Where a defined benefit scheme that is in deficit winds-up the trustees must distribute the assets between the different classes of members according to a statutory order of priorities. For schemes that wound up before 6 April 2005 priority is given to those members whose entitlement to payment of their pension has 'arisen'.
In this case, the relevant members were permitted under the scheme rules to request an early pension if they were the over the age of 50 and had satisfied other conditions. The members had not satisfied these conditions.
The High Court decided that even though the members had not taken all the necessary steps to permit payment of their pensions under the scheme rules, the members’ right to payment had 'arisen' on the date of scheme wind up. This was because the steps that the members needed to take were wholly and exclusively within the member’s powers.