Whitney v Monster Worldwide Ltd

This is an appeal from the decision of HHJ Behrens sitting as a additional judge of the Chancery Division ([2009] EWHC 2993 (Ch)) in which he held that Mr Whitney was contractually entitled as against the defendants to a pension equivalent to that which he would have received from his previous employers plus annual increments to reflect the annual increase in the Retail Price Index (“RPI”). The appellants, Mr Whitney’s employers at the date of his cessation of employment say that there was no contract in relation to his pension entitlement but only an entitlement to participate in the scheme current at the time of his transfer of employment to themselves.

There are thus 3 questions for determination:-

The detailed facts are set out in the judgment below. For present purposes a summary will suffice.

In 1955 the first of the MSL companies was formed as a Management Selection Company. In 1963 together with the Hay Consulting Group (“Hay”) it formed Hay-MSL Selection and Advertising Limited. This company was initially owned equally between MSL and Hay. However in the early 1980s Mr Garry Long, MSL’s Chairman and majority shareholder sold MSL to Hay with the result that MSL became American owed.

In 1986 Hay together with its subsidiary, MSL, was sold to Saatchi & Saatchi. On 2^nd November 1992 Mr Garry Long purchased MSL from Saatchi & Saatchi. On 28^th February 1997 Mr Long entered into a Sale and Purchase Agreement under which he sold the shares in MSL to the parent of MWL. With effect from 1^st July 1997 the trading activities in MSL were transferred to MWL.

Before 1983 MSL had its own pension scheme for employees. However on 31^st December 1983 the MSL and Hay pension schemes merged to become the HAY-MSL Pension Plan. Joan Blakeley, the secretary of MSL, became a trustee of the MSL pension fund in 1976 and remained a trustee of the merged fund after the merger.

The main terms of the scheme were:-

On the closure of the HAY-MSL Pension Plan there came into existence the MSL Money Purchase Scheme. This was also a scheme under which contributions were made by both MSL and the member. In summary:

Although MWL had no personal knowledge of the facts surrounding the transfer of MSL employees from the HAY-MSL Pension Plan (“the Pension Plan”) to the MSL Purchase Scheme (“the Money Purchase Scheme”), they denied that any such agreement as alleged by Mr Whitney had ever been made by MSL. The judge had therefore to determine the question with the assistance of documentary evidence and the recollection of witnesses who came to give evidence of what occurred 20 or more years ago.

The genesis of the decision to close the Pension Plan and transfer members to the Money Purchase Scheme was partly due to the fact that there was pressure from Saatchi & Saatchi on Hay and MSL to deliver profits at a time when actuaries advised that there was a surplus of funds in the Pension Plan. Hay therefore proposed to close the Pension Plan and return the surplus to the respective companies, Hay and MSL. The Pension Plan was closed to new members with effect from 1^st October 1988 and existing members were required to transfer to the new Money Purchase Scheme. This required some delicate handling since the new scheme was not so advantageous to its members as the Pension Plan. There was considerable discussion reflected in the minutes of the Board of MSL, then called MSL International (UK) Ltd. On 16^th March 1989 the Board decided to take advice about the legal implications of winding up the Pension Plan and the cost of a new scheme. Ms Blakely prepared a position paper for a board meeting of 18^th April 1989 in which she stated that there would need to be a “floor plan” to fund the entitlement of members of the Pension Plan; the Board were concerned about possible defections unless this was done. Both she and Mr Curnow, who was Chairman of MSL until January 1991, gave evidence to the judge. Mr Curnow said that it was regarded as shocking in the United Kingdom to contemplate a return of a pension surplus to the employer and that he opposed the plan to split the pension fund and redistribute the surplus to the respective Hay and MSL companies. Nevertheless it was a decision of the Hay Board in America and he would have to implement any decision made.

Mr Whitney was not yet a member of the Board of MSL but was invited to attend a meeting of the Reward Committee on 19^th June 1989 when he received a memorandum from Ms Blakely explaining that the “Hay Group” had agreed to the winding-up of the Pension Plan on condition that existing employees, who were members of the Fund, were dealt with on a “No Detriment” basis. This appears to be the first mention of “No Detriment” as a possible way forward for existing employees, but it was confirmed at a Board Meeting of 20^th July 1989 that the current proposal was to wind up the fund in the Pension Plan:

“… on the basis that pensioners, deferred pensioners and existing members should be bought annuities increasing in payment by 5% per annum. There would be no funded floor plan although Hay Group Board had confirmed that there should be a “no detriment” guarantee to existing members.”

There was, however, doubt whether MSL could afford to give such a guarantee and, according to Ms Blakely in her oral evidence, it was therefore agreed that the guarantee was to be given to key personnel who at that time were contemplated to be 24 in number and she wrote to the scheme actuaries to that effect on 2^nd August 1989.

On 31^st August 1989 the Trustees of the Pension Plan wrote to all the members setting out the proposal to wind up the scheme on 30^th September 1989. On the same day Mr Curnow sent a memorandum to all MSL employees contributing to the Pension Plan explaining the new arrangements under the Money Purchase Scheme. He also sent to 29 employees (including Mr Whitney) whose names were on a list headed “MSL No Detriment Guarantee” an Addendum which said:-

“The Company recognises that the change from the Final Salary to Money Purchase Pension arrangements will frustrate the cover and financial planning of certain key personnel. The Company is currently looking at their position with a view to introducing a Supplementary Elective Top Up Scheme.

There are some thirty people involved and it is appropriate that you should know that you are one of them.”

According to Mr Whitney’s evidence, which the judge accepted, he had been told by Mr Curnow that he had nothing to worry about, his pension was protected and he would be given a no detriment guarantee. Mr Curnow confirmed that evidence and said that, in his view, the no detriment guarantee had already come into effect when the Hay Board had intimated their agreement to the proposal on 20^th July.

At a future Board meeting of 19^th September 1989, which (as it happened) was the first Board meeting attended by Mr Whitney as a newly-appointed director, Mr Curnow reported the agreement of the trustees to the level of benefits to the existing members on the winding up of the scheme. He also reported the resolution passed by the Hay Group Board on 20^th July 1989 of a no detriment guarantee including increases guaranteed at 5% for pensions in payment. The minute of the meeting continues:

“The costings produced by the actuaries showed that the cost of giving the guarantee to all existing members would be too onerous on MSL. It was therefore agreed that the guarantee to be given in a side letter to the people concerned should be limited to some 30 key employees. It would be conditional on them joining the MSL Money Purchase Scheme from 1^st October and to them agreeing to contribute 6% of their salary to it.”

No side letter was, in fact, sent, but Mr Whitney did join the Money Purchase Scheme and did pay 6% of his salary to it.

There was subsequent discussion about implementation. A “Top Hat” scheme was mentioned but had to be delayed because “care had to be taken not to prejudice the winding-up of the Hay-MSL Pension Plan”. When, however, the winding-up was nearing completion, Ms Blakely reported to a Board meeting of 19^th September 1990 that the surplus in the pension fund was likely to be £3 million rather than an earlier prediction of £1.7 million. This meant, according to her, that the no detriment guarantee could be funded out of that surplus rather than from any further contributions from MSL.

Mr Curnow resigned as Chairman of MSL in January 1991 and his severance terms recognised his entitlement as one of the 29 employees benefiting from the no detriment guarantee. Mr Whitney retained his employment with MSL until July 1997 by which time Mr Long had, on 28th February 1997, sold the shares in MSL (or, more accurately, its parent) to TMP Worldwide Holdings (“Holdings”) a US Corporation ultimately owned by a Mr Andrew McKelvey. Mr Whitney’s employer then changed to MWL a subsidiary of Holdings and, in fairly short course, his employment terminated on 31^st December 1997.

Meanwhile Ms Blakely had confirmed the existence of the no detriment guarantee in a memorandum written to Mr Long at his request on 13^th February 1991 and also to Mr Whitney’s financial advisers, Stafford & Co, on 27^th February 1991 in response to a gently phrased inquiry from them. There are other subsequent references to the existence of the no detriment guarantee in 1992/1993. There was then in 1994 a proposal to refund part of the pension surplus to MSL. One of the matters discussed by the Board was a suggestion that a reserve fund should be ring-fenced for the 7 remaining employees with a no detriment guarantee. The minutes of a further Board meeting of 15^th February 1995 state:

“The draft announcement to members on the proposed changes was received. It was noted that the proposal to ‘ring fence’ part of the surplus for the no detriment undertakings from the pension fund surplus had been dropped. Although we expect to fund the no detriment undertakings from the pension fund surplus they ultimately remain, as now, a company undertaking”

It is also noteworthy that, when Mr Long sold his MSL shares to Holdings, he gave a full disclosure of the no detriment guarantee given to MSL’s key employees.

That was only a brief summary of the evidence available to the judge but it is sufficient to understand his conclusions at para 151-152:-

“151.

….

1.

Whilst it is true that relevant events took place 20 years ago there is a consistent body of oral evidence to the effect that the 30 key employees were contractually entitled to the no detriment guarantee. In particular Mr Whitney, Barry Curnow, Anthony Brown, Joan Blakely, Mr Mather and Mr Lilley all gave evidence to the same effect albeit that their sources of information were different. It was not suggested that any of them were dishonest witnesses. Thus TMP would in effect have to show that their combined recollections were all wrong.

2.

There was, as is plain from the Position Papers and the minutes, a good commercial reason for giving key employees a no detriment guarantee. As was made clear MSL’s business success depended on the skill and loyalty of its key employees. The final salary scheme provided a means to keep its staff. There was recognised to be a risk that key employees would leave if the reduced pension provision of the MSL Money Purchase Scheme was provided.

3.

It may well be that up until May 1990 there was no enforceable no detriment guarantee. It is plain that in the autumn of 1989 and the early part of 1990 concerns were being expressed as to the method of funding the no detriment guarantee. I do not have to decide whether it was in force at the time those concerns were being expressed. Barry Curnow, Mr Whitney and Joan Blakely all seemed to think it was. The position changed radically in May and September 1990 when it was appreciated that the pension fund surplus of nearly £3 million was to remain within the assets of the pension fund. Such a sum was believed to be more than sufficient to fund the no detriment guarantee. In those circumstances there were no further problems or technical difficulties in the way of the no detriment guarantee.

4.

Whilst there are no contemporaneous documents at the time of the creation of the no detriment guarantee which confirm its existence, the Memorandum of 13/2/91, the letters of 16/12/91, 13/10/92 from Joan Blakely, 23/3/93 and 2/10/96 from Garry Long all recognise a contractual entitlement to a no detriment guarantee. Thus there are near contemporaneous documents that support Mr Whitney’s case. There is no reason to believe that Joan Blakely was mistaken in her description of the contractually binding nature of the no detriment guarantee.

5.

The Board Minute of 15/2/95 expressly recognised that “the no detriment undertakings … ultimately remain, as now, a company undertaking”. Thus there was express recognition in the Board Minutes of the contractual nature of the no detriment guarantee.

6.

Whilst it is true that Garry Long has expressed the view that the no detriment guarantee was not binding, that was at a time when he was facing a claim under the warranty and is inconsistent with the other documents outlined above including documents written by Garry Long himself.

7.

The payments that have been made under the no detriment guarantee are, to put it no higher, consistent with having been made under a contractual obligation.

152.

It was common ground between Mr Croxford and Mr Carr QC that I have to view the matter objectively and to look at all the circumstances in determining whether the no detriment guarantee amounted to a contractual obligation rather than a mere statement of intent. For the above reasons I have come to the relatively clear conclusion that at least after October 1990 the no detriment guarantee amounted to a clear contractual obligation rather than a non-binding statement of intent”

Ms Dinah Rose QC on behalf of the appellant attacked these conclusions by submitting:-

It does not seem to me to be at all difficult to conclude that MSL had entered a binding commitment to each of the 29 employees, whom they were anxious to retain in 1989, that they would suffer no detriment if they transferred to the new scheme. It was in the interests of both parties to reach such an agreement and the relevant witnesses all thought that such an agreement had been made. It is unlikely that they were all mistaken and it was not suggested that they were giving dishonest evidence. Of course that cannot be conclusive because it is not unknown for parties to think they have made a contract only for lawyers to tell them that for one reason or another they have not. That is not, however, this case.

The correct legal position is that MSL, contrary to the expressed wishes of the Hay Board, decided that a no detriment guarantee to all members of the Pension Plan would be too expensive and therefore decided that a guarantee that they would suffer no detriment would be given only to 29 key employees of whom Mr Whitney was one. Mr Whitney had already been told on 31^st August 1989 that he would be given a no detriment guarantee and when the Board decided to confirm that position on 19^th September 1989 (at a meeting at which Mr Whitney was himself present) that became a binding legal commitment as far as Mr Whitney was concerned, if it was not a binding commitment already. It is true that the Board contemplated that a further letter would be written to the recipients of the guarantee and that no such letter was written then or later. But the guarantee was not intended only to become binding if and when such letter was written.

It may be that the reason why no such letter was written was that the Board wanted to defer the writing of any such letter until they were sure that there would, in fact, be a surplus in the Pension Plan which, on distribution to MSL, would suffice to fund the no detriment guarantee to the relevant 29 employees. But the Board never made it plain to those whom it informed were to be the recipients of the guarantee that it was conditional on sufficient funds becoming available from the winding-up of the Pension Plan, and the agreement was therefore not, in my view, subject to any such condition.

It may be that Judge Behrens was unable to be sure about this and that it was for this reason that he said there was a contract by at least October 1990 by which time it had become clear that there was to be a surplus from the Pension Plan of about £3 million and any possible condition of the contract had been satisfied. I cannot see any objections to a judge in circumstances such as these saying in effect that there was certainly a binding commitment made by such and such a date. That is all the judge was doing and I would agree with him.

As for the oral evidence of the witnesses, the appellant’s skeleton argument set out in detail the respects in which the witnesses differed in relation to the time when the binding commitment of a no detriment guarantee was made and whether it included a 5% annual increase or an RPI annual increase or no annual increase at all. But, with respect to Mr Croxford as the author of the skeleton, all of that was marginal to the case. As I have already indicated, it is not strictly relevant in law to know whether the parties thought they were contractually bound and a less courteous judge than Judge Behrens might have excluded the evidence altogether. The unsurprising fact that the witnesses might have differed as to the precise date when the binding guarantee was given or as to its precise scope is even less helpful in determining the question whether a binding contract was made. The unanimity of view that there was a contract is, in any event, quite striking as is the fact that MSL dealt with Mr Curnow on that basis and, indeed, a number of their other employees.

In these circumstances I conclude that MSL did give a no detriment guarantee to Mr Whitney and that that was a binding commitment. Whether it also binds his next employer MSL is a little more controversial.

These facts are important because although an employee’s terms and conditions of employment are usually transferred automatically on take-over of the original employer and transfer to a new employer by virtue of the Transfer of Undertakings (Protection of Employment) Regulations 2006, SI 2006/346 (and its equivalent at the time of the relevant events, TUPE 1981 SI/1981 1794), there is an express exemption for so much of any contract of employment as relates to an occupational pension scheme.

As, already stated, on 28^th February 1997 Mr Long sold his shares in MSL to Holdings. The staff of MSL knew about this sale well before it actually occurred and a great number of staff attended a meeting at London Zoo which was also attended by both Mr Long and Mr McKelvey. At that meeting Mr McKelvey made it clear that no one would lose their job and that, as the judge put it, MWL

“would honour every MSL commitment including pay and benefits” (para 115).

It is not clear whether Mr McKelvey specifically knew of the no detriment guarantee at the date of the London Zoo meeting but its existence was disclosed in the documentation leading up to and constituting the sale. Shortly after the sale contract was completed there was a further meeting in MSL’s premises at 32 Aybrook Street in London which was attended by the directors of MSL including Mr Whitney. Mr Whitney was expected to integrate the MSL business with that of Holdings and any subsidiary company through which Holdings and Mr McKelvey chose to continue MSL’s advertising business. The meeting was attended not only by Mr McKelvey but also by the Chief Executive of the company that became MWL, Mr Wilkinson, and its Chairman, Mr Dolphin. The evidence about what was said was disputed but the judge concluded that at both the meetings (at London Zoo and 32 Aybrook Street)

“assurances …. were given that terms and conditions would remain unaltered at least for the time being” (para 171)

Those assurances were important to Mr Whitney not merely in relation to his own position but also in relation to his job in integrating MSL’s business with Holdings’ business since he was instructed to spread the word that all employees’ terms and conditions would remain unaltered.

Mr Whitney, of course, was still employed by MSL at this stage; the fact that the shares in MSL had changed hands made no difference to that. But on 1^st July he was required to become an employee of a subsidiary of Holdings as part of the integration and rationalisation of Mr McKelvey’s business. Accordingly the company that in due course changed its name to MWL became Mr Whitney’s employer until his employment was terminated on 31^st December 1997. The question therefore is whether MWL are bound by the terms of the no detriment guarantee or, to put the matter in legal terminology, whether there was a novation whereby MWL agreed to become bound by the no detriment guarantee given by MSL.

Ms Rose submitted that MWL could not be bound, since the assurances given by Mr McKelvey, Mr Wilkinson and Mr Dolphin could not have been given on behalf of MWL which was not Mr Whitney’s employer in early 1997 and was not then even intended to be his employer since no transfer of employment took place until July 1997. When asked on whose behalf the assurances were given, she was constrained to accept that the assurances had been given by Holdings and would bind Holdings but, since Holdings was not a party to the suit, she submitted that that was irrelevant. This was despite the fact, as the judge pointed out (para 172), that there was undoubtedly a novation of the Money Purchase Scheme and that MWL became entitled to use the pensions surplus in that scheme.

I cannot accept Ms Rose’s submission. The assurances given at the meetings were meant to be relied on and were relied on. If MWL had said to Mr Whitney at the time they became his employer that he should realise that the assurances given in relation to his pension benefits did not bind them as his new employer he would have reacted with disbelief and would, no doubt, have never agreed to change his employer. It was recognised by all parties at both meetings that a degree of integration and rationalisation of the businesses would be required and Mr Whitney had been put in charge of achieving that desirable aim. It would have been obvious to all at the meetings that the assurance were being given not merely on behalf of the holding company, Holdings, which would be most unlikely to make any contract of employment themselves but also on behalf of whatever company would ultimately become the employer of MSL’s staff. The fact that the Chief Executive and Chairman of the company which did, in fact, become Mr Whitney’s employer were present at the second meeting and participated in the assurance being given by Mr McKelvey, only serves to emphasize the artificiality of the stance taken by MWL. Not only is that stance artificial but it is also, in my judgment, wrong in law. The appeal in this respect must also be dismissed.

That leaves the question of annual increment. It is here that terms of the trust deed by which the Pension Plan was set up become relevant:-

“PENSION INCREASES

(i)

The Trustees shall review the pensions in course of payment with effect from each 1^st October and shall increase pensions having regard to the financial position of the Fund as advised by the Actuary and the rise in the Index of Retail Prices since the previous 1^st October, or the date of commencement if later.

……….”

Once again we have to go back more than 20 years to understand the history of the matter. The trustees’ report to members of the original HAY-MSL Pension Plan for the year ending 31^st December 1986 stated that pensions in payment would be increased by the rate of inflation. That accorded with the provision of the trust deed. The report for the year ending 31^st December 1987 specified that there would be a 4.1% increase from 1^st October 1987 and that was, no doubt, also an increase by reference to RPI.

The position paper which Ms Blakely prepared for MSL’s Board meeting of 18^th April 1989 (in which she referred to the need for a “floor plan”) stated that there had been discussions about a figure of 5% for increases but she noted that that was inconsistent with the most recent practice of the trustees which had been to award increases in accordance with RPI. That was at a time when RPI was in excess of 5% so she stated that the minimum acceptable arrangement would be increases in accordance with RPI but capped at 5%. The final recommendation of her paper was, however, that increases should be linked to RPI without any cap.

At a Board meeting of 18^th May 1989 it was stated that the likelihood in relation to future increases for members of the original plan was that a 5% increase would be made which was recognised to be 1-2% less that RPI. It was in this context that the proposal (as stated above) was made at the 20^th July board meeting that existing members should be bought annuities on the winding up of the plan

“increasing in payment by 5% per annum.”

That is why, when Ms Blakely wrote to the scheme actuaries on 3^rd August 1989 confirming the ultimate intention of giving a no detriment guarantee to key personnel she said that that guarantee included a 5% RPI increase for pensions in payment. That is not to my mind a proposal of 5% come what may; it is a proposal for an RPI increase, as per the trust deed, which is to be taken to be 5%.

That is also the context in which the trustees made their report to the members of the plan on 31^st August 1989 in which they stated their policy that payments would rise with inflation and that members currently in service would, on the winding up of the plan, be bought annuities on the basis of an increase of 5% p.a for those over 50, 4% p.a. for those over 40 and 3% for those over 30.

There then followed the critical Board meeting of 19^th September 1990 when it was confirmed that the no detriment guarantee would be given only to some 30 key employees because the Hay Group Board’s resolution of

“a no detriment guarantee including increases guaranteed at 5% for pensions in payment”

to all existing members would be too onerous for MSL.

There matters rested in relation to Mr Whitney as far as annual increases were concerned until Mr Whitney’s financial advisers made their gently phrased inquiry about his position and received Ms Blakely’s confirmation of 27^th February 1991 relating to the existence of the no detriment guarantee which was said to include an annual increase of 5%. That was then re-confirmed in further letters from MSL to the actuaries and other employees such as Mr Mather and Mr Town in letters of 5^th April and 13^th October 1992 and 14^th April 1993.

In the light of all this evidence the judge decided that Mr Whitney was entitled to an annual increment to reflect the annual increase in RPI. Mr Bruce Carr QC attacked this conclusion, by way of cross-appeal, because (he said) it was clear that an annual increase of 5% had been agreed at the Board meeting of 19^th September 1990 and confirmed and re-confirmed in later correspondence. Ms Rose also attacked the judge’s conclusion saying that, even if it was right to say that a no detriment guarantee was agreed, there was no specific agreement about any annual increase and one was thrown back to the trust deed. This therefore meant that one had to inquire what the trustees, if they had continued to exist, would have concluded would have been an appropriate increase by reference to RPI for each year Mr Whitney’s pension would be payable. That would mean that the court would have to do its best to predict not the actual movement of RPI but how prudent trustees would predict RPI would move in the future by reference to what the fund (which, of course, no longer exists) might or might not be able to afford. This could only be done with the help of expert evidence and she relied on the unchallenged evidence of Mr Waddingham, a pensions expert called by MWL, to the effect that a notional cautious trustee would decide that the notional fund could not afford more than an annual increase of 2-3% even if RPI was in excess of that figure (which as it happens it currently is not).

One has the feeling that this issue was debated before us with more intensity than it was below. The judge certainly dealt with it quite shortly. It is, again, primarily a question of fact and resolves itself into two separate questions (1) was an agreement of some kind reached in relation to annual increases? (2) if so, what where the terms of that agreement? I am persuaded that the parties intended to reach some agreement about annual increases. They could never have intended, once the original plan was wound up, that for those members entitled to the no detriment guarantee an inquiry of both the complexity and uncertainty of that for which Ms Rose contends should be carried out. If, of course, they had never addressed their minds to it, no doubt it would be necessary to conduct some such inquiry but it is clear that annual increases were in their minds just as much as the no detriment guarantee and that they were striving to reach an agreement which would draw a line under the original pension plan once it had been wound up.

To this extent Mr Carr is, therefore, correct. The second question is to determine what they agreed and it is important to put oneself in the position in which the parties were in 1989-1990. At that time RPI was more than 5% and the pre-September 1989 proposals were all made against that background. 5% was thus a ceiling and not a floor. No one then was contemplating a prolonged period when RPI would be less than 5%; it must follow that an indefinite commitment to 5%, regardless of the appropriate figure for RPI, would have been extremely surprising. It would also be a substantial amendment to the provisions of the trust deed which no one employee of MSL would be authorised to make.

Whatever was agreed must have been agreed at much the same time as the no detriment guarantee was agreed namely (as I have already indicated) about September 1989. The best evidence of that agreement is contained in the minutes of the Board meeting of 19^th September 1989 which stated in terms that no guarantee could be given to all members but that the no detriment guarantee would only be given to some 30 key employees. It is true that it is also stated in terms that what was not available to all members was a no detriment guarantee which included “increases guaranteed at 5% for persons in payment”. This encouraged Mr Carr to submit that, for those who did receive the no detriment guarantee, an annual increase of 5% was also guaranteed. As the judge said there is considerable force in that argument.

He did not, however, accept it and neither do I. In the first place it does not follow from what is not available to all members that it will be available for the key employees. Secondly and more importantly the whole context of the figure of 5% was (as was clear from the documents, of 18^th May and 31^st August 1989 shortly before September 1989) that it was a cap on RPI not a free-standing figure. It was RPI that was being agreed; that was, after all, roughly in accordance with the provisions of the trust deed at any rate as it became clear that the fund was to be in substantial surplus. No doubt it was also agreed that increases should not be more than 5%; that does not mean that it was agreed that there should always be increases of 5%.

It may be that Ms Blakely thought that 5% was a permanent commitment but, if she did, I fear that was a mistake but not the sort of mistake that could invalidate her evidence about the existence of a no detriment guarantee.

I am, therefore, satisfied that there was evidence on the basis of which the judge was entitled to find that an agreement had been reached that there would be annual increases to pensions in payment in the amount of RPI with a cap of 5% per annum. More than that; he was, in my view, right.

I would therefore dismiss both the appeal and the cross-appeal.

I agree.

I also agree.