There have been conflicting decisions on whether a person may
be made the subject of any income payments order (IPO)
This case suggests that the court will not make an IPO in
respect of unelected pension entitlements
A trustee in bankruptcy applied for an IPO in respect of a
bankrupt's self-invested personal pension (SIPP). Only after
the hearing of the application, and the day before the intended
handing down of judgment, did it become apparent that the SIPP was
a capped drawdown scheme, which materially reduced the amount of
income available to the bankrupt, and therefore his estate.
The disclosure also raised the issue as to whether the bankrupt
would have sufficient income to meet his and his family's basic
domestic needs. The Registrar therefore admitted the additional
evidence, heard further submissions and reconsidered his
The Registrar followed the latter (Re Henry) of two
inconsistent High Court decisions (Re Henry and Raithatha v
Williamson) that held that a bankrupt could not be forced to
elect in respect of his/her pension entitlements.
However, on the facts of this case, the Registrar found that the
bankrupt had elected in respect of his pension entitlements. The
Registrar considered the evidence on the bankrupt's income
(including the SIPP) and ordered a contribution accordingly.
In light of the above conflicting cases, whilst an appeal
decision is awaited on the issue of whether a bankrupt can be
compelled by the court to make certain elections in respect of
his/her pension, this is a further decision suggesting that the
answer will be no and offers little encouragement to trustees in
bankruptcy hoping to recover unelected pension entitlements.
Hinton v Wotherspoon  EWHC 621 (CH)
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