The High Court has ruled that the Pensions Ombudsman cannot award substantive relief if there is a valid time bar defence.
In this case, a former employee complained that he had suffered loss by acting on his employer's negligent advice about the transfer of his DB pension. Despite the employer giving the advice over 20 years ago, the Ombudsman upheld the complaint, directing the company to pay the cost of restoring the member to its scheme or equivalent benefits.
The court held that, although the Ombudsman has the jurisdiction to investigate and decide a complaint, even if a court would have dismissed it for being out of time, he must decide disputes following settled legal principles. As a result, the Ombudsman cannot award substantive relief where a court would have dismissed a complaint because of a valid time limit defence.
The decision is a helpful one, giving more certainty about exposure to potential complaints. However, the restriction will not extend to complaints of pure maladministration which do not come within the scope of time limit laws.