a decision that financial support directions (FSDs) should be issued to five organisations that form part of the ITV Group (the Targets). The FSDs would require the organisations to put in place financial support for the Box Clever Group Pension Scheme. In response, ITV referred the case to the Upper Tribunal, the substantive hearing of which was held at the beginning of this year (2018) and the decision published today, 18 May 2018.

    The decision found unanimously that the Targets had a responsibility to support the members of the Box Clever Group Pension Scheme and should provide financial support.

    Eversheds Sutherland has been advising the Box Clever Trustee on this dispute for over nine years. The now global legal practice was at the forefront of the landmark decision by TPR when it determined that ITV should provide financial support to the Box Clever Group Pension Scheme in 2011.

    Emma King commented:

    “This win is testament to the in-depth knowledge and experience of our dedicated team and our trustee client’s incredible determination to pursue this matter to its rightful conclusion. ITV threw its whole weight behind this dispute, culminating in years of appeals by ITV at every stage of this process. Yet, in spite of its best efforts to avoid its moral responsibility to pension scheme members, almost all of its [ITV’s] arguments have been roundly rejected, amounting to a clear victory for TPR and the Trustee.

    “We’re absolutely delighted that the Pensions Regulator saw fit to doggedly pursue this matter and that the Trustee’s resolve and tenacity has been vindicated.”

    Alan Herbert, Chairman of Box Clever Trustees Limited, in welcoming the Upper Tribunal's decision, said:

    “This is another step forward towards securing the pension benefits of nearly 3,000 former Box Clever employees and their dependants. It’s been a long and incredibly complex journey. We are grateful to Emma, Giles and the Eversheds Sutherland team whose technical capability, knowledge and perseverance have helped to secure the right result. We are also very grateful to our excellent Counsel team.”

    Mr Herbert was described in today’s decision as a “…dedicated and conscientious Chairman of the Trustee doing his very best to promote the interests of the members of the Scheme…”

    The Eversheds Sutherland pensions team has advised on a number of high-profile cases in the last 12 months including the British Airways discretionary increase litigation which was recently heard in the Court of Appeal, and the Barnardo’s CPI/RPI case which will shortly be heard in the Supreme Court. Led by Partner Emma King, the team supported the BHS Trustees in relation to the insolvency of BHS, potential moral hazard action by TPR and subsequent settlement. Emma has also been shortlisted for ‘Pensions Adviser of the Year’ at the Professional Pensions Awards, 2018.

    For more information on Eversheds Sutherland, visit eversheds-sutherland.com

    This information is for guidance purposes only and should not be regarded as a substitute for taking legal advice. Please refer to the full terms and conditions on our website.

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