Lehman Brothers companies fighting to be excluded from Pension Regulator’s financial support direction
LEHMAN BROTHERS companies are fighting to be excluded from The Pension Regulator’s financial support direction (FSD), having secured a hearing in the Court of Appeal next April.
The 38 companies are due to appear at the Court of Appeal which will scrutinise the Upper Tribunal’s powers in pension cases, Accountancy Age’s sister publication Professional Pensions reports.
A source close to the case said the Court of Appeal would grapple with trustees’ role in the regulation of moral hazard cases.
The appeal follows a series of decisions as to the scope of the Lehman FSD.
In the Lehman administration, The Pension Regulator’s Determinations Panel agreed to impose an FSD on six companies – leaving 38 companies off the hook from an original hearing list of 44 targets.
The Lehman Brothers Pension Scheme trustees referred the decision not to impose the FSD on the 38 other companies to the Upper Tribunal.
The companies argued the appeal should be struck out because the trustees should not be able to appeal a negative decision and were out of time.
But Judge Bishopp and Judge Herrington upheld the trustees’ right to appeal as “directly affected” persons (PP Online, 19 June 2012).
The 38 companies have appealed that decision to the Court of Appeal, with the hearing set to take place on the 29 or 30 April 2013.
International law firm Eversheds partner Claire Carroll said the case would be of “great interest” to the industry.
She said: “As a practitioner, the rules are not always necessarily clear as to how the Tribunal are going to process things, so it will be of great interest to the industry to see what the Court of Appeal’s view is to the ambit of the process and the Tribunal’s powers.”
Sackers partner Peter Murphy said if the 38 companies succeed they will not have to fight the FSD further.
He said: “If they succeed on that point then those targets won’t even have to address the substance of whether an FSD should be issued against them.”
A spokesperson from The Pensions Regulator said: “It would be not be appropriate for us to comment on ongoing litigation.”