Case information

Pensions — Trustees — Duties of trustees — Deference applicable when reviewing trustees’ discretionary decision to alter pension plan benefits — Relevant and irrelevant considerations that will attract correction of trustee’s discretionary decisions — Scope of qualitative assessment to be applied by court or regulatory body when reviewing trustee’s discretionary decision.

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(SEALING ORDER) (CERTAIN INFORMATION NOT AVAILABLE TO THE PUBLIC)

The applicants are members of the British Columbia Credit Union’s Employee Pension Plan, a multi-employer defined benefit pension plan established in 1971. They brought an action against the respondents, as trustees of the Plan, after the trustees amended the Plan to increase the normal retirement date from 62 to 65. The current version of the Plan was effective as of September 2015. In reliance on the expert advice of an actuary, the trustees determine the benefits to be paid and the contributions to be required from members and employers. This differs from pension plans whose benefits and contributions are determined by collective agreement. In 2008, following the global financial crisis, the trustees began to be concerned about the funded status of the Plan. Thereafter, changes were made to improve the Plan’s short term affordability and long term sustainability, but several factors led to continuing solvency concerns. In March 2015, the actuary advised the trustees that the Plan was underfunded on a solvency basis, such that a significant increase in employer contributions could be required. The actuary was asked to present options for improving the Plan’s solvency. In June 2015, the trustees narrowed the options to two: increasing the normal retirement date to 65 or removing the subsidy on the married form of the normal joint pension. In March 2016, they passed a resolution to increase the normal retirement date to 65 because removing the subsidy would have a minimal effect on contribution rates. The change to the normal retirement date was communicated to Plan members in a booklet sent with their annual pension statements in June 2016. Thereafter, the trustees took other steps to address the continuing solvency concerns.

The applicants filed a notice of civil claim on April 4, 2017. On August 20, 2021, the respondents applied for summary trial. The trial judge granted a summary trial but dismissed the action. The applicants’ appeal was dismissed.