Clift (PO-2066) Trustee time-barred with recovery of overpayments
The Deputy Pensions Ombudsman (DPO) has held that, in recovering overpayments made incorrectly to a pension member, going back to the late 90s (but only discovered in 2011) the trustees were time barred under statute from seeking recovery of such overpayments.
The DPO held that, in accordance with section 32(1) of the Limitation Act 1980, the trustees should have been able to identify the incorrect overpayments in 1998/99. Consequently, the six year limitation period back to the late 90’s had been exceeded, and trustees were time barred from making a claim.
Important to also note is the DPO only partly upheld the complaint by the member who agreed he had altered his financial position in respect of the incorrect overpayments. The DPO held the member had only changed his financial position based on the lump sum element of the overpayment but not in relation to the incorrect monthly overpayments. The trustees were, therefore, able to recover such overpayments that had been paid in the six years prior to them notifying the member of the error in 2011.
The determination brings to light how easy things can go wrong for trustees when trying to recover overpayments from members. The legislation in respect of limitation periods is complex, especially in respect to pensions where there is a degree of uncertainty about when the limitation period as set out in the Limitations Act 1980 applies. We therefore recommend that you seek legal advice on this issue if the matters similar to this one rise.
Jardine (PO-2465): Ill-health early retirement medical experts need to be more thorough with their examinations
The DPO held that the employer British Telecommunications plc (BT), in response from a member to an application for ill-health early retirement, based its decision on incomplete and insufficient information from a registered medical practitioner (RMP) which resulted in maladministration. The member was refused an ill-health early retirement pension based on the RMP’s opinion that the member’s condition was not permanent, and other treatments were available to treat his condition.
The DPO held that the RMP had reached his findings without procuring vital information regarding the treatments which the member had tried. The RMP also rejected findings from a previous medical report for this member which suggested viable treatments had been exhausted. Furthermore, the RMP failed to provide reasons for why he had rejected the previous report.
As a result, the DPO directed BT to request a new medical report from the RMP and also directed BT to compensate the member for the sum of £250 for the distress and inconvenience caused to the member by BT’s maladministration.
The key points to take away from this determination are that when a medical practitioner advises on a member’s health and incapacity, it is not enough for such practitioner to only raise concerns or highlight possible untried treatments. Instead the medical practitioner must expressly identify them in the medical report for completeness.
In addition, decision makers (employers and trustees) should be conscious of the above when reviewing medical evidence and in making a decision as to whether such a member is eligible for an incapacity pension. If the medical report is vague and indecisive, the decision maker should go back to medical practitioner who produced the report and request clarification prior to making a decision.