Irish Pensions Magazine Spring 2015
20
Expert Opinion
The Power of the Pensions Authority to Remove and
Appoint Trustees of a Pension Scheme
P
ension schemes run for several years, sometimes
decades, so the trustees will change reasonably
frequently. The pension scheme’s trust deed will
usually set out the powers of retirement, appointment
and removal of the trustees. The vast majority of
trust deeds give the principal employer the power to
remove and appoint the scheme’s trustees subject to
member trustee regulations where applicable.
The Pensions Act 1990 (the “Act”) gives the
Pensions Authority various powers in relation to the
appointment and removal of trustees of occupational
pension schemes and trust RACs. This article outlines
two key provisions contained in the Act that concern
the replacement and appointment of trustees by the
Pensions Authority and will focus on occupational
pension schemes (here referred to as “schemes”)
rather than trust RACs.
Appointment and Removal of Trustees by
the Pensions Authority
The Pensions Authority has power under section 64
of the Act to take certain actions in situations where
there are no longer any remaining trustees or the
trustees of a scheme cannot be located.
The Pensions Authority has power under section
64(1) of the Act to:
(a)
appoint new trustees to the scheme (in substitution
for the existing untraceable trustees if required); and
(b)
vest the assets of the scheme in the new trustees.
The powers of the Pension Authority under section
64 of the Act are carried out by order under seal of
the Pensions Authority.
The Pensions Authority may require evidence from an
“appropriate person” in order that the Authority may
satisfy itself that there are no trustees in place or that
the existing trustees cannot be located. The Pensions
Authority’s guidance notes (the “Notes”) state that the
evidence may be provided by an affidavit sworn by
the appropriate person. The Pensions Authority may
also request certain information and documentation
in relation to the scheme, including the governing
documentation or trustee annual reports.
The Notes provide further information on the
circumstances where the Pensions Authority will
be prepared to exercise their statutory powers of
appointment. For example:
(a)
the Pensions Authority must, prior to the exercise
by it of its power under section 64(1) of the Act,
satisfy itself that it is “desirable to do so”; and
(b)
the power under section 64(1) of the Act will
generally only be exercised where “all other avenues
have been exhausted”.
In particular, the Pensions Authority will only exercise
its powers under section 64(1) of the Act where:
(a)
there is no other person in whom a power to
appoint is vested under the trust deed or under
statute; and
(b)
it is not feasible, for cost or other reasons, to
procure the appointment of new trustees under the
provisions of the Trustee Act 1893.
The Notes provide an example of a situation where the
Pensions Authority would typically consider exercising
its power under section 64(1) of the Act. The example
provided in the Notes concerns a situation where a
liquidator has been appointed to a company (where
the company involved also acted as the trustee of
a pension scheme) and the liquidator was unable,
before the liquidation of the company was complete,
to appoint a new trustee to the pension scheme.
The Notes also discuss some important practical
considerations that may arise when the need for a
statutory appointed trustee arises:
• A person appointed as a new trustee by the
Pensions Authority may be nominated by a
“person having an interest” for consideration for
the position.
• The Pensions Authority must be satisfied that
such a person is a “fit and proper person” to act
as a trustee.
• The Pensions Authority will not appoint persons
as trustees if they reside outside the State or if
they are employed by the Pensions Authority.
The Pensions Authority may require sworn evidence
from the nominee trustee prior to appointing that
person or body corporate as a trustee of the scheme.
Where the Pensions Authority exercises its power
under section 64(1) of the Act it must publish details
of the order in a national daily newspaper. The
publication must occur not later than 21 days after
the making of the order.
Section 64(4) of the Act permits a “person having an
interest” to lodge an appeal to the High Court against
the making of a section 64(1) order by the Pensions
Authority. An appeal must be made within 21 days
of the publication of the newspaper containing the
details of the order. The Pensions Authority, the new
trustees, the scheme’s sponsoring employer and its
by Stephen Gillick
