R (Britannic Asset Management Ltd) v Pensions Ombudsman

An entity is not an administrator of an occupational pension scheme merely because it performs administrative acts connected with the scheme. Under the Personal and Occupational Pension Schemes (Pensions Ombudsman) Regulations 1996, it must be concerned with the administration of the scheme.

An insurer which administers its own fund and calculates sums payable under a unit-linked policy is ordinarily acting under its contractual relationship with the trustees. It is not thereby administering the scheme. The statutory extension of the Pensions Ombudsman’s jurisdiction to administrators does not include persons concerned only with scheme financing or the provision of benefits.

The Britannic companies sought judicial review of the Pensions Ombudsman’s decision that he could investigate a complaint concerning payments made on requests by trustees for partial surrender of a unit-linked insurance policy held as an asset of the Cheney Pension Scheme.

Lightman J held that the companies were not administrators of the scheme and that the Ombudsman lacked jurisdiction. The Ombudsman appealed. The central issue was whether, in making payments under the policy, the companies were persons concerned with the administration of the scheme for the purposes of the Personal and Occupational Pension Schemes (Pensions Ombudsman) Regulations 1996.

1. Appeal dismissed. The court, in a judgment delivered by Chadwick LJ, upheld Lightman J’s conclusion that none of the Britannic companies was concerned with the administration of the pension scheme. The Pensions Ombudsman therefore had no jurisdiction to investigate the complaint under regulation 2(1) of the Personal and Occupational Pension Schemes (Pensions Ombudsman) Regulations 1996.
2. The statutory distinction was material. Under section 146(4) of the Pensions Schemes Act 1993, regulations could have extended the Part X regime to persons concerned with financing a scheme, administering it, or providing benefits under it. The 1996 Regulations deliberately confined the extended jurisdiction to a person concerned with administration of the scheme.
3. The policy was an asset of the scheme, but the insurer’s managed fund and notional units were the insurer’s own assets. Administering that fund, calculating the policy value, and paying the contractual surrender value on the trustees’ request were administrative acts connected with the scheme, but were not administration of the scheme. In that respect the insurer was analogous to a banker or other depository obliged to make payment on request.
4. The court accepted that an insurer providing full or partial scheme-administration services might fall within the expression. On the evidence, however, the trustees had not retained the companies for those services. They did not maintain members’ records, calculate contributions or benefits, deal with transfer values, or undertake scheme communications.
5. The court declined to rely on Lightman J’s alternative observation that the only alleged maladministration was by the former trustees. If the companies had been administrators, an investigation would be needed before that issue could be resolved. That did not affect the primary and sufficient ground: the companies were not administrators.

• Court of Appeal (Civil Division) — the Pensions Ombudsman’s appeal was dismissed: [2002] EWCA Civ 1405.
• High Court of Justice, Queen’s Bench Division, Administrative Court (Lightman J) — on judicial review, the court held that the Pensions Ombudsman lacked jurisdiction to investigate the complaint. The judgment appealed was made on 21 March 2002; its citation was not stated in the judgment.