Social Security Pensions Act 1975

[F1 57C Requirement for independent trustee where employer becomes insolvent etc. E+W+S

(1) This section applies in relation to an occupational pension scheme which is constituted by trust deed—

(a) if a person (“the practitioner”) commences to act as an insolvency practitioner in relation to a company which, or an individual who, is the employer of persons in the description or category of employment to which the scheme relates; or

(b) if the official receiver becomes—

(i) the liquidator or provisional liquidator of a company which is the employer of any such persons, or

(ii) the receiver and the manager, or the trustee, of the estate of a bankrupt who is the employer of any such persons.

(2) If and so long as this section applies to a scheme, it shall be the duty of the practitioner or official receiver—

(a) to satisfy himself that at all times at least one of the trustees of the scheme is an independent person; and

(b) if at any time he is not so satisfied, to appoint under this paragraph, or to secure the appointment of, an independent person as a trustee of the scheme;

but this subsection is subject to subsection (5) below.

(3) For the purposes of subsection (2) above a person is “independent” only if—

(a) he has no interest in the assets of the employer or of the scheme, otherwise than as trustee of the scheme;

(b) he is neither connected with, nor an associate of—

(i) the employer;

(ii) any person for the time being acting as an insolvency practitioner in relation to the employer; or

(iii) the official receiver, acting in any of the capacities mentioned in subsection (1)(b) above in relation to the employer; and

(c) he satisfies such other requirements as may be prescribed;

and any reference in this section or section 57D below to an “independent trustee” shall be construed accordingly.

(4) Sections 249 and 435 of the Insolvency Act 1986 (connected and associated persons) shall apply for the purposes of paragraph (b) of subsection (3) above as they apply for the purposes of that Act; and section 74 of the Bankruptcy (Scotland) Act 1985 (associated persons) shall apply for the purposes of that paragraph as that section applies for the purposes of the said Act of 1985.

(5) Where, apart from this subsection, the duties imposed by subsection (2) above in relation to a scheme would fall to be discharged at the same time by two or more persons acting in different capacities, those duties shall be discharged—

(a) if the employer is a company, by the person or persons acting as the company’s liquidator, provisional liquidator or administrator; or

(b) if the employer is an individual by the person or persons acting as his trustee in bankruptcy or interim receiver of his property or as permanent or interim trustee in the sequestration of his estate.

(6) if the practitioner or official receiver neglects or refuses to discharge any duty imposed upon him by subsection (2) above in relation to a scheme, any member of the scheme may apply to the appropriate court for an order requiring him to discharge his duties under that subsection.

(7) Where this section applies in relation to a scheme, it shall cease to do so—

(a) if some person other than the employer mentioned in subsection (1) above becomes the employer of persons in the description or category of employment to which the scheme relates; or

(b) if at any time neither the practitioner nor the official receiver is acting in relation to the employer;

but nothing in this subsection affects the application of this section in relation to the scheme on any subsequent occasion when the conditions specified in subsection (1)(a) or (b) above are satisfied in relation to the scheme.

(8) In this section:—

• “acting as an insolvency practitioner” and “official receiver” shall be construed in accordance with sections 388 and 399 of the Insolvency Act 1986;

• “the appropriate court”, in relation to an application for an order under subsection (6) above, means—

(a) if the employer in question is a company—

(i) where a winding up order has been made or a provisional liquidator appointed, the court which made the order or appointed the liquidator;

(ii) in any other case, any court having jurisdiction to wind up the company; and

(b) in any other case—

(i) in England and Wales, the court as defined in section 385 of the Insolvency Act 1986; or

(ii) in Scotland, where sequestration has been awarded or, by virtue of the proviso to section 13(1) of the Bankruptcy (Scotland) Act 1985 (petition presented by creditor or trustee acting under trust deed) an interim trustee appointed, the court which made the award or appointment and, if no such award or appointment has been made, any court having jurisdiction under section 9 of that Act;

• “bankrupt” has the meaning given by section 381 of the Insolvency Act 1986;

• “company” means a company within the meaning given by section 735(1) of the Companies Act 1985 or a company which may be wound up under Part V of the Insolvency Act 1986 (unregistered companies);

• “interim trustee” and “permanent trustee” have the same meaning as they have in the Bankruptcy (Scotland) Act 1985.

(9) References in this section to an individual include, except where the context otherwise requires, references to a partnership and to any debtor within the meaning of the Bankruptcy (Scotland) Act 1985.]

Textual Amendments

F1 Ss. 57C and 57D inserted (with effect from 12.11.1990) by Social Security Act 1990 (c. 27), Sch. 4, para. 1, (but with effect from 22.10.1990 for the purpose of making regulations). These sections are subject to modification and disapplication in specified circumstances, and their insertion is subject to a saving for specified processes started before 12.11.1990, under S.I. 1990/2075.