The Pensions (Northern Ireland) Order 1995

Pension rights of individuals adjudged bankrupt, etc.

93.  After Article 315 of the Insolvency (Northern Ireland) Order 1989(1) insert—

“Recovery of excessive pension contributions

315A.— (1) Where an individual is adjudged bankrupt and—

(a) he has during the relevant period made contributions as a member of an occupational pension scheme, or

(b) contributions have during the relevant period been made to such a scheme on his behalf,

the trustee of the bankrupt’s estate may apply to the High Court for an order under this Article.

(2) If, on an application for an order under this Article, the High Court is satisfied that the making of any of the contributions (“the excessive contributions”) has unfairly prejudiced the individual’s creditors, the Court may make such order as it thinks fit for restoring the position to what it would have been if the excessive contributions had not been made.

(3) The High Court shall, in determining whether it is satisfied under paragraph (2), consider in particular—

(a) whether any of the contributions were made by or on behalf of the individual for the purpose of putting assets beyond the reach of his creditors or any of them.

(b) whether the total amount of contributions made by or on behalf of the individual (including contributions made to any other occupational pension scheme) during the relevant period was excessive in view of the individual’s circumstances at the time when they were made, and

(c) whether the level of benefits under the scheme, together with benefits under any other occupational pension scheme, to which the individual is entitled, or is likely to become entitled, is excessive in all the circumstances of the case.

Orders under Article 315A

315B.— (1) Without prejudice to the generality of Article 315A(2), an order under that Article may include provision—

(a) requiring the trustees or managers of the scheme to pay an amount to the individual’s trustee in bankruptcy,

(b) reducing the amount of any benefit to which the individual (or his spouse, widow, widower or dependant) is entitled, or to which he has an accrued right, under the scheme,

(c) reducing the amount of any benefit to which, by virtue of any assignment, commutation or surrender of the individual’s entitlement (or that of his spouse, widow, widower or dependant) or accrued right under the scheme, another person is entitled or has an accrued right,

(d) otherwise adjusting the liabilities of the scheme in respect of any such person as is mentioned in sub-paragraph (b) or (c).

(2) The maximum amount by which an order under Article 315A may require the assets of an occupational pension scheme to be reduced is the lesser of—

(a) the amount of the excessive contributions, and

(b) the value (determined in the prescribed manner) of the assets of the scheme which represent contributions made by or on behalf of the individual.

(3) Subject to paragraphs (4) and (5), an order under Article 315A must reduce the amount of the liabilities of the scheme by an amount equal to the amount of the reduction made in the value of the assets of the scheme.

(4) Paragraph (3) does not apply where the individual’s entitlement or accrued right to benefits under the scheme which he acquired by virtue of the excessive contributions (his “excessive entitlement”) has been forfeited.

(5) Where part of the individual’s excessive entitlement has been forfeited, the amount of the reduction in the liabilities of the scheme required by paragraph (3) is the value of the remaining part of his excessive entitlement.

(6) An order under Article 315A in respect of an occupational pension scheme shall be binding on the trustees or managers of the scheme.

Orders under Article 315A: supplementary

315C.— (1) Nothing in—

(a) any provision of section 155 of the Pension Schemes (Northern Ireland) Act 1993 or Article 89 of the Pensions (Northern Ireland) Order 1995 (which prevent assignment, or orders being made restraining a person from receiving anything which he is prevented from assigning, and make provision in relation to a person’s pension on bankruptcy),

(b) any provision of any enactment (whether passed or made before or after the making of the Pensions (Northern Ireland) Order 1995) corresponding to any of the provisions mentioned in sub-paragraph (a), or

(c) any provision of the scheme in question corresponding to any of those provisions,

applies to the High Court exercising its powers under Article 315A.

(2) Where any sum is required by an order under Article 315A to be paid to the trustee in bankruptcy, that sum shall be comprised in the bankrupt’s estate.

(3) Where contributions have been made during the relevant period to any occupational pension scheme and the entitlement or accrued right to benefits acquired thereby has been transferred to a second or subsequent occupational pension scheme (“the transferee scheme”), Articles 315A and 315B and this Article shall apply as though the contributions had been made to the transferee scheme.

(4) For the purposes of this Article and Articles 315A and 315B—

(a) contributions are made during the relevant period if—

(i) they are made by or on behalf of the individual at any time during the period of 5 years ending with the day of presentation of the bankruptcy petition on which the individual is adjudged bankrupt, or

(ii) they are made on behalf of the individual at any time during the period between the presentation of the petition and the commencement of the bankruptcy, or

and

(b) the accrued rights of an individual under an occupational pension scheme at any time are the rights which have accrued to or in respect of him at that time to future benefits under the scheme.

(5) In this Article and Articles 315A and 315B—

“occupational pension scheme” has the meaning given by section 1 of the Pension Schemes (Northern Ireland) Act 1993, and

“trustees or managers”, in relation to an occupational pension scheme, means—

(a)

in the case of a scheme established under a trust, the trustees of the scheme, and

(b)

in any other case, the managers of the scheme”.

(1)

1989 NI 19.