IN PERSPECTIVE 2/2026
Pension Funds Adjudicator cases
Section 37C case – No allocation to estranged spouse
Ndlangamandla (Complainant) v BECSA Provident Fund (Fund) and others[1]
After conducting its investigation following the deceased member’s passing, the Board of the Fund resolved to allocate the death benefit among the deceased’s children and his life partner.
The Complainant is the deceased member’s estranged spouse. She lodged a complaint, contending that the Fund failed to allocate any portion of the death benefit to her or her children, despite her marriage to the deceased and her alleged financial dependency on him. In support of her claim, she submitted a marriage certificate, a lobola letter, and affidavits confirming the existence of a customary marriage, which was registered posthumously (after the death of the member). She argued that posthumous registration of a customary marriage is permissible under the Recognition of Customary Marriages Act. She further submitted that she never received money from the deceased member by electronic means but in cash. The deceased member would buy groceries for her and the children and sometimes she would go to his house and collect money.
The Fund explained that its investigation, based on available official documentation – including the death certificate, beneficiary nomination forms, and affidavits – indicated that the deceased was single at the time of death and cohabiting with a life partner, who had provided proof of financial dependency. The Fund noted that the documentation regarding the deceased’s marital status was conflicting and sought guidance from the Adjudicator.
The Fund further submitted that the Complainant did not provide proof of financial dependency during the investigation and allocation process and that, as a result, the test for dependency was not satisfied.
The Adjudicator accepted that posthumous registration of a customary marriage is legally permissible. However, section 37C of the Pension Funds Act requires a board to allocate death benefits in a manner that is equitable, taking into account both legal and factual dependency.
Although the Complainant qualifies as a legal dependant by virtue of her marriage to the deceased, marriage alone does not entitle a person to a share of the death benefit. The decisive consideration is whether the claimant was financially dependent on the deceased at the time of death.
The Adjudicator found that the Board’s investigation revealed no evidence of financial dependency of the Complainant, as she failed to submit supporting documentation. In contrast, the Board considered affidavits and bank statements demonstrating dependency in respect of the beneficiaries who were allocated a share of the benefit.
Accordingly, the Adjudicator held that the Board had taken relevant factors into account and that its decision was rational, reasonable, and lawful. There were no grounds to interfere with the allocation.
To satisfy the test for dependency, dependants are required to submit supporting documentation demonstrating financial dependence on the deceased. However, this requirement can be onerous in practice, as financial support is often provided informally—such as in cash or through groceries and other necessities—rather than via traceable electronic means. In these circumstances, boards of funds should adopt a more proactive investigative approach. This includes asking targeted questions, cross‑checking allegations against the deceased member’s bank statements, and corroborating claims through engagement with family members, friends, and neighbours. Such measures are necessary to ensure that dependency assessments are both thorough and equitable.
Dishonesty Arising from Payroll Error – Application of Section 37D(1)(b)(ii)
Master Parts (Pty) Ltd (Employer) v Auto Workers Provident Fund (Fund) and another[2]
The Employer lodged a complaint against the Fund after the Fund refused to deduct an amount from the withdrawal benefit of its former employee and member of the Fund.
The member in question had been on unpaid maternity leave for four months during 2024. Due to a payroll system error, she incorrectly continued receiving her basic salary for several months. The Employer alleged she was aware that she was not entitled to remuneration during this period, failed to report the error, spent the money, and later refused to repay it.
The Employer opened a criminal case and obtained a signed acknowledgement of debt (AOD) from the member, authorising recovery of the amount from her retirement benefit. Despite this, the Fund paid out her withdrawal benefit in full, contending that the circumstances did not amount to theft, dishonesty, fraud, or misconduct as required by section 37D(1)(b)(ii) of the Pension Funds Act (Act).
The Adjudicator found that the member’s failure to report the payroll error and her use of the funds constituted dishonesty. As an employee, she owed a duty of good faith to the Employer. The signed AOD and the circumstances met the requirements of section 37D(1)(b)(ii) of the Act and the Fund’s rules. The Fund should have deducted the amount from the member’s benefit when the Employer’s request was received.
Although the Fund had already paid out the member’s withdrawal benefit, it was ordered to pay the Employer R19 653.00 plus interest.
The requirements of section 37D(1)(b)(ii) relating to theft, dishonesty, fraud, or misconduct are met where an employee’s conduct reflects a breach of good faith, even if the initial error originated with the employer. Silence in the face of known overpayment, coupled with use of the funds, can constitute dishonesty.
National Financial Ombud (NFO) case
Beneficiary nominations must be properly communicated
A recent NFO decision highlights the importance of ensuring that beneficiary nominations on life policies are submitted to and recorded by the insurer. In this case, a policyholder had nominated his minor daughter as beneficiary. After his death, a signed nomination form, naming a family trust – found in a desk drawer but never sent to the insurer during his lifetime – was used to pay the proceeds to the trust.
The NFO initially ruled that the matter should be decided by a court, as it could potentially affect the rights of the trust, a third party outside the NFO’s jurisdiction. However, this decision was overturned on appeal by a full panel of the NFO’s appeal tribunal.
The NFO appeal tribunal ruled that a beneficiary “nomination” requires communication to the insurer, even if not explicitly stated in the policy. As the trust nomination was never submitted while the policyholder was alive, it was ineffective. The child’s rights crystallised on death, and the insurer was ordered to pay the benefit to her guardian.
It is important for members to review beneficiary nominations regularly and ensure that the fund or the insurer has the correct, up‑to‑date records.
Financial Services Tribunal Cases
Employer‑caused pension payment delay
Prof IA Gorlach (Complainant) v Pension Funds Adjudicator (Adjudicator) and others[3]
The complaint arose from a delay in receiving the Complainant’s first monthly pension payment after retiring from his Employer at the end of December 2023. The first payment was made in February 2024 instead of January 2024.
The delay was caused by the Employer’s late submission of the retirement claim documentation to the Fund. The Complainant sought to hold his former Employer liable for the financial loss allegedly suffered due to this delay.
The Fund maintained that it applied its rules correctly and that it bore no responsibility for the delay. The Adjudicator agreed, finding that although the Employer submitted the paperwork late, the Applicant suffered no financial prejudice and dismissed the complaint.
On reconsideration, the Financial Services Tribunal (Tribunal) held that the Complainant’s complaint was effectively against the Employer, not the Fund and that the Fund correctly applied its rules and no relief could be granted against it.
The relief sought amounted to compensation for damages arising from alleged negligence by the Employer, which falls outside the jurisdiction of both the Adjudicator and the Tribunal. Such a claim may constitute a labour dispute or delictual claim, neither of which can be adjudicated under the Pension Funds Act or the Financial Sector Regulations Act.
The Tribunal found it had no jurisdiction to grant the relief sought and dismissed the application for reconsideration.
A retirement fund is not liable for delayed pension payments caused by an employer’s late paperwork, and neither the Adjudicator nor the Tribunal can award compensation for employer negligence. Whilst this is true from a jurisdiction perspective, retirement funds have a duty to treat members fairly and ensure members are not prejudiced.
Prescription and jurisdiction
TM Mbasa (Applicant) v Pension Funds Adjudicator (Adjudicator) and others[4]
The Applicant, who was the complainant in the matter before the Adjudicator applied for the reconsideration of a decision made by the Adjudicator that it lacked jurisdiction to investigate his complaint because it was time‑barred.
The complaint related to the deduction of R171418.89 from his pension benefit in January 2007, for a housing loan.
The Applicant argued that the loan deduction was unlawful without his written consent, the debt should have been covered by the NBC Credit Life Insurance Scheme and that he was unaware of the existence of the Adjudicator and complaint time limits due to being a layperson.
The Tribunal confirmed the complaint was lodged approximately 18 years late.
Section 30I of the Pension Funds Act bars the Adjudicator from investigating complaints where the act or omission occurred more than three years before the complaint was lodged. The Adjudicator no longer has discretion to condone late complaints due to the repeal of section 30I(3)(b). Ignorance of the law or the Adjudicator’s existence does not interrupt prescription and the insurance policy relied upon only covered death and disability, not retrenchment.
The Adjudicator correctly declined jurisdiction and even if discretion existed, the applicant provided no reasonable explanation for the 18‑year delay. The Tribunal emphasised the importance of finality and certainty in pension disputes, supported by Constitutional Court authority.
The application for reconsideration was dismissed.
Pension complaints must be lodged within 3 years, as prescription is jurisdictional and cannot be condoned by the Adjudicator. Ignorance of the law or complaint procedures does not interrupt prescription.
Jurisdiction to investigate and determine complaints pending the outcome of civil proceedings
Atlas Finance (Pty) (Employer) Ltd v Pension Funds Adjudicator (Adjudicator) and others[5]
The Employer applied to the Financial Services Tribunal (Tribunal) for the reconsideration of two determinations issued by the Adjudicator. The complaints concerned the Fund’s decision to withhold withdrawal benefits payable to two former employees, pending the outcome of civil proceedings instituted against them by the Employer.
Despite the existence of these civil proceedings, the Adjudicator ordered the Fund to release the withdrawal benefits to the members. The key issue before the Tribunal was whether the Adjudicator was entitled to entertain complaints and issue determinations while civil proceedings concerning the same subject matter were already pending.
Section 30H(2) of the Pension Funds Act provides that: The Adjudicator shall not investigate any complaint if proceedings have been instituted in any civil court in respect of the same matter.
The Tribunal reaffirmed that this provision is designed to regulate concurrent jurisdiction between civil courts and the Adjudicator. In this matter, the Tribunal found that civil proceedings were already in existence at the time the complaints were lodged with the Adjudicator. As such, section 30H(2) operated as an absolute jurisdictional prohibition.
The Adjudicator therefore ought to have dismissed the complaints outright, rather than proceeding to determine the merits and ordering payment of benefits.
The Adjudicator cannot investigate or determine complaints where civil litigation involving the same issues is already pending. Section 30H(2) is not discretionary—it is a jurisdictional bar designed to preserve the primacy of the courts and prevent duplicative adjudication.
[1] [2025] 4 BPLR 64 (PFA)
[2] [2025] 4 BPLR 65 (PFA)
[3] CASE NO: PFA85/2025
[4] CASE NO: PFA69/2025
[5] (PFA 82/2025 & PFA 83/2025)