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	England and Wales High Court (Chancery Division) Decisions
You are here: BAILII >> Databases >> England and Wales High Court (Chancery Division) Decisions >> Safeway Ltd v Newton & Anor [2016] EWHC 377 (Ch) (29 February 2016) URL: http://www.bailii.org/ew/cases/EWHC/Ch/2016/377.html Cite as: [2016] Pens LR 79, [2019] WLR(D) 543, [2016] EWHC 377 (Ch)

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IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION

		Royal Courts of Justice Rolls Building, Fetter Lane, London, EC4A 1NL
		29/02/2016

Mr Justice Warren :

Introduction

1. This is another case concerning the equalisation of pension benefits for men and women. It relates to the Safeway Pension Scheme ("the Scheme") of which the Second Defendant ("SPTL") is the sole trustee. The question before me is whether the normal pension age ("NPA") of men and women was equalised at age 65 with effect from 1 December 1991 or only from 2 May 1996. A very large sum of money turns on the answer to that question. The Claimant ("Safeway") is a subsidiary of WM Morrison Supermarkets plc and the principal sponsoring employer with an interest in arguing that the NPA for men and women was equalised with effect from 1 December 1991. The First Defendant ("Mr Newton") is an active member of the Scheme who is acting in a representative capacity for all those with an interest in arguing that NPAs were not equalised until 2 May 1996.
2. The issues arise as the result of a written announcement to members dated 1 September 1991 ("the 1991 Announcement"), its content being repeated in a letter dated 1 December 1991 ("the 1991 Letter") (together "the 1991 Notices"). The 1991 Announcement and the 1991 Letter announced the introduction of an equal NPA of 65 for men and women with effect from 1 December 1991. Formal recognition in the Scheme documentation of the common NPA is to be found in the subsequent definitive trust deed (consolidating amendments since the previous definitive trust deed) dated 2 May 1996 ("the 1996 Deed").
3. The issue is whether the 1991 Announcement and the 1991 Letter were effective to introduce a common NPA of 65 so as to satisfy the requirements of EU law in respect of service from 1 December 1991. Safeway contends that it was effective to do so with the result that the NPA for men and women in respect of all of their service from that date was equalised at age 65. Mr Newton contends that the 1991 Announcement and the 1991 Letter were not effective for that purpose with the result that NPA for men and women in relation to service between 1 December 1991 and 2 May 1996 was age 60, the benefit of the disadvantaged class (men) for that period being increased to that of the advantaged class (women) for that period.
4. There are two main issues:

i) The first is an issue of construction concerning the amendment power found in the Scheme. Safeway's contention is that the result of Clause 19 of the 1984 Deed ("Clause 19")was that the 1991 Announcement and the 1991 Letter were effective to bring about an alteration to the benefits to which a member was entitled so that equalisation was effected as of 1 December 1991. Mr Newton's contention is that since an exercise of that power requires a deed, an effective alteration was only made by the 1996 Deed.

ii) The second is whether the amendment power (which expressly permits retrospective amendments as a matter of domestic law) could be used to bring about equal NPAs for men and women with effect from 1 December 1991 as a matter of EU law (or Community law as it then was). This gives rise to a question concerning the extent and possibly correctness of my decision in Harland & Wolff Pension Trustees Limited v Aon Consulting Financial Services Ltd [2007] ICR 429 ("Harland & Wolff"). Safeway contends that Harland & Wolff is wrong in its conclusion but only as a result of arguments which were not presented to me but which Mr Green now presents; or, if that is not a correct interpretation of Harland v Wolff, then it should not be followed. Mr Newton contends that Harland & Wolff is correct and is indistinguishable; even if there is doubt in my mind about its correctness, it is said that I should follow it (although I should add that if I am in doubt, there is lurking a question of EU law which may require a reference).

The Scheme

5. The Scheme is a conventional balance of cost scheme providing final salary benefits. The Third Schedule to the Definitive Trust Deed and Rules dated 1 April 1984 ("the 1984 Deed") contained the Rules of the Scheme. Rule 2 contained a number of definitions including a definition of "Normal Pension Age" which for women was age 60 and for men was age 65.
6. Rule 23 gave the Principal Company power by written notice to the Trustees to augment the benefits conferred by the Rules either in respect of all beneficiaries or in respect of any beneficiary or class of beneficiaries.
7. By a deed of amendment dated 23 March 1987, a new Rule 35 was inserted. This required the Trustees from time to time and at least once every three years to carry out a review of pensions in payment (or contingently payable to spouses and dependants). They then had a discretion, after consulting the Scheme actuary and with the consent of the Principal Employer, to increase such pensions.
8. The Scheme contained a power of amendment. It was to be found in Clause 19 . At all material times, it provided as follows:

"The Principal Company may at any time and from time to time with the consent of the Trustees by Supplemental Deed executed by the Principal Company and the Trustees alter or add to any of the trusts powers and provisions of the Scheme including this Trust Deed and the Rules and all Deeds and other instruments in writing supplemental to this Trust Deed and the Deeds specified in the Second Schedule hereto and may exercise such powers so as to take effect from a date specified in the Supplemental Deed which may be the date of such Deed or the date of any prior written announcement to Members of the alteration or addition or a date occurring at any reasonable time previous or subsequent to the date of such Deed so as to give the amendment or addition retrospective or future effect as the case may be."

9. The 1996 Deed was a consolidating and amending deed wholly superseding the previous Definitive Trust Deed and Rules. It took effect from 26 April 1988, defined as the Revision Date. It is unnecessary to comment on its detail. I need only note that it contains a definition of "Normal Pension Age" which included the following:

"(1) as regards all Members except a 1973 Plan Member from the Revision Date until 30^th November 1991, the last day of the month on which the Member attains the age of 65 years if male or 60 years if female and,

(2) as regards all Members from 1st December 1991 except a 1973 Plan Member or those who are already Pensioners, Deferred Pensioners or Postponed Pensioners at that date, the date on which the Member attains the age of 65 years;"

10. Nothing turns, for present purposes, on the exceptions referred to in (1) or (2). However, EU law required benefits in respect of service from 17 May 1990 until 30 November 1991 to be equal so that NPA for men in respect of service during that period was, notwithstanding (1), 60 not 65. One reading of (2) is that an NPA of 65 was adopted in relation to all service where the Member remained in service after 1 December 1991. In practice, however, the Scheme is administered on the basis that an NPA of age 60 applies to benefits accrued between 17 May 1990 and 1 December 1991.

The facts

11. The catalyst for the change in NPA was, of course, the decision of the ECJ (now the CJEU: I will refer to it in this judgment as the ECJ) in Barber v Guardian Royal Exchange Assurance Group (Case C-262/88) [1991] 1 QB 344 [1990] ICR 616 ("Barber").
12. The response of Safeway and SPTL to Barber is described in the witness statement of John Kinch. He was, throughout the relevant period, (i) the Company Secretary of Safeway (previously called Safeway plc and before that Argyll Group plc) (ii) a director and Company Secretary of the company now known as Safeway Stores Ltd which was and is the principal operating company in the group and (iii) a director and the secretary of SPTL. The key events which he identifies, and about which there is no dispute, are these:

i) 7 March 1991: a meeting of the board of SPTL when it was resolved to adopt a common NPA of 65 but on the basis that active members would be permitted to retire from age 60 onwards on an unreduced pension subject to Safeway's consent and subject to 3 months' notice being given.

ii) 29 July 1991: a meeting of the board of SPTL at which discussions were held concerning the giving of notice to employees and the timetable for implementation of the changes. A draft of the announcement to members was approved.

iii) 1-31 August 1991: consultation process conducted with Trade Unions.

iv) 1 September 1991: the 1991 Announcement. This went out under Mr Kinch's name to all full time employees to be received by them on 2 September 1991. There followed a consultation period leading to a formal announcement.

v) 1 September onwards: communication and consultation with members.

vi) 1 December 1991: the 1991 Letter announcing that the changes described in the 1991 Announcement had been made with effect from 1 December 1991.

The 1991 Announcement

13. The 1991 Announcement was headed "Change to your Scheme Benefits". It explained immediately after that heading that the announcement:

"brings you advance news of two significant changes to [the Scheme] which [Safeway and SPTL] intend to introduce with effect from 1^st December 1991."

14. The second of the changes was:

"A common Normal Pension Age for men and women of 65 – treating men and women differently in employment practices has long been outlawed. Surprisingly, in the pensions arena it has been possible to allow different treatment, especially with regard to pension ages. A recent case in the European Court is set to change all that. See right."

15. There then appears to the right a note about Barber. Although it was still uncertain what impact the decision would have, it was explained that Safeway and SPTL:

"have decided that it is right to act now to equalise Normal Pension Age. They are continuing to monitor the situation and will make any further changes which may be required as a result of clarification of the effects of the judgment."

16. Further detail was given on the second page of the 1991 Announcement. The heading explained that SPTL had decided to set the single NPA for men and women at age 65. Under a section headed "Options for an early retirement, available to all", the following was to be found:

"Of course, not everyone wants to work up to 65: you may already be dreaming about your retirement at age 60…. So your initial reaction to the change in Normal Pension Age may be one of gloom! However, in keeping with the current practice for male members with a Normal Pension Age of 65, the pension earned for service up to your early retirement will not be reduced for early payment if you retire from service between ages 60 and 65. You will need Company consent and, so that if the Company is more able to comply with your wishes, you must give at least 3 months' irrevocable notice in writing…."

17. The 1991 Announcement was signed "J.P. Kinch, Secretary". Mr Kinch's evidence, for what it is worth, is to the effect that "Secretary" was a designation which he would use to reflect his position within both Safeway and SPTL: he would have used the designation "Company Secretary" if he had been acting solely for Safeway. Looking back, he thinks that:

" whilst the announcement was primarily a communication from the Group to its employees, it [the 1991 Announcement] was very much a joint statement with the Trustee which had approved the announcement at its meeting on 29 July 1991. I certainly have no doubt that I had the authority of both the Trustee and the Principal Company to make this announcement or, to put it another way, I am absolutely confident that I would not have sent this announcement out without the clear authority and approval of both the Principal Company and the Trustee."

18. In my view, the 1991 Announcement is properly to be seen as coming from both Safeway and SPTL. If and to the extent that an announcement within the meaning of Clause 19 was required to be one which was made with the consent of SPTL, I am satisfied that the 1991 Announcement was made with that consent. I do not, in any case, understand Mr Short to contend otherwise.
19. In italics and in smaller type-face than the body of the document, there appears at the foot of the page the following rubric:

"It is emphasised that the Trust Deed and Rules are the legal basis of the Safeway Pension and Family Benefits Scheme, and that this announcement is intended only for the purposes of general guidance and information. You should note that the changes described in the leaflet represent an alteration to your Terms and Conditions of employment."

The 1991 Letter

20. The 1991 Letter was issued on behalf of a number of companies in the group. It was signed by Mr Kinch for and on behalf of those companies. Safeway itself was included in that number, but SPTL was not. It is a short letter and I set it out in full:

"This letter is addressed to those employees of the companies listed above who are members or eligible to become members of the Safeway Pension and Family Benefits Scheme ("the Scheme"). The purpose of this letter is to formally confirm that the changes to pension benefits under the Scheme described in the announcement dated 1^st September 1991 have been made with effect from 1^st December 1991. All such employees should note therefore, that their terms and conditions of employment have been amended from today on the basis outlined in the September announcement."

21. Copies of that letter were provided to managers to distribute to employees. The covering memorandum asked managers to arrange for each employee to receive a copy of the letter on 2 December 1991 or as soon as possible thereafter. It is accepted that I should proceed on the basis that the 1991 Letter was effectively provided to each employee with effect from 1 December 1991. No point is being taken by Mr Newton in relation to:

i) the possibility that not all members received the 1991 Letter;

ii) the actual date on which the 1991 Letter was issued (which could, it is said, effect the date from which equalisation takes effect).

22. Mr Newton, of course, is a party to these proceedings in a representative capacity and Mr Newton's neutrality on those two aspects is subject to the Court making a direction that submissions on this point should be made on his behalf. I did not make at the hearing and do not propose to make now any such direction. Even in litigation involving as much money as this litigation does, there still needs to be proportionality about the conduct of the litigation and about what points can sensibly be ignored. In my view it is appropriate to proceed (i) on the basis that the 1991 Announcement and the 1991 Letter between them constituted an announcement for the purposes of Clause 19 even if the 1991 Letter was not in fact received by some Members and (ii) on the basis that the 1991 Letter was issued on the date which it bears.
23. Since 1 December 1991, the Scheme has been operated on the footing that NPA was effectively equalised at age 65 on that date. That is the clear evidence of Mr Kinch who is in a strong position to know. As he says in paragraph 77 of his witness statement dated 16 January 2015 when commenting on the 1996 Deed:

"It was certainly my understanding that we had already fully committed ourselves to the equalisation of NPAs at 65 with effect from 1 December 1991, that we had acted and administered the Scheme on that basis and that we were merely giving formal effect to a change that had already taken place".

Clearly, those concerned in the administration of the Scheme thought that the change had been effected.

24. To take one example, the actuarial valuation report dated 12 May 1993 carried out by Bacon & Woodrow as at 1 April 1992 contains, at Appendix 2, a list of benefit changes since the previous valuation. It notes that NPA was changed to age 65 for all men and women with effect from 1 December 1991 whilst also noting that members were permitted to retire from age 60 on unreduced pension subject to Safeway's consent and on 3 months' notice. The results and recommendations (in particular the recommendation concerning contributions) contained in the report "reflected the amendments made to the Scheme relating to the equal treatment of men and women": see paragraph 2.7 of the Summary of Results on p 3.
25. Whilst the NPAs of members under the 1984 Deed were age 60 for women and age 65 for men, the general (but not universal) practice of Safeway was to permit members to retire from age 60 with an unreduced pension on three months' notice being given. This practice was reflected in the 1991 Announcement as can be seen from the passage which I have quoted at paragraph 16 above. This practice lasted for both men and women until April 2003, when the funding levels of the Scheme had deteriorated to such an extent that Safeway considered that the practice could no longer be supported. All other Scheme benefits, for instance transfer values, were, however, paid with effect from 1 December 1991 on the footing of a common NPA for men and women of 65 in respect of benefit accrual from 1 December 1991.

The principles of EU law

26. Although the issue of construction of Clause 19 concerning the effect of the 1991 Announcement and the 1991 Letter on members' benefits is perhaps logically the first issue which needs to be addressed, it is not possible to understand the significance of the issue – and thus precisely how the issue is to be formulated – without an appreciation of the requirements of EU law in relation to equal pay under EU law. I therefore propose to look at those principles first.
27. At the material times, the principle of equal pay was laid down in article 119 of the EEC Treaty in the following terms:

"1. Each Member State shall during the first stage ensure and subsequently maintain the application of the principle that men and women should receive equal pay for equal work.

2. For the purpose of this article, "pay" means the ordinary basic or minimum wage or salary and any other consideration, whether in cash or in kind, which the worker receives directly or indirectly, in respect of his employment, from his employer."

28. The principle of equal pay was subsequently re-enacted in article 141 of the EEC Treaty and is now found in article 157 of the Treaty on the Functioning of the EU. I will refer to it in this judgment as article 119. It is worth making the preliminary observation that, as Mr Short submits, the principle of equal pay is of great importance in the European Community. As the ECJ put it in Coloroll Pension Trustees Ltd. v Russell (Case C-200/91) [1995] 2 CMLR 357; [1995] ICR 179 ("Coloroll") at [26]:

"…it must be remembered that the principle of equal pay is one of the foundations of the Community and that article 119 creates rights for individuals which the national courts must safeguard. Article 119 being mandatory in nature, the prohibition on discrimination between men and women applies not only to the acts of public authorities but also to all contracts between private individuals and to all collective agreements intended to regulate paid employment: see Defrenne v Sabena (Case 43/75)) [1976] ICR 547, 566, 568, paras 12 and 39."

29. As the Advocate General (Van Gerven) said in his joint opinion in Coloroll and other cases at [57] (as set out in the body of that paragraph in the ICR report at p 126):

"It is precisely the fundamental nature of the principle of equal treatment in the Community legal order that has repeatedly led the Court to interpret narrowly the derogations from it permitted by the Community legislature: see Roberts v. Tate & Lyle Industries Ltd [1986] (Case 151/84) [1986] ICT para. 35; Marshall v. Southampton and South-West Hampshire Area Health Authority (Teaching)(Case 152/84) [1986] ICR 335, para 54 and Beets-Proper v. F. Van Lanschot Bankiers NV (Case 262/84) [1986] ICR 706, para 38."

30. In my decision in Harland & Wolff, I gave a brief description of where the law had got to. I repeat it here:

"5. Article 119 requires member states to ensure that the principle of equal pay for male and female workers for equal work or work of equal value is applied. This article is of direct effect and can be relied on by, for instance, employees against employers to secure equality of pay. In the seminal case of [Barber], the Court of Justice of the European Communities stated the application of this provision to pension benefits, in particular deciding that it was unlawful to discriminate between men and women by providing benefits by reference to different ages at which pension becomes payable. It was, as is well known, common for pension schemes to provide different retirement ages for men and women (typically 65 and 60 respectively); the decision in Barber and the requirement to remove this discrimination was a cause of great activity in the period after the judgment of the Court of Justice (which was delivered on 17 May 1990).

6. Because of the uncertainty, partly engendered by certain Community instruments and the decision of the Court of Justice in Newstead v Department of Transport (Case 192/85) [1988] ICR 332, about whether article 119 applies to benefits provided by a contracted-out pension scheme (the scheme in the present case was such a scheme at the time of the amendments in 1993), a temporal limitation was laid down by the Court of Justice in its decision in Barber: as the court put it, overriding considerations of legal certainty required the effects of the judgment to be limited in time.

7. Unfortunately, the scope of that temporal limitation was itself a matter of great uncertainty. Many of the uncertainties were resolved in a series of cases: Van den Akker v Stichting Shell Pensioenfonds (Case C-28/93) [1994] ECR I-4527, [Coloroll], Smith v Avdel Systems Ltd (Case C- 408/92) 1995] ICR 596. These are conveniently reported together at [1994] Pen LR 211. The effect of these cases is summarised by Lewison J in Trustee Solutions Ltd v Dubery [2007] ICR 412, at para 4:

"Following subsequent cases, particularly [Coloroll], the effects of the Barber judgment on the requirements for equal treatment of men and women were confirmed as follows: (i) For pensionable service prior to 17 May 1990 (the date of the Barber judgment) it was not unlawful for male and female pension benefits to be provided at different retirement ages. (ii) A scheme could be amended so as to equalise benefits for men and women, if the rules of the scheme permitted such amendment. The nature of the amendment could either reduce the normal male retirement age, or increase the normal female retirement age, or both; provided that both sexes were treated equally. (iii) For pensionable service between 17 May 1990 and the operative date of any valid amendment…… male members of a pension scheme were entitled to be treated as if their normal retirement age was the same age as that applicable to female members (usually 60). This period is known, in the jargon, as "the Barber window"."

31. It can be seen that, during the Barber window, the disadvantaged class was to receive the same benefits as the advantaged class. Achieving equality in this way is often referred to as "levelling up" and the phrase "levelling down" is often used in a corresponding way.
32. I will refer to the last two of the cases referred to above as "Avdel" and "Dubery". To that list I should add Ten Oever v Stichting Bedrijfspensioenfonds voor het Glazenwassers- en Schoonmaakbedrijf (C-109/91) [1995] ICR 74 ("Ten Oever").
33. At the date of Barber, there was no domestic provision giving effect to article 119 in relation to pension provision: the terms and conditions of employment relating to retirement were excluded from the operation of the Equal Pay Act 1970 by section 7 of that Act; article 119 was, however, of direct effect as noted in the passage I have just quoted from Harland & Wolff. Effect was given to article 119 in domestic law by sections 62 to 65 Pensions Act 1995 which came into force on 1 January 1996. These provisions are relied on by Mr Green; I will be considering them in due course.
34. In order to address the arguments which have been raised, it is necessary for me to go into the cases in the ECJ in rather greater depth than I did in Harland & Wolff. I need to mention some of the earlier cases in order to put into context what was said in later cases, in particular in Avdel, Coloroll and Ten Oever.
35. I start with Defrenne v Sabena (No. 2) (Case 43/75) [1976] ICR 547 ("Defrenne"). This explained the context of article 119 and went on to reject the suggestion that equal pay could be achieved otherwise than by increasing the pay of the disadvantaged group to match that of the advantaged group, ie by levelling up. The following is to be found at [8] to [15] of the judgment of the Court:

"8 Article 119 pursues a double aim.

9 First, in the light of the different stages of the development of social legislation in the various Member States, the aim of Article 119 is to avoid a situation in which undertakings established in States which have actually implemented the principle of equal pay suffer a competitive disadvantage in intra-Community competition as compared with undertakings established in States which have not yet eliminated discrimination against women workers as regards pay.

10 Secondly, this provision forms part of the social objectives of the Community, which is not merely an economic union, but is at the same time intended, by common action, to ensure social progress and seek the constant improvement of the living and working conditions of their peoples, as is emphasized by the Preamble to the Treaty.

11 This aim is accentuated by the insertion of Article 119 into the body of a chapter devoted to social policy whose preliminary provision, Article 117, marks 'the need to promote improved working conditions and an improved standard of living for workers, so as to make possible their harmonization while the improvement is being maintained'.

12 This double aim, which is at once economic and social, shows that the principle of equal pay forms part of the foundations of the Community.

13 Furthermore, this explains why the Treaty has provided for the complete implementation of this principle by the end of the first stage of the transitional period.

14 Therefore, in interpreting this provision, it is impossible to base any argument on the dilatoriness and resistance which have delayed the actual implementation of this basic principle in certain Member States.

15 In particular, since Article 119 appears in the context of the harmonization of working conditions while the improvement is being maintained, the objection that the terms of this article may be observed in other ways than by raising the lowest salaries may be set aside."

36. The next case is Razzouk and Beydoun v EC Commission (Cases 75/82 and 117/82) [1984] 3 CMLR 470 ("Razzouk") in which the ECJ considered the pension arrangements made for Commission staff. This was discriminatory in that it provided survivors' pensions for widows but not widowers. The Advocate General (Slynn) agreed that this was discriminatory and should be annulled, but said (see pp 485-6 of his Opinion) that the Court should not make any decision as to the rights under the scheme as it was for the Commission to introduce equality.
37. The Court did not agree with this last conclusion. It said this:

"[19] As a result of this annulment it is incumbent on the Community legislature to draw the conclusions from this judgment by taking suitable measures to establish equality between the sexes as regards Community pension arrangements. In the meantime it is for the Commission to reconsider the plaintiff's request by applying the provisions of the Staff Regulations relating to the widow's pension which at present remain the only valid system of reference."

38. One there sees reference to a "valid system of reference". This is the frame of reference by which the directly enforceable rights of a member of the disadvantaged class is to be ascertained. To put this in another way, the valid system of reference comprises the arrangements (in that case, the Staff Regulations) by which the rights of the advantaged class are to be ascertained. I will, in due course, need to identify the relevant frame of reference in the present case by which the rights of the advantaged class (women) are to be ascertained in order to assess how the directly enforceable rights of the disadvantaged class (men) are to be given effect.
39. The approach of providing the disadvantaged class the same rights as those of the advantaged class is found in other cases relating to pensions and other forms of pay under article 119 as well as in relation to parallel rights to equal treatment in the field of social security provisions. I give some examples in the following paragraphs. Others can be found in [10] of the Advocate General's Opinion in Avdel.
40. The Netherlands v Federatie Nederlandse Vakbeweging ("FNV") (Case 71/85) [1987] 3 C.M.L.R. 767) was a case which concerned discrimination in the provision of social security, contrary to article 4 of Council Directive 79/7/EC on the progressive implementation of the principle of equal treatment for men and women in matters of social security. The ECJ held that article 4 was of direct effect and said at [22]:

"[22] It follows that until such time as the national government adopts the necessary implementing measures women are entitled to be treated in the same manner, and to have the same rules applied to them, as men who are in the same situation since, where the directive has not been implemented, those rules remain the only valid point of reference."

41. Nimz v. Freie und Hansestadt Hamburg (Case C-184/89) [1992] 3 CMLR 699 ("Nimz") concerned a discriminatory provision in a collective agreement. The ECJ held:

"[18] It follows from Case C-33/89 cited above, that, where there is indirect discrimination in a clause in a collective wage agreement, the class of persons placed at a disadvantage by reason of that discrimination must be treated in the same way and made subject to the same scheme as other workers, such scheme remaining, for want of correct application of Article 119 EEC in national law, the only valid system of reference."

42. The issue was addressed in the context of retirement benefits in Coloroll, Ten Oever and Avdel.
43. The starting point is the combined Opinion of the Advocate General (Van Gerven) referred to at paragraph 29 above. At [59] of his Opinion, the Advocate General identified one question as concerning "the financial shaping of the equal treatment principle, in particular whether this must be put into effect by increasing the benefits granted to the disadvantaged sex or whether it may also be put into effect by reducing the benefits granted to workers of the advantaged sex". This question arose, so far as concerns Coloroll, out of the questions referred by the High Court. The questions can be found at [16] of the judgment of the Court. Question 1(2) (ii) asked whether the direct effect of article 119 could be relied on "to require the employer and/or the trustees to use such powers as they may have, whether by amendment of the rules of the scheme or otherwise, to secure that the benefits payable under the scheme reflect the principle of equal pay" and, if the answer to that question was Yes, the next question was "(iii) does the principle of equality require the benefits of the disadvantaged sex to be increased in all cases, or is it consistent with article 119 for the benefit of the other sex to be reduced?". Question 1(2)(iii), in referring back to a positive answer to Question 1(2)(ii), included, it seems to me, within its scope the question whether it was open to the trustees to use their power of amendment (assuming of course that they had such a power as a matter of domestic law) so as to reduce the benefits of the advantaged class.
44. The Advocate General's answer is found in [60] and [61]. After referring to Defrenne v Sabena he said this:

"60. ……… The court's statement may accordingly be regarded as only having in view discrimination occurring in the past. The fact that, in relation to such discrimination and pending a measure eliminating it, an increase of the lowest salaries is required has been confirmed by more recent case law, particularly since [Razzouk] para 19…… the court has indicated that "the only valid frame of reference" for an immediate implementation of the principle of equal treatment, so long as a scheme is still not adapted to that principle, is to be found in the pension scheme rules in force.

That means that, pending new adjusted rules, the rule applicable under the existing scheme provisions to members of the more favoured sex must also be applied to members of the less favoured sex. [Footnote 125: The court applied that criterion in particular in order to ensure application of the principle of equal treatment laid down in article 4(1) of Directive (79/7/E.E.C.) for as long as this Directive is not being implemented, in full, by the national legislature……] As regards the past, or, more precisely, as regards pension benefits which relate to periods of service performed in the past, the principle of equal treatment therefore requires that the benefits of the disadvantaged sex be brought up to the level of those of the advantaged sex."

45. In contrast, the position in relation to future periods of service was different:

"However, in the case of benefits based on new rules adapted to the principle of equal treatment which govern periods of service in the future, the situation is different. Like the Commission, I take the view that Community law does not preclude a reduction of such benefits, so long as those benefits are set at a level which is the same for men and women. To take any other view would entail undesirable Community interference in a policy area which, in the present state of Community law, belongs to the sphere of competency of member states, which, as the court has repeatedly emphasised, "enjoy a reasonable margin of discretion as regards both the nature of the protective measures and the detailed arrangements for their implementation.….."

46. His proposed answers in Coloroll [66] accordingly includes these:

"(3) The Trustees of an occupational pension scheme are obliged under article 119 to do everything within their powers in order to ensure that benefits to be paid to employees or those entitled under them comply with the principle of equal treatment laid down in this article. (4) So long as article 119 has not been properly implemented, the pension benefits of the disadvantaged sex must be brought up to the level of those of the advantaged sex [with an exception relating to "periods of service in the future]."

47. The next relevant guidance came from the same Advocate General in Avdel prior to delivery by the ECJ of its judgment in Coloroll and the related cases. Before turning to that, I mention the reference to the ECJ from the Industrial Tribunal which can be found at [1993] PLR 19. The case concerned various groups of women whose retirement ages had been changed from 60 to 65. They included employees who had retired, those who were working, those who had left the scheme and those who had died. The result was that early retirement factors were applied from age 65 and transfer values were calculated on the basis of a retirement age of 65. This adversely affected the accrued and prospective rights of the women.
48. The reference records, at [25], that the rules of the Scheme were amended with effect from 1 July 1991 to provide for a normal pension date for men and women of 65 years. This change was notified to members by a notice dated June 1991. The reference does not set out the amendment power, but it is reasonable to assume that the amendment took effect pursuant to a valid exercise of that power.
49. That assumption is confirmed by reference to the actual amendment power which has been obtained and shown to me. The power was one "to amend or modify" the trust deed or rules and was vested in the Trustees with the consent of the Principal Employer and after consulting the Actuary. It was exercisable "so that any such alteration or modification may have retrospective effect". It was exercisable by deed or by the insertion, in the case of the Rules, of particulars of the amendment in the Schedule to the Rules. The power was subject to a number of provisos one of which was this:

"(f) If notice in writing of any such alteration or modification shall be published in such form and in such manner as the Trustees and the Principal Employer shall agree the trusts powers and provisions of this Deed and of the Rules shall, pending the execution of the Deed or the insertion of the particulars in the Schedule as aforesaid, be deemed to be altered or modified in such manner and to such extent as the Trustees shall determine to give effect to the provisions set out in such notice….."

50. Notice having been given in June 1991, clearly the substance of the notice took effect as of 1 July 1991 either by virtue of proviso (f) or because the appropriate formal amendment had been made by that date. The reference does not disclose which was the case and it makes no practical difference. The amendment, if valid, applied to all service including service prior to the date of the notice and was in that sense retrospective in its effect.
51. The first question referred by the Industrial Tribunal to the ECJ was this:

"(1) Where an occupational pension scheme has different normal pension ages for men and women (65 and 60 respectively), and where an employer seeks, in the light of [Barber] to eliminate that discrimination, is it inconsistent with article 119 of the EEC Treaty for the employer to adopt a common pension age of 65 for men and women … (ii) in respect of occupational pension benefits received by employees which are based on years of service on or after 17 May 1990, but before the date of equalisation, when the date of equalisation was 1 July 1991 …?"

52. The same Advocate General (Van Gerven) gave an Opinion in this case. He drew the distinction between benefits which were based on "periods of service completed in the past to which discriminatory rules applied" and benefits that were "related to service performed after the introduction of new rules adapted to the principal of equal treatment". I need to set out some passages from his Opinion, starting with a question which he asked himself. The question was this: "Is the raising of the pension age of female employees to that of male employees, in order to comply with the court's judgment in Barber, compatible with article 119 of the EEC Treaty?" For reasons which will become apparent in due course, Mr Green attaches importance to the words "in order to comply with the court's judgment in Barber". In answering his own question, the Advocate General, in addressing the general principles, said this:

"9. Although the matter in issue is delicate, my view is that the fundamental answer is quite clear under Community law. A similar question has been referred to the court in [Coloroll] in which the High Court of Justice (Chancery Division) seeks to ascertain whether the implementation of the principle of equal treatment requires that the benefits for the disadvantaged sex be increased in all cases or, on the contrary, whether it is consistent with article 119 for the benefits of the other sex to be lowered: question 1(2)(iii) in that case. In my joint opinion of 28 April 1993 in [Ten Oever] and other cases … , point 60, taking the court's case law as my basis, I drew a distinction between pension benefits according to whether they were based on discrimination occurring in the past (after the judgment in [Barber]) or they were related to service performed after the introduction of new rules adapted to the principle of equal treatment as a result of that judgment. That distinction must also be maintained in the present cases.

10. As regards benefits based on periods of service completed in the past to which discriminatory rules applied, it is necessary, pending rules to abolish such discrimination, to increase the level of benefits of the disadvantaged sex so as to bring it up to that of the advantaged sex. In cases involving sex discrimination the court has consistently held that the more favourable rules must be applied to the less favoured sex, those rules forming "the only valid frame of reference" for immediate implementation of the principle of equal treatment…..

11. The situation is fundamentally different so far as concerns benefits based on new rules adapted to the principle of equal treatment and relating to future periods of service, that is to say periods completed after the entry into force of the rules. [He then repeated much the same as he had said in his Opinion on Coloroll as set out at paragraph 46 above.]…… The court's finding [in Defrenne] may accordingly be regarded as applying only to discrimination in the past, with regard to which the court, as already stated, requires that the more favourable rules should also apply to the less favoured group…."

……."

53. Applying those principles to the facts in Avdel, the Advocate General said this:

"14. Next, there is levelling-up of pensionable ages [note that, although the age was raised, the benefit was levelled down] of male and female employees as regards pension benefits acquired by virtue of periods of service completed between 17 May 1990 and the date of levelling-up, which in this case was 1 July 1991. Since these periods of service are posterior to the judgment in Barber, full application must be given to the rule derived from the case law of the court that the principle of equal treatment requires that the rule or rules applying to the more favoured sex (in this case, women) must also be applied to the less favoured sex (in this case men).

Unlike the Commission …… I therefore take the view that article 119 of the E.E.C. Treaty does not permit levelling-up of pensionable ages as regards benefits acquired by virtue of those periods of service…..

15. Finally, as regards the levelling-up of pensionable ages for benefits acquired by virtue of periods of service posterior to the date of levelling-up, I would…. agree ….that such a step is not contrary to article 119 of the EEC Treaty, provided at least that it complies in full with the principle of equal treatment."

54. That last paragraph is reflected in the Advocate General's conclusions:

"29. .… Community law does, however, preclude such a step [raising pensionable age] in relation to periods of service completed between 17 May 1990 and the date on which pensionable ages are levelled. In the case of the last mentioned periods of service, the principle of equal treatment must be implemented by applying the rules enjoyed by the members of the more favoured sex to members of the less favoured sex."

55. The judgments in Coloroll and related cases and in Avdel were given in September 1994. The results followed the Opinions of the Advocate General. In Coloroll, the Judge Rapporteur, Judge Mancini, recorded under the heading "Effects of article 119 of the EEC Treaty on the rules of the scheme" one contention of Mrs Broughton (who was arguing for the most limited scope of article 119). She argued that the consequences of such sex inequality as may be found to exist are to be determined in accordance with national law. Thus, in an appropriate case, inequality may be corrected by making appropriate changes to the benefits received by the advantaged class, without equalisation having necessarily to be secured by increasing the benefits of the disadvantaged class. That argument was directed not only at achieving equality of benefits relating to periods after the change but also at achieving equality of benefits relating to earlier periods.
56. I have already set out [15] of the judgment in Defrenne at paragraph 35 above. The Court ruled against the argument that compliance with article 119 could be achieved otherwise than by raising the lowest salaries in view of "the connection between article 119 and harmonisation of working conditions". That ruling was referred to by the Court at [30] of its judgment in Coloroll. In [31] of that judgment, the Court referred to Nimz (see paragraph 41 above) and the need, in effect, to level up. It continued in [32] to [36] to say this:

"32. It follows that, once the court has found that discrimination in relation to pay exists and so long as measures for bringing about equal treatment have not been adopted by the scheme, the only proper way of complying with article 119 is to grant to the persons in the disadvantaged class the same advantages as those enjoyed by the persons in the favoured class.

33. The situation is different as regards periods of service completed after the entry into force of rules to eliminate discrimination, since article 119 does not then preclude measures to achieve equal treatment by reducing the advantages of the persons previously favoured. Article 119 merely requires that men and women should receive the same pay for the same work without imposing any specific level of pay.

….

36. The answer to be given to the second part of the first question must therefore be that, in so far as national law prohibits employers and trustees from acting beyond the scope of their respective powers or in disregard of the provisions of the trust deed, they are bound to use all the means available under domestic law, such as recourse to the national courts, in order to eliminate all discrimination in the matter of pay. Moreover, as regards periods of service completed after the court's finding of discrimination but before the entry into force of the measures designed to eliminate it, correct implementation of the principle of equal pay requires that the disadvantaged employees should be granted the same advantages as those previously enjoyed by the other employees. However, as regards periods of service subsequent to the entry into force of those measures, article 119 does not preclude equal treatment from being achieved by reducing the advantages which the advantaged employees used to enjoy.…"

57. It is clear from this analysis that if trustees and employers have power in accordance with national law to achieve equal treatment, and so do not have to have recourse to the national courts, they must exercise their powers to achieve that end. Accordingly, if a scheme contains a power of amendment which can be used to achieve equal treatment, then it must be used to do precisely that. The second sentence of [36] applies whether that equal treatment is achieved through the use of express powers, such as a power of amendment of the trust deed and rules governing a pension scheme, or through recourse to the courts.
58. On the same day as judgment was given in Coloroll, the ECJ delivered its judgment in Avdel. All of the judges sitting in Avdel also sat in Coloroll. It cannot be suggested that there is any conflict or inconsistency between the two decisions. They must be read together in a way which is compatible. As appears from [5] of the judgment, the Court was well aware that the change in retirement age for women from 60 to 65 related to benefits payable in respect of periods of service both prior and subsequent to 1 July 1991 (the effective date of the changes). I need to include, at this stage, a fairly long citation:

"13. It was in order to comply with the Barber judgment that the occupational scheme concerned in the main proceedings adopted the measure now in dispute. In order to do so, it opted for one of the two possible ways of achieving equal treatment: instead of granting men the same advantage as that enjoyed by women and thus lowering their retirement age to that for women, the scheme raised the retirement age for women to that for men, even for the past, including the period prior to the Barber judgment, and as a result the position of women was made less favourable.

14. That being so, the point raised is whether it is permissible, for the purpose of achieving equality, to take away from the favoured class (in this case, women), both for the past and for the future, the advantage enjoyed by that class, the reference date being either the date of entry into force of such a measure (in this case, 1 July 1991) or the date (17 May 1990) of the Barber judgment which identified the discrimination to be eliminated.

15. and 16. [In paragraph 15, the Court made the same points as it had made in Defrenne and Coloroll, in relation to harmonisation, as to which see paragraph 57 above, and in paragraph 16 it again referred to the "only valid point of reference".]

[17] It follows that, once the court has found that discrimination in relation to pay exists and so long as measures for bringing about equal treatment have not been adopted by the scheme, the only proper way of complying with article 119 is to grant to the persons in the disadvantaged class the same advantages as those enjoyed by the persons in the favoured class.

18. Application of this principle to the present case means that, as regards the period between 17 May 1990 (the date of the Barber judgment) and 1 July 1991 (the date on which the scheme adopted measures to achieve equality) the pension rights of men must be calculated on the basis of the same retirement age as that for women.

…

21. As regards periods of service completed after the entry into force, in this case on 1 July 1991, of rules designed to eliminate discrimination, article 119 of the Treaty does not preclude measures which achieve equal treatment by reducing the advantages of the persons previously favoured. Article 119 merely requires that men and women should receive the same pay for the same work without imposing any specific level of pay.

22. The answer to the first question must therefore be that article 119 of the Treaty precludes an employer who adopts measures necessary to comply with the Barber judgment from raising the retirement age for women to that for men in relation to periods of service completed between 17 May 1990, the date of that judgment, and the date on which those measures come into force. On the other hand, as regards periods of service completed after the latter date, article 119 does not prevent an employer from taking that step. …"

59. In the last EU case which I wish to mention at this stage, Fisscher v Voorhuis Hengeglo BV (Case C-128/93) [1995] ICR 635 ("Fisscher"), the issue related to the fact that married women had historically been excluded from the scheme but had been permitted by virtue of an amendment dated 1 January 1991 to join with effect from 1 January 1988. This practice of excluding women was challenged by a female member on the grounds that it was contrary to article 119 and so she claimed to be entitled to retroactive membership as from 1 January 1978. Having concluded that the exclusion of married women from the Scheme was contrary to article 119 so that female members were entitled to a retroactive right to join the Scheme, the ECJ was asked to address the question whether that meant that female members were not bound to pay the premiums which they would have had to pay had they been admitted earlier to the Scheme.
60. The answer to that question given by the ECJ was that women were bound to pay those premiums for the following reasons given at [34] to [36] of the Judgment:

"34. As far as the right to be a member of an occupational scheme is concerned, Article 119 requires that a worker should not suffer discrimination based on sex by being excluded from such a scheme.

35. This means that where such discrimination has been suffered, equal treatment is to be achieved by placing the worker discriminated against in the same situation as that of workers of the other sex.

36. It follows that the worker cannot claim more favourable treatment, particularly in financial terms than he would have had if he had been duly accepted as a member".

Domestic Legislation

61. I have mentioned sections 62 to 65 Pensions Act 1995 ("PA 95") at paragraph 33 above. I now need to look at them.
62. Section 62 is headed "The equal treatment rule". It provides materially as follows:

"(1) An occupational pension scheme which does not contain an equal treatment rule shall be treated as including one.

(2) An equal treatment rule is a rule which relates to the terms on which

(a) persons become members of the scheme, and

(b) members of the scheme are treated.

(3) Subject to subsection (6), an equal treatment rule has the effect that where

(a) a woman is employed on like work with a man in the same employment,

(b) a woman is employed on work rated as equivalent with that of a man in the same employment, or

(c) a woman is employed on work which, not being work in relation to which paragraph (a) or (b) applies, is, in terms of the demands made on her …. of equal value to that of a man in the same employment,

but (apart from the rule) any of the terms referred to in subsection (2) is or becomes less favourable to the woman than it is to the man, the term shall be treated as so modified as not to be less favourable….."

63. Section 63 is a supplementary provision. Subsection (6) provides that section 62 is to be treated as having had effect in relation to any pensionable service on or after 17 May 1990.
64. Section 65 provides for the consequential alteration of schemes. So far as material, it provides:

"(1) The trustees or managers of an occupational pension scheme may, if

(a) they do not (apart from this section) have power to make such alteration to the scheme as may be required to secure conformity with an equal treatment rule, or

(b) ….

by resolution make such alterations to the scheme.

(2) The alterations may have effect in relation to a period before the alterations are made."

65. The meaning of these provisions is a matter of contention. Mr Green's submission is that section 62 brought about a situation under which all occupational pension schemes became automatically compliant with article 119 on 1 January 1996; the section amounted to the "measures" which the case law has demonstrated to be required in order to bring about equal treatment. Although scheme documentation ought to be amended so that the wording of that documentation reflects the equal treatment rule, it is not necessary for that to be done for the scheme to be treated as so amended and, if it is so treated, then that is enough for the purposes of article 119. Mr Short says that that is a misunderstanding of the purpose and effect of section 62. I will deal with this dispute later in this judgment.

Domestic case-law

66. I dealt with a very similar issue in my decision in Harland & Wolff. Mr Short submits that the present case is, in fact, indistinguishable and that my decision was correct. Mr Green submits that my decision is distinguishable, or if not distinguishable, should not be followed because the argument which he now pursues was not taken in Harland & Wolff.
67. In [12] of my judgment in Harland & Wolff, I recorded one argument of Mr Paines QC (who appeared for the employer) whose case was that the retrospective amendment of the trust deed and rules was effective. The argument as I recorded it was that article 119 only requires equality of treatment and did not require that any particular level of benefit was required. Prior to the amendments in 1993, the benefits provided under the trust deed and rules were subject to amendment pursuant to the power contained in rule 32 and such amendment could result in a reduction. Pursuant to the exercise of that power, the rules were rewritten so that the new normal retirement date for women was applied with effect from 17 May 1990, an element of retrospection being expressly permitted by the amendment power. Accordingly, the benefits of men and women had been (retrospectively) equalised with effect from 17 May 1990. Ultimately, I rejected that argument. I do not understand Mr Green to submit that I was wrong to do so. But what he does say is that the argument which he, Mr Green, now presents and to which I will come in due course, is a different argument, which Mr Paines did not raise. Had Mr Paines done so, my answer would, Mr Green says, inevitably have been different.
68. In [18] and [19] I addressed what the Advocate General and the Court had meant in using the phrases "same arrangements" and "only valid point of reference". I concluded that they must have been intending to refer not simply to the level of benefits and the time of payment of benefits, but also to other provisions of the scheme which define and limit the benefits (such as a forfeiture provision). Even so, I considered that it was unclear whether or not account was to be taken of a power of amendment which might be exercised validly under domestic law with retrospective effect.
69. In [22] I observed that the critical difference between the situations before and after the entry into force of new rules appeared to be that, after that time, article 119 imposes no specific level of pay whereas before that time, it is the rules in force which are the only valid point of reference, so that equal treatment requires the same level of pay to be enjoyed by both classes as were enjoyed by the advantaged class. Those "rules" on Mr Green's submissions, include the pre-existing power of amendment. He submits that the power of amendment is part of the arrangements to which the benefits of a member are subject since it is the entire scheme which forms the only valid point of reference.
70. In Harland & Wolff, I took the phrase "entry into force" from the words of the Advocate General and the Court in Coloroll and Avdel. They reflect the consistent requirement demonstrated in the cases that discrimination prior to the date on which steps are taken to introduce equality must be remedied by levelling up. As Mr Short submits, the past did not end, and the future did not begin, until those steps were taken. In Coloroll, the Court at [32] referred to the entry into force of "measures" although I do not perceive any difference in substance between the entry into force of measures and the taking of steps, in each case to achieve equality of treatment.
71. In the context of a pension scheme, the obvious way in which the appropriate steps or measures can be taken is by an amendment to the provisions of the scheme. I do not say that that is the only way in which equal treatment can be achieved, but what is clear is that the steps or measures which are taken must put the disadvantaged class into the same position as the advantaged class by levelling up for the period from 17 May 1990 until equal treatment has been achieved (that is to say the time of entry into force of those measures or those steps taking effect).
72. At [25] of my judgment, I observed that the terms of the amendment power in Avdel did not appear from any of the decisions or judgments in that case. I did, however, note that it was clear that everyone proceeded on the basis that, as a matter of domestic law, the amendments to the scheme were valid and effective to reduce benefits for women in respect of the three periods (i) prior to 17 May 1990 (ii) from then to 1 July 1991 and (ii) thereafter, so that the amendment was of retrospective effect. That is confirmed by reference to the power of amendment which is now before the Court: see paragraph 49 above.
73. In saying what I did at [26] of my judgment, to the effect that no-one had argued that it was permissible to reduce women's benefits earned in the period 17 May 1990 to 1 July 1991, I now see that I had overlooked the Commission's argument recorded in the second paragraph of [21] of the report for the hearing: see [1995] ICR at 605C. It was therefore a live issue whether equality could be achieved by the adoption of a common normal retirement date of age 65 for all periods of service. My oversight did not affect my eventual decision, but it is right to record it here because it is relevant to what the Court did and did not actually decide in Avdel.
74. In [31] and [32] I considered the Advocate General's opinion, concluding that it was clear that he did not regard service prior to the actual amendment to be "future" (in accordance with his division of service into past and future) simply because, after 1 July 1991, the amendment was fully retrospective. And then in [33] to [35] I considered the judgment of the Court. In [34] I said this:

"34. The question then identified (see p 627, para 14) was whether it was permissible to take away from the favoured class "the advantage enjoyed" by that class, the reference date being either the "date of entry into force of such measure (in this case 1 July 1991) or the date (17 May 1990) of the Barber judgment."

75. Mr Green draws attention to the fact that that summary of what the Court said in [14] omitted the words "for the purpose of achieving equality" after "whether it was permissible". He presents an argument based on the effect of those words to which I will come in due course: see paragraph 143ff below.
76. My discussion of the issues in Harland & Wolff runs from [36] to [45] and my conclusions are to be found at [46] to [51]. In [36] I identified a certain logic in the submissions of Mr Paines QC, submissions based on the fact that a woman's benefits were always vulnerable to reduction pursuant to a proper exercise of the power of amendment (at least until they had fallen into payment): there is no reason why a requirement to treat men and women in the same way should result in men being granted a benefit better than that currently enjoyed by women, namely one entrenched against subsequent amendment. As I recorded Mr Paines' submission, there can "be nothing objectionable… in levelling down the women's benefits to achieve equality since that is precisely what the power of amendment permits".
77. In [37], I mentioned the argument based on In re Collard's Will Trusts [1961] Ch 293 ("Collard"). Equality could have been achieved by levelling up and then the benefits of both men and women could have been retrospectively altered pursuant to the amendment power so as to provide for a common normal retirement age of age 65; in accordance with Collard, this court will not require two steps to be taken, that is to say, reducing the normal retirement age to age 60 and then increasing it for both men and women to age 65, but will give effect to the single step, namely, increasing the normal retirement age to age 65. Jumping ahead, I mention again the argument now raised by Mr Green but not raised in Harland & Wolff and which I will consider later: namely that section 62 PA 95 of itself brought about equal treatment in a way which satisfied the requirements of article 119. There is no need to invoke Collard because, by the time of the 1996 Deed, NRA had been equalised at age 60 as a result of section 62; all that the 1996 Deed did was to change the common NRA from age 60 to age 65, something which was entirely consistent with article 119.
78. Mr Newman (who appeared for the trustees) submitted that Avdel had decided the very point at issue in Harland & Wolff, namely that there had to be levelling up even where the power of amendment in point permitted levelling down. But Mr Paines submitted that a careful reading of Avdel shows that it did not establish the proposition that benefits must be levelled up in respect of the Barber window in all cases. It all depended on the precise scope of the amending power. As to Mr Paines' argument, I said this:

"40. The first point [Mr Paines] raises is that the court, in using the phrase "date of entry into force" of the equalising measure, was looking at the date from which it took effect according to its terms. Thus, in [Avdel] itself, that date was 1 July 1991. In the present case, so far as the change in NRD is concerned, the amendment is expressly backdated to 17 May 1990 and that backdating was expressly authorised by the amending power in rule 32. The second point, which goes with it, is that when one reads the 1993 deed and rules after their execution, it can be seen that the benefits accruing for both men and women during the Barber window were based on a common NRD of age 63: because the amending power is expressly retrospective, the amendment takes effect, he says, for all purposes as if the new NRD had actually been in place on 17 May 1990.

41. I reject that interpretation of the judgment in [Avdel]…... [W]hat the court decided was that benefit accrual during the Barber window had to be at the rate appropriate to the advantaged class. It reached that conclusion against the background of the exercise of a power of amendment which resulted, as much for women attaining age 60 after 1 July 1991 as for those attaining that age during the period 17 May 1990 to 1 July 1991, in a reduction of benefits. I am of the firm view, on a proper reading of the judgment, that the court was concerned to look at the (discriminatory) benefits before any change in the rules designed to achieve equalisation had been made and to compare that position with the position which obtained after that change….."

79. After noting in [42] that the substance of the amendment in Avdel was that it was fully retrospective for all service (in that, after 1 July 1991, the benefits for men and women in respect of their entire service were based on a pensionable age of 65) I went on, in [43] and [44] to say this:

"43. It is impossible, to my mind at least, to think that the court's approach would have been any different from what it was in [Avdel] in the case of an amendment which, as a matter of form, stated that it was retrospective and was made pursuant to a power of amendment expressly providing for such retrospectivity. In both cases, the apparent benefit provided by the scheme prior to amendment is subject to reduction. The right arising under article 119 prior to the actual amendment, ie the right to equal treatment, is a substantive right. If it is correct that the article 119 right immediately before the making of an amendment can be adversely affected by the exercise of a power where both the power and its exercise are expressed to be fully retrospective then I can see no reason why the same should not apply in the case of the exercise of a power where the power can be, and has in fact been, exercised in a way which is retrospective. There is, in my judgment, no valid distinction for present purposes between the two types of power and their exercise.

44. Another way of making this point is to look at the position immediately before the execution of the 1993 deed and rules in the present case. At that stage, before any attempt has been made to rewrite history by making a retrospective amendment, men are entitled to claim, in respect of service after 17 May 1990, benefits on the same basis as those accruing to women. The question is then asked: can this right which men have be adversely affected, as a matter of Community law, by amendment? The answer to that question cannot, it seems to me, depend on the precise wording of the power under which it is sought to act. The question in all cases, assuming that the amendment is effective under national law, is whether levelling down is permitted. [Avdel] has answered that question in the negative."

80. In [46] I concluded that, in respect of the Barber window, men were entitled to have their benefits levelled up to those of women on the basis of a normal retirement date of age 60. The 1993 deed and rules did not provide this accrual and could not stand consistently with article 119. The arguments which I had addressed up to that point were concerned with a single exercise of the power of amendment which, materially, did only one thing, namely it reduced benefits for women by introducing a common normal retirement date for men and women of age 63. In [47] to [50] I addressed the argument based on Collard. I concluded that a member's rights under article 119 are not entrenched for all time, saying that it did not follow from Avdel that an amendment to the scheme many years in the future and having nothing to do with equalisation issues would be invalid. If a scheme is amended so as to provide, expressly, for the equal treatment which article 119 requires then those benefits should, I considered, be subject, in principle, to the scheme amendment power.
81. I went on, however, in [49] to consider whether Community law would permit a two-stage process under which benefits were levelled up and then, in the space of a short time, the benefits of both men and women were reduced. I concluded that the decision of the ECJ in Avdel was essentially inconsistent with the validity, from a Community law perspective, of this two-stage approach.

The main issues

82. Mr Green has two main submissions. The first relates to the true meaning and effect of Clause 19. He says that Harland & Wolff is not engaged: the present case is not one which concerns a retrospective adoption of "measures" at all. The second relates to the effect of section 62 Pensions Act 1995: that section, he says, brought about the required equal treatment as from 1 January 1996 without the need for any amendment to the scheme provisions in order for EU law to have been fully complied with. The 1996 Deed applied the same treatment in respect of men and women to the (equal) benefits of men and women so that article 119 has no relevance to the validity of the 1996 Deed.
83. If those submissions are wrong, his secondary submission is that Harland & Wolff represents an excessive application of EU law and should not be followed. I deal with the meaning and effect of Clause 19 first.

Safeway's submissions on Clause 19

84. The general approach to construction of pension scheme documents is well known. I have summarised it in my judgments in PNPF Trust Company Limited v Taylor [2010] EWHC 1573, [2010] PLR 261 at [127] to [145] and IBM United Kingdom Holdings v Dalgleish [2014] EWHC 980 (Ch) at [215] to [218]. I do not need to repeat again what I said there. However, Mr Green also relies on my decision in Premier Foods Group Services Ltd v RHM Pension Trust Ltd [2012] EWHC 447, [2012] PLR 151 ("Premier Foods"). I do not think that I said anything novel in my judgment about the general approach. Mr Green relies – at least he says it makes salutary reading - on what I said at [54]. I need to set it out in order to address his submission:

"54. Mr Simmonds says that, on his construction, this is not really a problem because the Trustee knows that, within a reasonably short time, everything will be retrospectively validated. I find that an unsatisfactory answer. I am not attracted, to say the least, by a construction which necessarily involves a Trustee acting other than in accordance with the provisions of the trust even when, in practical terms, any breach can be retrospectively validated. But where the breach cannot be retrospectively validated, such a construction is almost impossible to defend. …. Certainly, when faced with competing constructions one of which does, and one of which does not, involve a breach of trust, I prefer the one which does not in the absence of compelling reasons to the contrary."

85. I derive no assistance from that particular submission in the context of the present case. What I said there concerned giving validity to a deed as an effective exercise of the relevant power of amendment. I held that the Deed of Intention in that case was effective as a matter of construction, to exercise the power of amendment which was exercisable by deed, adopting the approach to construction indicated in [54]. That case was not only entirely different from the present case, but I do not consider that any parallel can usefully be drawn between it and the present case. It is one thing (as in Premier Foods) to construe a deed (the Deed of Intention in that case) as effective to exercise a power of amendment rather than simply as an expression of intention; it is quite another to construe the power of amendment itself so as to give effect to a document which is not a deed (the 1991 Announcement and/or the 1991 Letter in the present case) as an exercise of a power of amendment which is expressed to be exercisable by deed.
86. Mr Green focuses on [17] and [29] of the judgment of the ECJ in Avdel which requires, in order to achieve compliance with EU law, "measures for bringing about equal treatment to have been adopted by the scheme". Equal treatment is achieved upon "the entry into force" of those measures. I have discussed the concept of "measures" and the meaning of "entry into force" at paragraphs 70ff above. In particular, I have said that it is clear that the steps or measures which are taken must put the disadvantaged class into the same position as the advantaged class by levelling up for the period from 17 May 1990 until equal treatment has been achieved (that is to say the time of entry into force of those measures or those steps taking effect).
87. Mr Green says that it is a question of domestic law when the relevant measures were adopted and entered into force. The relevant questions in the present case are whether the 1991 Announcement amounted to the necessary "measures" and if so when did the entry into force of those measures occur. As to the first of those questions, Mr Green identifies the issue as being whether a common NPA of age 65 was as of 1 December 1991 implemented under and in accordance with the trusts and provisions of the Scheme. His case is that the 1991 Letter were effective, as a matter of domestic law, to implement an increase in the NPA of women from 60 to 65 in a way which amounted to "measures" for the purposes of EU law. In terms of the "past" and the "future" as discussed by the Advocate General in Coloroll and Avdel, the past ended on 30 November 1991 and the future began on 1 December 1991.
88. The words of Clause 19 (the full text is set out at paragraph 8 above) of importance are these:

"which may be the date of such Deed or the date of any prior written announcement to Members of the alteration or addition or a date occurring at any reasonable time previous or subsequent to the date of such Deed so as to give the amendment or addition retrospective or future effect as the case may be."

89. I have highlighted in bold face the words ("the bold-faced words" to adopt Mr Green's definition) which are the critical words on which Mr Green relies. He submits that the effect of the bold-faced words is that, once there had been issued a "written announcement to Members of the alteration or addition" (in the present case, the 1991 Notices), SPTL was explicitly, alternatively by necessary implication, authorised under and in accordance with the trusts of the Scheme to operate it on the basis that the change announced was effective, pending the subsequent making of a formal deed confirming the same. Thus one finds arrangements (to use my word), namely the 1991 Notices, which he submits constitute "measures" and the entry into force of those measures occurred on 1 December 1991 since that is clearly the date when the arrangements came into effect. I agree this far: that if the 1991 Notices constituted measures sufficient to comply with the EU requirements concerning equal treatment, then the measures did, indeed, come into force on 1 December 1991.
90. Mr Green does not submit that the Scheme was actually amended by the 1991 Notices when Clause 19 requires amendments to be made by deed. However, his case is that SPTL would not be acting other than under and in accordance with the trusts and provisions of the Scheme if it were to conduct itself in accordance with an announcement within the bold-faced words even at a time before the announcement had been given formal effect by an amendment by deed to the trust deed and rules. The purpose of the bold-faced words is, he says, to legitimise as a matter of trust law and administration the implementation of "the written announcement to members" pending its being swept up in the next definitive deed or other supplemental instrument (which in fact took place in the 1996 Deed).
91. His case is that Clause 19 is predicated upon trustees, who act upon an announcement pending the making of a confirmatory deed bringing the text of the rules into conformity with the way in which the Scheme has been operated, having acted in a manner authorised by their trusts, not having been in breach of trust in doing so, and on members not being entitled to assert otherwise. As he puts it, "Clause 19 is in the nature of a compound amendment power, that enables trustees to proceed pro tem as if the textual rules had been amended, pending the textual rules actually being brought up to date by a supplemental deed, so as to catch-up with what has been announced". I am not sure whether Mr Green's case goes as far as saying that an announcement which has not reached the stage of implementation at all is nonetheless a "measure" but it is not necessary for him to do so.
92. He says that Clause 19 is obviously concerned with announcements which have been acted on and that it is obviously not concerned with announcements which have not been acted on. I do not necessarily accept the second proposition but I do not think anything turns on that. The important point is that some announcements will relate to immediate changes or to changes which are intended to take effect at some date in the future, and are in fact implemented, but before the relevant amendment by deed has been made.
93. Mr Green draws an analogy with an interim trust deed. Trustees are often enabled to run a scheme in accordance with announcements and booklets pending their incorporation into a definitive deed. In effect, Clause 19 preserves, he says, that possibility even after the definitive deed is made. This result, I observe, is to include within Clause 19, as a matter of interpretation, a power or direction to similar effect as proviso (f) to the power of amendment in Avdel. I do not derive any assistance from that analogy in the task of interpretation. At most it is an example of a situation where the operative trusts are to be found outside the formal scheme document (the interim deed) and demonstrates that there is nothing inherently odd about the result for which he contends. In any case the power of amendment in Avdel demonstrates even more clearly than the interim deed analogy one way in which matters could rationally and sensibly be constructed.
94. Mr Green says that the present case is entirely different from Harland & Wolff: there is no element of retrospectivity because what was done pursuant to the 1991 Notices was done prospectively with effect from 1 December 1991 and done perfectly properly as of 1 December 1991 pursuant to the bold-faced words. Accordingly, Harland & Wolff is simply not engaged.
95. Further, there are these differences from the position in Harland & Wolff:

i) The amendment power was simply stated to be exercisable by deed "retrospectively". There was, as Mr Green points out, no equivalent to the bold-faced words. That is true, but there is not to be found in the present case any words similar to those of proviso (f) to the power of amendment in Avdel (as to which see paragraph 49 above).

ii) The first "measure" in Harland & Wolff clearly did not occur until the execution of the relevant deed on 7 September 1993 which purportedly backdated the increase in normal retirement date. In contrast, the measure in the present case (as he would have it, the 1991 Notices) took place before the date from which the change to NPA took effect and without any element of retrospection.

iii) There was no prior announcement in Harland & Wolff of the change. I accept that there is nothing in my judgment to suggest that there was no prior announcement; but whether, as a matter of fact, there was no announcement, I simply do not know. It seems to me to be unlikely that there was no announcement although if there was one it may well have been quite close in time to the actual amendment.

96. Consistently with those submissions, Mr Green asks rhetorically what would have happened if a male member had come along between 1 December 1991 and 2 May 1996 and sought to argue that his NPA was 60 as of right (rather than subject to Safeway's discretion) in relation to the post-1 December 1991 period, because a supplemental deed had not been executed in the meantime. His answer is that SPTL and Safeway would have been fully entitled to reject such a claim; and they would have been entitled to back up their refusal with a supplemental deed confirming the change of NPA with effect from 1 December 1991 in accordance with the written announcements. Mr Green asked his rhetorical question by reference to a man (presumably focusing on the man's rights under article 119). But the question arises with even more force in relation to a woman who has a right to an NRA of 60 without any need to rely on article 119 at all. No doubt Mr Green's answer would be the same as in the case of a man.
97. He submits, in any case, that such a scenario is unreal and that his rhetorical question does not represent a genuine test of whether "measures" were adopted or brought into effect on 1 December 1991. But continuing with the question, he says that SPTL and Safeway could have chosen to admit the man's claim and not to execute a supplementary deed in relation to him. This, he says, would be the conferring of a discretionary benefit on the man at that time (as was done in fact in relation to most people taking early retirement at age 60 until 2003). This submission appears to me to be inconsistent with the proposition that Clause 19 provides simply an authority for SPTL to act in accordance with the 1991 Notices; if it had been merely an authority, the decision not to make a supplemental deed would simply leave matters as they are, namely with the benefits as set out in the unamended trust deed and rules and a decision not to depart from them. This submission, however, appears to me to accept that there would be a discretionary improvement in benefits awarded to the man which would not be the case if Clause 19 had merely conferred an authority to act in accordance with the 1991 Notices.
98. Mr Green draws attention to the fact that the 1991 Announcement also informed members of a benefit improvement, namely a right to an increase in pension in payment in excess of gmps by 5% pa or RPI if less. He asserts that SPTL's implementation of that benefit improvement did not involve a breach of trust. There was no breach of trust, he says, because the bold-faced words authorised the adoption of the changes under and in accordance with the trusts of the Scheme even before a formal amendment was made to the wording of the Scheme documentation.

Mr Newton's submissions on Clause 19

99. Mr Newton's case is that, on the proper construction of Clause 19, any amendment was made on the date of the deed making the amendment. He acknowledges that, as a matter of domestic law, such an amendment could take effect from a date prior to the deed so that the adoption of a common NPA of age 60 for men and women by the 1996 Deed with effect from 1 December 1991 would have been valid. However, until the 1996 Deed, benefits had not been equalised, the 1991 Notices were ineffective on their own to achieve that result so that, until that date, women continued to have an NPA of age 60. And so Mr Short challenges Mr Green's submission that, by virtue of the 1991 Notices, a common NPA for men and women was implemented "under and in accordance with the trusts of the Scheme" as a result of the 1991 Notices.
100. Although it is therefore common ground that a formal amendment was not effected under Clause 19 until the 1996 Deed, I think that it is important to consider in some detail what Clause 19 requires for there to be such an amendment. In that context, I need to rehearse some of Mr Short's submissions which now seem to be of other than central significance.
101. Mr Short draws attention to the structure of Clause 19 which can be divided into two parts:

i) The first part provides the power to amend and states how it is to be exercised:

"The Principal Company may at any time … with the consent of the Trustees by Supplemental Deed … alter … any of … the provisions of the Scheme …"

ii) The second part establishes when the changes made by that power take effect:

["the Principal Company] may exercise such powers so as to take effect from a date specified in the Supplemental Deed which may be the date of such Deed or the date of any prior written announcement to Members of the alteration … or a date occurring at any reasonable time previous or subsequent to the date of such Deed so as to give the amendment … retrospective or future effect …."

102. He submits that the words of Clause 19 are unambiguous: an alteration has to be made by deed but the deed, when made, may have retrospective effect. The unambiguous words of the clause are the primary guide to its meaning, reliance being placed on:

i) Rainy Sky v Kookmin Bank [2011] UKSC 50, [2011] 1 WLR 2900 at [23]"

"When the parties have used unambiguous language, the court must apply it."

ii) Honda Motor Europe Ltd v Powell [2014] EWCA Civ 437, [201] PLR [2014] 255 at [24]:

"…. The task is to determine what the words of the instrument, read against the relevant background, would have meant to a reasonable reader. It is an iterative process in which possible meanings are checked against their likely consequences and the background facts. If the language is reasonably susceptible of two or more meanings, the court should choose that which best serves the object of purpose of the transaction, objectively ascertained. Any interpretation must, so far as possible, be one that is not impractical or over restrictive or technical in practice. But three further points are of importance in this case. First, the question is not what the parties meant to say: but what is the meaning of what they did say. Second, the language that they used is likely to be the most important factor, unless the court can conclude that something has gone wrong with the language….."

iii) Arnold v Britton [2015] UKSC 36 at [17] to [20]. I do not propose to set those paragraphs out in this judgment. The points to be taken from those paragraphs for present purposes are these:

Save perhaps in a very unusual case, the meaning of a provision is most obviously to be gleaned from its language.

The less clear the words are, or the worse their drafting, the more ready the court can properly be to depart from their natural meaning.

Commercial common sense is not to be invoked retrospectively. Commercial common sense is only relevant to the extent of how matters would or could have been perceived by the parties, or by reasonable people in the position of the parties at the date that the relevant provision (the contract in that case) was made.

103. In the context of a pension scheme, the requirement for formalities to be observed is important. In particular, the requirement in a power of amendment for a deed is an important protection for members and the court should be very careful before departing from the plain words. Mr Short relies on Bestrustees v Stuart [2001] PLR 283 at [33]. It is worth having the facts of that case in mind. Following Barber, the employer and the trustees of the scheme issued an announcement to members on 26 April 1994 which purported to change normal retirement date to a common age of 65, having previously been 65 for men and 60 for women. The announcement, which was made by the employer, stated that the formal scheme rules were being amended with effect from 6 April 1994 to give effect to such changes. On 23 May 1996, a new set of rules was brought into force to give effect to the changes in the earlier announcement. The power of amendment provided that the employer:

"may… authorise the trustee in writing to alter or add to the terms and provisions of the rules in the trust, powers and provisions of this deed, and any such alteration or addition may have retrospective effect. The trustees shall forthwith declare any such alteration or addition to the rules in writing under its hand, or any such alteration or additions to this deed in writing under its hand and seal….. This deed and/or the rules shall stand amended accordingly with effect from the effect [perhaps this should be "date"] of such declaration or from such other date, whether future or past, as is stated in such declaration….."

There was a proviso which protected pensions in payment and accrued rights up to the date when the alteration took effect.

104. The announcement was intended to be effective only from 26 April 1994 and not from any earlier date. Neuberger J held that it was ineffective of itself to amount to the written declaration envisaged by the power of amendment from which I have quoted the relevant words above. The Judge started his discussion by reference to the position in relation to the period from 26 April 1994 (the date of the announcement) to 22 May 1996 (the date of the amending deed). At [31], he set out and adopted six features of the amending power. For present purposes, I need to identify four of those:

i) The power is vested in the employer to authorise the trustees to make an alteration.

ii) On authorisation by the employer of an amendment, the trustee must "forthwith declare" any such alteration (in writing or by deed as the case may be).

iii) The trustee's declaration is to have the effect of amending the deed and/or the rules with effect of the date of the declaration or any other date past or future as stated in the declaration.

iv) The exercise of the power is subject to the proviso protecting accrued rights.

105. At [33], Neuberger J made the observations about the importance of observing formalities which I have just referred to. The need to protect beneficiaries

"requires the court to be very careful before it permits a departure from the plain wording and plain requirements of the trust deed…..".

106. That observation was made in the context of the requirement (which he considered existed) for there to be a written authorisation by the employer. Neuberger J held that the announcement amounted, nonetheless, to a sufficient authority.
107. He went on to hold further that the announcement did not amount to the required declaration in writing by the trustees and so was not effective to exercise the amending power. In doing so, he addressed at [39] an argument raised by counsel for the employer:

"However, Miss Rich argues, one should not be too strict about a further requirement of a separate declaration, because the terms of [the amendment power] effectively requires the trustee to make the amendment and forthwith to declare it, if and when it is so authorised by the principal employer. It appears to me that it cannot have been intended that the trustee would have no power to refuse to do what the principal employer requires, even if it thought it was unlawful or inappropriate. However, even assuming Miss Rich's argument is correct, the mere fact that it was obliged to put into effect what the principal employer authorised it to do does not alter the fact that it still has to make the appropriate declaration before the alteration can be effective."

108. In [42] of his judgment, Neuberger J made reference to the proposition that the court should assume that that which had been reported as having been done should be seen as having been done. He did not see that principle as assisting the case. Accordingly, he did not see the obligation of the trustees to amend the scheme as leading to the conclusion that the scheme was to be treated as amended.
109. In [52] of his judgment, Neuberger J considered the effect of the 1996 amending deed. Insofar as it was retrospective, he held that it was invalid. This was because it infringed the proviso protecting accrued benefits. The result was that for the period 26 April 1994 to 22 May 1996, the normal retirement date for both men and women was 60.
110. Mr Short also relies on Dubery. In particular, Lewison J, after referring to Bestrustees said this at [20] of his judgment:

"…An avoidance of pedantry, and the need to protect beneficiaries may well be powerful factors in choosing between rival constructions; but once the requirements of a valid means of alteration of the rules has been determined as a matter of construction, either a document satisfies those requirements or it does not…."

111. Mr Short submits that Clause 19 operates perfectly well when construed in accordance with its words. An amendment is made only when a deed is executed; an announcement is relevant to Clause 19 only insofar as it specifies a time as of which the amendment, when made, takes effect. Safeway's approach, he says, creates uncertainty. For instance, the employer and the trustee might have a change of mind before making the deed giving rise to questions such as whether a further announcement is required and, if so, whether it could have retrospective effect.
112. Mr Short further submits that the absence of any detail regarding the characteristics of an announcement makes Safeway's approach unworkable and unlikely to have been intended. In particular, a substantive change in the rights of members cannot arise as a result of an announcement of a decision to change benefits with effect from a future event when the announcement itself states, as in the present case, that the Trust Deed and Rules are the legal basis of the Scheme and that the announcement is intended only for the purposes of general guidance and information. Although Mr Green says that a caveat of this nature appearing in small print at the bottom of a page cannot affect the substance of the matter, Mr Short points out that the announcement certainly was intended to have some effect as from 1 December 1991 namely as an alteration to the terms and conditions of employment of members as that same caveat makes clear.
113. Mr Short submits next that, in contrast with Premier Foods and with the power of amendment in Avdel, SPTL is neither required nor entitled to act contrary to the Trust Deed and Rules until they have been changed. In some cases, the change can be implemented under another provision (eg the power to augment benefits). But where that is not possible, Safeway and SPTL have the remedy under their control: they can alter the Scheme by Supplemental Deed in accordance with Clause 19.
114. Once it is appreciated what Clause 19 does mean, it can be understood what it does not mean. It does not mean or entail, Mr Short would say, that an announcement has any relevance, for the purposes of Clause 19, other than to define the period of retrospectivity which can validly be adopted when the actual amendment is made. In particular, it has nothing to say about whether SPTL can properly act in accordance with an announcement rather than in accordance with the (unamended) letter of the Trust Deed and Rules. Indeed, he rejects the suggestion that SPTL would be acting under the trust deed and rules if it were to act on an announcement which had not been reflected in a formal amendment.

Clause 19 - discussion

115. As a matter of construction, the meaning of Clause 19 is, at least in these respects, clear and unambiguous:

i) An alteration or addition to the trusts powers and provisions of the Scheme must be effected by deed. The power can be used to alter or add to any written instrument supplemental to the Trust Deed and Rules. Although the exercise of the power will result in a textual change to the governing documents, the power is a substantive one because a change to the text will, usually, result in a change to the members' substantive rights or to administrative provisions. This will not always be so because a textual change might simply reflect a change which has come about in another way, for instance as the result of legislation or because of conduct giving rise to an estoppel as between SPTL and the members.

ii) An amendment, when made, can be retrospective to the extent permitted by Clause 19. In contrast with a power where the period of retrospectivity is not expressly restricted (as in Harland v Wolff), the period in the present case is restricted to (i) the date of any prior written announcement or (ii) a reasonable time previous to the amendment. The inclusion of (i) is sensible: it eliminates any dispute about what a reasonable time is and it allows the amendment to take effect from the date of the announcement even where there has been unreasonable delay in making the amendment. Indeed, in the present case, there is a lot to be said for the view that the delay between 1 December 1991 and 2 May 1996 is unreasonable so that reliance needs to be placed on (i) to give the 1996 Deed validity.

116. At paragraph 96 above I referred to Mr Green's rhetorical question about what would have happened if a male member had come along between 1 December 1991 and 2 May 1996 and sought to argue that his NPA was 60 as of right (rather than subject to Safeway's discretion) in relation to the post-1 December 1991 period, because a supplemental deed had not been executed in the meantime. His answer is that SPTL and Safeway would have been fully entitled to reject such a claim; and they would have been entitled to back up their refusal with a supplemental deed confirming the change of NPA with effect from 1 December 1991 in accordance with the written announcements.
117. I do not disagree with the conclusion that SPTL and Safeway would have been able to make the necessary amendment and thus, retrospectively, to have eliminated the claim. But that is not to say that without the amendment the claim could properly have been rejected. In practical terms, SPTL would be able to refuse to meet the claim by telling the claimant that it would make an amendment in accordance with the announcement. But if and so long as it has failed to make the amendment, the claim is, in my view, a good legal claim.
118. Thus, if for some reason the power of amendment had come to an end or had become subject to restriction prior to its exercise to give effect to the 1991 Notices, the 1991 Notices of themselves would not, in my view, have provided SPTL with any defence against the claim.
119. This is not a fanciful possibility. Suppose, for instance, that section 67 PA 95 had, along with section 62, come into force on 1 January 1996 before the amendment power had been exercised to implement the 1991 Notices. The question would then arise whether the accrued rights of female members were based on an NPA of age 60 or age 65. Clearly, under the wording of the Trust Deed and Rules, a woman's NPA on 1 January 1996 was age 60. Had section 67 been in force when the 1996 Deed was made, that NPA could not have been reduced in respect of past service. It would not, therefore, have been open to SPTL at that stage to reject a woman's claim to benefits based on an NPA of age 60 on the footing that it could make an amendment to give effect to the 1991 Notices unless the 1991 Notices had already – and without reference to a potential amendment by deed – effected the change.
120. Mr Green's position is that the 1991 Notices were indeed effective to produce accrued rights in respect of service after 1 December 1991 which were based on a common NRD of age 65, so that the 1996 Deed did not reduce any rights accrued from that date. In my view, that is not correct. In my judgment, the 1991 Notices did not of themselves bring about a change of the NPA of women. It is only in conjunction with the actual exercise of the amending power by the 1996 Deed that a change in the NPA of women could take effect albeit that the relevant amendment could take effect as a matter of domestic law from the date of the 1991 Notices.
121. In reaching that conclusion, I reject the submission that SPTL was authorised, as a result of the 1991 Notices, to operate the Scheme as if the 1991 Notices had been implemented. I do not agree that SPTL was, pending formal amendment, entitled to act as if the amendment had been made. In my view, SPTL was acting contrary to the provisions of the Trust Deed and Rules. In practice, it was not exposed to risk since the reality would be, if faced with a claim by a woman, that the power of amendment would be exercised with retrospective effect. But it was acting contrary to the Trust Deed and Rules nonetheless. The example I have given in relation to section 67 demonstrates the point. There may be other situations in which the power of amendment could not be exercised: for instance, if the Scheme had gone into winding-up. And if that happened before the 1991 Notices had been formally introduced, SPTL would have to give effect to members' rights in accordance with the unamended provisions.
122. I reach that conclusion as a straightforward matter of construction. It is reinforced by the following considerations which I have not needed to rely on.
123. First, Mr Green himself has described Clause 19 as being in the nature of a compound amendment power: see paragraph 91 above. The exercise of the compound power is not, I would suggest, complete until the final stage that is to say the making of the deed of amendment.
124. Secondly, quite apart from the situation where the power of amendment is no longer available, there is the possibility of a change of mind by SPTL or Safeway between the making of the announcement and the making of the formal amendment. On the facts of the present case, Mr Green correctly points out that there was no change of mind. That there might be a change of mind on different facts does not give rise to any issue relevant to the present case.
125. I disagree with that last proposition. The meaning of Clause 19 must be judged against realistic scenarios. It cannot, I consider, be suggested that the hypothesis of a change of mind after the making of an announcement – whatever the scope of that announcement – is one which is so unrealistic as to be dismissed.
126. Thirdly, Mr Green asserts that a refusal to execute a supplemental deed in circumstances where an announcement had been and was continuing to be acted upon (as in the present case) would be a breach of duty. It would be a breach of duty because, under Clause 19, the Scheme would have been operated on the basis that such an interim process would be formalised by bringing the rules into alignment with how the Scheme was being run. This however is to beg the question, because it assumes what is in issue, namely that the Scheme would have been operated under Clause 19. True it is that the Scheme would have been operated in accordance with the announcement; but the very issue is whether Clause 19 of itself authorises a departure from the Trust Deed and Rules otherwise than by retrospective validation.
127. Fourthly as to the suggestion that Clause 19 is predicated on the operation of the Scheme pro tem (see paragraph 91 above) in accordance with a written announcement, the same might be said in relation to any retrospective amendment power. Suppose, for instance, that the power in the present case had been an unrestricted one with no mention of announcements being made. Suppose that SPTL and Safeway had announced that a change to NPA from 1 December 1991 was intended and would be made in due course. The arguments which Mr Green has raised about the power "obviously" being concerned with announcements which have been acted upon apply with equal force, it seems to me, in this hypothetical situation. Given that there has been an announcement, it is equally obvious (to the extent that it is obvious at all), in each case that the draftsman must have had in mind that the announcement would be acted on. Why, I ask rhetorically, can it not be said in this hypothetical example that where an announcement is made the amendment power is in the nature of a compound amendment power with the trustee being authorised pro tem to operate the Scheme as though the amendment had been made? I do not consider that it can seriously be maintained that the mere presence of a retrospective power of amendment justifies such an approach, and yet it would be entirely unsurprising to find a scheme being operated in just that way in these circumstances. Trustees would not be unduly concerned about acting contrary to the trusts as they stand because they know that matters can, and almost certainly will, be put right retrospectively.
128. Fifthly, the small print which I have referred to (see paragraphs 19 and 112 above) cannot simply be ignored. It is, I consider, to be taken at face value and strongly supports the conclusion that the announcement does not impact directly on the benefits to be provided by the Scheme (in contrast with the terms of employment).
129. The question then is whether it follows from my conclusions so far that the 1991 Notices are not, and cannot be, "measures" sufficient to comply with the EU requirement concerning equal treatment. There is no doubt that the 1991 Notices were, at the very least, the commencement of a process which was intended to result, and as a matter of purely domestic law would have been effective to result, in a common NPA of age 65 with effect from 1 December 1991. In my judgment, however, the 1991 Notices taken by themselves are not measures which are sufficient to comply with the EU requirements. Reliance needs to be placed on the possibility of the future exercise of Clause 19 in order to be able even to argue that the 1991 Notices constitute measures. Since, as a matter of domestic law, I have concluded that a woman's claim to benefits based on an NPA of age 60 can be rejected only once an amendment has been made, it follows that without the 1996 Deed, there are no measures by which equality has been effected. Whether the decisions in Avdel and Harland & Wolff preclude an amendment being made which gives effect to the 1991 Notices is a separate question to which I turn in the next section of this judgment.

Conclusion on Clause 19

130. The 1991 Notices do not, by themselves, amount to an amendment within Clause 19. The impact of Clause 19 is not such that the 1991 Notices constitute measures sufficient to give effect to the equal treatment requirements of EU law.

Application of EU principles to the 1991 Notices and the 1996 Deed

Sections 62 to 65 Pensions Act 1995

131. Logically, the next issue to address is the impact of sections 62 to 65 PA 95. In order to understand what the impact of section 62 actually was, an understanding of the position immediately before that date is required. The position, in that regard, is, as I see it, precisely the same as it would have been immediately before the 1996 Deed if section 62 had not come into force by the date of that Deed. Mr Green has made submissions about the validity of the 1996 Deed which do not depend on section 62. I therefore propose to deal with the position immediately before the date of the 1996 Deed before considering the impact of section 62.
132. Mr Green's submissions, ignoring section 62, are to the following effect:

i) He accepts that the Barber window opened on 17 May 1990.

ii) The EU cases, in particular Avdel, require men and women to be treated in the same way.

iii) The relevant frame of reference is the Scheme itself and all of the provisions of the trust deed and rules. Thus (taking my example in Harland & Wolff) a power of forfeiture under a pension scheme applies as much to a member's directly enforceable rights under article 119 as it does to the rights already provided by the pension scheme itself.

iv) The power of amendment is part of the relevant frame of reference. It applies equally to men and women.

v) It would be open to Safeway and SPTL to alter early retirement factors or to introduce a requirement for consent to early retirement (and the attractive early retirement factors then available). There is no reason why in relation to one particular feature, NPA, it should be outside the scope of the amendment power to effect a change.

vi) Accordingly, once benefits for men and women have been equalised, there is nothing to preclude an amendment to the equalised benefits under which both are reduced in the same way.

vii) As a matter of domestic law, the Collard principle enables a single step where the same result could be achieved in two steps. It would have been open to Safeway and SPTL immediately before 1 January 1996 or 2 May 1996 to have amended the Scheme by levelling-up benefits to a common NPA of age 60 and then, on 1 January 1996 or 2 May 1996 to reduce those equal benefits to a common NPA of age 65.

133. Mr Green submits that the result is a principled application of the EU law requirements. The essential point is that the frame of reference includes the power of amendment. All that Coloroll, Avdel and the other equalisation cases require is equal treatment for men and women. All benefits under the Scheme are subject to the amendment power and thus subject to retrospective reduction to the extent permitted by domestic law. That applies equally to directly enforceable rights under article 119 and to additional benefits introduced as a result of amendments introduced to give effect to those rights as it does to the rights already provided for in the Scheme. He relies on [36] of the judgment of the ECJ in Fisscher as to which see paragraphs 59 and 60 above.
134. Mr Green's analysis of Harland & Wolff is that this point was not argued. The argument which was presented by Mr Paines was to the effect that the Barber window never opened in the first place because the relevant amendment in that case had retrospective effect, with the result that history was truly rewritten and all along the benefit is to be treated as having been compliant with article 119. In the light of the argument which he now presents, he submits that my decision should not be followed because my decision was an excessive application of Avdel:

i) The result could not possibly have been required under EU law

ii) My decision was internally inconsistent.

iii) My decision conflicted with the principle of "minimum interference" with the operation of scheme rules, affirmed by the Court of Appeal in Foster Wheeler Ltd v Hanley [2010] ICR 374 ("Foster Wheeler")

135. I do not accept Mr Green's submission that the argument which he now raises did not feature in Mr Paines' argument in Harland & Wolff. It is certainly the case that the principal focus of the argument and of my judgment was on the validity of the single step of increasing normal pension age with retrospective effect. But I did also address the argument based on Collard at [46] to [49] of my judgment (as to which see paragraphs 78 to 81 above). It seems to me that the issue which I was addressing in those paragraphs is in substance the argument which Mr Green now raises. There is, however, the important factual distinction which I have already mentioned between the present case and Harland & Wolff in that nothing equivalent to the bold-faced words was found in the latter and it may be that the presence of those words means that a qualification must be placed on what I decided and would justify a departure from my decision. But if that is a distinction without a difference, then Harland & Wolff would appear to govern the present case and if Safeway is to succeed, I must decline to follow my own decision.
136. Mr Green refers to [18] of my judgment where I observed that it would be extraordinary if a forfeiture provision did not apply with full force to the improved benefit of the disadvantaged class. He submits that it is no less extraordinary that, as a result of article 119, not only did men, as the disadvantaged class, receive indefeasible benefits when express conferment (by amendment) of those same benefits would have been defeasible by an exercise of the power of amendment, but also women would have their hitherto defeasible benefits converted into indefeasible benefits as a result of the requirement of there to be equal treatment with men – the so-called ratchet effect.
137. He says that this is what I actually decided. In doing so I read between the lines of what was decided in Avdel and yet there was no hint, according to him, of the point having been subject to argument or consideration by the ECJ in that case. And so my conclusion involves "an exaggerated domestic application of the equality principle". As to that, he relies on the following passage from the judgment of Arden LJ in Foster Wheeler:

"33. ….. Accordingly, the court should where possible, give effect to Barber rights by adhering to the provisions of the relevant scheme where it is possible to do so in preference to some other approach. If some departure is required, it should in general, so far as practicable, represent the minimum interference with the scheme provisions. This approach is not limited to the situation where members have been led to believe that a provision will be used in a certain way or a stated aim of that provision has been only imperfectly achieved (as in [Bestrustees] itself). As the judge in this case recognised, it is a principle of more general application."

The "provisions of the relevant scheme" include, on his submission, the power of amendment.

138. Mr Green says, as just noted, that the point did not arise before the ECJ in Avdel. He points to my own judgment at [42] where I recorded a submission of Mr Paines (who had appeared for the UK government in Avdel) that the ECJ did not have in mind the possibility that an amendment might have retrospective effect "in the sense of rewriting the scheme from an earlier date than the date of the amendment itself". I agreed that the Court probably did not have that particular form of amendment in mind. The point which I was attempting to make, however, was that that was not the form of the amendment in Avdel itself. Rather, the form of the amendment was simply a change in the definition of normal retirement date as from 1 July 1991 which was not rewriting the scheme from an earlier date. The substance, however, was that the amendment was fully retrospective for all service.
139. The ECJ was clearly aware of the substance of the amendment. It held that there was no justification for the reduction of benefits of women for the period from 17 May 1990 to 1 July 1991. It was wrong in principle, in order to effect equal treatment, to reduce those benefits. In saying what I did in Harland & Wolff, I do not consider that I was reading between the lines or adopting an exaggerated and extravagant domestic interpretation of what Avdel decided. In any case, whether involving a pension scheme or not, where an employer or a pension scheme trustee might seek to level down for the past, there has to be power, at a domestic level, to do so. If there is no domestic power to do so, the issue would never arise since, from long before Barber, it has been impossible to say that article 119 itself confers a power to reduce pay for the past. As Mr Short puts it, the existence of the power of amendment engages, rather than avoids, Avdel.
140. Avdel cannot, in my judgment, be distinguished on the basis of a difference in the wording of the power of amendment in that case and in the present case. Once it is accepted that the 1991 Notices are of themselves ineffective to bring about equalisation (which is the hypothesis now under consideration), the relevance of the bold-faced words is simply to provide, as a matter of domestic law, the date from which the amendment can take effect. The EU cases identify a general principle against retrospective levelling-down. The general principle, demonstrated in Avdel, does not depend on the form of the amending power. In particular, the reference to announcements in Clause 19 does not take the provision out of the general principle so as to permit Safeway and SPTL to circumvent the clearly established principles of EU law.
141. Harland & Wolff is an application of the case law of the ECJ. In that case, an amendment having retrospective effect could not validly be made. Although, as I have said, the focus was on Mr Paines' main argument relating to the single step of changing the normal retirement date of women to 65, I did address the Collard principle. I have already referred to what I said in Harland & Wolff in relation to Collard (see paragraphs 80 and 81 above). I have also noted (see paragraph 140 above) that Mr Green's argument is essentially about the application of that principle. Having concluded that the inclusion of the bold-faced words in Clause 19 does not provide a material distinction, it follows that my decision in Harland & Wolff is a decision precisely in point and which cannot be distinguished.
142. I have recorded already why Mr Green says that I should not follow my own decision. I do not have to grapple with the difficulty of not following my own decision were I to think that I was wrong. I do not need to do so, because I consider that I was right and should follow myself. The Collard principle allows a result to be obtained in one step when it could validly have been achieved in two. But if the result cannot validly be obtained in two steps, it cannot be achieved in one.
143. At [48] of my decision in Harland & Wolff, I stated that a member's rights under article 119 were not entrenched for all time. I gave, by way of example only, the possibility of an amendment many years in the future having nothing to do with equalisation issues. Mr Green says the caveat indicated by that example is not required by Avdel. In this context, he refers to [14] of the judgment in Avdel (see paragraphs 58 and 75), submitting that the argument was addressed to levelling down "for the purpose of achieving equality". Once equality has been achieved, by levelling up, Clause 19 can be used to reduce the equalised benefit without infringement of article 119.
144. I reject that argument. My reasons for doing so are those which I gave in [49] of my judgment in Harland & Wolff. It is clear, in my view, that the purpose of the two step process would be to achieve the equal treatment of men and women which is required by EU law. There would be no genuine desire to increase the benefits of men by reducing their NPA to age 60; there would be a purely artificial attempt to achieve in two steps something which could not validly be achieved in one step. It is impossible, in my view, to divorce the two steps and to say that the first step constitutes the "measures" required by EU law but that the second step can be ignored. In my view, the ECJ would view those two steps together as the measures designed to achieve equal treatment, but would hold those measures to be ineffective because their effect would be to level down the pre-existing benefits of women by increasing their NPA to age 65. I regard this conclusion as acte clair. I do not consider that I need to make a reference to the ECJ. I might add that, even if I thought that there was a real doubt, I would not make a reference: that course should be left to the Court of Appeal if this matter should go further.
145. That is enough to conclude the point against Safeway. Safeway's case on this point, however, faces a further difficulty which did not arise in Harland & Wolff. The two-stage approach of course requires two deeds. The second deed could be effective only if it complied with Clause 19. I have already concluded (see paragraph 142 above) that the period from the 1991 Notices until the 1996 Deed was too long to allow reliance to be placed on the "reasonable" period allowed by Clause 19. Accordingly, reliance must be placed on the bold-faced words. The only announcement which could be relied on would be the 1991 Notices. Those make clear, however, that the proposed adoption of a common NPA of age 65 was to be implemented in order to comply with Barber. It necessarily follows that the second deed would be part of a process designed to achieve equalisation. It is not possible, therefore, for Safeway and SPTL to contend that the two-stage process as a whole would be other than the implementation of the equal treatment requirement.

Conclusion on validity of 1996 Deed ignoring section 62 PA 95

146. In my judgment, ignoring the impact of section 62 PA 95, the 1996 Deed was not effective to introduce a common NPA of age 65 for men and women for the period from 1 December 1991 to 2 May 1996. The result is that both men and women are entitled to benefits in respect of that period based on an NPA of age 60.

The impact of section 62 PA 95

147. Mr Green's submission is, as I have said, that section 62 was an effective implementation of article 119 under domestic law. As from 1 January 1996, a member of the Scheme had no need (and indeed no right) to rely on article 119. Instead, a member of the disadvantaged class had a right, as a result of section 62, to equal treatment with the advantaged class, with the result in the present case that a man was entitled in respect of the period from 17 May 1990 to an NPA of age 60. Further, the way in which such equal treatment is achieved is that the discriminatory term of the Scheme is to be treated as modified so as to be no less favourable to a man than a woman. In effect, the definition of NPA in the Scheme is modified so that, in respect of the relevant period, it provides for an NPA of age 60 for men as well as for women.
148. Accordingly, Mr Green submits, equal treatment was automatically effected as of 1 January 1996. The 1996 Deed did not bring about equality, even retrospectively, since equality had already been achieved, including with retrospective effect, as a result of section 62. All that the 1996 Deed did (so far as relevant for present purposes) was to reduce the benefits of men and women in the same way by changing the common NPA of age 60 to one of age 65. It follows that the issue of levelling-down to achieve equality does not arise. It is a matter of purely domestic law whether the 1996 Deed was effective and, as to that, there is no doubt, he says, that it was.
149. It is perhaps worth making the point at this stage, obvious as it may be, that in one sense it can be said that article 119 itself brings about equal treatment in pension schemes as much as in employment contracts since it is of direct effect. It is clear, however, that this fact does not itself satisfy the requirement appearing in Coloroll, Avdel and the other equality cases for benefits to be levelled up until the appropriate domestic measures giving effect are introduced. Mr Short submits that the fact that, from 1 January 1996, article 119 was given effect by sections 62 to 65 does not exclude the operation of EU law.
150. I agree with him that domestic law cannot override the directly enforceable rights under article 119. But equally, if and to the extent that those rights are fully recognised in domestic law, whether as the result of a rule amendment or as the result of statute, I do not understand why article 119 has any further part to play. I must emphasise the word "fully" because an apparent equalisation may nonetheless leave open scope for the direct application of article 119. Take, by way of example, the two-stage process which I have discussed in the previous section of this judgment. The first stage apparently achieves equality. If that were regarded as a complete implementation of article 119, then a retrospective amendment (at least, so far as Clause 19 is concerned, in relation to a reasonable period in the past) could be implemented as a matter of purely domestic law. But article 119 could still be invoked by a member whose benefits were reduced at the second stage. The member would be able to invalidate the intended levelling-down effected by way of the two-stage process, a composite process designed to achieve the improper aim of levelling-down. This is not a situation where the second stage can be viewed in isolation as if it were unconnected with the first stage. A male member of the Scheme would be able to claim benefits based on an NPA of age 60 for the relevant period by virtue of the direct effect of article 119.
151. In my judgment, even if Mr Green is right in saying that section 62 operates as if the Scheme had actually been amended by a change to the definition of NPA, section 62 does not fully implement article 119 so as to eliminate any further reliance by a member of the Scheme on article 119. Section 62 does not operate in this way any more than would an express amendment under the two-stage process. At best, from Safeway's point of view, the first stage of the two-stage process is to be seen as taking place on 1 January 1996 and the second stage on 2 May 1996. If it is correct to view matters in that way, then it becomes a question of fact whether the 1996 Deed is properly to be seen as part of the process of equalisation required by article 119, or whether it can be seen and treated as an independent amendment in the same way as the sort of amendment which I referred to in [48] of my judgment in Harland & Wolff.
152. In my view, in the present case it is clearly the former. I do not consider that Safeway can be in any better a position as a result of section 62 than if an express amendment (the first stage of the two-stage process) to the Scheme, introducing a common NPA of age 60, had been made on 31 December 1995. If that had been done, then the 1996 Deed would have been ineffective to introduce a common NPA of age 65 with effect from 1 December 1991 for precisely the same reasons as given in relation to the two-stage process discussed in the preceding section of this judgment.
153. An application of the equal treatment rule under section 62 – as I have said, at best from Safeway's point of view, taking effect as an amendment to the definition of NPA – cannot, in my judgment, put Safeway in any better a position than would an express amendment on 31 December 1995. The fact is that the 1996 Deed was part and parcel of a set of arrangements introduced because of, and designed to give effect to, the equal treatment requirement under article 119. Those arrangements would, if valid, result in a levelling-down of the benefits of women in respect of their service during the Barber window, something which would be contrary to EU law.
154. Further, as with the second deed under the two-stage process, it is necessary for Safeway to rely on the 1991 Notices in order to give validity to the 1996 Deed. For the same reasons as given in relation to the two-stage process, once reliance is placed on the 1991 Notices, the inevitable conclusion is that the 1996 Deed was a constituent part of the arrangements designed to achieve equality. For that reason, also, section 62 does not provide Safeway with an escape from the consequences of article 119.
155. Mr Short makes some more general submissions to the effect that section 62 does not result in the equal treatment which Mr Green contends it does.
156. Mr Short submits that PA 95 itself recognises that the equal treatment rule does not complete the job of equalisation. Thus, section 65 provides the trustees of a scheme with power (where they do not already have power) to make such alterations as are needed to comply with the equal treatment rule. He submits that section 65(2) is inserted in order to ensure that trustees are able, without recourse to the courts, to introduce the amendments to the scheme required by [36] of the judgment in Coloroll (as to which see paragraph 56 above). There would be no point in this provision, he submits, if full equality had already been achieved. A scheme does not comply with the equal treatment rule and the employer's obligations under article 119 until that resolution has taken effect. I observe however that there would be some point in this provision even on Mr Green's case, namely to ensure that the text of the governing documentation reflected accurately the substantive rights of the member; but there is force in the point that that is not what section 65(2) is aimed at.
157. Mr Short further contends that section 62 does not, in any event, achieve the equality required by article 119. There is a real difference between a rule which says that men and women have a common NPA of age 60 and a rule which says that women have an NPA of age 60 but men have an NPA of age 65 subject to the equal treatment rule. Before the equal treatment rule is actually introduced, a man would have to show that he was employed in the same, or comparable, employment as the woman. Even then, the equal treatment rule will not take effect if the employer shows that there was a genuine material factor for the difference: see section 62(4). I do not consider that there is much in this particular point since article 119 itself only requires the man to be treated in the same way as the woman if the necessary same, or comparable, treatment is shown.
158. In the light of my conclusions at paragraphs 151ff above, it is not necessary to decide whether Mr Short's wider submissions are correct. Since the position is not at all clear, in my view, one way or the other, it would not, I think, be helpful for me to express even a provisional view. I do not propose to do so.

Disposition

159. In the light of all of the above, I reject Safeway's claim for a declaration confirming that NPA was equalised at age 65 in respect of men and women with effect from 1 December 1991.