20 October 2009 - Post by:Stephen Beattie
“I don’t need your reasons, don’t tell me coz it hurts” sang Gwen Stefani as lead singer of No Doubt, the 90s ska-pop funk rock band.
Unfortunately, Gwen Stefani is not the Pensions Ombudsman. Tony King is. And he needs your reasons, no matter how much it hurts.
It’s not the first time Tony’s championed the importance of reasons but recently he’s pushed the point even more.
In his recent Curran determination, the trustees distributed a lump sum death benefit in complicated family circumstances. There were five children, none of whom had been supported by the member, and with two of whom he’d had no contact since their adoption at birth. The trustee minutes were scanty at best – most of their considerations were based on an unrecorded oral report at the trustee meeting. The decision they reached looked reasonable – to split the money between the five children – but because of the lack of records and reasons, they couldn’t prove it was reasonable.
Records and reasons will help trustees prove they were reasonable: but is the test an objective one? The general principle followed by the Ombudsman is that if reasons are given and the decision has been properly made then the decision would stand even if it was “on the margins of rationality”.
A lack of documentation will make it difficult for trustees to satisfy the Ombudsman that their decision was not perverse. It’s not enough to reasonably reach a reasonable decision it seems – you must also be able to prove that you reached it reasonably.
So, if you want to have “No Doubt” (ooooh, blatantly desperate attempt to make this blog circular and the initial quote more relevant – apologies), or as close as possible to no doubt, that you won’t face the music from Tony, make sure you record the evidence you considered and the reasons for the decisions you make. Lecture over.
Stephen Beattie is an associate at Allen & Overy LLP.