Overview
During the 1990’s, Fisher Controls Inc. (“Fisher”) went through two significant downsizings of its operations. As a result of these downsizings, Fisher was required by the Ontario pension regulator to partially wind-up the Pension Trust for Salaried Employees of Fisher Controls Inc. (the “Plan”) in connection with these downsizings (effective December 31, 1993 and June 30, 1997 respectively).
In conjunction with these two partial wind-ups, following the settlement of all basic benefits under the Plan in respect of affected employees, it was determined that there remained a surplus in the Plan.
As a result of the downsizings, a committee of Plan members was formed to ensure the rights of Plan members affected by the downsizings were protected, which retained Koskie Minsky LLP in 1999. The committee and Koskie Minsky LLP began making representations to the provincial pension regulator in an attempt to compel distribution of surplus in relation with the two partial wind-ups.
In 2004, the Supreme Court of Canada held in Monsanto that, when a pension plan is partially wound up, any surplus remaining in the plan attributable to affected employees must be distributed to plan beneficiaries.
Following the decision in Monsanto, the committee and Koskie Minsky LLP continued its efforts to compel Fisher to distribute surplus in respect of the two partial wind-ups. In July, 2005, the Superintendent of Financial Services issued a notice proposing to order the company to file new partial wind-up reports with the regulator that dealt with the distribution of surplus. As a result of this notice, and after obtaining legal advice, Fisher decided to distribute surplus to affected members.
An agreement was ultimately reached to distribute surplus to Plan members, minus all reasonable legal, actuarial, custodial fees, expenses and disbursements of the committee and Fisher.