Cofal Limited v The Pensions Regulator
[2024] UKFTT 578 (GRC)
James Caldwell (Trustee of the Smith & Wallace & Co 1988 Pension Plan) v The Pensions Regulator
14 June 2024
[2024] UKFTT 505 (GRC)
First-tier Tribunal
A pension trustee didn't file the right paperwork on time and got fined. He tried to argue he wasn't told about it, but the court said the rules are clear and the fine stands, although the judge criticized the regulator for not being helpful enough.
Key Facts
- •James Caldwell, sole trustee of the Smith & Wallace & Co 1988 Pension Plan, appealed a £500.70 penalty notice from the Pensions Regulator (TPR) for failing to submit a Chair's Statement by the October 31, 2022 deadline.
- •The penalty was issued under the Occupational Pension Schemes (Charges and Governance) Regulations 2015 for non-compliance with the Occupational Pension Schemes (Administration) Regulations 1996.
- •Caldwell argued he was not informed about the requirement for the Chair's Statement by TPR.
- •TPR argued that Caldwell was solely responsible for compliance, regardless of lack of communication.
Legal Principles
Trustees of occupational pension schemes providing money purchase benefits are required to provide an annual governance statement (Chair's Statement).
Occupational Pension Schemes (Administration) Regulations 1996, reg 23
Failure to prepare a Chair's Statement results in a mandatory penalty of at least £500 and not exceeding £2,000.
Occupational Pension Schemes (Charges and Governance) Regulations 2015, reg 28(2), (4)(b)
The First-tier Tribunal (FTT) has wide powers to determine the appropriate action for the Regulator to take, acting as a decision-maker, not an appellate court, while according 'great respect' and 'considerable weight' to any public authority’s policy on financial penalties.
Pensions Act 2004, s103(4); In the matter of the Bonas Group Pension Scheme [2011] UKUT B 33 (TCC); Waltham Forest LBC v Marshall and Ustek [2020] UKUT 0035
The mandatory language of the regulations ('must') does not preclude consideration of exceptional circumstances excusing non-compliance, to avoid unjust outcomes.
Judge's interpretation of the Governance Regulations and principles of statutory interpretation
Outcomes
Appeal dismissed; matter remitted to the Respondent.
While acknowledging the possibility of exceptional circumstances justifying non-compliance, the Judge found that Caldwell's arguments did not meet this threshold. The statutory requirement to impose a penalty was upheld, and no procedural irregularities causing prejudice were found.