Mother fails in bid to claim all of son’s death benefit for herself

06 January 2017
The Pension Funds Adjudicator Muvhango Lukhaimane

The Pension Funds Adjudicator Muvhango Lukhaimane

A child born two days before her father’s death has qualified to share in the death benefit on the basis of being a dependant by virtue of being the child of the deceased.

The Pension Funds Adjudicator Muvhango Lukhaimane has dismissed a complaint by the deceased’s mother who claimed the deceased was not married and did not have any children and, therefore, she expected the entire benefit to be paid to her. 

Ms AJ Malinga brought a complaint against Ejoburg Retirement Fund (first respondent); MMI Group Limited (second respondent); and Pikitup Johannesburg Soc (Pty) Ltd (third respondent) concerning the allocation and distribution of a death benefit following the demise on 1 June 2014 of her son who was a member of the first respondent. 

Following the deceased’s demise, a death benefit in the amount of R473 549 became available for distribution to his beneficiaries and dependants. 

The board of the first respondent resolved to allocate an amount of R200 000 of the death benefit to the complainant and the balance of R273 549 was allocated to the deceased’s minor daughter (name withheld).           

The complainant was dissatisfied with the manner in which the death benefit was distributed. She was paid an amount of R206 848.46, including interest. 

The complainant contended that the deceased was not married and did not have any children and, therefore, she expected the entire benefit to be paid to her. She further stated that she expected to be paid an amount of R430 060.01, which she indicated was a figure given to her by the third respondent. 

The first respondent submitted that the deceased resided with his mother (the complainant) and contributed to the household. They were both working for the third respondent, but he earned substantially less than his mother (R5 263.50 vs R7 426.45 per month). 

The deceased was said to have been in an intimate relationship with a fellow employee. From this relationship a daughter was born two days before the deceased’s unnatural death.   

It submitted that when the complainant was questioned about the deceased’s child, she claimed that the deceased never showed anyone in the family his child before he died. The first respondent stated that the deceased clearly could not do that as the child was in Limpopo at the time. 

The complainant was requested to have a paternity test done to confirm her allegation that the child in question was not the deceased’s child. The complainant gave the board the run around about this and eventually claimed that she did not have money for the tests. However, when the board offered to pay for the tests, she refused to undergo the test, which left the board with no option, but to accept that the child was the deceased’s child and to treat her as his dependant. 

Thus on 15 November 2015, more than 12 months after the death of the deceased, the board agreed to distribute the benefit according to section 37C of the Act and apply its mind to the relevant facts. 

The total death benefit at that stage had accumulated to R473 549. It was agreed that there was sufficient proof of mutual dependency between the complainant and the deceased (although she was earning more than him) and to allocate R200 000 to her to compensate for her loss in additional income. The balance of the benefit, i.e. R273 549, was allocated to the child. 

An amount of R206 848.46 was paid to the complainant on 17 December 2015. 

In her determination, Ms Lukhaimane said the primary purpose of a death benefit is to protect those who were financially dependent on the deceased during his lifetime. 

Section 37C of the Act imposes three pertinent duties on the board when distributing a death benefit. In the first instance, the board has to identify and trace all the dependants and nominated beneficiaries of the deceased. Secondly, the board must effect an equitable distribution of the death benefit; and finally, the board must determine an appropriate mode of payment. 

Ms Lukhaimane said the law recognised three categories of dependants based on the deceased member’s liability to maintain such a person, namely, legal dependants, factual dependants and future dependants. 

In principle, a member is legally liable for the maintenance of a spouse and children as they rely on the member for the necessities of life. In the case of factual dependants, where there is no duty of support, a person might still be a dependant if the deceased in some way contributed to the maintenance of that person. The person alleging to be a factual dependant will have to prove that he was dependent on the deceased (despite the deceased not having a legal duty to maintain) at the time of the member’s death. 

In the case in question, Ms Lukhaimane said although a biological relationship is not a determining factor in a section 37C allocation consideration, the board of the first respondent was correct to establish the biological relationship between the deceased and the child as there was no opportunity for the deceased to maintain the child, thereby establishing factual dependency. 

“In the circumstance, this Tribunal is convinced that the board of the first respondent correctly identified the deceased’s dependants.”

She said the deceased would have been legally compelled to provide financial support to the child had he survived. However, a minor child would need a longer period of financial assistance as compared to the complainant who was working at the time of the deceased’s demise and had gone on retirement.

“Therefore, this Tribunal is satisfied that the board of the first respondent applied its mind to relevant considerations when it took into account the age of the child in deciding to allocate a bigger share of the death benefit to her,” Ms Lukhaimane said . 

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