Bankruptcy: Court Protects Personal Pension Rights
The contentious issue of whether a bankrupt's personal pension should be available to his creditors has given rise to a number of court decisions over the years. Many thought the issue had been put beyond doubt in 2000 when the Welfare Reform and Pensions Act removed most pensions from an individual's estate on bankruptcy although it was generally accepted that it was still possible for a court to make an income payments order over a pension in payment.
This position was confirmed and extended by the High Court in Raithatha v Williamson where the judge found that an income payments order could be made in relation to a personal pension where the member had the right to elect to take a drawdown pension even where he had not yet done so. A different High Court judge has recently handed down a judgment disagreeing with Raithatha. In Horton v Henry it has been held that the trustee in bankruptcy could not obtain an income payments order over a personal pension where the pension is not yet in payment as there was no "entitlement" on which the order could bite. In order for an income payments...
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