Briggs & Ors v Gleeds (Head Office) & Ors

A representation of law can in principle found an estoppel by representation. The position remains subject to reasonable reliance, the nature of the statement and statutory policy. Estoppel cannot cure a document which does not appear on its face to comply with the deed-execution requirements of the Law of Property (Miscellaneous Provisions) Act 1989. A pension scheme amendment power requiring a deed and declaration may make the declaration obligatory without making it a condition of validity. Accrued benefits under a final-salary scheme can include the prospective right to calculation by reference to final salary. Conduct referable only to existing scheme rights does not ordinarily create an extrinsic contract. A signed acceptance given in return for a specific salary increase may do so. Passive acceptance of pension changes does not establish estoppel by convention.

The trustees brought a Part 8 claim seeking answers to issues concerning the Gleeds Retirement Benefits Scheme. Numerous documents intended to amend the Scheme or replace trustees had been executed by Gleeds partners without witnessed signatures after the Law of Property (Miscellaneous Provisions) Act 1989 came into force. The parties disputed whether the defects could be overcome by estoppel, whether particular powers in the Scheme documents had been exercised, and the effect on pension increases, membership, accrued final-salary benefits and future accrual.

The court also considered whether members had entered extrinsic contracts or were bound by estoppel by convention. The central questions were the legal effect of the defective deeds and the rights arising under the Scheme despite those defects.

Disposition. The court answered the agreed List of Issues. The defective deeds were not validated by estoppel. The present partners in Gleeds (UK) constituted the Principal Employer.

1. Deed formalities and estoppel. A statement of law can found an estoppel by representation, but only where the ordinary requirements of reliance and reasonableness are met. Estoppel could not be used here because the documents were visibly non-compliant with section 1 of the Law of Property (Miscellaneous Provisions) Act 1989. Shah v Shah [2001] EWCA Civ 527, [2002] QB 35 concerned an apparently valid deed and a narrower attestation defect. The representations attributed to Aon also could not be attributed to the trustees, since Aon was not shown to have acted solely on their behalf.
2. Scheme powers. Clause 9(a) of the 1993 Definitive Deed misdescribed, rather than restricted, the statutory power under section 36 of the Trustee Act 1925. Clause 12 required a deed followed forthwith by a written declaration, but the declaration was not a pre-condition to an effective amendment. The failure to declare therefore did not itself invalidate an amendment.
3. Benefits and membership. The power in rule 4.5 of the 1979 Rules had been exercised by at least April 1983, giving entitlement to annual compound pension increases of at least 4%. Under clause 5 of the 1979 Definitive Deed, accrued benefits included the prospective right to calculation by reference to final salary, so the final-salary link could not be removed by the 2006 amendment. Persons who were not chartered quantity surveyors and purportedly joined a money-purchase section after 6 April 1997 did not become Scheme members.
4. Implied exercises and contracts. The court followed Davis v Richards & Wallington Industries Ltd [1990] 1 WLR 1511 and LRT Pension Fund Trustee Co Ltd v Hatt [1993] PLR 227 in recognising that an intended transaction may sometimes be treated as an exercise of an available power. That approach was unavailable where materially different considerations arose or where it could save only part of the intended transaction. The applications for the 1997 money-purchase section and the 2003 changes did not create contracts. However, the 103 members who signed the 30 March 2006 letter, including three who did not join the 2005 money-purchase section, contracted to accept benefits under the 2006 Deed of Amendment.
5. Estoppel by convention. The requirements include a shared assumption expressed by words or conduct, responsibility for that assumption, reliance, subsequent mutual dealing and sufficient detriment or benefit to make departure unjust. The members had passively accepted what Gleeds presented, while Gleeds relied on its professional advisers. No relevant estoppel therefore arose.