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Fund reprimanded for demanding destitute mother to produce DNA test result

22 September 2020 The Office of the Pension Funds Adjudicator (OPFA)
Advocate Matome Thulare, Deputy Pension Funds Adjudicator

Advocate Matome Thulare, Deputy Pension Funds Adjudicator

A fund has been lambasted by the Deputy Pension Funds Adjudicator, Advocate Matome Thulare, for causing the mother of a child to suffer undue hardship in having to obtain a DNA test without any financial assistance, in order to prove paternity.

FundsAtWork Umbrella Provident Fund decided not to pay a portion of the deceased’s death benefit to a minor child after initially withholding it pending the production of a DNA test by the child’s mother.

Instead the fund decided to redistribute the benefits that were set aside for the child amounting to R313 876.59 when the mother of the child did not produce the DNA test results. This was notwithstanding the fact that it had already found that the child was factually dependent on the deceased.

The mother, who was financially destitute, took a period of over two years to muster up enough money (R2000) to pay for a DNA test which proved the child’s paternity. The DNA test proved that the deceased was indeed the father of the child.

The fund submitted to Advocate Thulare that it allowed the mother a period of two-and-half years to provide the paternity test and that it was afforded a period of 12 months to trace and identify dependents or nominees.

Advocate Thulare held that the fund cannot rely on the 12-month period referred to in section 37C of the Pension Funds Act to reject the complainant’s claim when it had not itself adhered to same and in circumstances where it failed to conduct a proper investigation.

He also held that the fund failed to provide clarity on why it failed to assist the mother with the paternity tests, or let alone follow up on its request before its decision to redistribute. Had the fund contacted the mother, it would have been aware of the challenges she faced, and that she was in the process having the paternity tests conducted regardless of these challenges.

“The least the first respondent (FundsAtWork Umbrella Provident Fund) could have done is to contact the complainant prior to making a decision to redistribute the death benefit.”

“It has come to the attention of the Adjudicator that the complainant is unemployed. Therefore, the question for the first respondent is how the complainant was reasonably expected to have the tests conducted if she is unemployed?”

Advocate Thulare found that the fund abdicated its responsibility of conducting a thorough investigation as envisaged in section 37C as it made no effort to confirm the minor child’s paternity.

He said the fund sat back and expected the complainant to provide it with information, and after a period of time, without consulting the complainant, it made an incorrect decision to redistribute the minor child’s portion of the death benefit.

If it had complied with its duties, the fund would have taken responsibility for obtaining the DNA test results and would have had the proof that it purportedly required to pay the minor child’s benefit.

The fund had no regard to the protection, promotion and fulfilment of the best interests of the minor child. The fund, therefore, did not consider the best interests of the minor child in its decision to redistribute the death benefit allocated to him.

Advocate Thulare found that the fund failed in its fiduciary duty owed to the minor child.

“It is clear that the first respondent accepted that the child was factually supported by the deceased. It is not clear what purpose a DNA test could have served to prove that the child was a dependent as defined in the Act.

“Withholding the payment in respect of the child, after it had accepted him as a factual dependent, based on the production of DNA test results, was an act of irrationality on the part of the first respondent.”

It was also confusing that the fund had taken three resolutions in this matter. However, Advocate Thulare found that the third resolution was taken in a failed attempt to ameliorate the wrongs of its previous execrable conduct of requiring a DNA test without providing any financial support to the mother in order to obtain same when she was financially distressed and in circumstances where a DNA test was not needed because the fund accepted the factual dependency of the minor child.

The fund caused the mother of the child to suffer undue hardship in having to obtain a DNA test without any assistance, said Advocate Thulare.

“The severity of first respondent’s conduct is aggravated by the fact that it sought to justify its actions by passing a resolution on 18 July 2019, well after the benefit had been paid, in order to submerge the incorrect basis on which it had decided to redistribute the minor child’s benefit.”

In the circumstances, Advocate Thulare ordered the fund to pay the minor child’s benefit of R313 876.59 together with interest.

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