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Horton v Henry – finally a decision on whether a bankrupt can be compelled to draw down a pension

The Court of Appeal has finally handed down its long-awaited judgment in Horton v Henry [2016] EWCA Civ. 989, the case determining whether a Trustee in Bankruptcy can compel a Bankrupt to draw down his pension even though the pension is not in payment because the Bankrupt has elected not to call it down.  

The Trustee maintained that he could do so in order to create a surplus income (which there would otherwise not be) and thus claim all or some of the pension pot by way of an income payments order pursuant to s 310 of the Insolvency Act 1986 (“the Act”). 

At first instance the Trustee’s application was dismissed, but this conflicted with the earlier decision of Bernard Livesey QC in Riathatha v Williamson [2012] EWHC 909 (Ch), [2012] 1 WLR 3559 (“Williamson”). 

The unanimous decision of the Court of Appeal, dismissing the Trustee’s appeal, is in fact a complete vindication of Alaric Watson of Hardwicke’s position in Williamson.  It is perhaps therefore a pity that the debtor’s appeal of the decision in Williamson was compromised, so that we have had to wait four years to discover that that wayward decision was wrong.

If you would like any further details on this matter, please contact Andrew Hall on 020 7242 2523 or Andrew.hall@hardwicke.co.uk