In mid-October, the Supreme Court of Canada released its decision in the case of Burke v. Hudson's Bay Company, on the issues of transfer of assets between pension plans and use of pension plan assets for plan administration expenses. The Court ruled in favour of the sponsoring employer on both issues.

All things considered, the Burke decision is somewhat less groundbreaking than the Supreme Court's seminal 2009 pension law decision in Nolan v. Kerry Canada Inc. But this latest decision contains some interesting and novel observations on certain key principles underlying the case. In particular, Mr. Justice Rothstein rejected the affected employees' argument that HBC had a duty to "hold an even hand" between transferring and non-transferring employees in its allocation and use of surplus. He noted that such duty is fiduciary in nature, and while HBC had a fiduciary duty in its role as plan administrator, that role required only that it protect the members' defined benefits. Its actions in regard to surplus were held not to be fiduciary in nature, and therefore not to be subject to the duty of even-handedness.

This analysis reflects the well-known "two hats" doctrine of pension law, even if it does not expressly use that terminology. That is, the same corporation may act as (i.e. wear the hat of) administrator of a pension plan for certain purposes, and will be considered as a fiduciary for those purposes, while it may act as (wear the hat of) sponsoring employer for other purposes, and it will not be considered as a fiduciary for those other purposes. It would appear, then, that the Supreme Court has implicitly blessed the two hats doctrine.