The Girls' Day School Trust v GDST Pension Trustees Ltd & Anor

Rectification of an executed pension scheme deed may be determined summarily where cogent documentary evidence establishes that the employer and trustee shared a continuing, objectively ascertainable intention which the executed instrument failed to express. The court must first construe the instrument objectively, without relying on subjective intention. For a corporate party, intention is ordinarily that of the board or of a properly authorised delegate whose decision the board intended to implement. The court may rectify the instrument, but may not make a different bargain. Although summary judgment is available, pension scheme rectification applications will ordinarily require a public hearing because scheme members should not suspect that a private arrangement has been made. Exceptional cases may proceed without a hearing if adequate publicity, disclosure and procedural safeguards preserve openness.

The claimant employer established a new defined benefit pension scheme intended to receive a bulk transfer of benefits from an existing scheme. After extensive negotiations, a final version of the deed was agreed by the employer and trustee, but an earlier draft was accidentally engrossed and executed. The claimant sought rectification of the executed deed and summary judgment.

The trustee was neutral. Vivienne Chartres was appointed as a representative defendant for persons who might oppose the relief. The central issues were whether the parties had a common continuing intention as to the intended deed, whether the mistake was established by sufficiently cogent evidence, and whether the claim could properly be resolved summarily without a public hearing.

1. Rectification and construction. The executed deed could not, on any legitimate process of construction, be read as containing provisions present in the negotiated final version but absent from the engrossed version. Construction required attention to the natural and ordinary meaning of the words, the provision’s purpose, the deed as a whole, known or assumed surrounding circumstances and commercial common sense, while disregarding subjective intention.
2. Common intention. The claimant had to establish that the employer and trustee shared a common, continuing and objectively demonstrated intention concerning the particular terms mistakenly omitted or altered, and that the intended deed would not have been objectionable to the transferring scheme’s trustee. The evidence had to be cogent. The evidence showed that both the employer and trustee intended the negotiated final version, not the earlier draft.
3. Corporate intention. The relevant intention of a corporate body is that of its board or of a person or committee to whom the board delegated the decision-making or entrusted negotiation and reporting for a transaction the board intended to implement. The evidence established that the responsible director had approved and transmitted the final version for execution.
4. Summary judgment. The court may grant summary judgment in rectification proceedings. The relevant question is whether any apparent defence has a real prospect of success, while allowing for the possibility that fuller factual investigation might alter the evidence. Here the documentary trail was decisive and a trial would serve no useful purpose.
5. Open justice and pension schemes. Summary determination without a hearing should ordinarily be avoided in pension scheme rectification cases because scheme members should have assurance that no private deal has been made. In this exceptional case, a full judgment, inspection of the evidence on the court file, publication, notification to members and a 42-day delay before the rectification order took effect sufficiently protected openness. Summary judgment was granted and the deed was ordered to be rectified.

First instance decision. The judgment does not state any prior appellate decision in the same litigation.