In Colorcon v Huckell, Judge Toulmin CMG QC in the High Court rectified the Trust Deed and Rules of the Colorcon Ltd Staff Benefits Plan under the summary judgment procedure (i.e. the decision was made without a trial – Civil Procedure Rule 24.2). The court rectified the scheme rules because the high evidentiary burden of intention had been overcome and because both the trustees and company agreed to the rectification.
In this case, the company wanted to change the rate of revaluation of deferred benefits under the scheme rules to correct a mistake. The trustees acted as the defendants but took a neutral position.
The High Court cited the following statement as the legal position on rectification of pension scheme documents: “documents relating to pension schemes…are as amenable to rectification as any other document with a legal effect. …” (Scania v Wager (2007)).
The High Court referred to various documents, including witness statements from the trustees and employer, before coming to the conclusion that there was “convincing proof on all the evidence on the balance of probabilities that the employer and trustees held the requisite common intention” to allow the court to rectify the rules.
The High Court commented that an “outward expression of joint accord” between the trustees and company was not needed to prove their joint intention because the trustees had already admitted that this was their stated belief. Nevertheless, the court was satisfied that the expression of joint accord could be proved in this case.
The court permitted a dissenting scheme member to make further representations at a future hearing because they would potentially be adversely affected by the rectification.
Comment: This case highlights the possibility of using summary judgment for rectification but the procedure may be limited to cases where there is very clear evidence of the parties’ intention.