Commercial Court rules creditors cannot access pension funds
The High Court, on Tuesday, delivered judgment in a significant case on pension security on which ITC Consulting advised.
In the case, a bank, owed money by two individuals, initially succeeded in appointing a receiver over the individuals’ pension assets in March this year. The appointment was appealed to the Commercial Division of the High Court and the very welcome news for many pension holders is that the Court struck out the appointment of the receiver on Tuesday.
The Court considered that the characteristics of the pension schemes precluded the appointment of a receiver. The schemes concerned were individual self-administered schemes and ITC Consulting was appointed by solicitors for some beneficiaries of the pension schemes to give an expert opinion.
The prevailing view in the pensions industry was that pre-retirement benefits were not vulnerable to attack by creditors. However, there was no clear Irish legal authority on the point so the matter was not absolutely free from doubt until the judgment. The 2010 case where a receiver was appointed over Brendan Murtagh’s Approved Retirement Fund had also caused concern. The issue has received significant attention from the media and commentators as for many people their pension is their most valuable asset and the idea that somehow creditors could access someone’s pension was an understandable worry. Thankfully, the judgment has now clarified matters in favour of the pension holders.
It is important to note that, whilst most Irish pension schemes have the same characteristics as the pension schemes in the case, all scheme documents must be reviewed to ensure that appropriate protections are in place. This is a service that ITC Consulting is well placed to provide in view of its experience in this area.
*Please note this content is the view of the author and not of Independent Trustee Company