What was in issue

Whether a pension trustee who obtains competent professional advice and follows it can nonetheless be liable when the advice later turns out to be wrong.

How it ran

We acted for the trustees. The evidence was about the instructions given to the adviser rather than the advice itself, and we resisted attempts to widen disclosure into the trustees’ own deliberations.

The result

The Court of Appeal held that taking and following competent advice discharged the duty, provided the instructions were adequate. The trustees were exonerated.

Trustee applications are brought to obtain the court’s blessing for a course of action, not to resolve a dispute between adversaries. The trustees here faced a decision on which reasonable professionals could differ and were entitled to protection before taking it.

What decided it

The evidence had to demonstrate that the trustees had properly considered the relevant matters, taken advice, and reached a decision within the range open to them. The court’s role was supervisory rather than substitutive.

Why it matters

The case illustrates how much of the outcome depends on the quality of the trustees’ contemporaneous minutes. Where the reasoning is recorded properly, these applications are short. Where it is not, they are not.