Category Legal Affairs

‘De bloedige hand’ principle and its application in s37C pension fund distributions

23 September 2020 Amina Yuda and Michelle David, Norton Rose Fulbright

The Pretoria High Court has refused to extend the ‘bloedige hand’ principle in instances where the beneficiary of a death benefit was the child of the deceased’s killer. The ‘bloedige hand’ principle holds that no person who unlawfully causes the death of another may inherit from the deceased.

The deceased and his wife were killed by the deceased’s stepdaughter (Bonolo). The stepdaughter had a minor child who was living with and dependent on the deceased and his wife. The deceased had nominated his mother and his wife as beneficiaries to his pension benefit upon his death and in the event that his mother died before him, he nominated his wife as the only beneficiary.

Notwithstanding that Bonolo was instrumental in the murder of the deceased and his wife, the pension fund awarded the entire pension benefit to Bonolo’s child in terms of section 37C of the Pension Funds Act 1956.

The deceased’s siblings contested this by filing a complaint with the pension funds adjudicator. The adjudicator set aside the pension fund’s award and ordered a re-investigation of the allocation. The pension fund conducted the investigation and declared that the siblings were not dependants of the deceased and this decision was confirmed by the adjudicator.

The deceased’s siblings launched an application to review the decision of the pension fund adjudicator relying on the principle that ‘de bloedige hand neem geen erfenis’. The reasoning of the applicants was that, since the child’s mother was precluded from receiving a benefit based on the ‘bloedige hand’ principle, her child was equally not entitled to benefit and the common law ought to be extended. The court disagreed for the following reasons:

  • The ‘bloedige hand’ principle does not extend down the bloodline to exclude anyone other than the ‘bloedige hand’ from receiving the benefit;
  • The trustees of the pension fund correctly distributed the deceased’s pension benefit in accordance with section 37C of the Pension Funds Act by establishing factual dependence on the deceased notwithstanding that there was no biological link between the deceased and the child; and
  • The trustees correctly compared the child’s position with that of the deceased’s siblings and established that the siblings are not indigent and their need was premised on what could be categorised as speculative future contingencies.

The judgment aligns with the position that only a wrongdoer should be prejudiced by his or her actions. The order sought by the siblings in this instance would have been to the detriment of the child despite him being innocent.

First published by: Financial Institutions Legal Snapshot

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