HL UK Pensions Law Digest 20 October 2025

Welcome to our latest update, in which we cover: 

Enforcement of debts against personal pensions

• A review by the High Court of how creditors may enforce judgment debts against personal pension rights;

Pensions Regulator (TPR): DC pension schemes research

• TPR’s latest survey of DC schemes, focussing on decumulation support and value for members (VFM);

Information Commissioner (ICO): £14m fine for data breach

• The ICO sets out steps organisations should take to improve data security.

Enforcement of debts against personal pensions 

The High Court has recently reviewed the legal process by which creditors may enforce a judgment debt against a debtor’s personal pension scheme (Zubarev and anor v Singh and anor). In addition, it rejected arguments that statutory protection applicable to occupational pension scheme rights could also apply to rights under a personal pension scheme.

Mechanics of enforcing judgment debts against pension schemes

In recent cases, judgment creditors have sought two types of Court order to enforce judgment debts against a debtor’s pension scheme rights:

• “s37 injunctions”: requiring the debtor to take certain actions to draw down, or otherwise access, their pension funds (or authorising the claimant’s solicitor to take these actions on the debtor’s behalf); and
• Third party debt orders (TPDOs): requiring a third party (the pension provider) to pay the creditor a sum owed by the third party to the debtor. Under the relevant Civil Procedure Rule, a final TPDO cannot be made unless an interim TPDO has already been made.

Zubarev: background

• In December 2022, the High Court gave judgment for the claimants against the defendants for damages for fraudulent misrepresentation and breach of warranty. The judgment debts were together approximately US$1.5m, plus interest and costs.
• The defendants made various attempts to appeal or otherwise frustrate the payment of the amounts owing.

Zubarev: s37 injunctions and TPDOs

• The claimants sought to enforce the judgment debts against the defendants’ rights in personal pensions held with two pension providers. In October 2024, before a different judge, the claimants were granted s37 injunctions and interim TPDOs in respect of the defendants’ personal pensions.
• The pension providers raised no objection to the s37 injunctions and had taken steps to implement them, in one case by disinvesting the assets and holding cash within the defendants’ pension funds; in the other, by terminating the pension fund, paying tax to HMRC and holding the remainder in cash outside the pension scheme.
• The Court was asked to make the interim TPDOs final given that, following implementation of the s37 injunctions, the pension providers now owed actual debts to the defendants.

Section 37 injunctions and TPDOs: what did the Court decide?

• The judge reviewed the use of s37 injunctions and TPDOs in recent caselaw and concluded that:
  • In order to enforce judgement debts, s37 injunctions should be sought before seeking a TPDO. When considering an application for a s37 injunction, the Court should examine the scheme rules;
  • Where creditors do not have full information about a debtor’s pension arrangement, it may be appropriate to seek an interim s37 injunction. Before the injunction is made final, the pension provider or trustee could be invited to explain any fiduciary duties or other reason (such as the scheme assets comprising an illiquid asset, the sale of which would require use of the trustee’s investment power) which might prevent implementation of the injunction; and
  • TPDOs should only be made where a debt is actually due from the third party provider to the debtor. Where a debt has not yet arisen (for example, because the debtor has not yet exercised a right to draw down pension assets), a TPDO should not be made.
• The judge had concerns about the basis on which the interim TPDOs had been made, as at that time there had been no debts due from the pension providers. Accordingly, although there was a compelling case on the merits for making the interim TPDOs final, the judge did not feel able to do so.
• However, as there were now debts owed by the pension providers to the defendants, it would not be in the interest of justice to require the claimants to start afresh with a new application for interim TPDOs. The judge left it open for counsel to present arguments on whether the Court could make TPDOs and if, in the circumstances of the case, these could be final.

Could the protection of s91 Pensions Act 1995 extend to personal pensions?

• Section 91 Pensions Act 1995 protects an individual’s rights under an occupational pension scheme from being removed (“alienated”) by various means, including by a Court order.
• In the case of Manolete Partners PLC v White, the Court of Appeal held in December 2024 that s91 prevented creditors from using s37 injunctions and TPDOs to enforce a judgment debt against the debtor’s occupational pension rights.
• In Zubarev, the claimants argued that provisions in some of their personal pension schemes’ rules were similar to those in s91 and that these pensions should also be protected. The Court rejected these arguments:
  • The statutory construction underpinning the judgment in Manolete was specific to occupational schemes. It would have been open to Parliament to apply s91 to both occupational and personal pensions, but it did not do so; and
  • The rules of only one of the personal pensions included an express prohibition against assignment and surrender, and the similarities between this scheme’s wording and s91 were incomplete. Even in respect of this pension there was no reason to conclude that the Court’s powers were curtailed or that the exercise of the Court’s discretion was materially affected.

The defendants in Zubarev were not bankrupt. Had they been bankrupt, the position would have been different, as the rights of a bankrupt member in both occupational and personal pension schemes are protected (under provisions in the Welfare Reform and Pensions Act 1999) and do not form part of the bankruptcy estate. However, any benefits in payment to a bankrupt member may be made subject to an income payments order, requiring all or part of the benefit to be paid to the trustee in bankruptcy.

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Pensions Regulator: DC schemes research

The Pensions Regulator (TPR) has issued a report of the findings of its March 2025 survey of defined contribution (DC) trust-based pension schemes. TPR’s accompanying press release focuses on the proposed guided retirement duty, included in the Pension Schemes Bill currently before Parliament. Key points include the following.

In relation to guided retirement:

• All the master trusts surveyed offer decumulation benefit options, representing an estimated 27m members;
• Only 27% of DC schemes overall currently offer decumulation options (small and micro schemes form the majority of schemes by number and are less likely to offer retirement options at present); and
• 35% of large schemes and 44% of medium schemes have started the process of transferring members into a master trust, or plan to do so. In contrast, consolidation had never been considered by 51% of small schemes and 76% of micro-schemes.

In relation to value for members (VFM):

• 97% of memberships were in schemes which demonstrate all the elements associated with assessing VFM;
• Only 32% of schemes conduct research and take into account the preferences, characteristics and needs of members; and
• Detailed VFM (dVFM) assessments had been completed by only 33% of schemes within scope of the dVFM requirements (applicable to schemes with less than £100m assets under management).

In relation to investment and environmental, social and governance (ESG) factors:

• Only 15% of trustee boards considered ESG a high priority compared to their other responsibilities; and
• 43% of schemes believed that trustees’ fiduciary duty was a barrier to long-term investment in a net zero economy.

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£14M fine for data breach

The Information Commissioner’s Office (ICO) has announced that it has reached a voluntary settlement with Capita, following the serious data breach in March 2023 in which the personal data of over 6m people was stolen. Capita has agreed to pay a total fine of £14m, made up of a £8m fine for Capita plc and a £6m fine for Capita Pension Solutions Limited.

The ICO’s announcement explains that the data breach arose when a malicious file was unintentionally downloaded on to an employee device. It highlights a number of ways in which failure to adopt appropriate safeguards had enabled the hacker to remain in the system and to access further data, despite a high priority security breach being raised within 10 minutes of the original breach.

The ICO highlights key ways in which organisations should be proactively reducing security risks, including:

• Following guidance from the National Cyber Security Centre on preventing lateral movement within the organisation’s network and adopting the principle of “least privilege”;
• Monitoring for suspicious activity regularly and responding to warnings promptly;
• Sharing insights from penetration testing across the whole organisation;
• Prioritising investment in key security controls; and
• Checking agreements and responsibilities between data controllers and data processors.

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Authored by Jill Clucas.