No federal rule covered the refund, so the courier asked a judge to undo a costly error
A courier giant that paid far more than it had to into its workers’ pension plan is getting the money back, after an Ontario judge found an actuarial report had the numbers wrong and plan members had no claim to the cash.
In a decision dated Oct. 13, 2026, Justice Jana Steele of the Ontario Superior Court of Justice ordered the return of $50,742,012.37 to United Parcel Service Canada Corporation (UPS), effective immediately. The plan’s board of trustees took no position, subject to any regulatory consents that might apply from the federal pension regulator (OSFI) and the Canada Revenue Agency (CRA).
The report that missed a payment break
UPS set up the defined benefit plan in 1988 for eligible Teamsters members and is the only employer paying in. Three UPS-appointed and three Teamsters-appointed trustees run it, and actuarial valuations the board files set UPS’s contributions.
The board hired an actuarial firm for its 2021 to 2023 valuations. The firm flagged errors in the 2022 and 2023 reports, which were addressed. UPS later determined the 2021 report was wrong too. It got the plan’s 2022 minimum funding requirements wrong and missed that UPS could take a contribution holiday, paying nothing.
Believing the payments were required, UPS put almost $51 million into the plan in 2022 and 2023. Tax rules allowed them, but neither the plan nor federal pension law required them. A corrected report showed a surplus of $140,648,000 on an ongoing basis, with room for a contribution holiday of up to $67,692,000.
No refund rule, so UPS went to court
UPS consulted OSFI once the error came to light, but federal pension law offered no refund route. Ontario’s Pension Benefits Act lets the provincial regulator approve refunds of employer overpayments, Justice Steele noted, but the federal statute has no similar provision.
UPS asked the court to order the money returned, arguing it paid by mistake. Justice Steele held that federal pension law does not strip the court of that power. Under Supreme Court of Canada law, money paid under a mistaken belief about the facts can generally be recovered, unless the payer meant the recipient to keep it anyway, got something in return, or the recipient acted on it in good faith.
None of those exceptions applied, the judge found. UPS paid only because it relied on the faulty report, the money was never owed, and the plan had not changed course because of it. Letting the plan keep it, she wrote, would hand the fund “a windfall of more than $50 million.” The law against unjust enrichment pointed the same way, she added.
Plan members’ benefits stay intact
The trustees checked UPS’s math and did not dispute the amount, and the plan is expected to stay in surplus after the refund. UPS said no benefit improvements were made because of the extra money, and no decisions assumed it would stay.
That the money went to pension trustees made no difference, the judge found. UPS could not point to another pension case, but relied on a 2022 Alberta Court of Appeal decision, which she called instructive, involving Chevron’s recovery of about $10 million in royalties overpaid into a trust.
After a first hearing on Sept. 14, 2026, Justice Steele asked whether the union, retirees and former members still owed a pension should have been told about the case. The Teamsters, OSFI and the CRA were notified, and none appeared. Because the money was clearly paid in error, the judge found it could not be used to buy, secure or boost member benefits, and that “their return does not affect them.”
See United Parcel Service Canada Corp. v. MacDonald, 2026 ONSC 5770
