Statement on the Bonas Group Pension Scheme | 13 June 11
Martin Woodford, associate at Ward Hadaway, solicitors for Charles Beauduin and Michel Van de Wiele, said: “Following the decision of the Tax and Chancery Chamber of the Upper Tribunal (President Sir Nicholas Warren) to bar the Pensions Regulator from pursuing a Contribution Notice against Mr Charles Beauduin in January 2011, we can now confirm that a settlement has been reached between Michel Van De Wiele and the Pensions Regulator to settle this matter in the sum of £60,000."
In Re Bonas Group Pension Scheme, the Pensions Regulator sought the issue of Contribution Notices in the sum of over £20 million against Michel Van De Wiele and its managing director.
Michel Van De Wiele was the parent company of a UK subsidiary with a pension scheme. Following the insolvency of the subsidiary company, the Michel Van De Wiele group bought the business of its subsidiary from the administrator by means of a pre-pack administration.
The subsidiary’s pension scheme, which was heavily in deficit at the time of the purchase in December 2006, has since entered the Pension Protection Fund.
The Determinations Panel of the Regulator decided that no notice should be issued against the director but that Michel Van De Wiele was liable for a payment in excess of £5 million.
Michel Van De Wiele referred the matter to the Upper Tribunal and in these subsequent proceedings the Regulator attempted to revive its case against the managing director and Michel Van De Wiele for a contribution notice in the sum of £20 million.
Michel Van De Wiele made an application to strike out the case against it which was heard by Mr Justice Warren in October with judgment given in January 2011.
Members of Ward Hadaway’s commercial litigation, pensions and corporate recovery teams advised Michel Van De Wiele and Charles Beaduin on the case.
Martin Woodford said: "Given that until very recently the Pensions Regulator was seeking an order against both Michel Van De Wiele and the director Charles Beauduin for a sum in excess of £20 million, this settlement for just £60,000 is clearly welcomed by both Mr Beauduin and Michel Van De Wiele.
“In the hearing in October Mr Justice Warren refused to allow the Regulator to revive its case against the director and, although he did not strike out the case of the Regulator, reasoned that any sum sought by the Regulator would in effect be restricted to the monetary detriment suffered by the scheme.
In essence his view was that any monies due under a Contribution Notice were compensatory and not punitive in element.
“Mr Justice Warren stated that unless the Regulator could file further evidence it was difficult, on the most optimistic view, to envisage that the business of Bonas could be worth more than £100,000, of which £40,000 had already been paid by Michel Van De Wiele.
“No further evidence was filed by the Regulator, thus confirming that it had no basis to contend that the business was sold outside the range of acceptable prices.
"However, Michel Van De Wiele is prepared to make this payment of £60,000 to settle the case in order to obviate the costs of continuing legal action. This payment is in addition to the dividend of £1.272 million that was paid into the scheme following the insolvency of Bonas.
“In reaching this settlement, Michel Van De Wiele has not admitted any liability and it remains of the view that it handled the purchase of the Bonas business entirely properly.
"No findings have been made that Michel Van De Wiele bought the business of Bonas at an undervalue or that the amount paid by Michel Van De Wiele for the business was not a reasonable amount."
Mr Bob Harding, on behalf of Michel Van de Wiele, said: “Michel Van De Wiele has always struggled to understand the actions of the Regulator.
“Michel Van De Wiele has always been confident that it would be vindicated in this matter.
“By taking the actions that it did Michel Van De Wiele ensured the continuing survival of the UK business and its employees. The fact that those jobs remain secure five years later confirms that these actions were justified."