Trustee Savings Banks Act 1985

Preliminary

Preliminary

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• (1) In this Act—

• (a) “the existing TSB group” means the following, taken as a whole—

• (i) the existing trustee savings banks certified under the Trustee Savings Banks Act 1969 or 1981 (“the existing banks”);

• (ii) the Trustee Savings Banks Central Board (“the Central Board”);

• (iii) Trustee Savings Banks (Holdings) Limited (“the existing holding company”); and

• (iv) the existing subsidiaries of any of the existing banks, the Central Board or the existing holding company;

and “existing” with reference to any of those banks or companies means existing immediately before the vesting day and, in the case of a bank, with a certification under the Trustee Savings Banks Act 1969 or 1981 effective on 17th December 1984;

• (b) “the new TSB group” means the following, taken as a whole—

• (i) the companies formed or to be formed with objects including that of assuming and conducting, after the vesting day, the respective businesses of the existing banks and eligible to succeed them;

• (ii) the companies which, immediately before the vesting day, are subsidiaries of the existing banks, the Central Board or the existing holding company;

• (iii) the company formed or to be formed with objects including that of acting as the holding company for the companies falling within (i) and (ii) above and which, immediately before the vesting day, is a subsidiary of the Central Board (“the new holding company”);

and for the purposes of this section “formed”, with reference to the objects of a company, includes the alteration of its objects (with or without an alteration of its name);

• (c) “successor”, with reference to an existing bank, means the company formed or to be formed with objects including that of assuming and conducting its business and eligible to succeed it; and

• (d) “the vesting day” means the day appointed for the transfer by virtue of section 3 below of the assets and liabilities of any of the bodies comprising the existing TSB group to any of the bodies comprising the new TSB group.

• (2) For a company to be “eligible to succeed” an existing bank it must have been, immediately before the vesting day, a subsidiary of the Central Board or the existing holding company and it must—

• (a) in the case of the company which is to succeed the existing bank for England and Wales, be registered (and accordingly have its registered office) in England and Wales;

• (b) in the case of the company which is to succeed the existing bank for Scotland, be registered (and accordingly have its registered office) in Scotland;

• (c) in the case of the company which is to succeed the existing bank for Northern Ireland, be registered (and accordingly have its registered office) in Northern Ireland; and

• (d) in the case of the company which is to succeed the existing bank for the Channel Islands, be incorporated (and accordingly have its registered office) in any of the Channel Islands.

• (3) References in this Act to a company being a subsidiary of another or being a holding company as regards another company are to be construed in accordance with the Companies Act 1985.

• (4) The vesting day shall be appointed by the Treasury by order made by statutory instrument after consulting the Central Board.

• (5) This Act, except section 6, has effect for the purpose of enabling the existing TSB group to be reorganised into the new TSB group and any reference in it to “the reorganisation” shall be construed accordingly.

The reorganisation

The Central Board and the reorganisation

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Transfer of assets, liabilities, etc. from existing to new institutions

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• (1) Subject to subsection (8) below, on the vesting day there shall, by virtue of this subsection, be transferred to and vested in the new holding company—

• (a) all the property, rights, liabilities and obligations of the Central Board except any shares in the new holding company;

• (b) all the shares of the existing banks in the existing holding company; and

• (c) all the property, rights, liabilities and obligations of the existing holding company.

• (2) Subject to paragraph 2 of Schedule 2 to this Act, the transfer of the assets specified in paragraphs (b) and (c) of subsection (1) above shall be for the consideration determined by the Central Board under section 2 above and the consideration for the transfer of the shares specified in paragraph (b) shall be treated for the purposes of this section as having accrued to the bank immediately before the transfer of the bank’s assets effected by subsection (3) below.

• (3) Subject to subsections (4), (5) and (8) below, on the vesting day, there shall, by virtue of this subsection, be transferred from each of the existing banks to and vested in its successor all the property, rights, liabilities and obligations of the bank.

• (4) The liabilities referable to a despositor’s deposit with a bank which are transferred by subsection (3) above to the bank’s successor are liabilities to return his deposit and to pay interest on it (if it was payable) at the rate prevailing immediately before the vesting day, but, as from that day, the rights, liabilities and obligations referable to the deposit shall become instead rights, liabilities and obligations incident to the relationship of customer and banker (and variable accordingly).

• (5) The rules of each of the existing banks shall not, by virtue of subsection (3) above, bind its successor, but nothing in subsection (3) or (4) above or the foregoing provision of this subsection shall affect the continuance in force of any direction, authority or power subsisting with reference to a customer’s account with a bank immediately before the transfer of the account to its successor.

• (6) References in this Act to property, rights, liabilities and obligations of any body comprised in the existing TSB group are, subject to subsection (8) below, references to property, rights, liabilities and obligations of theirs whether or not capable of being transferred or assigned and, in its application to an existing bank, property, rights, liabilities and obligations are property, rights, liabilities or obligations “of” the bank whether they are vested in or incumbent on the custodian trustees of the bank, the general trustees of the bank or the bank as an institution.

• (7) The substitution effected by the foregoing provisions of the section of a body comprised in the new TSB group for a body comprised in the existing TSB group as employer under contracts of employment subsisting immediately before the vesting day shall, in the case of the successor to an existing bank, be treated for the purposes of the application of section 218(3) of the Employment Rights Act 1996 or the corresponding Northern Ireland enactment (continuity of employment on statutory substitution of employers), as the substitution of one body corporate for another body corporate.

• (8) No person holding office as a member of the Central Board, as an officer of the existing holding company, as a trustee of an existing bank or as an auditor shall be entitled, by virtue of the foregoing provisions of this section, to hold any corresponding office in any body comprised in the new TSB group.

• (9) Schedule 1 to this Act has effect for supplementing this section.

• (10) In subsection (7) above “the corresponding Northern Ireland enactment” is paragraph 10(3) of Schedule 1 to the Contracts of Employment and Redundancy Payments Act (Northern Ireland) 1965.

Dissolution of existing banks and repeal of 1981 Act etc.

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• (1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (3) On such day as the Treasury, by order made by statutory instrument, appoints—

• (a) the Trustee Savings Banks Act 1981, and

• (b) the other enactments relating to such banks,

shall, subject to any provision made under subsection (5) below, cease to have effect.

• (4) Different days may be appointed under subsection (3) above for the repeal of different provisions.

• (5) Any order under subsection (3) above may contain such transitional and saving provisions as appear to the Treasury to be appropriate in connection with the reorganisation.

• (6) ... in subsection (3)(b) above, “the other enactments relating to such banks” has the meaning given by section 7(3) below.

Taxation

Taxation

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Schedule 2 to this Act shall have effect for the purpose of making provision about taxation in relation to the reorganisation.

Miscellaneous and general

Treatment of Scottish 1819 savings banks

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Short title, commencement, repeals and extent

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• (1) This Act may be cited as the Trustee Savings Banks Act 1985.

• (2) This Act shall come into force at the end of the period of two months beginning with the day on which it is passed.

• (3) The enactments to be repealed or revoked under section 4(3) above are those specified in Schedule 4 to this Act and, for the purposes of that subsection, “the other enactments relating to such banks” means the enactments so specified other than the Trustee Savings Banks Act 1981.

• (4) Subject to subsection (5) below, this Act extends to Northern Ireland, the Isle of Man and the Channel Islands and shall have effect in that island or those islands subject to such adaptations and modifications as Her Majesty may by Order in Council specify.

• (5) Where any enactment repealed or instrument revoked under section 4(3) above extends to any part of the United Kingdom or to the Isle of Man or the Channel Islands, the repeal or revocation extends to that part, that island or those islands.

SCHEDULE 1

Part I — Preliminary

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• (1) This Schedule has effect in relation to the transfer by section 3 above of any property, rights, liabilities or obligations of a body comprised in the existing TSB group to a body comprised in the new TSB group and, subject to sub-paragraph (2) below, “transferor” and “transferee” shall be construed accordingly.

• (2) In the application of this Schedule to a transfer of any property, rights, liabilities or obligations of an existing bank, “transferor” means the custodian trustees of the bank, the general trustees of the bank or the bank as an institution, as the case requires and, as regards property, rights, liabilities and obligations derived from an amalgamation or succession of amalgamations of trustee savings banks, includes (as the case requires) the custodian trustees of any bank, the general trustees of any bank or any bank (as an institution), to which the existing bank has succeeded.

• (3) In sub-paragraph (2) above, “trustee savings bank” means a bank certified under the Trustee Savings Banks Act 1981, the Trustee Savings Banks Act 1969, the Trustee Savings Banks Act 1954 or the Trustee Savings Banks Act 1863.

Part II — General Provisions

Construction of agreements and documents

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• (1) Where there subsists immediately before the vesting day an agreement to which the transferor is a party, the agreement shall have effect on and after the vesting day—

• (a) as if the transferee had been the party to the agreement; and

• (b) as respects anything falling to be done on or after the vesting day, with the modifications set out in sub-paragraph (2) below.

• (2) Those modifications are the substitution—

• (a) for any reference (whether express or implied and, if express, however worded) to the transferor, of a reference to the transferee, and

• (b) for any reference in general terms (however worded) to persons employed by or agents of the transferor, of a reference to persons employed by or agents of the transferee.

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• (1) Any instrument or other document (not being an agreement to which paragraph 2 above applies or an enactment) in being immediately before the vesting day which refers, whether specifically or generally, to the transferor shall have effect on and after the vesting day, as respects anything falling to be done on or after that day, with the modifications prescribed by paragraph 2(2) above.

• (2) Sub-paragraph (1) above applies to testamentary instruments made before the vesting day whether the testator dies before or after that day.

• (3) As regards negotiable instruments and orders for payment of money, sub-paragraph (1) above applies to an instrument or order drawn, given, accepted, or endorsed on or after the vesting day as it applies to one drawn, given, accepted or endorsed before that day.

Remedies

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Without prejudice to the generality of the provisions of paragraphs 2 and 3 above, the transferee and any other person shall, as from the vesting day, have the same rights, powers and remedies (and in particular the same rights and powers as to the taking or resisting of legal proceedings or the making or resisting of applications to any authority) for ascertaining, perfecting or enforcing any right, liability or obligation transferred to the transferee by section 3 above as he would have had if that right, liability or obligation had at all times been a right, liability or obligation of the transferee.

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Without prejudice to the generality of the provisions of paragraphs 2 and 3 above, any legal proceedings or applications to any authority pending immediately before the vesting day by or against the transferor in so far as they relate to any property, right, liability or obligation transferred to the transferee by section 3 above or to any agreement relating to any such property, right, liability or obligation shall be continued by or against the transferee to the exclusion of the transferor.

Part III — Specific Aspects of the Reorganisation

Accounting provisions

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• (1) In any case where—

• (a) a transfer is effected by section 3(1)(a) or (3) above, and

• (b) the vesting day falls less than twelve months after the end of a financial year of the transferor,

each of the statutory accounts prepared by the directors of the transferee in respect of a period which includes or consists of the whole or any part of the transitional period shall deal with the affairs of the transferor during so much of the transitional period as falls within that period as well as, and as one with, the affairs of the transferee.

• (2) Any statutory accounts (including, in particular, group accounts) falling to be prepared by the directors of the new holding company by reference to accounts (or matters reflected in accounts) prepared in respect of a period which includes or consists of the whole or any part of the transitional period by the directors of a successor to an existing bank shall be prepared by reference to the accounts (or the matters reflected in the accounts) as prepared in accordance with sub-paragraph (1) above for that period.

• (3) If, in a case where sub-paragraph (1) above applies, the day with which the transitional period begins falls before the date of incorporation of the transferee, section 224(4) of the Companies Act 1985 (which defines a company’s first accounting reference period) or, in Northern Ireland, Article 232(4) of the Companies (Northern Ireland) Order 1986 (which makes similar provision) shall have effect in relation to the transferee as if for the reference to the date of incorporation of the company there were substituted a reference to the day with which the transitional period begins; and references in the Companies Act 1985 and the corresponding Northern Ireland legislation to the first accounting reference period shall be construed accordingly.

• (4) In any case where sub-paragraph (1) above applies, the transferor shall be under no obligation, with respect to the transitional period, to prepare or submit its statutory accounts.

• (5) In any case where a transfer is effected by section 3(1)(a) or (3) above—

• (a) the transferor shall furnish the transferee with all such information, and afford all such other assistance, as the transferee may reasonably require to enable its directors to discharge their duties in relation to the statutory accounts; and

• (b) the transferee shall furnish the transferor with all such information, and afford all such other assistance, as the transferor may reasonably require to enable the transferor to discharge its duties in relation to its statutory accounts for its final financial year.

• (6) In this paragraph—

• “corresponding Northern Ireland legislation” means the Companies (Northern Ireland) Order 1986;

• “final financial year”, in relation to a transferor, means the financial year referred to in sub-paragraph (1)(b) above;

• “financial year”, in relation to a transferor,—

• (a) except in a case falling within paragraph (b) below, has the meaning given by section 54(1) of the Trustee Savings Banks Act 1981, and

• (b) where the transferor is the Central Board, has the meaning given by paragraph 15(5) of Schedule 2 to that Act;

• “statutory accounts” means—

• (a) in relation to a transferee, any accounts or statement of accounts required to be prepared by any provision of the Companies Act 1985 or the corresponding Northern Ireland legislation; and

• (b) in relation to a transferor, any accounts or statements of account required to be prepared by section 23 of or paragraph 15 of Schedule 2 to the Trustee Savings Banks Act 1981;

Profits available for distribution

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• (1) where, in the case of a transfer effected by section 3(1)(a) or (3) above, immediately before the vesting day the transferor had any qualifying reserves, the corresponding reserves of the transferee immediately after the transfer shall be treated for the purposes of the Companies Act 1985 and the corresponding Northern Ireland legislation as accumulated, realised profits of the transferee.

• (2) Where, in the case of a transfer effected by section 3(1)(a) or (3) above, immediately before the vesting day some part of the transferor’s reserves represents the amount by which unrealised surpluses attributable to an increase in the value of land exceed unrealised deficits attributable to a decrease in the value of land, then, for the purposes of the Companies Act 1985 and the corresponding Northern Ireland legislation—