Webber v Department for Education

On an appeal from the Pensions Ombudsman limited to points of law, factual findings and evaluative judgments may be disturbed only where unsupported by evidence or outside the range of reasonable conclusions.

A change of position defence to recovery of mistaken pension payments is unavailable where the recipient appreciates that an overpayment may have occurred, could readily ask the payer to check, and consciously chooses not to enquire. For limitation purposes, a scheme administrator may have constructive knowledge of an overpayment where it possesses the information showing that the overpayment will inevitably arise if employment continues. Reasonable diligence does not require exceptional measures.

The appellant challenged a determination by the Deputy Pensions Ombudsman dismissing his complaint concerning recovery of pension overpayments under the Teachers’ Pension Scheme. An earlier appeal had resulted in remission of the complaint by Asplin J in Webber v Department for Education, Teacher’s Pensions, [2012] EWHC 4225 (Ch).

On reconsideration, the Deputy Ombudsman found that the appellant knew, or should have known, that he had to provide information about his salary after returning to teaching. She rejected his change of position and limitation defences. The appeal raised the scope of the High Court’s review, the adequacy of the Ombudsman’s procedure and factual findings, the state of mind sufficient to defeat change of position, and when the limitation period began.

1. Scope of appeal. Under section 151(4) of the Pension Schemes Act 1993, the appeal was confined to points of law. The Court could not reopen primary facts or value judgments unless there was no evidence to support them or the conclusion was one that could not reasonably be entertained.
2. Oral hearing. The Ombudsman’s procedure is investigative rather than trial-based. Whether an oral hearing is necessary is ordinarily for the Ombudsman, subject to review on the familiar basis of whether the decision exceeded the generous ambit within which reasonable disagreement is possible. The Deputy Ombudsman was entitled to decide the matter on the papers, although findings rejecting a person’s account of his own knowledge or intentions require careful scrutiny where no oral hearing has taken place.
3. Change of position. The Deputy Ombudsman was entitled to find that the appellant appreciated there was a possibility of overpayment and deliberately failed to ask Teachers’ Pensions to check. Applying Niru Battery Manufacturing Co v Milestone Trading Ltd, [2002] EWHC 1425 (Comm), and the Court of Appeal’s approval in [2003] EWCA Civ 1446, a recipient who knows, or has good reason to think, that payment may have been made by mistake, and who can readily enquire but chooses not to do so, acts inequitably or unconscionably in relying on change of position.
4. Limitation. The phrase “any change in salary” in regulation H3(4)(b) of the 1997 Regulations included an annual pay rise. However, the Regulations imposed no separate obligation to notify the administrator merely because employment continued into a new tax year. Teachers’ Pensions already possessed sufficient information to know that an abatement would arise if the appellant continued working. It could therefore have discovered the overpayment with reasonable diligence during 2002/03. The appeal was allowed to that extent.
5. The limitation cut-off date and the amount of recoverable overpayments were left for agreement, with liberty to refer those matters back to the Deputy Ombudsman if necessary.

1. High Court (Chancery Division): Asplin J allowed the appellant’s earlier appeal and remitted the complaint for reconsideration in Webber v Department for Education, Teacher’s Pensions, [2012] EWHC 4225 (Ch).
2. Pensions Ombudsman: On reconsideration, the Deputy Pensions Ombudsman dismissed the complaint in the Second Determination dated 24 January 2014.
3. High Court (Chancery Division): The present court dismissed the challenge to the change of position ruling but allowed the appeal on the limitation issue.