Releasing surplus in winding up (Arcadia Group Pension Trust Ltd v Smith)
Pensions analysis: Master Marsh (sitting in retirement) approved the merger of two Arcadia Group pensions schemes, both of which were in winding-up following the principal employer’s entry into administration and then liquidation. Because the proposed exercise of the amendment power enabling the merger was at a time that the schemes were in winding up, it was a momentous decision requiring the courts approval. The Master was satisfied that the amendment power was sufficiently wide to enable it to be exercised. Insofar as the deed made express provision for the exercise of the power during winding up, there was no scope to imply any fetter on the proposed exercise in this case. Furthermore, the merger constituted a proper exercise of the power, ascertained by reference to the purpose of the scheme, even though adding members of the Executive Scheme to the Staff Scheme would apportion Staff Scheme surplus to Executive Scheme members. Written by Dr Charlotte Elves, barrister at Outer Temple Chambers.
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