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You are here: BAILII >> Databases >> High Court of Ireland Decisions >> The Minister for Education & Skills & anor -v- The Pensions Ombudsman & anor [2015] IEHC 466 (16 July 2015)
URL: http://www.bailii.org/ie/cases/IEHC/2015/H466.html
Cite as: [2015] IEHC 466
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Judgment
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Neutral Citation [2015] IEHC 466 THE HIGH COURT [2013/342 MCA] IN THE MATTER OF AN APPEAL FROM A DETERMINATION OF THE PENSIONS OMBUDSMAN BETWEEN THE MINISTER FOR EDUCATION AND SKILLS AND THE MINISTER FOR PUBLIC EXPENDITURE AND REFORM APPELLANTS -AND-
THE PENSIONS OMBUDSMAN RESPONDENT -AND-
MARGARET McDERMOTT NOTICE PARTY JUDGMENT of Mr. Justice Max Barrett delivered on 16th July, 2015. PART I BACKGROUND 1. In November 2003, Ms McDermott was granted a divorce by the Circuit Court from her since-deceased husband. Following an appeal concerning the ancillary arrangements made consequent upon that divorce, the High Court ordered, inter alia, on 4th December, 2003, that:
3. Mr McDermott, regrettably, died on 17th September, 2009, and was at that time a widower. On 12th November, 2009, Ms McDermott requested payment of her spousal pension. This was declined. On 26th May, 2010, Ms McDermott made complaint to the Pensions Ombudsman. On 6th July, 2010, the Ombudsman made his first determination favouring Ms McDermott. On 24th October, 2011, the High Court remitted the first determination to the Pensions Ombudsman for fresh consideration. On 8th October, 2013, the Ombudsman made a second determination in favour of Ms McDermott. 4. The last-mentioned final determination is a detailed document which had the effect that a spousal pension fell to be paid to Ms McDermott back-dated to the day after her late ex-husband died. The within proceedings commenced on 19th December, 2013, and were, no doubt, an unwelcome Yule-time present for Ms McDermott. 5. In broad terms, the appellants contend as follows in the within appeal. First, that the Pensions Ombudsman has acted ultra vires in directing the award of a pension in alleged contravention of s.17 of the Act of 1996. Second, that the respondent has acted ultra vires in his statutory jurisdiction, as provided for in s.139(1) of the Pensions Act, 1990. Third, that the respondent has acted ultra vires in making a finding of maladministration which is not supported by the evidence. Section 17 of the Act of 1996 is concerned with the issue of pension arrangements consequent upon divorce. Section 139(1) of the Pensions Act, 1990, empowers the Pensions Ombudsman to make determinations, to give such directions as he considers necessary or expedient for the satisfaction of a complaint or the resolution of a dispute, and makes certain related provision. Mention is made in the outline written submissions that the Pensions Ombudsman also did not conform with certain time requirements applicable under s.131(4) and (5) of the Pensions Act 1990. This last ground of contention was not pursued at the hearings; however, it appears in any event to be a procedural issue that, for the reasons outlined later below, the court considers the appellants cannot now rely upon due to acquiescence and/or estoppel. PART II THE PENSIONS OMBUDSMAN 6. Before proceeding further, a brief excursus on the nature of the role and jurisdiction exercised by the Pensions Ombudsman is required. 7. The role of the Pensions Ombudsman is to act as an independent and impartial medium for the resolution of complaints alleging financial loss occasioned by an act of maladministration and of disputes of fact or law in relation to occupational pension schemes and Personal Retirement Savings Accounts (PRSAs). 8. It is clear from the Pensions Act, 1990, as amended, that the Pensions Ombudsman is entitled to set his own procedures. (As the present Pensions Ombudsman is a man, the court will use the masculine form throughout this judgment; clearly a woman could be an Ombudsman). Section 138 of the Pensions Act 1990, as amended, provides that:
PART III APPLICABLE TEST FOR APPEAL 11. Section 140 of the Pensions Act, 1990, as inserted by s.5 of the Pensions (Amendment) Act, 2002, provides as follows:
(2) The High Court, on the hearing of an appeal under this section may, as it thinks fit, annul the determination concerned, confirm the determination or confirm the determination subject to such modifications as it considers appropriate.” 13. Some consideration of the recent decision in Millar is perhaps merited. That was a successful appeal from a decision of the High Court (Hogan J.) in which a meaning had been ascribed by Hogan J. to a particular clause in a set of consumer banking terms and conditions; his interpretation differed from the meaning ascribed the same clause by the Financial Services Ombudsman. In his judgment for the Court of Appeal, Kelly J. indicates as follows, at paras.27-38 of his judgment:
33. I am of the view the [deferential] approach identified in the decisions just cited is the correct one. Indeed, I do not understand the trial judge to have taken any different view. The question which troubled him was whether deference should be shown to the Ombudsman when the issue before him involved a pure question of law…. 34. I am of the view that the trial judge was correct in his conclusion that no curial deference is to be shown to the Ombudsman on what he [the trial judge] described as ‘purely legal questions’. That is not so merely for the reasons which were relied upon by the trial judge, but also because such an approach is entirely consistent with the statutory scheme underpinning the jurisdiction of the Ombudsman…. 36. Having correctly, in my view, concluded that pure questions of law ought not to be shown curial deference, the trial judge then went on to carry out an exercise in construing the provisions of clause 3 of the agreements in suit. 37. It is at this stage in his judgment that I take the view that the trial judge fell into error. 38. I am of the view that the issued raised by the Millars complaint was not a pure question of law, but rather a mixed question of both law and fact.” 15. In any event, there seems little, if any, doubt that the reasoning in Millar is also applicable, by analogy, when it comes to the Pensions Ombudsman. The particular significance of this is that the appellants in this case query whether the Pensions Ombudsman ought to have proceeded on the basis that he was giving effect to the court order of 4th December, 2003. However, this query appears to the court to raise questions of fact (is there a High Court order?) and mixed questions of fact and law (have the facts referred to in the Order occurred and, if so, what consequences now follow?), and these questions of fact or of fact and law, are precisely the types of issue that Millar puts squarely out of the reach of this Court in the within appeal. PART IV THE CHALLENGE TO THE MERITS OF THE FINDING 16. At the core of the appellants’ appeal on the merits in the within proceedings appear to be two key propositions. First, that the Ombudsman was bound by the letter of the law and not entitled to fashion a recommendation in accordance with fairness. Second, that the introduction of what is now the standard public service spouse’s scheme by way of the HETAC Pensions Scheme involved maladministration. 17. Perhaps the most germane decision when it comes to the challenge made to the merits of the Pension Ombudsman’s final determination in the within proceedings is that of Willis v. Pensions Ombudsman [2013] IEHC 352, in which Kearns P. dismissed an appeal against the merits of a decision of the Pensions Ombudsman. In his judgment, Kearns P. stated as follows, at pp.30-31:
19. Notably, Kearns P. continued, at pp.35-36 of his judgment, as follows:
21. As to the proposition that the Ombudsman was bound by the letter of the law and not entitled to fashion a recommendation in accordance with fairness, it is difficult to see how such a proposition could stand in circumstances where the Pensions Ombudsman was in effect giving effect to an order of the High Court, especially when the courts have made clear (inter alia in Willis) that an Ombudsman may have regard to general considerations of fairness when making a decision on a complaint. 22. As to the second proposition, i.e. that the introduction of what is now the standard public service spouse’s scheme by way of the HETAC Pensions Scheme involved maladministration, it appears to the court from the argument at the hearings that the Pensions Ombudsman may have erred in this regard. However, to paraphrase Finnegan P. in Ulster Bank, it does not appear to the court that the entirety of the decision reached therefore falls to be considered as a decision that has been vitiated by a serious and significant error. Error there may be, but the entirety of the reasoned determination reached by the Pensions Ombudsman is not vitiated thereby. PART V THE PENSION ADJUSTMENT ORDER CONTENTIONS 23. As the court understands the appellants’ contentions as regards the High Court order of 4th December, 2003, they are, in essence, that if one takes the order to be a pension adjustment order made under s.17(2) of the Family Law (Divorce) Act, 1996, (a) it does not follow the typical form of such order, (b) it appears to have been made without advance notice being given to the pension trustees pursuant to s.17(18) of the Act of 1996, or at the least the fact of such notice has not been proved, (c) the trustees were not heard prior to the order being made, and (d) a copy of the order made by the High Court appears not to have been served on the trustees. 24. A difficulty that the appellants face is that none of the issues just mentioned appears to taint the validity of the High Court order. A further difficulty that the appellants face is that case-law makes clear that this Court in this application has a very limited role, and such contentions as the appellants make regarding the order of 4th December, 2003, appear to the court to raise questions of fact (is there a High Court order?) and mixed questions of fact and law (have the facts referred to in the Order occurred and, if so, what consequences now follow?). These questions of fact and of fact and law, appear to the court to be precisely the types of issue that the decision of the Court of Appeal in Millar put squarely out of the reach of this Court in the within appeal. PART VI THE PROCEDURES ADOPTED BY THE OMBUDSMAN 25. The courts have recognised that the Pensions Ombudsman has a wide discretion when it comes to the procedures that he adopts during the course of an investigation. So, for example, in Murray v. The Trustees and Administrators of the Irish Airlines (General Employees) Superannuation Scheme [2007] IEHC 27 at p.21, Kelly J. observed that “[T]he procedures of the Ombudsman are undoubtedly less formal than those of a court”. 26. In the present case, there have now been two investigations in which the parties have had an opportunity to make submissions. It is therefore difficult to see any basis on which the matter could reasonably be sent back for a third investigation to occur. Given the length of the proceedings and the advanced age of Ms McDermott, it seems to the court more appropriate that it focus on the merits of the final determination rather than on such procedural complaints as have been raised. In any event, it seems to the court that the procedures adopted by the Pensions Ombudsman in this case were fair and complied with statutory obligations. It is clear that the appellants were sufficiently on notice of the central issues in the case, in particular as a result of the first determination. 27. As to any allegation of pre-judgment, it appears from the second and final determination that the Pensions Ombudsman approached the issues arising appropriately and with an open mind. 28. Finally in this regard, it appears to the court that the reasons set out in the Pension Ombudsman’s second and final determination are more than adequate. A finding of an Ombudsman is not in any event expected or required to be as detailed or formal as one would expect a Court judgment to be. The court is mindful in this regard of the observation of O’Flaherty J. in Faulkner v. Minister for Industry and Commerce [1997] ELR 107 at p.111 that:
30. In any event, it appears that the appellants did not at any point prior to the within appeal raise any complaint concerning the procedures adopted by the Ombudsman. This being so, it is difficult to see how why the court should do anything other than hold that the appellants are guilty of acquiescence and/or estopped from raising procedural objections to the determination of the Ombudsman; and so the court holds. That it is open to the court to make this last holding is clear from decisions such as those of MacMenamin J. in Hayes, Dunne J. in Bandon Medical Hall Ltd. v. Pensions Ombudsman (Unreported, High Court, 21st December, 2010), MacMenamin J. in Ryan v. Financial Services Ombudsman (Unreported, High Court, 23rd September, 2011), and Fennelly J. in the Supreme Court case of Rotunda Hospital v. Information Commissioner [2011] IESC 26. PART VII FACTORS THAT LIKELY RENDER THIS CASE UNIQUE 31. Before the court turns to its conclusions, the court pauses to consider the possibility that the present judgment opens a Pandora’s Box from which all manner of miseries will now be visited on pension trustees who will be deluged with innumerable petitions from divorced persons staking a claim to a survivor’s pension after an ex-spouse dies. The court does not consider this to be a realistic possibility. This is because there are a number of factors that likely render the present case unique. So, for example:
- instead of challenging the order of 4th December, 2003, the appellant Ministers have brought the within appeal against the second determination of the Pensions Ombudsman. There is abundant case-law which indicates that there are significant constraints on what the High Court can and cannot do in the event of such an appeal. If those constraints did not exist, this case might have ended with a different result, but they do exist. - some emphasis was placed by the Pensions Ombudsman on the significant discretion that he enjoys - as recognised in Willis - to achieving a fair outcome in relation to complaints that present before him. Even if there were a rich abundance of cases with similarities to the present case now coming before the Pensions Ombudsman - and there is no indication that there is- the Ombudsman might quite legitimately arrive at a very different conclusion as to how rightly to exercise his jurisdiction in any one such case. In passing, the court notes that the Pensions Ombudsman appears to have had no little regard in his reasoning to the existence of the court order of 4thDecember, 2003, an order that is in a form which seems likely to be rare, if not unique. PART VIII CONCLUSION 33. For the reasons outlined above, the court considers that the final determination made by the Pensions Ombudsman as regards Ms McDermott’s complaint should stand. |