Can one person's customary spouse still be considered “on any logical basis” the life partner of another? And can any decision taken by a pension funds adjudicator fall within the jurisdiction of the Constitutional Court?
These were some of the questions that came up in the apex court on Tuesday during an application for leave to appeal a Supreme Court (SCA) ruling on a death benefit award made a decade ago in Limpopo.
Tshifhiwa Shembry Mutsila is challenging the distribution of benefits by the Municipal Gratuity Fund (MGF) after the death of her husband, Takalani Emmanuel Mutsila, in 2012. Takalani worked at the Phalaborwa municipality before his death.
Mutsila and her five children were the nominated beneficiaries of the death benefit.
She had submitted a claim on behalf of herself and their five children as the nominated beneficiaries, but the fund added another woman, Dipuo Masete, and her two children as beneficiaries based on its findings that they were Takalani's dependents.
This was based on a claim that Masete and her children were “factually dependent upon the deceased” and received R2,000 monthly from him.
Additionally, Takalani had taken out a funeral policy shortly before his death and listed them, his own children with Mutsila and Masete's mother as beneficiaries.
Masete also alleged she was customarily married to Takalani.
This despite a private investigation finding much later that she was in a customary marriage with another man, Malema Mphafudi, who was the alleged biological father of her children.
A legal battle ensued in 2014 after the fund distributed the death benefit and allocated 22.5% to Mutsila and 27.5% to Masete, while the children's benefits varied between 2.5% and 14% of the total benefits depending on their ages.
Mutsila then approached the pension funds adjudicator, who set aside the fund's decision on the basis that it failed to properly investigate the matter.
The matter then reached the Pretoria high court, which also found that the fund had neglected its duty to “accurately assess dependents, leading to an improper benefit distribution”.
The fund successfully appealed this ruling in the SCA, which set aside the adjudicator's 2014 award as it found that Masete, who it referred to as his life partner, and her children were his “factual dependents” before his death.
Adv Sandile Khumalo, appearing for Mutsila, in his submission said the matter before the court related to the “proper interpretation” of the Pension Funds Act (PFA) and three sections in particular.
The uneasiness on my part is [in two parts and] perhaps you can help me. How can something so wrong be so right? Two, you are a partner in a customary union and [yet] you are life partner at the same time. I mean, if this court were to endorse it, this court would have ushered in a new era with untold ramifications.
— Justice Rammaka Mathopo
“It is our submission that the pension funds distribution decision cannot stand and should have been set aside for mainly three reasons. One, when the pension fund made an allocation to Masete and her children, it did not know that she was married to somebody else, and according to that person, Mphafudi, Masete lived with his family until March 2013.
“The court will recall that the deceased died in December 2012 so the board of the pension fund did not know that there was a husband who was liable to maintain Masete and therefore, did not take that into account, including the fact that there's a joint estate between those two people.”
The second reason was that the fund didn't know that Masete's children had a father who was “alive and well” and “willing and able” to maintain them at the time it made its decision. Finally, Khumalo disputed the amounts the deceased apparently paid to Masete, saying bank statements produced at a custody hearing brought by Mphafudi showed that these actually ranged between R200 and R900.
“They relied on the mere say-so of Masete, which is wrong because ... whenever you have something like that, you should conduct a proper investigation and verify claims made by people who come forward.
“If the board made a distribution decision without knowledge of those facts, then clearly no proper investigation was conducted and the decision should be set aside. Because all those facts are material to the distribution decision and they were present when the decision was made; they were simply not properly investigated.”
The relief Mutsila sought, according to Khumalo, was for their leave to appeal application to be granted and for the pension fund to be “ordered to conduct a proper investigation within three months and make a distribution decision afterwards”.
Several justices questioned Khumalo on various issues relating to his submission. Among them were justices Rammaka Mathopo and Leona Theron.
Mathopo on his part expressed his “uneasiness” about previous arguments made in the long-running saga.
“The uneasiness on my part is [in two parts and] perhaps you can help me. How can something so wrong be so right? Two, you are a partner in a customary union and [yet] you are life partner at the same time. I mean, if this court were to endorse it, this court would have ushered in a new era with untold ramifications.
“If indeed, as the evidence shows, Masete was in a customary union with Mphafudi, how can on any logical basis it be said she was a life partner? A life partner who's not even cohabiting with her spouse. That's one difficulty I have.”
Mathopo also raised issue with the evidence the fund relied on to recognise Masete and her children as beneficiaries (the bank deposits) as well as Masete's claim that Takalani was the father of her children. “That's purely a lie,” he said on the latter.
Responding to Khumalo's submission was adv Ross Shepstone, who argued that the fund's decision was based on the “wide discretion” it had as per the applicable act.
“Our submission is that section 37(p) of the PFA ... doesn't create rights for beneficiaries. What it does is place an obligation on the fund to correctly apply a discretion, first to determine who the beneficiaries are, then second to determine a proportion of the benefits to be applied to each one,” he said.
He too fielded questions on Masete's recognition as a life partner by the SCA, arguing that the fund did not base its decision on this, but rather on the fact that she and her children were “factual dependents” given the money the deceased apparently paid to them.
Shepstone also touched on the audi-principle, in which the fund argued it was not given an opportunity to make representations before the adjudicator made its decision.
Speaking on this, Shepstone said: “The complaint the fund had about the way the adjudicator dealt with the issue was that the adjudicator never gave it an opportunity to put the full facts of its investigation, which it had conducted, before the adjudicator.
“That was the complaint. Not that it wanted more time in which to investigate whether there were further beneficiaries or how the benefits must be allocated,” he said.
Judgment has been reserved.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.