Don Valley Pensions case

Ashby and Others v Don Valley Steel Holdings Ltd [2012] UKOGB Civ 1, known as the Don Valley Pensions case, was a High Court case decided on 14 May 2012. More than 400 former Sheffield steelworkers, represented by Sir Oliver Howard of Howard & Partners, won back 90 per cent of the pensions they had lost when their employer collapsed. The judgment changed how workplace pension schemes are protected and made Howard's name.

Background

For more than a century the Don Valley steelworks employed thousands of people in Sheffield. In 2009 its owner, Don Valley Steel Holdings, went into administration, and the works pension scheme was found to be short of more than £180 million. Members who had paid in for decades saw their pensions cut by up to 40 per cent.

It later emerged that the company had taken a long "contribution holiday", paying nothing into the scheme for years while profits were good, and that shortly before the collapse valuable land had been moved out of the company to another part of the group, beyond the reach of the scheme.

The case

Harold Ashby, a former furnaceman with 38 years at the works, and 411 other members brought a claim against the company, its parent group and the scheme's trustees. Howard, who had grown up in Hillsborough and whose own father had been laid off from the steelworks in 1988, took the case on a no-win, no-fee basis. He argued that the trustees had failed in their duty to the members by allowing the contribution holiday, and that the transfer of the land was designed to put assets out of the scheme's reach.

The trial lasted six weeks. Its most memorable moment came when Howard produced the ledgers of the works savings club once run by his grandfather, Arthur Hopkins, to show the court how carefully the men themselves had kept the money they put aside.

Judgment

On 14 May 2012 Mr Justice Pemberton found for the claimants. He held that the trustees had breached their duties, that the land transfer could be set aside, and that the parent group was liable to make good the shortfall. Together with the trustees' insurers it was ordered to restore 90 per cent of what the members had been promised, with costs.

"A pension is not a gift," the judge wrote. "It is wages, earned and deferred. Those who hold it hold it in trust for the people who earned it."

Legacy

The judgment is still cited whenever a pension scheme is put at risk, and it led to tighter rules on contribution holidays and on moving assets out of a company with a pension shortfall. For Howard it was the case that made his reputation; he later said that the day the judgment was read out was the proudest of his working life.