The Court of Appeal allowed an appeal by BIC U.K. against the part of the decision of Arnold J. in Burgess v. BIC U.K. Limited  EWHC 785 (Ch) by which the judge held that under the Bic UK Pension Scheme increases to pensions in payment at the rate of 5% or the increase in RPI if lower were validly granted from 1992. The scheme rules had not been validly amended at that date in accordance with the scheme’s governing documentation, but Arnold J. had held that powers given by a 1993 Deed expressed to have effect from 1990 were to be treated as having been available and exercised from 1992. The Court of Appeal held that there was no basis on which the mere introduction of powers with retrospective effect could have brought about the necessary deemed exercise of those powers. If the increases had been validly granted, the scheme’s liabilities would have been increased by some £5.06 million. Keith Rowley Q.C. and Elizabeth Ovey acted for BIC U.K.
The Court of Appeal also expressed some doubts whether, contrary to the decision of Arnold J., certain of the powers relied on could in any event have validated the introduction of the increases. In particular, the court was inclined to the view that a trustees’ resolution passed orally but recorded in minutes later signed only by the chairman of the trustees did not constitute “a resolution (in writing)” for the purposes of the scheme’s 1993 power of amendment. Provisions permitting amendment by resolution in these (or similar) terms are frequently found in standard form pension scheme documentation and this case is the first to consider how they should be construed.