Michelle David

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“Retrospective pension fund rule amendments not registered by FSCA do not bind members” says ConCourt

By Michelle David, Amina Yuda and Ntokozo Ngubane on August 23, 2023 Posted in Banking

The Constitutional Court has provided much needed certainty to the retirement fund industry following the surprising April 2022 judgment of the Supreme Court of Appeal in Municipal Employees Pension Fund & Another v Pandelani Midas Mudau and Another. On 02 August 2023, the Constitutional Court overturned the SCA judgment. The facts of the matter are … Continue reading

Automatic Payment Portal Systems cannot be used as a defence to pension interest claims

By Michelle David on May 12, 2023 Posted in Finance

This blog was co-authored with Rory Scott, Candidate Attorney. On 15 March 2023, the Financial Services Tribunal dismissed a reconsideration application, ruling that a fund cannot rely on a benefit being in the process of being automatically paid as a defence to a pension interest claim. The non-member spouse filed a complaint on 12 May … Continue reading

Use of day-to-day benefits account to fund PMB conditions

By Michelle David on October 21, 2022 Posted in General

In October 2022, the High Court in KeyHealth Medical Scheme v Ngoepe No and Others considered whether the court a quo was correct in finding that a medical scheme was prohibited from using day-to-day benefits to fund the treatment and costs of Prescribed Minimum Benefit (PMB) conditions. The court found that the source of the … Continue reading

Prescription and claims for interest on late payments

By Michelle David on October 18, 2022 Posted in General, Uncategorized

This blog was co-authored by: Bwanika Lwanga, Candidate Attorney In June 2022, the High Court held that a claim by a provident fund for interest on late-paid contributions had prescribed. The parties signed an acknowledgement of debt on 26 November 2013 for a total of R12 488 219. 04 owed by an employer to the … Continue reading

The power of trustees to invest where profits and principles conflict

By Michelle David on June 14, 2022 Posted in General

This blog was co-authored by Bwanika Lwanga, Candidate Attorney The English judgment of Butler-Sloss & Ors v The Charity Commission for England and Wales & Anor [2022] EWHC 974 (Ch), considered the question of whether the trustees of two charitable trusts could adopt investment policies that exclude profitable potential investments on the basis that the … Continue reading

Jurisdiction of Pension Funds Adjudicator and Financial Services Tribunal over non-participating employers

By Ntokozo Ngubane and Michelle David on March 3, 2022 Posted in General

On 23 February 2022, the Financial Services Tribunal (FST) reinforced that an employee who does not have a “complaint” as provided for, in section 30A of the Pension Funds Act,1956 (PFA) cannot have recourse under the PFA. The fact of the case are: The applicant was employed as a truck driver by during the period … Continue reading

A pension fund cannot challenge the Pension Fund Adjudicator’s section 37C decision

By Michelle David on July 20, 2021 Posted in Insurance

A pension fund failed in its application for reconsideration of the Pension Fund Adjudicator’s (PFA) decision to refer the matter back to the fund for reconsideration because, according to the Financial Services Tribunal the fund is not a ‘person aggrieved’ as required by section 230 of the Financial Sector Regulation Act of 2017. The fund … Continue reading

Employer ordered to pay costs of application to the Financial Services Tribunal

By Michelle David on May 27, 2021 Posted in Banking

The Tribunal has determined that the employer in the recent decision in the matter of Oasis Group Holdings (Pty) Limited v Mansoor and Others, is liable for the costs of the fund member in opposing the application on the High Court scale. The costs order comes in the wake of the Tribunal having repeatedly dealt … Continue reading

Pension Fund Adjudicator: Complainants cannot keep raising new issues

By Michelle David on May 4, 2021 Posted in General

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 … Continue reading

Pension Funds: Section 37D(1)(b)(ii) and Employer requests to withhold member benefits

By Ntokozo Ngubane and Michelle David on March 24, 2021 Posted in General

In February 2021, the Financial Services Tribunal (“FST”) in L.S Ngqengelele v Afrisam South Africa (Pty) Ltd considered the question of when a fund may withhold and deduct money from a member’s benefit in accordance with section 37D(1)(b)(ii) of the Pension Funds Act (“PFA”). Section 37D(1)(b)(ii) of the PFA, allows a fund to deduct from … Continue reading

Principle of equity cannot override the provisions of the Pension Funds Act

By Michelle David on October 14, 2020 Posted in General

The principles of equity, despite the equitable jurisdiction of the Pension Funds Adjudicator, cannot override the provisions of the Pension Funds Act (PFA) by permitting a fund to act in contravention of the PFA. The Financial Services Tribunal (Tribunal) has reaffirmed this position. The applicant had been a municipal councillor since 5 August 2016 but … Continue reading

‘De bloedige hand’ principle and its application in s37C pension fund distributions

By Amina Yuda and Michelle David on September 22, 2020 Posted in General

The Pretoria High Court has refused to extend the ‘bloedige hand’ principle in instances where the beneficiary of a death benefit was the child of the deceased’s killer. The ‘bloedige hand’ principle holds that no person who unlawfully causes the death of another may inherit from the deceased. The deceased and his wife were killed … Continue reading

Trustees’ duty to exercise independent discretion on withholding pension benefits

By Michelle David on September 21, 2020 Posted in General

If an employer requests that provident fund benefits be withheld from an employee due to misconduct, the trustees of the fund must still independently exercise their discretion to satisfy themselves that a sufficient case against the employee has been established, in order to withhold the benefit. The Financial Services Tribunal has again considered the withholding … Continue reading

Amendments to the Financial Sector Regulations published

By Ntokozo Ngubane and Michelle David on August 18, 2020 Posted in General

The Minister of Finance, has published amendments to the Financial Sector Regulations under Gazette 43581 intended to simplify the process of appointing the Commissioner and Deputy Commissioner of the Financial Sector Conduct Authority (FSCA). The amendments provide that: The Minister must re-appoint a shortlisting panel (two panellists being the Deputy Govrnor of the South African … Continue reading

Equitable Jurisdiction: The Pension Funds Adjudicator cannot make orders disregarding statutory provisions

By Amina Yuda and Michelle David on May 21, 2020 Posted in General

Since 1 April 2019, the Pension Funds Adjudicator has been empowered to apply the principles of equity in dealing with complaints. The concept of an equity jurisdiction has raised concerns in the industry due to its discretionary nature. The concept of ‘equitable jurisdiction’ has been the subject of a recent determination by the Financial Services … Continue reading

Economic relief measures for members of pension funds

By Michelle David and Roxanne van Rooyen on May 4, 2020 Posted in General

People unable to work due to the pandemic may be looking to access their pension credits in this time of financial hardship. The position in South Africa remains that a member cannot access their pension benefits while they are still in service. Several other countries have however included, as part of their economic relief packages, … Continue reading

COVID-19 and the potential use of medical scheme reserves

By Ntokozo Ngubane and Michelle David on April 16, 2020 Posted in General

Medical scheme trustees cannot take a business as usual approach during the COVID-19 pandemic. Boards should be giving thought to the value of their reserves and whether using such reserves would be of benefit to members. At a minimum, trustees need to understand the options available to them when considering using scheme reserves. In terms … Continue reading

Council for Medical Schemes banning of low cost benefit options

By Lolo Mhaga and Michelle David on March 19, 2020 Posted in Insurance

Healthcare has found its way into everyday conversations more so than in recent years. The steadfast movement towards a National Health Insurance has inspired vigorous yet contrary emotions with each side holding their position with equal conviction. On 4 December 2019 a decision by the Registrar and Chief Executive Officer of the Council for Medical … Continue reading

Coronavirus and pension funds – South Africa

By Michelle David on March 17, 2020 Posted in General

In the wake of coronavirus and the possibility of negative impacts on the economy, trustees of pension funds need to focus on their fiduciary duties. Trustees must ensure that they are well-advised on the possible impact of COVID-19 on their investments and seek to mitigate any loss to assets under investment. The mitigation must include … Continue reading

Coronavirus and medical scheme benefits in South Africa

By Michelle David on March 10, 2020 Posted in General

Coronavirus is yet to test the rules of medical schemes. While it has been reported that a virus like COVID-19 would not usually be covered as a prescribed minimum benefit condition, where the virus amounts to an emergency condition then it will fall within the PMB legislation. In addition, to the extent that the virus … Continue reading

Distribution of pension benefit under section 37C is determined at the date of distribution

By Michelle David on July 18, 2019 Posted in General

Where the board of a pension fund makes a distribution under section 37C(1)(a) of the Pension Funds Act 1956, the distribution must be made according to the circumstances at the time of the distribution and not at the date of death of the deceased member of the fund. The fund had distributed part of the benefits … Continue reading

Restrictions on transfer of benefits on termination of pension fund membership is valid

By Michelle David on June 18, 2019 Posted in General

Provisions in pension fund rules that a member may not withdraw from membership of the fund while remaining in service of the employer to transfer benefits to another fund, were held to be valid and not unconstitutional or contrary to public policy, said the appeal court. Section 13A(5) of the Pension Funds Act read with the … Continue reading

FSB can’t challenge the decision of appeal board

By Michelle David on April 4, 2016 Posted in General

The appeal board established under the Financial Services Board Act overturned a decision made under section 14 of the Pension Fund Act by the Registrar of Pension Funds to permit a transfer of business by a pension fund. The court held that the registrar does not have legal standing to take the appeal board decision on … Continue reading

Directors personally liable for unpaid pension contributions and other changes

By Michelle David on April 14, 2014 Posted in General

Pension Funds need to ensure that they comply with their new obligations because the Financial Services Laws General Amendment Act came in to operation on 28 February 2014. All the amendments to the Pension Funds Act with the exception of the amendments to sections 5(a) and 31 will need to be complied with from the … Continue reading