Many directors of companies are also trustees of the company pension scheme. Sometimes, their duties as a director and as a scheme trustee can be difficult to reconcile. In a recent case, a company alleged that two directors who were trustees of the firm's pension scheme had breached their duties as trustees and their fiduciary duties to the company.
The details of the dispute are not significant but the implications of the decision are. The argument was that the trustees of the scheme had a duty to take the employer's interests into account when exercising their functions as pension scheme trustees.
The High Court decisively rejected that argument, concluding that a trustee cannot serve two masters and does not owe a fiduciary duty to the employer sponsoring the scheme. Those interests, if considered, should not override the duty towards the scheme's beneficiaries.