UK Solicitors’ claims arising out of pension schemes

Pensions is a highly technical and regulated area where trustees and employers are increasingly relying on solicitors (aka attorneys in U.S.) to advise. As a result of poor investment terms and improving mortality rates, defined benefit schemes are, across the board, in deficit. In the recession, where many companies are becoming insolvent, leaving schemes in deficit and without an employer to make good the shortfall, trustees are more inclined to scrutinize the advice they have received to assess whether this has exposed the scheme.

Areas where solicitors may be exposed to claims include:

1. Drafting scheme documents and amendments to schemes – this remains the principal area of exposure for solicitors;
   
2. Conflicts of interest where solicitors act both for the employer of a pension scheme and the trustees; and
   
3. Failure to give or to qualify advice.
   

Solicitors need to analyze areas of potential exposure, and consider the steps that can be taken with a good insurance broker to reduce the risk of claims.