Pennines and Mendip

As discussed in our Fourteenth Announcement, the judgment handed down following the Beddoe hearing in November 2012 has now been made public. A copy can be found below:

Beddoe Judgment – November 2012

On 28th March 2012 Dalriada Trustees Limited (“Dalriada”) was appointed as an Independent Trustee of the Schemes. Since Dalriada’s appointment it has been reviewing the underlying scheme documentation, and it has taken legal advice on various issues.

On 31st October 3012, Dalriada became aware of an email sent to members by Mr John Woodward. Dalriada has responded to that e-mail in Announcement 4, issued on 1st November and which can be downloaded via the link above.

In Announcement 1 Dalriada commented that its appointment was subject to a further review by the Regulator’s internal Determinations Panel (the Panel), known as the ‘compulsory review’ process.

This review process will culminate with an Oral Hearing, to be held on 8th November in Brighton in front of the Panel.

The Panel has recently made it clear that it must, and will, have regard to the interests of the Schemes’ members in carrying out its compulsory review and the Panel has expressed a willingness to receive members’ views either at or in advance of the hearing.

Details of how members can contact the Panel are set out in Announcement 5, issued on 2nd November and which can be downloaded from the link above.

The Panel met on 8-9 November 2012.

Having completed its review the Panel has determined to confirm the order made under section 7 of the Pensions Act 1995 in respect of the appointment of Dalriada as trustee of the Schemes. It also determined to confirm the order under section 9 of the Pensions Act 1995 allowing that all property and assets of the Schemes be vested in, assigned to and transferred to Dalriada.

The Panel’s decision is set out in our Announcement 7 which can be downloaded from the link above.

In our fourth Announcement dated 1st November we advised that Dalriada had sought expedition of the Beddoe hearing and that it understood that the Beddoe application would be heard in early November, possibly starting as early as Monday 5th. The hearing did commence on Monday 5th November. However, it has now been adjourned until Monday 12th November.

At the adjourned hearing, after hearing full argument from all 3 barristers, and therefore both for and against the application, the Court decided to give appropriate directions to authorise Dalriada to continue to pursue the litigation.

Dalriada remains committed to bringing matters to a conclusion as quickly and as cost effectively as possible.

Dalriada has lodged its own Summary Judgment application. It is hoped that the Court will find Dalriada’s claim sufficiently strong that it is able to uphold it without the need for legal proceedings going to full trial (which would be both expensive and lengthy).

However, Dalriada has agreed to ‘stay’ this application and to take part in a mediation with the previous trustees and the Hedge companies in an attempt to reach a negotiated settlement.

A day has been set aside for the mediation with a respected and experienced QC instructed by the parties as the independent mediator, who will assist in trying to achieve a settlement. This will take place on the 5th March 2013.

Dalriada said it would update members after the 5th March. However, if a settlement was not reached, it would continue with the Summary Judgment application.

No agreement was reached on the 5th March. However, negotiations continued such that Dalriada continued to hold off with the Summary Judgment application in the hope that settlement terms could eventually be agreed.

Dalriada acknowledges that some weeks have now passed since the 5th March and apologises that it has not been in a position to update members more fully up to this point and, further, appreciates members’ patience during this time.

However, Dalriada is now able to confirm that non-binding ‘heads of terms’ have been agreed with the Hedge companies that should enable Dalriada to get to a position where, ultimately, it takes control of the assets of the Hedge companies (these assets being the subject of Dalriada’s claim).

The parties will now work towards putting the heads of terms into a full settlement agreement as quickly as possible over the forthcoming weeks.

Members should be aware that, whilst the agreement of heads of terms represents a significant step forward, there are several more stages to go through before Dalriada is able to calculate the value of, and subsequently settle, members’ benefits.

Dalriada will continue to update members, the next update being in June or July by which point it will hopefully be in a position to confirm that a settlement agreement has been signed.

More details are included in our tenth Announcement which can be downloaded from the link above.