Category Legal Affairs

There is no direct access to the Pension Funds Adjudicator

09 September 2021 Ntokozo Ngubane, Norton Rose Fulbright

The Pension Funds Act, 1956 (“PFA”) is the primary legislation regulating retirement funds. Section 30A of the PFA provides that any person who has a complaint as defined in section 1 “may lodge a written complaint with the retirement fund for consideration by the board, which must be properly considered and responded to within 30 days”. Should the complainant be dissatisfied with the decision of the board, they may then lodge a complaint with the office of the pension funds adjudicator but only if this route has been followed.

Ms Jacks lodged a complaint with the office of the pension funds adjudicator relating to a delay in the finalisation of a distribution of death benefits but did not challenge the decision of the board of trustees on the grounds of fairness and equity. The pension funds adjudicator dismissed the complaint on the basis that, Ms Jacks had failed to lodge a complaint with the board of trustees challenging the distribution and allocation of the deceased death benefits. This is the primary consideration for the pension funds adjudicator in establishing whether she has the power to adjudicate a complaint as contemplated in section 30A.

Dissatisfied with the decision of the pension funds adjudicator, Ms Jacks lodged an application for reconsideration before the Financial Services Tribunal (“FST”) in terms of section 234(4) of the Financial Sector Regulation Act, 2017. The FST, summarily dismissed Ms Jacks application for reconsideration on the following basis:

  1. The application was filed out of the prescribed timelines and although she had sought for condonation for the delay, she did not state why she is entitled to consideration;
  2. The relevant beneficiaries were not cited (being the beneficiaries to the deceased estate); and
  3. The FST does not have the jurisdiction to hear the matter, given that she did not formally lodge a complaint with the board of trustees and consequently if the PFA could not adjudicate the complaint, and the same applies to the FST.

The decision emphasises that individuals who are aggrieved by decisions of a fund, must first seek recourse with the fund and then escalate the complaint to the office of the pension funds adjudicator. This provides funds with an opportunity to resolve the issue internally. Where this route is not followed it could result in matters that were capable of resolution at fund level being needlessly attended to by the dispute forums.

The case is: Rina Belinda Jacks v Sanlam Futura Umbrella Retirement Fund and Others

First published by: Financial Institutions Legal Snapshot

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