The latest decision from the Court of Appeal in the long running Box Clever saga (in which Eversheds LLP acts for the Trustees who are supporting the Pensions Regulator – TPR) was far from decisive.
TPR has been seeking a Financial Support Direction (FSD) against ITV, which extracted £500 million when the Box Clever TV rental joint venture was established in 2000. However, it collapsed under the weight of its debts in 2003. The Box Clever Pension Scheme was left hugely underfunded. It is now in a Pension Protection Fund assessment period with a deficit of around £70 million.
TPR’s Determinations Panel ruled in December 2011 that a FSD should be issued. ITV appealed to the Upper Tribunal (UT) which is then required to undertake a complete re-hearing with TPR going first to plead its case.
The Court of Appeal has become involved as ITV has sought to challenge a UT ruling that TPR and the Trustees could expand on the case as set out in the original Warning Notice issued to ITV on 1 September 2011. Although ITV succeeded on a technicality in having that decision remitted to the UT to consider further, honours were divided as the Court of Appeal made no costs order and rejected ITV’s primary argument that a high threshold “good reason” test should have been applied by the UT before TPR could be allowed to amend its case. The Court of Appeal upheld arguments from the Trustees that this was simply a matter for the general discretion of the UT.
ITV is now seeking to appeal to the Supreme Court against the decision, though the Court of Appeal declined ITV’s request for permission to do so. ITV may now petition the Supreme Court direct.
The case goes to demonstrate the complexity of the procedures involved in the making of a FSD. There is ample scope in the appeals process for a reluctant target of regulatory attention to drag the process out for many years.