After superannuation was made compulsory in 1993 in Australia, it has become a common practice for Defined Benefit superannuation funds to be closed to members and for membership of Defined Contribution funds to be provided to new employees.
Defined Contribution funds are also called Accumulation Funds.
In a Defined Benefit fund, the Employer bears the risk of variable returns in financial markets, whilst in a Defined Contribution fund, the Employees bear the risk.
A common practice is to also make an offer to the members of the Defined Benefit fund to elect to leave the Defined Benefit fund and to then join the new Defined Contribution fund.
Spooner v British Telecommunications  OPLR 189;  PLR 65 was but about elections which members had made to shift their benefits from one category to another. They mistakenly believed that the other category of benefit would be more favourable for them, and had been given erroneous advice to that effect by the employer. The question was whether their elections could be set aside for mistake, and the answer which Jonathan Parker J gave was that they could.
A Trustee as a fiduciary has an obligation to properly inform the members as to their existing entitlements and any entitlements that might be available under an offer made to the members.
This tab updated on 22 August 2015