Key points

  • There have been conflicting decisions on whether a person may be made the subject of any income payments order (IPO)
  • This case suggests that the court will not make an IPO in respect of unelected pension entitlements

The facts

A trustee in bankruptcy applied for an IPO in respect of a bankrupt’s self-invested personal pension (SIPP). Only after the hearing of the application, and the day before the intended handing down of judgment, did it become apparent that the SIPP was a capped drawdown scheme, which materially reduced the amount of income available to the bankrupt, and therefore his estate.

The disclosure also raised the issue as to whether the bankrupt would have sufficient income to meet his and his family’s basic domestic needs. The Registrar therefore admitted the additional evidence, heard further submissions and reconsidered his judgment.

The Registrar followed the latter (Re Henry) of two inconsistent High Court decisions (Re Henry and Raithatha v Williamson) that held that a bankrupt could not be forced to elect in respect of his/her pension entitlements.

However, on the facts of this case, the Registrar found that the bankrupt had elected in respect of his pension entitlements. The Registrar considered the evidence on the bankrupt’s income (including the SIPP) and ordered a contribution accordingly.


In light of the above conflicting cases, whilst an appeal decision is awaited on the issue of whether a bankrupt can be compelled by the court to make certain elections in respect of his/her pension, this is a further decision suggesting that the answer will be no and offers little encouragement to trustees in bankruptcy hoping to recover unelected pension entitlements.