Apek Design Pension Scheme · CAS-30534-X6G1

CAS-30534-X6G1

Ombudsman’s Determination Applicant Mr E

Scheme Apek Design Pension Scheme (the Scheme)

Respondent Mr Eric Hill

Outcome

Complaint summary

Background information, including submissions from the parties The sequence of events is not in dispute, so I have only set out the salient points. I acknowledge there were other exchanges of information between all the parties.

The Scheme was subject to an amended Trust Deed and Rules dated 2 January 2007, with Mr Hill, Mr E and a third individual trustee. Alliance Trust Pensions Limited acted as an Independent Trustee.

In 2007, the Scheme owned a property which the sponsoring employer leased.

On 17 September 2007, the property was valued by a RICS surveyor at £500,000. The property had been previously valued in 2005 at around £400,000.

Around this time Mr Hill and the third trustee crystallised a portion of their funds and took a PCLS on the basis of the £500,000 valuation. Mr E did not.

In 2017, the property was sold by the Scheme for £402,444. 1 CAS-30534-X6G1 The parties’ submissions

Mr E has said:-

11.1. He does not question the need for the valuation or that the valuation was undertaken by a legitimate firm.

11.2. However, it was kept secret from him and the difference between the 2007 valuation and the 2014 sale price highlights that the valuation was inflated and out of kilter with market prices.

11.3. There is clear collusion between the valuer and Mr Hill in the arrangement of the valuation and he chose not to report the valuation to him as a trustee or the independent trustee. It is fanciful for Mr Hill to suggest that it was an oversight not to provide the valuation to the accountants, who he was in regular contact with. Further, it would be expected that Mr Hill would have noted this omission when reviewing the scheme accounts.

11.4. Mr Hill was vociferously against others involving themselves in the communications with the accountants.

11.5. The Scheme’s adviser did not consider the property within its investment strategy reviews.

11.6. While he was verbally informed of the PCLS being paid to Mr Hill and the third trustee, the calculation of these benefits was not reported to him.

11.7. The crux of the complaint is that the “valuation was used exclusively for the tax-free benefit calculation of Mr Hill and [the third trustee] and reflected a 25% increase of the property value reported in the annual accounts and then by

2 CAS-30534-X6G1 withholding this re-valuation at the time and then year on year until discovery by me in December last year deprived other trustees of any benefit of the higher valuation.”

Adjudicator’s Opinion

Mr E did not accept the Adjudicator’s Opinion and the complaint was passed to me to consider. Mr E provided further comments which do not change the outcome. I agree with the Adjudicator’s Opinion and note the additional points raised by Mr E.

3 CAS-30534-X6G1 Ombudsman’s decision

4 CAS-30534-X6G1

I do not uphold Mr E’s complaint.

Anthony Arter CBE

Deputy Pensions Ombudsman 29 October 2024

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