Rio Algom established a defined benefit pension plan in 1966, which was changed effective 1997 to a plan with a defined benefit portion and a defined contribution portion. Lomas, a retired employee of Rio Algom, brought an application for damages and for an order allowing him to represent the members of the defined benefit portion of the plan, among other relief. Some of the allegations made by Lomas were that Rio Algom had unilaterally and surreptitiously amended the plan to the detriment of the plan members. He also alleged breach of trust, contract, and fiduciary duty. Lomas originally sought an order winding up the plan, but after the Supreme Court’s decision in Buschau v. Rogers Communications Inc., conceded that this relief was unavailable. He amended his application to seek an order compelling Rio Algom itself to take steps to commence the winding up of the plan. Rio Algom brought a motion to strike the application as disclosing no reasonable cause of action.
On appeal, the Court of Appeal struck the portion of the application seeking to compel Rio Algom to wind up the plan. The only issue on appeal to the Court of Appeal was whether the court can compel an employer to commence proceedings to wind up a pension plan. The Supreme Court, in Buschau, held that the rule in Saunders v. Vautier, which provides that trust beneficiaries may, in certain circumstances, terminate a trust and force the distribution of trust property, was inapplicable to pension plans. Ordering an employer to commence wind up proceedings under the Pension Benefits Act is tantamount to ordering the wind up of the pension plan. The court cannot do indirectly that which it cannot do directly. Buschau makes it “plain and obvious” that the Court does not have the authority to grant the relief sought by Lomas.