On 4 May 2022, the Financial Services Tribunal (Tribunal) dismissed an application for condonation in an application that was filed a year and a day later than the determination, which was the subject of the reconsideration. The grounds for the dismissal were, inter alia, that the pension fund and the respondents would be severely prejudiced.
In this matter, the guardian of the children (Ms JA) applied for a reconsideration of the Pension Fund Adjudicator’s (Adjudicator) determination where the Adjudicator had set aside the pension fund’s allocation of a death benefit to two of Ms JA’s children on the grounds that the children were not the deceased’s biological children and no factual dependency could be established. Further, the pension fund was ordered to reconsider its allocation within six weeks of the determination and to provide the Adjudicator with a report within two weeks after finalisation of its decision.
Ms JA alleged that the children were the deceased’s biological children and in a separate matter under the jurisdiction of the Magistrate’s Court, DNA tests were ordered to be performed and which results showed that no such relationship existed. On the strength of these results, the Adjudicator set aside the pension fund’s allocation to the two children; on the issue of factual dependency, the Adjudicator reiterated the stance that –
“…isolated sporadic payments are not sufficient to indicate a maintenance relationship. There must be some regularity in the payments made by the deceased to confirm that he was supporting [the children] during his lifetime.”
The Tribunal did not consider the merits of the determination because the main issue was whether condonation could be granted. The determination was issued by the Adjudicator on 27 September 2021 and it only came to Ms JA’s attention on 15 October 2021. The Tribunal Rules state that an application for reconsideration must be made within 60 days after the applicant was notified of the decision or such longer period as may on good cause be shown. Ms JA’s application for reconsideration was filed on 28 September 2022, one reason being that she was considering consolidating her application, with another case similar to hers, which she did not go through with.
Taking her factual circumstances into consideration, the Tribunal also made note of section 30O of the PFA which in essence states that the decision of the Adjudicator has the same effect as any civil judgment given in a court of law and thus a writ or warrant of execution may be granted by a registrar of the court based on such determination.
In this case, the pension fund had adhered to the Adjudicator’s determination having regard to section 30O of the PFA and had reallocated the allocations to Ms JA’s two children to the deceased’s wife and made payment of same. Ms JA had not advised that she would be applying for reconsideration of the Adjudicator’s determination.
In light of the above, the Tribunal dismissed Ms JA’s condonation application because allowing condonation would prejudice the pension fund materially and procedurally; more specifically it would result in a financial loss for the fund. The Tribunal said in this regard –
“Undoing the determination of the PFA means that the Tribunal will have to remit the matter to the PFA. The PFA will then have to decide whether to uphold, dismiss or refer the matter back to the Fund for further investigation. Should the Fund then revert to its original 7% allocation, it will have to reclaim the overpayment from the Member’s (deceased’s) widow. If the Fund does not succeed, the funds of its other members will bear the loss.”
This determination once again highlights the need for applicants who seek to have decisions, especially those of the Pension Funds Adjudicator, reconsidered to ensure that they do so within the timeframe permitted by legislation, alternatively to make out a proper case for condonation. Moreover, such applicants must show that no material prejudice will be suffered by the respondents if condonation is granted.
The judgment can be found HERE.