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APERT is a voluntary association of
members or beneficiaries of The Royal Trust Pension Plan.
APERT members are seeking improvement
of the pension and benefits or, alternatively, a payout of surplus
to the rightful beneficiaries of the Plan.
APERT believes that the Royal Trust
Pension Plan is in a large surplus position as against its funding
requirements; a surplus of some $150,000,000. No employer
contributions are currently being made to the Plan and the surplus
continues to grow.
Royal Trust was founded in 1899 in the
province of Québec. It developed operations across Canada to become
one of Canada's largest and most respected financial institutions.
In 1993, Royal Bank acquired all Royal Trust’s Canadian operations.
Royal Trust is now a fully-owned member of The Royal Bank Financial
Group.
Royal Bank claims that it owns the
surplus. However, the pension trust directs that the fund can only
be used for benefits to be provided to members of the Plan; no one
else.
Many former employees of Royal Trust
are now retired; and many more will begin drawing their pensions in
the coming few years. They all rely heavily on their Royal Trust
pension as their prime source of retirement income. Some, who have
been retired longer, draw relatively small pensions, as compared to
today's cost of living.
Royal Trust Pension Plan members have
little enough in the way of benefits other than the pension. Many
have medical/dental expense insurance coverage which limits re-imbursment
to $15,000 over their total retirement life. As a result, some have
had their coverage run out; a growing number are in danger of the
same fate in the forthcoming few years.
As of December 1989, membership in the
Pension Plan was restricted to employees who were members on
December 31/89. APERT believes that the closing of the Plan as at
that date means that the Royal Trust Pension Plan obligations and
beneficiaries are set and known. APERT believes that the Plan
Trustee's fiduciary responsibilities are to use the funds in full to
the exclusive benefit of those Plan members, by improved pensions,
benefits and/or distribution to members.
APERT believes that, in 1995, Royal
Bank unillateraly opened the Plan to new members. APERT's position
is that the funds are thereby being used for the benefit of people
who have no legal interest or entitlement in the Plan, and to the
benefit of Royal Bank/Royal Trust, in breach of the terms of the
Plan and of the Trust. This would be to the detriment of the
legitimate members, some of whom are suffering economic hardship at
a time when there are ample assets to alleviate member needs.
APERT has approached Royal Trust and
Royal Bank repeatedly since 1997 for the purpose of undertaking
negotiations to increase pensions and benefits and/or an equitable
distribution of the pension plan surplus. So far, with no tangible
result. APERT also believes that a negotiated arrangement in good
faith would be preferable for all parties. However Royal Bank has
clearly stated that it will not enter into or conduct such
negotiations; and that it will not discuss further any of these
issues unless it was forced by legal recourse by APERT.
APERT has retained the law firm of
Cohen Highley LLP to commence and prosecute a court action under the
Ontario Class Proceedings Act. On October 19/00, APERT filed a
Statement of Claims in the Superior Court of Justice in Ontario
against Royal Trust Corporation and Royal Bank.
The court action is essentially with
respect to the following:
1. To determine the interest of the
class in the Royal Trust Pension Plan and the surplus;
2. To determine the entitlement of the
class to surplus distribution and/or enhanced benefits;
3. To award the class compensation for
Royal Trust misadministration of the Pension Plan;
4. To require repayment of all monies
wrongly used by Royal Trust for purposes other than the benefit of
the Plan members;
5. To remove Royal Trust as trustee of
the Pension Plan.
As of Dec. 1, 2000, Royal Trust/Royal
Bank has filed Intent to defend.
On April 20, 2001, APERT and RBC
agreed by Memorandum of Understanding (MOU) to enter into
negotiations to resolve APERT's concerns and to make reasonable
efforts to achieve and implement a mutually beneficial agreement.
On August 29, 2002, a proposed
settlement was achieved by Memorandum of Agreement (MOA) subject to
APERT membership, court and regulatory authority approvals.
On February 10, 2003, the APERT vote
was concluded. Of the 430 eligible voters, 402 ballots were received
and 401 votes were in favour of approval of the proposed Settlement
Agreement.
On May 30, 2003, Justice Haines of the
Ontario Superior Court rendered judgment certifying APERT's Class
Action and approving the Settlement Agreement.
On June 10, 2003, Justice Claude
Tellier of the Quebec Superior Court rendered judgment in exact
similar fashion as the Ontario judgment, certifying APERT's Class
Action and approving the Settlement Agreement.
As of June 12, 2003, the process
continues to secure further required approvals with a time-line
indicating that full actualization of the settlement should be
achieved by the second half of the year 2004.
For more information, please see "Public
Documents".
To communicate with a member of APERT
or with our lawyers, please see "Contact Us". |
