In Blight v Brewster [2012] EWHC 165 (Ch) the High Court allowed a creditor to enforce his judgment debt against a debtor's pension funds. The court followed a 2011 Privy Council case (Tasarruf Mevduati Sinorta Fonu v Merrill Lynch Bank and Trust Company & ors) in holding that it had jurisdiction to do so under section 37 of the Senior Courts Act 1981. Section 37 provides that the court may appoint a receiver in all cases in which it appears to the court to be just and convenient to do so. The “demands of justice” (noting in this case that the Claimants were the victims of a fraud by the Defendant) required the court to prevent the debtor hiding assets in his pension fund when the creditor was out of pocket. The court ordered the debtor to delegate to the claimant's solicitor the power to elect to take the 25% lump sum permitted by the pension. The court then granted a third party debt order to take effect once the pension monies entered the account.

The Judge considered the position in bankruptcy where an HMRC approved pension is afforded special statutory protection but declined to conclude that this fettered his discretion under section 37. Of course where the Defendant did become bankrupt the statutory protection would apply notwithstanding section 37.

The case is welcome for lenders pursuing shortfall cases or claims against mortgage fraudsters.