Eskom Pension and Provident Fund v Molefe and Others (93895/2019) [2022] ZAGPPHC 492 (4 July 2022)

Eskom Pension and Provident Fund v Molefe and Others (93895/2019) [2022] ZAGPPHC 492 (4 July 2022)

The court held that Mr Molefe is obliged to repay all benefits received from the Fund as a result of his unlawful membership, as previously ordered by the full court. The quantification of amounts due was determined based on joint actuarial minutes, with only two legal deductions claimed by Mr Molefe being disallowed: set-off of employer contributions and tax paid to SARS on the Transnet Retirement Fund lumpsum. The court found no genuine factual disputes and rejected Mr Molefe's arguments for mediation and judicial deference. Taxes paid to SARS are recoverable only by the taxpayer under the Tax Administration Act, not by the Fund. The Fund is entitled to set-off the balance of the...

Citation
[2022] ZAGPPHC 492
Parties
Applicant: Eskom Pension and Provident Fund; Respondent: Brian Molefe; Respondent: Eskom Holdings SOC Limited; Respondent: The Commissioner for South African Revenue Service
Court
North Gauteng High Court, Pretoria
Jurisdiction
South Africa
Judgment Date
4 July 2022
Case Number
93895/2019
Procedural Posture
Civil Application / Quantification and Enforcement of Repayment Order
Outcome
Application granted. Mr Molefe is ordered to repay the quantified amounts to the Fund, and the Fund is ordered to repay unlawful payments to Eskom. Set-off and tax directives are to be implemented as specified. Costs awarded against Mr Molefe for the Fund and SARS.
Judges
N Davis
Legal Topics
Unlawful Pension Benefits, Quantification of Liability, Set Off, Tax Refund Procedure
Civil Procedure Banking and Finance Unlawful Pension Benefits Quantification of Liability Set Off Tax Refund Procedure

Case Brief

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Parties

Eskom Pension and Provident Fund

Applicant

Brian Molefe

Respondent

Eskom Holdings SOC Limited

Respondent

The Commissioner for South African Revenue Service

Respondent

Procedural Posture

Civil Application / Quantification and Enforcement of Repayment Order

Legal Issues

  1. 1 Whether Mr Molefe is obliged to repay all benefits received from the Fund as a result of unlawful membership.
  2. 2 How the amounts to be repaid should be quantified, including interest and tax implications.
  3. 3 Whether the Fund or Mr Molefe is entitled to claim repayment of taxes paid to SARS.

Ratio Decidendi

The court held that Mr Molefe is obliged to repay all benefits received from the Fund as a result of his unlawful membership, as previously ordered by the full court. The quantification of amounts due was determined based on joint actuarial minutes, with only two legal deductions claimed by Mr Molefe being disallowed: set-off of employer contributions and tax paid to SARS on the Transnet Retirement Fund lumpsum. The court found no genuine factual disputes and rejected Mr Molefe's arguments for mediation and judicial deference. Taxes paid to SARS are recoverable only by the taxpayer under the Tax Administration Act, not by the Fund. The Fund is entitled to set-off the balance of the...

Court Disposition

Application granted. Mr Molefe is ordered to repay the quantified amounts to the Fund, and the Fund is ordered to repay unlawful payments to Eskom. Set-off and tax directives are to be implemented as specified. Costs awarded against Mr Molefe for the Fund and SARS.

Orders

  • The Fund is directed to repay Eskom Holdings SOC Ltd the amount of R30,103,915.62, together with interest at the prescribed mora rate from date of unlawful payment to date of repayment.
  • The Fund is directed to repay Eskom the amount of R1,345,461.79 (employer contributions), together with mora interest from 31 October 2019 to date of repayment.