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Rectification of Pension Scheme Documentation

April 20, 2011

A decision of the Supreme Court in Boliden Tara Mines v Cosgrove (December 2010) confirmed that in order for a rectification application to succeed, the parties must meet the civil standard of proof, ie. on the balance of probabilities.  The case involved a pension scheme that included a category of employees who were not in active employment by reason of disability and who received an income continuance benefit until normal retirement age, at which stage they qualified for a pension. 

Amendments were made to the scheme documentation.  The amendments included the elimination of integration, which meant that any State social welfare pension would no longer be taken into account when calculating pensionable salary.  Some years later it was discovered that the wording of the relevant Deed of Amendment had eliminated integration not only for current and future employees but also for members in the income continuance category.  No express wording was included in the Deed of Amendment to the effect that the income continuance members would not be excluded from the elimination of integration.  It was held that since the parties had had their intentions expressed in professional legal documents, clear and convincing evidence would be needed in order to prove that the documents did not reflect the intentions of the parties.  Since neither party disputed the rectification application, nor had the defendants cross-examined the plaintiffs’ witnesses, the Deed of Amendment did not reflect the intentions of either party and the rectification application was allowed

Contributed by Michael Wolfe.