The Pension Funds Adjudicator has issued her first two default judgments - one against the Mineworkers Provident Fund (MPF) and one against an employer, Gobodo Risk Management.
Mamodupi Mohlala, the adjudicator, announced last month that she intended to make default judgments against funds and administrators that are tardy about responding to her requests for responses to or information about complaints.
Mohlala warned then that to expedite the resolution of the more than 10 000 cases with which the adjudicator's office is dealing, funds and administrators will be given three reminders to supply the required information, before the adjudicator will issue a default determination on the basis of the available information.
Withdrawal benefit delay
In the case against Gobodo Risk Management, a former employee of the company, SN Makaula, complained that he was a member of the Retail Financial Intermediaries Provident Fund until he resigned in August 2007. Makaula then became entitled to a withdrawal benefit, but by January this year, he had still not received his money. Makaula then complained to the adjudicator.
The adjudicator's office asked parties involved, including the fund's administrator, Absa Consultants and Actuaries, for a response to the complaint.
Absa Consultants and Actuaries responded that they were unable to work out Makaula's benefit because the employer had not paid over any contributions to the fund since June 2007.
The administrator told the adjudicator that the fund's consultants have tried on several occasions to urge Gobodo Risk Management to pay the outstanding contributions, but to no avail.
Mohlala says in her default ruling that Gobodo Risk Management was sent a letter in February asking it to respond to the complaint within a month, but it failed to respond. It was subsequently reminded of the matter in writing and verbally, but still failed to respond.
On the information before her, Mohlala then found against Gobodo Risk Management and ordered it to put Makaula in the position he would have been had Gobodo paid the contributions to the fund.
Mohlala instructed Absa to calculate Makaula's benefit as if all the contributions had been paid over timeously, and ordered Gobodo to pay that amount to Makaula, plus interest at 15.5 percent from the date the employer stopped paying over its contributions to the fund.
Money in trust
In the case against the MPF, TS Mabuza, the brother of a deceased member of the fund, complained that R108 000 of death benefits due to his brother's five minor children had been placed in a trust rather than given to the children's grandmother, who was looking after them.
Mohlala repeatedly asked the MPF to respond to Mabuza's complaint, but, despite giving undertakings that it would, the fund failed to do so.
The adjudicator's office had even met with the fund 10 days before the default ruling was issued and requested a response to this and other matters, but still did not receive one.
Mohlala therefore set aside the decision made by the fund's board of trustees to put the money in trust.
The adjudicator ordered the MPF to conduct a proper investigation regarding the ability of the grandmother to administer the minors' financial affairs and to finalise this investigation within six weeks of the determination.
In both cases, Mohlala argued that she had the right to issue default determinations, because her office has the authority to issue determinations that have the same effect as that of a civil judgment and that therefore she is entitled to apply the rules of the High Court relating to default judgments.
These rules give the courts the power to issue default determinations in cases where they have attempted to procure a response from a respondent but to no avail. This is due to the fact that a failure by a respondent to file a response delays the resolution of the complaint and protracts the dispute unnecessarily.
Further, Mohlala says, a delay may prejudice a complainant in respect of his or her rights to his or her benefit in the fund and also delays access to justice.
Contact
The Pension Funds Adjudicator is Mamodupi Mohlala.
Cape Town office:
Telephone: 021 674 0209