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[2016] ZAGPPHC 201
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Joint Municipal Pension Fund v Enhlanzeni District Municipality (70680/13) [2016] ZAGPPHC 201 (12 April 2016)
IN THE HIGH COURT OF
SOUTH AFRICA
[GAUTENG DIVISION,
PRETORIA]
70680/13
12/4/16
Not reportable
Not of interest to other
judges
Revised.
In the matter between:-
JOINT MUNICIPAL
PENSION FUND
Plaintiff
and
ENHLANZENI DISTRICT
MUNICIPALITY
Defendant
JUDGMENT
SKOSANA AJ
[1] The plaintiff in this
case is the Pension Fund incorporated and registered in accordance
with the Pension Fund Act 24 of 1956
("the Pension Act").
The defendant is a district municipality established in terms of the
Local Government: Municipal Structures Act 117 of 1998
as well as the
Local Government: Municipal Systems Act 32 of 2000
. The defendant is
a successor in law of the former Lowveld Escarpment District Council.
The plaintiff was represented by Adv WG
Pretorius while the defendant
was represented by Adv Fl Baloyi.
[2] The plaintiff alleges
that one Mr John Willem Scheepers ("Scheepers") was a
member of the plaintiff as contemplated
in section 1 of the Pension
Act as he was employed by the predecessor to the defendant, the
Lowveld and Escarpment Regional Services
which later became the
Lowveld Escarpment District Council and ultimately the defendant
municipality. This is common cause between
the parties.
[3] The plaintiff further
alleges that Scheepers was retrenched by the Lowveld Escarpment
District Council on 30 April 1997. It
further alleges that in terms
of section 13A of the Pension Act, the defendant became liable to pay
to plaintiff in full for any
contribution which, in terms of the
rules of the plaintiff are to be deducted from Scheepers's
remuneration and any contribution
for which the defendant is liable
in terms of the plaintiff's rules.
[4] It is further alleged
by the plaintiff that paragraph 35 read with paragraph 33 of the
plaintiff's rules, created a liability
on the defendant to pay the
plaintiff a lump sum calculated by an evaluator.
[5] Consequently, the
plaintiff claims from the defendant amounts referred to as arrear
retrenchment contributions for the period
from August 2005 to 30
September 2013 as well as future pension instalments from 01 October
2013 until the members' retirement
age of 65 on 15 October 2025. This
appears from the plaintiff's particulars of claim.
[6] The parties agreed at
the commencement of the trial that I only have to determine the
defendant's liability and that the quantum
of the claim will be
determined at a later stage. This was confirmed later during the
trial by the respective parties.
[7] In its amended plea
the defendant raised three special pleas, one of which was abandoned
during the trial. The two remaining
special pleas related to
locus
standi
and the other to prescription. It also pleaded on the
merits of the claim.
[8] The special plea on
locus standi
was based on the following:
[8.1] That the plaintiff
has no
locus standi
to institute these proceedings on behalf
of Scheepers;
[8.2] That Scheepers was
employed by the defendant until 30 April 1997 and thereafter took up
employment with the Department of
Health, Welfare and Gender Affairs:
Mpumalanga Province ("the department") from 01 May 1997;
[8.3] That Scheepers'
transfer to the department resulted in the termination of his
membership with the plaintiff in terms of section
23(3) and (4) of
the plaintiff s rules;
[8.4] That the definition
of the member as defined in section 1 of the Pension Act excludes a
member or a former member like Scheepers
who has received all the
benefits and whose membership has been terminated.
[8.5] That Scheepers
ceased to be a member of the plaintiff in April 1997 and consequently
stopped contributing to the plaintiff
and the defendant ceased to
contribute on his behalf.
[9] The prescription
plea, according to the defendant's amended plea, is based on the
following:
[9.1] The plaintiff's
claim constituted a debt as defined in the
Prescription Act 68 of
1969
;
[9.2] The plaintiff
allegedly demanded payment on 09 November 2010 but the summons were
only issued on 11 November 2013, i.e. more
than 3 years after the
debt would have become due and payable;
[9.3] That the defendant
pleads that the plaintiff's claim prescribed on 10 November 2013
alternatively, that since Scheepers left
his employment with the
defendant in April 1997, the plaintiff's claim prescribed in April
2000.
[10] At the beginning of
the trial, the defendant sought to argue these special pleas without
any evidence being led. The plaintiff
resisted, contending that the
special pleas required the leading of evidence. I ruled against the
defendant allowed the parties
to lead evidence.
[11] My reasons for the
above ruling are briefly that the defendant had issued a notice of
exception against the plaintiff's particulars
of claim earlier but
did not complete the process by filing an exception. This is already
an indication that the defendant realized
that the issue could not be
determined on the basis of the pleadings only. Further, the plaintiff
had also replicated against the
defendant's special plea raising,
among others, interruption against prescription and alleging that the
defendant had paid the
arrear retrenchment contributions up to July
2005 thereby acknowledging the indebtedness to the plaintiff. There
was also a possibility,
in my view, for the plaintiff to explain by
way of evidence or otherwise the basis upon which it claims to have
locus standi.
[12] There was also an
application for absolution from the instance brought by the defendant
after the plaintiff had closed its
case. I exercised my discretion
against the defendant in this regard and dismissed the application
largely on the reasons already
stated above. In particular, there had
been a denial by the defendant, as reflected during cross-examination
of the plaintiff s
witness, of the alleged payments made by the
defendant after April 1997. At that stage it appeared to me that it
may become necessary
for me to weigh up all the evidence before
deciding on the special pleas.
[13]
LOCUS
STANDI
The pension benefits
claimed by the plaintiff are for the benefits of Scheepers. The
plaintiff s only witness, Ms Fourie conceded,
towards the conclusion
of the cross-examination, that the money claimed by the plaintiff
belongs to Scheepers and not to the plaintiff,
though it should be
paid to him through the plaintiff.
[14] In argument on the
merits, the plaintiff s counsel referred me to the case of
Telkom
SA Ltd & Others v Blom & Others 2005(5) SA 352 (SCA).
In
that case, the eight employees who were affected by the non-payment
of the pension benefits were joined as parties to the proceedings.
In
fact, the employer and the pension fund were cited as first and
second respondent in the court a quo. Similarly, in the case
of
Independent Municipal and Allied Workers Union v The Cape Joint
Retirement Fund 2007 JDR 1296 (C),
the trade union was the first
applicant and the employees were joined as second to hundredth
applicants. The pension fund and the
employer were cited as first and
second respondents respectively.
[15] In this case, the
employee, who is the sole beneficiary to the claim, being Scheepers,
was not joined as a party to these proceedings.
No allegation was
made nor evidence adduced that the plaintiff was acting on behalf of
Scheepers. In any event even if the plaintiff
were to claim that it
was acting on behalf of Scheepers, it would have required his
authority for the institution of the proceedings
[1]
.
[16] It is also common
cause that Scheepers ceased to be a member of the plaintiff in April
1997. The defendant argued that the
definition of 'member' in section
1 of the Pension Act gives the plaintiff the necessary
locus
standi.
This definition reads as follows:
'"member', in
relation to-
(a)
a
fund
referred to in paragraph (a) or (c) of the definition of 'pension
fund organisation: means any member or former member of the
association by which such fund has been established;
(b)
a
fund
referred to in paragraph (b) of that definition, means
a
person
who belongs or belonged to
a
class of persons for whose
benefit that fund has been established,
but does not include
any person who has received all the benefits which may be due to that
person from the fund and whose membership
has thereafter been
terminated in accordance with the rules of the fund;"
[17] Mr Pretorius, who
acted for the plaintiff, argued on the basis of the definition above
that Scheepers remained a member of
the plaintiff by virtue of the
residual definition of the member as he had not received all his
benefits from the plaintiff. In
my view, this argument may be
attractive but lacks merit. First, the plaintiff has no
locus
standi
to claim the benefits of Scheepers regardless of whether
he is a former member or remains a member of the plaintiff. In its
own
version, the plaintiff was merely a conduit to pass on the
pension benefits to Scheepers and had no direct and substantial
interest
in the matter. Second, the residual part of the definition
refers to a former member who has not received all the benefits which
may be due to him
from the fund
. In the plaintiff’s own
version, the benefits that are due to Scheepers are not from the fund
but from the defendant.
[18] In
Cosira
Developments (Pty) Ltd v Sam Lubbe Investments CC
2011
(6) SA
331
(GSJ)
para [12], Van Oosten
J
stated thus:
"[12] The general
rule that
a
person who claims relief from
a
court must
establish an interest in that matter in order to acquire the
necessary locus standi to seek relief is well established.
The
interest, Rabie ACJ pointed out in Cabinet of the
Transitional
Government for the Territory of South West Africa v Eins
1988 (3) SA
369
(A) at 388A
-
I, with reference to earlier judgments of
the then Appellate Division, must be direct and not therefore too
remote or
as
it has also been referred to, an actual and
existing interest in the matter."
[19] In the present case,
the claim relates also to future interest of Scheepers and not an
existing one. There is also no direct
interest shown on the part of
the plaintiff.
[2]
Consequently,
I am of the view that the plaintiff has failed to establish its
locus
standi.
[20] In the
circumstances, it is my view that the plaintiff has no
locus
standi in judicio
to bring the present claim against the
defendant. In the light of this finding I do not have to consider any
further defences as
well as the merits of the plaintiff s claim.
[21] Although I no longer
have to consider the special plea of prescription, I have misgivings
whether the plaintiff s claim would
have succeeded against it. This
is particularly so when regard is had to the claim as now argued by
the plaintiff in its heads
of argument paragraph 22. In that
paragraph, the plaintiff reduced its claim to a mere declarator that
the defendant is liable
to the plaintiff for the payment of monthly
pension benefits in terms of Rule 35 read with Rule 33 of the
plaintiff s Rule from
02 December 2010 to 15 October 2025. This
belated limitation of its claim by the plaintiff was due to the
difficulties encountered
with regard to prescription.
[22] The reduction of the
claim to a declarator is not only a contention which is not supported
by the pleadings, but seems to also
fortify the plea of prescription
in that the declaratory has to be dealt with with reference to the
date on which the cause of
action arose, which would have been either
in 1997 or in July 2005. Further, the declarator would have also
attracted the defence
of unreasonable delay on the part of the
plaintiff. It therefore could not be raised by way of argument.
[23] I therefore point
out, without deciding, that the plaintiff s attempted reformulation
of its claim would have probably exacerbated
its position.
[24] Mr Baloyi for the
defendant argued that I should dismiss the plaintiff s claim and
mulct the plaintiff with costs on a punitive
scale. I do not find it
appropriate to award punitive costs in this case. The defendant
argued that the plaintiff's claim was frivolous
in that the plaintiff
knew that such claim did not exist or was unsustainable and therefore
its conduct bordered on abuse of process.
[25] I have not decided
the matter on the basis of the merits thereof and can therefore not
conclude whether the plaintiff's case,
absent the adverse finding on
the special plea, would have been meritorious or not. There is
therefore, in my view, no basis for
ordering costs on a punitive
scale.
[26] In the results, I
make the following order:
[26.1] The plaintiff's
claim is dismissed with costs.
____________________
DT SKOSANA
Acting Judge of the High
Court
[1]
See Ganes & Another v Telecon Ltd
2004 (3) SA 615
(SCA) para 19
[2]
See also Public Protector v Mail & Guardia n 2011(4) SA 420
(SCA)