Mahlangu v Government Employees Pension Fund and Another (3297/2018) [2020] ZAGPPHC 814 (17 August 2020)

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

CASE NO: 3297/2018

DATE: 2020.05.03

(1) REPORTABLE: YES / NO

(2) OF INTEREST TO OTHER JUDGES : YES / NO

(3) REVISED

17/8/2020

In the matter between

MANZIMA SIMON MAHLANGU Applicant

and

GOVERNMENT EMPLOYEES

PENSION FUND & ANOTHER First Respondent

DEPARTMENT OF EDUCATION,

MPUMALANGA PROVINCE Second Respondent

J U D G M E N T

WANLESS, AJ

Introduction

[1] In this matter one Manzima Simon Mahlangu (“the Applicant”) essentially seeks an order that he receive payment of what he alleges to be the correct pension benefit due to him from the Government Employees Pension Fund (“the First Respondent”) pursuant to his employment with and retirement from the Department of Education, Mpumalanga Province (“the Second Respondent”).[1] The application is opposed by the First Respondent but not the Second Respondent. In light of the First Respondent’s opposition as aforesaid the Applicant seeks an order that the First Respondent pay the costs of the application on the scale of attorney and client.

[2] It is common cause in this application that the calculation of the pension benefit ultimately due and payable to a member of the First Respondent is done in terms of a formula which depends primarily on the period of pensionable service. In this regard, it is further common cause that, upon the Applicant’s retirement on the 31st of December 2015 the First Respondent calculated the Applicant’s pension benefit on the basis of a pensionable service from 1 December 1989 to 31 December 2015. It is the Applicant’s case that his pensionable service was in fact from the 23rd of January 1980 to the 31st of December 2015. This discrepancy obviously has a marked effect on the final amount of the pension benefit payable by the First Respondent to the Applicant.

The respective cases of the Applicant and the First Respondent

[3] Simply put, the Applicant submits that he has complied with all of the statutory obligations imposed upon him to provide the First Respondent with sufficient proof that he was employed, first by the KwaNdebele Government and, thereafter, by the Second Respondent, from the 23rd of January 1980 to the 31st of December 2015. It should be noted at this stage that it is also common cause that any employment of the Applicant by the KwaNdebele Government is to be regarded as pensionable service for the purpose of calculating the Applicant’s pension benefit to which he may be entitled.

[4] Further and in this regard it is submitted, on behalf of the Applicant, that the First Respondent’s opposition is based on bare denials and, ultimately, a highly technical defence that it has complied with all of its statutory obligations. It light thereof the Applicant submits that this Court should find in his favour with a punitive order as to the costs payable by the First Respondent.

[5] Also put very simply the case of the First Respondent is that it has not been provided with sufficient proof by the Second Respondent (who, it is common cause, as the Applicant’s employer, has lost certain documentation in respect of the Applicant’s employment) and/or the Applicant, to base its payment of the Applicant’s pension benefit upon the period of employment as alleged by the Applicant. Moreover, the First Respondent avers that the application is misguided since, inter alia, the Applicant should have first compelled the Second Respondent to provide the necessary information for the First Respondent to reconsider its calculations in respect of the Applicant’s pension interest. Further, the First Respondent avers that if the Applicant has suffered damages by way of a short payment of his pension interest, he should look to the Second Respondent, as his erstwhile employer and in terms of his contact of employment with the Second Respondent, to compensate him therefor.

The facts

[6] The facts which are either common cause in this matter or not seriously in dispute, are the following:

[6.1] The Applicant was permanently employed as an assistant educator on 23 January 1980 with the Vusa Primary School for the KwaNdebele Government Service. The Applicant remained in the employ of the KwaNdebele Government Service (and thereafter the Mpumalanga Department of Education) in various capacities until his retirement on 31 December 2015.[2]

[6.2] The Applicant, inter alia, served as assistant educator, acting principal and principal in the education system. The Applicant also served for 12 years in the Office of the Premier and became involved in skills development and human resources.[3]

[7] A number of documents were placed before this Court by the Applicant to substantiate the aforegoing. These documents are, inter alia, the following:-

[7.1] 1980: Performance evaluation and remarks by the Applicant’s principal (as his supervisor) during August 1980.[4]

[7.2] 1981: Assumption of duty form reflecting the Applicant’s transfer from Vusa Primary to Simuyembiwa Combined School. The Applicant’s departmental reference number is reflected therein as 882/94/3.[5]

[7.3] 1984: Assumption of duty form reflecting the Applicant’s transfer from Simuyembiwa Combined School to Sithembiso Community school.[6]

[7.4] 1984: Approval of the Applicant’s appointment as acting principal of Sithembiso Community School by the Secretary for Education of the KwaNdebele Government Service.[7].

[7.5] 1985: Assumption of duty form reflecting Applicant’s transfer from Sithembiso Community School back to Simuyembiwa Combined School.[8]

[7.6] 1985 to 1988: Various leave application forms.[9]

[7.7] 1989: A payslip dated 1 December 1989. It is noted that the department (the Second Respondent) utilised this payslip to incorrectly record the Applicant’s admission date into the First Respondent when it submitted the information required by the First Respondent in respect of the claim for the Applicant’s pension benefit. The following however is evident from that document:[10]

[7.7.1] The Applicant’s occupation is reflected as “permanent”;

[7.7.2] The Applicant’s salary reference number is reflected as “0882943” the same reference number used for the Applicant since 1980, that is, 882/94/3;

[7.7.3] The Applicant’s date of appointment is reflected as the 23rd of January 1980.

[7.8] A document issued by Vusa Primary School (where the Applicant commenced his career during 1980) on the 6th of December 1999 titled “Acknowledgement of Previous Employment: Mahlangu Simon Manzima” confirming the Applicant’s particulars, including his commencement of service and his Persal number as 882943.[11]

[7.9] A mark of appreciation issued to the Applicant by the Office of the Premier for the Applicant’s loyal service and dedication;[12] and

[7.10] A long service certificate issued on 10 April 2003 to the Applicant for 20 years “continuous, consistently satisfactory and devoted service in the public service”).[13]

[8] As part of his employment the Applicant states to this Court in the founding affidavit (and obviously under oath) that pension contributions were deducted each and every month from his remuneration. The Applicant was a member of the Government Service Pension Fund at the time.[14]

[9] Rule 6 of the First Respondent’s Rules provides as follows:

“6. Furnishing of proof by member, pensioner or beneficiary.

The Board is entitled to require satisfactory proof of the right of any member, pensioner or his/her beneficiaries to any benefit and the Fund is not obliged to pay benefits to a member, pensioner or their beneficiaries until such proof has been submitted to the Board.”

[10] In a benefit calculation quotation dated 20 November 2015 and issued by the First Respondent to the Applicant the following is stated:[15]

“Service date: 1980-01-23

Total service: 35.2889864”.

[11] In a “Person’s Personal File” document dated the 7th of December 2015 and issued by the First Respondent the following is stated:[16]

“Service date: 1980/01/23 unconfirmed

Admitted on: 1980/01/23”

[12] Rule 4.1.19 provides that the First Respondent’s trustees shall take all reasonable steps to ensure that the interests of members in terms of the rules of the Fund and the provisions of the Law are protected at all times and that trustees shall act at all times with due care and diligence and in good faith.

[13] Rule 1 of the First Respondent defines “pensionable service” as, inter alia, continuous service of a member on or after the fixed date in respect of which such a member contributes or contributed to the Fund or was liable to contribute to the Fund and in respect of which no benefit has been paid out of the Fund under the applicable rules.[17]

[14] Regulation 1 of the regulations promulgated in terms of section 17 of the Government Services Pension Act, 57 of 1973 (as amended) defines “pensionable service” as being continuous service on or after the fixed date in respect of which such member contributes or contributed to the Fund or was liable to contribute to the Fund and in respect of which no benefit has been paid out of the Fund in terms of the Act or these regulations.[18]

[15] As part of the Applicant’s replying affidavit, a confirmatory affidavit was deposed to by Mr ZA Mthimunye. Mr Mthimunye states the following:[19]

[15.1] He has known the Applicant since 1975 (when the Applicant was teaching privately) and served as the Applicant’s mentor throughout his career.

[15.2] The Applicant was employed in a permanent teaching post at Vusa Primary School during January 1980 after having qualified during 1979.

[15.3] Like the Applicant, he was also employed by the erstwhile KwaNdebele Government Service before being employed by the Mpumalanga Department of Education.

[15.4] All educators in the permanent employ of the KwaNdebele Government were obliged to become members of and to contribute to the Government Service Pension Fund on a monthly basis.

[16] It is neither a statutory requirement nor a requirement in terms of the common law that the Second Respondent is obliged to submit the appropriate claim form to the First Respondent before the First Respondent can pay out a pension benefit.[20] Also, rule 22 of the First Respondent’s Rules states:

“22. Communication-

F. For purposes of communication in regard to membership of the Fund, payment of member and employer contributions to the Fund, payment of other monies owing by members and the employer to the Fund, and related matters, the Fund shall communicate with the departments, administrations, institutions and bodies where members are or were in service: Provided that where any such matter or any other matter cannot be effectively dealt with my means of such communications the Fund shall communicate with the Minister: Provided further that a member or pensioner shall have the right to communicate direct with the Fund in regard to any matter was affects him or her personally. All factors and interest rates to be decided by the Board after the required consultation processes, as set out in the rules, shall be communicated to the employer and the members in accordance with the provisions set out above.”[21]

[17] In respect of the duties of the Second Respondent, it is clear that these duties include the provision of correct and complete information to the First Respondent to allow the correct calculation and payment of a member’s pension benefit. Further, if the Second Respondent is not in possession of same, it is obliged to make all reasonable enquiries in respect thereof and advise the member that he or she can approach the Fund (the First Respondent) directly. The First Respondent is also obliged to take into account facts brought to its attention directly by interested parties.[22]

Conclusion

[18] It is correct that there is a statutory duty upon the Second Respondent to provide correct and complete information to the First Respondent. However, it is clear that the Second Respondent has failed in its duties in that (a) it misplaced the Applicant’s personnel file, and (b) it provided factually incorrect information to the First Respondent while labouring under the misapprehension that the Applicant was legally obliged to submit payslips from 35 years ago to the First Respondent.

[19] The Applicant accordingly submitted the correct and complete information as far as he was able to do so, directly to the First Respondent in order to process his correct pension benefit which he was clearly entitled to do. The First Respondent was obliged (in terms of its own Rules) to consider the Applicant’s claim so submitted as premised on his correct period of pensionable service.

[20] The non-compliance by the Second Respondent with its statutory duties cannot, in law, disentitle the Applicant from claiming his pension benefit from the First Respondent.

[21] Regarding the submission by the First Respondent that the Applicant should look to the Second Respondent, his employer, for payment of any damages in respect of short-payment of his pension benefit[23] this Court can find no support at all for this proposition, either in statute or the common law. It is the First Respondent who is obliged to properly calculate and then pay, to its members, their pension benefits to which they are entitled. If the First Respondent alleges it has suffered any damages, it can look to the Second Respondent.

[22] Having regard to all of the evidence placed before this Court, as dealt with in this judgment (and which is largely undisputed) and applying the correct legal principles thereto, it is clear that the Applicant is entitled to the relief sought.

Costs

[23] As set out earlier in this judgment the Applicant seeks a punitive costs order against the First Respondent. This is based, inter alia, on the following submissions:

[23.1] No cost order was sought against any of the Respondents in the event of the application remaining unopposed.

[23.2] The Second Respondent did not oppose the relief sought as it clearly had no basis in fact or in law to do so.

[23.3] Initially the First Respondent delivered a notice to abide the decision of this Court[24] with a letter containing the First Respondent’s contentions regarding the correctness of the relief sought in the notice of motion purely on a technical level.[25]

[23.4] The Applicant’s attorneys of record stated in a letter dated 22 March 2018 that the First Respondent’s contentions would be placed before this Court hearing the application on the unopposed motion role.[26]

[23.5] Notwithstanding its original election to abide this Court’s decision and its consequent failure to respond to the course of conduct proposed by the Applicant’s attorneys of record the First Respondent delivered a notice of its intention to oppose the application during November 2018.[27]

[23.6] The First Respondent has elected to oppose this application not only on the technical basis initially indicated in its letter accompanying its notice to abide this Court’s decision but the First Respondent has opposed the application and disputed the correctness of the Applicant’s period of pensionable service, raising bare and spurious denials.

[24] This Court can find no fault with the said submissions in respect of costs made on behalf of the Applicant. It is scandalous that a member of the Fund who has served his employer faithfully for a period of 35 years should have payment of his pension benefit withheld on such flimsy grounds. A cost order on a punitive scale will assist somewhat to ensure that the Applicant is not kept out of pocket. It will also mark this Court’s displeasure as to the manner in which the First Respondent has conducted itself in this litigation.

Order

[25] In the premises, this Court makes the following order:

1. The Applicant’s period of pensionable service (as contemplated in the Government Employees Pension Law, 1996 and the Rules of the Government Employees Pension Fund) is the period from 23 January 1980 to 31 December 2015;

2. The period from 23 January 1980 to 31 December 2015 be accepted and utilised by the First and Second Respondents as the Applicant’s period of pensionable service in calculating and processing the Applicant’s pension benefits;

3. The First Respondent is ordered to take all steps necessary to process and finalise the Applicant’s claim for payment of his pension benefits due to him in accordance with the provisions of the Government Employees Pension Law, 1996 (as amended) and the applicable Rules, within sixty (60) calendar days from the date of this order;

4. The First Respondent is to pay the costs of the application on the scale of attorney and client.

I hand down that order.

ACTING JUDGE OF THE HIGH COURT

DATE: 17/8/2020

[1] Amended notice of motion at pages 1 to 5 of the application papers

[2] Founding affidavit, paragraph 12 at page 9 of the application papers

[3] The Applicant’s full employment history is set out in paragraphs 12 to 13.17 of the founding affidavit at pages 9 and 10 of the application papers

[4] Annexure “SN2.2” at page 29 of the application papers

[5] Annexure “SN2.3” at page 31 of the application papers

[6] Annexure “SN2.4” at page 32 of the application papers

[7] Annexure “SN2.5” at page 33 of the application papers

[8] Annexure “SN2.6” at page 35 of the application papers

[9] Annexure “SN2.7” at pages 38 to 40 of the application papers

[10] Annexure “SN2.8” at page 41 of the application papers

[11] Annexure “SN2.9” at page 42 and 43 of the application papers

[12] Annexure “SN2.10” at page 44 of the application papers

[13] Annexure “SN2.11” at page 45 of the application papers

[14] Founding affidavit, paragraph 16 at page 12 of the application papers

[15] Annexure “SN4.1” at pages 47 and 48 of the application papers

[16] Annexure “SN4.2” at page 49 of the application papers

[17] Emphasis added

[18] Emphasis added

[19] At pages 185 to 189 of the application papers

[20] Nomalungisa Mpofo v Government Employees Pension Fund (228/2015) [2015] ZAECPEHC 53 at paragraphs [16] to [18]

[21] Emphasis added

[22] Government Employees Fund and another v Buytendag and others at paragraph [20]

[23] Paragraph [5] IBID

[24] Annexure “SM14” at pages 176 and 177 of the application papers

[25] Annexure “SM13” at page 174 and 175 of the application papers

[26] Annexure “SM15” at pages 178 to 180 of the application papers

[27] Annexure “SM16” at page 182 of the application papers