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Pension Fund Adjudicator: Complainants cannot keep raising new issues

05 May 2021 Michelle David, Norton Rose Fulbright
Michelle David, Norton Rose Fulbright

Michelle David, Norton Rose Fulbright

In Nicolaas Albertus Van Rhyn and Another v The Pension Funds Adjudicator and Others, the applicants brought an application for review and remittal back for reconsideration of a determination by the Pension Fund Adjudicator (PFA). Providing the High court of South Africa (Court) with an opportunity to consider the final and binding nature of decisions taken by the PFA.

The crux of the first complaint concerned the apportionment of the death benefit arising from the death of the applicants’ unmarried daughter. The deceased had no children, but at the time of her death the applicant was residing with the third respondent, with whom the applicant shared a mutually dependant relationship. Following an investigation by the retirement fund, the third respondent was identified as a beneficiary, resulting in the applicants lodged a complaint with the PFA.

The first complaint was upheld and the retirement fund was ordered to investigate whether the third respondent qualified as a dependant of the deceased. Subsequent to the second investigation, the apportionment to the third respondent was significantly reduced. This did not accord with the applicants’ desire that the third respondent be excluded from the distribution, resulting in them bringing a second complaint. The PFA however did not consider the second complaint, having taken the view that its initial order was final and binding.

The Court assessed whether the PFA’s decision was final by applying the following test:

If the terms of the complaints are materially different, the PFA’s decision is not final.

The High Court agreed that the PFA’s decision was final. In the second complaint, the applicants’ raised a new issue alleging that the PFA did not attach sufficient weight to the allegation raised that the deceased and the third respondent had terminated their mutual dependency two weeks before her death. The Court found this not to be materially different and stressed that complainants cannot keep raising new issues on the same set of facts, in an effort to get the desired result (which, in this case, was the total exclusion of the third respondent as a dependant).

The Court also invoked its powers under section 30P (2) of the Pension Funds Act, 1956 which allows it to consider the merits of the complaints. In doing so, the Court found the conduct of the retirement fund to be consonant with the proper construction of section 37C (1)(a) of the Act and dismissed the application.

When submitting complaints to the PFA, complainants must be aware that new issues cannot be created in the hope of obtaining the desired result. Only in instances where the complaints are materially different, will the PFA be entitled to consider the new complaint.

Following the proper construction of section 37C (1)(a), funds will make a determination as to who constitutes as a beneficiary based on the information available at the time when the determination is made, provided that the person concerned is still a beneficiary at the time the distribution is made. New issues, like the issue raised by the applicants, cannot be created and raised in subsequent complaints should complainants not be satisfied with the result.

*This blog was co-authored by Devan Falconer, Candidate Attorney

First published by: Financial Institutions Legal Snapshot

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