The Ombudsman dismissed a complaint from Mrs Barnicoat that Hargreaves Lansdown Asset Management Limited (“HLAM”) the trustee of the Hargreaves Lansdown Vantage SIPP (the “SIPP”) failed to exercise its discretionary power to award the death benefits available from theSIPP to her on a timely basis, which she had claimed caused her significant financial loss and distress.


Mrs Barnicoat’s partner, Mr Alan Bunn, died on 14 September 2012 leaving two adult children from a previous relationship. Before his death Mr Bunn had completed an “expression of wish” form which nominated Mrs Barnicoat to receive benefits payable from the SIPP on his death, at HLAM’s discretion. To assist HLAM with its decision making process regarding the benefits payable after Mr Bunn’s death, Mrs Barnicoat provided details of her financial position and relationship with Mr Bunn. Meanwhile Mr Bunn’s children also provided information to HLAM, stating that, in their opinion, their father and Mrs Barnicoat’s relationship had broken down before his death. The children consequently asked for more time and for HLAM to defer making their decision on who should receive the SIPP death benefits until they had had further opportunity to investigate the circumstances surrounding their father’s death and so could submit more evidence to HLAM.

Due to the seriousness of the allegations HLAM allowed Mr Bunn’s children the additional time they requested, but later on 1 March 2013 wrote to Mrs Barnicoat apologising for the delay, and informing her that they had decided that she should be the sole beneficiary of the death benefits available from the SIPP. They explained that they were giving Mr Bunn’s children 14 more days to submit any further evidence, and if they did not hear from them then they would pay her the death benefits.

Mr Bunn’s children responded within the 14 days, saying that “the circumstances surrounding the final days of Mr Bunn’s life were serious requiring contact with the police, the fraud departments of various financial institutions and a private investigation agency”. HLAMinformed Mrs Barnicoat of this development, explaining that “they were mindful that they had to give full consideration to all parties involved”, so could not pay the SIPP death benefits to her immediately. Mrs Barnicoat subsequently engaged a solicitor who continued to correspond with HLAM asking, amongst other requests, for a copy of the children’s letter and indicating that Mrs Barnicoat was suffering financial hardship because of the delay in HLAM’s decision. HLAM in response offered for part of the SIPP fund to be paid out to assist with her day to day expenses, however this was refused.

The SIPP death benefits were eventually paid to Mrs Barnicoat on 9 September 2013, just under a year after Mr Bunn’s death.


The Ombudsman noted that HLAM could use its discretion to pay the death benefits under theSIPP to a defined range of potential beneficiaries and that while many schemes allow their members to complete an “expression of wish” nomination form, these are not binding on the trustee, and should only be one of the factors it considers in reaching a decision. HLAMtherefore had to enquire whether there had been any change in Mr Bunn’s circumstances by investigating the deceased’s personal and financial background so as to see if there could have been any change in his wishes. The Ombudsman highlighted the importance of this, noting that HMRC allows a maximum of two years to determine the most appropriate beneficiaries of the death benefits under the SIPP. The Ombudsman stressed the difficultyHLAM faced in weighing up the different parties’ interests and that this was not a clear-cut decision. Therefore, he determined that it was not unreasonable for HLAM to have allowed Mr Bunn’s children the additional time to conclude their investigation.

In terms of the financial loss Mrs Barnicoat claimed to have suffered from having to use her savings while waiting for HLAM’s decision, the Ombudsman stated that she had a duty to mitigate this loss and that she should have accepted the financial assistance that HLAMoffered. The Ombudsman also said that it was a matter of personal choice for Mrs Barnicoat to engage a solicitor and so she should bear these costs.

In respect of the distress Mrs Barnicoat suffered, the Ombudsman directed that HLAM pay her £500 in compensation, an amount that HLAM had previously offered Mrs Barnicoat before the Ombudsman’s determination.


This decision highlights the principle that an “expression of wish” nomination for any death benefits cannot be binding on trustees and they have discretion to determine the beneficiaries (as long as the rules of the scheme provide for benefits to be payable under a discretionary trust). As the definition of who could qualify as a beneficiary can be very wide, this often leaves trustees with difficult decisions to make in sad circumstances. Therefore, trustees should carefully investigate the personal and financial circumstances of the deceased and any potential beneficiary so as to make an informed decision. Here, it was found that the time taken to deal with certain issues in the process was not unreasonable in the circumstances.

As the trustees had complete discretion to determine the beneficiary of the death benefits in this case, it initially seems surprising that Mrs Barnicoat was awarded £500 for distress caused when she had no direct claim to the death benefits. However this could be attributed to the lengthy correspondence and initial failure to keep her informed of the process.