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[2014] ZAGPPHC 481
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Kwacha Pension Fund and Another v Pension Fund Adjudicator and Another (76484/2013) [2014] ZAGPPHC 481 (23 May 2014)
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG
DIVISION. PRETORIA
CASE NUMBER:
76484/2013
in the matter
between:
KWACHA PENSION
FUND
................................................................................................
1
st
APPLICANT
SIZWE MEDICAL
FUND
....................................................................................................
2
nd
APPLICANT
and
PENSION FUND
ADJUDICATOR
.................................................................................
1
st
RESPONDENT
NOMPUMELELO FAITH
GABELA
.............................................................................
2
nd
RESPONDENT
CORAM:
DE VRIES AJ
JUDGMENT
1. In this matter
the 1
st
and 2
nd
Applicants seek an order in the
following terms:
1.1 That the
decision/determination of the 1
st
Respondent dated 26
November 2013 be reviewed and set aside insofar as it directs the l
sl
Applicant to reimburse the 2
nd
Respondent with an amount
of R 383 808.86;
1.2 That the
determination of the 1
st
Respondent be substituted by an
order dismissing the 2
nd
Respondent’s complaint
dated the 17
lh
of January 2013;
1.3 That the
deduction of R 383 808.86 from the 2
nd
Respondent's
pension benefit be declared to have been lawfully made;
1.4 That the
Respondent who opposes this application be ordered to pay the costs
thereof.
2. The 1
st
Applicant is Kwacha Pension Fund (“Kwacha"), a pension
fund duly established and registered in terms of the provisions
of
the
Pension Funds Act 24 of 1956
.
3. The 2
nd
Applicant is Sizwe Medical Fund (“Sizwe”), a medical fund
duly established and registered in terms of the provisions
of the
Medical Schemes Act 131 of 1998
.
4. The 1
st
Respondent is the Pension Fund Adjudicator appointed as such by the
Minister of Finance in terms of Section 30C(1) (a) of the Pension
Fund Act 24 of 1956.
5. The 2
nd
Respondent is Nompumelelo Faith Gabela, previously employed by the
2
nd
Applicant (Sizwe) as a principal officer.
THE FACTUAL
BACKGROUND
6.
The contract ot employment was terminated by way of an agreement,
entered into belween the 2
nd
Applicant and the 2
nd
Respondent on the 31
si
ot October 2011. The agreement was in writing and annexed
\o
the
Applicants’ papers.
7. The salient terms
of this agreement which are germane to this dispute are the
following:
“
The
employee hereby undertakes 1o return Ihe following assets and/or
property to the employer with immediate effect:
5.1 The employee’s
company car, a black BMW X6, with letters and registration numbers
LHK IGP;
5.2 The employer’s
petrol card;
5.3 The employer's
two cell phones;
5.4 The employer's
laptop;
5.5 External data
storage (USB), including the cable and charger;
5.6 The employer’s
credit card.”
8. The 2
nd
Respondent alleges that, after the agreement had been concluded, the
2
nd
Respondent breached and repudiated the agreement
between the parties which repudiation was accepted by the 2
nd
Applicant.
9.
Thereafter, the 2
nd
Applicant instituted its
Rei
Vindicatio
by
way of application, which application was ultimately successful in
order to recover the motor vehicle referred to herein above.
10.
On the 19
th
of January 2012, the South Gauteng High Court, as it was then known,
confirmed a
Rule
Nisi
and
in terms thereof, the 2
nd
Respondent was ordered to pay the 2
nd
Applicant’s costs.
11. The costs were
taxed and amounted to a sum of R 383 808.86.
12. The Taxing
Master’s allocatur, on the two bills, a total of which is this
sum, was affixed on the 24
th
of October 2012.
13. A letter, dated
the 28
lh
of November 2012 was directed by attorneys, at
that stage acting for the 2
nd
Respondent, to the l
s1
and 2
nd
Applicants attorneys, and -contained the
following:
"Kindly take
note that we have read the contents of your letter dated above, and
our client consent (sic) to such set-off irorn
pension fund (sic) in
the amount of R 383 808.86.”
14. On the same date
the attorneys caused a further letter to be direct to the 1
st
and 2
nd
Applicants' attorneys, which letter contains the
following:
‘
'Kindly
take note that we requested you to inform Moriting Wealth Managers,
who informed us that they will release our client’s
pension
once they have been advised (sic) of the status of the case in High
Court by Sizwe Medical Fund or their representative
under case number
42022/01, that it has been finalised, hence the case is finalised, we
therefore request from your office to discuss
this matter with your
client as their legal representatives that they must release our
client (sic) pension fund and subject to
the set-off of the amount
agreed on between our client and your client as costs incurred at
High Court by your client in the amount
of R 383 808.86”
15. Pursuant to that
letter, the 1
st
Applicant deducted the sum in respect of
the taxed costs from the pension benefit and paid it over to the 2
nd
Applicant. The balance of the credit of the 2
nd
Respondent’s entitlement in terms of the fund was retained and
not paid out to the 2
nd
Respondent pursuant to a request
by the 2
nd
Applicant who had instituted an action for
damages against the 2
nd
Respondent under case number
5560/2013 in the South Gauteng High Court, as it was then known, for
amounts far exceeding that credit
which action is still pending.
16. A complaint was
laid by the 2
nd
Respondent with the l
sl
Respondent during January 2013, in terms of which the 2
nd
Respondent complained that she had not been paid out the
pension benefit accruing to her, held by the 1
st
Respondent. The complaint was replied to by way of submissions made
by Moriting Wealth Managers (Pty) Ltd, made to the 1
st
Respondent and thereafter the 1
st
Respondent made the
following order:
16.1 The l
s1
Respondent is ordered 1o reimburse the complainant with an amount of
R 383 808.86 deducted from her withdrawal benefit together
wilh
interest at a rate of 15.5% per annum calculated from the 26
lh
of March 2013 to date reimbursement (sic), within three weeks of this
determination.
17. It is this
determination which forms the subject matter of the present dispute
between the parties.
18. The 2
nd
Respondent has not opposed this application and the l
sl
Respondent takes the view, in an affidavit filed by her, that she
does not oppose the application and says:
"In these
circumstances, my possession akin to that of a judicial officer who's
ruling is appealed against or reviewed. I do
not defend my
determinations, nor do 1 have a right to do so."
19. The affidavit
contains a request:
“
I
will read the outcome or judgment and reasoning when the matter is
finalised and abide by the decision of the Honourable Court.
I humbly
request that the Honourable Court considers giving a written judgment
as guidance of the l
st
Respondent, particularly in instances where the Court differs with
the reasons for my determination.”
THE PRESENT
DISPUTE BETWEEN THE PARTIES:
20. The Applicants
take the view that the 1
st
Respondent correctly found
that:
"Having regard
to the rules of the 1
st
:
Respondent and the
Act, there is nothing in the 1
st
Respondent's conduct to
suggest that it acted outside the scope of its powers as contained in
Section 37D(1) ot the Act by withholding
the complainant’s
benefit, pending the finalisaiion of the criminal case against her.
Thus the withholding of the complainant's
withdrawal benefit by the
Respondent, pending the outcome of the criminal charge is permitted
by the rules and the law."
21. The Applicants
take the view that the determination given by the Pension Fund
Adjudicator in regard io the deduction from the
pension fund, as set
out in her award, is bad in law, was not an issue before her, and has
in any event become settled between
the parties.
22. The allowable
deductions which a fund may make against the benefits accruing to a
member are set out in
Section 37D
of the
Pension Funds Act, 24 of
1956
.
Section 37D(b)
(ii) reads:
“
Compensation
(including any legal costs recoverable from the member in a matter
contemplated in sub-paragraph (bb)) in respect of
any damages caused
to the employer by reason of any theft, dishonesty, fraud or
misconduct by the member, and in respect of which
-
(aa) The member has
in writing admitted liability to the employer; or
(bb) Judgment has
been obtained against the member in any Court, including a
Magistrate's Court,
from any benefit
payable in respect of the member or a beneficiary in terms of the
rules of the fund, and pay such amount to the
employer concerned;”
23. There is in my
view no doubt that the actions of the 2
nd
Respondent in
retaining the employer’s vehicle after having undertaken to
return same, thereby placing the employer in a
position where it had
to institute action to recover its asset falls four square within the
ambit of misconduct by the member and
against the background of the
correspondence between the parties, the member had, in writing,
admitted liability, and that the
amount thereof was fixed by order of
Court is an allowable deduction.
24. For these
reasons I make the following order:
24.1
That the deduction of R 383
808.86
from
the 2
nd
Respondent’s pension benefit was lawfully made;
24.2 The l
sl
Respondent’s determination is set aside, insofar as it directs
the 1
st
Applicant to reimburse the 2
nd
Respondent;
24.3 The 2
nd
Respondent’s complaint is dismissed.
DE VRIES AJ
JUDGE OF THE HIGH
COURT OF SOUTH AFRICA, GAUTENG DIVISION,
PRETORIA