Municipal Employees' Pension Fund and Another Mudau and Another (61555/14) [2017] ZAGPPHC 157 (29 March 2017)
- Citation
- [2017] ZAGPPHC 157
- Status
- Judgment
- Jurisdiction
- South Africa
- Court
- North Gauteng High Court, Pretoria
- Panel
- TJ Raulinga
- Case number
- 61555/14
More details
- Court
- North Gauteng High Court, Pretoria
- Panel
- TJ Raulinga
- Case number
- 61555/14
On this page
Professional case brief
Research organized from the available case record
01
Holding and result
The court found that the Adjudicator had jurisdiction to determine the complaint as defined under the Pension Funds Act. The amended Rule, although registered with retrospective effect, could not be applied to the first respondent's accrued withdrawal benefit because he had resigned and his benefit had accrued before the amendment was registered. The presumption against retrospective application of statutory amendments, especially where accrued rights are affected, was reinforced by considerations of procedural fairness and the need for prior notice. The Adjudicator acted lawfully, fairly, and within her powers. The applicants failed to demonstrate any ground for review under section 30P of the Act or PAJA. The application for condonation was granted, but the substantive application to set aside the Adjudicator's determination was dismissed with costs.
Court disposition
Application dismissed with costs.
Orders
- Condonation for the late filing of the application is granted.
- The application to review and set aside the Adjudicator's determination is dismissed with costs.
02
Material facts
Parties
Municipal Employees' Pension Fund
ApplicantAkani Retirement and Administrators
ApplicantPendelani Midas Mudau
RespondentVhembe District Municipality
RespondentAmounts and remedies
- Withdrawal Benefit Claimed by First Respondent: ZAR 2,140,313.19
- Withdrawal Benefit Paid to First Respondent: ZAR 646,437.42
03
Procedural history
Posture
Review Application / Judgment
04
Questions and positions
Legal issues
- 01
Whether the Pension Fund Adjudicator had jurisdiction to determine the dispute regarding the retrospective application of the amended Rule.
- 02
Whether the amended Rule could be applied retrospectively to the first respondent's accrued withdrawal benefit.
- 03
Whether the Adjudicator's determination was liable to be reviewed and set aside under section 30P of the Pension Funds Act and PAJA.
- 04
Whether procedural fairness was observed in the notification and application of the Rule amendment.
Party arguments
- Applicant
- The applicants argued that the Adjudicator lacked jurisdiction to determine the effective date of the amended Rule and that her decision was invalid. They further contended that the Adjudicator's decision was based on material errors of fact and law, and that the amended Rule should be applied to the first respondent, resulting in a reduced withdrawal benefit. The applicants sought to have the Adjudicator's order set aside and replaced with an order dismissing the first respondent's claim.
- Respondent
- The first respondent maintained that the Adjudicator had jurisdiction under section 30H of the Pension Funds Act, as a valid complaint was lodged. He argued that the determination was correct in law because his withdrawal occurred before the amended Rule was registered by the Registrar, and thus the old Rule should apply. He asserted that he was not notified of the amendment and that the retrospective application was unfair. The respondent sought dismissal of the application with costs.
05
Court’s reasoning
Legal principles
- 01
Section 1, Pension Funds Act 24 of 1956
A complaint under the Pension Funds Act is defined disjunctively; the presence of any qualifying allegation suffices for jurisdiction.
- 02
Section 12(2)(c), Interpretation Act 33 of 1987; Mahomed v Union Government 1911 AD 11
Retrospective application of statutory amendments is generally presumed against, especially where accrued rights are affected, unless expressly provided and procedurally fair.
- 03
Natal Joint Municipal Pension Fund v Endumeni Municipality 2012 (4) SA 593 (SCA)
Interpretation of statutory provisions must be contextual, purposive, and avoid oppressive or unbusinesslike results.
- 04
PAJA; Masetha v President of the Republic of South Africa and Another [2007] ZACC 20; 2008 (1) SA 566 (CC)
Administrative action must be lawful, procedurally fair, rational, and not arbitrary or biased.
- 05
Mostert NO v Old Mutual Life Assurance Company (SA) 2001(4) SA 159 (SCA); TEK Corporation Provident Fund v Lorenz 1999 (4) SA 884 (SCA)
Rule amendments cannot be applied to benefits that have already accrued before registration of the amendment.
06
Ratio, limits and disposition
Ratio decidendi
The court found that the Adjudicator had jurisdiction to determine the complaint as defined under the Pension Funds Act. The amended Rule, although registered with retrospective effect, could not be applied to the first respondent's accrued withdrawal benefit because he had resigned and his benefit had accrued before the amendment was registered. The presumption against retrospective application of statutory amendments, especially where accrued rights are affected, was reinforced by considerations of procedural fairness and the need for prior notice. The Adjudicator acted lawfully, fairly, and within her powers. The applicants failed to demonstrate any ground for review under section 30P of the Act or PAJA. The application for condonation was granted, but the substantive application to set aside the Adjudicator's determination was dismissed with costs.
Obiter and limits
- The court noted that the late filing of the applicants' supplementary affidavit diminished its evidentiary weight and did not assist their case.
- Prior notice of rule amendments is essential to procedural fairness and natural justice, especially where rights may be affected.
- The validity of the Rule amendment was not challenged; only its unfair retrospective application was at issue.
Court disposition
Application dismissed with costs.
- Condonation for the late filing of the application is granted.
- The application to review and set aside the Adjudicator's determination is dismissed with costs.
Source and reliance status
North Gauteng High Court, Pretoria
This page organises the available record for research. Confirm quotations, current status, and subsequent treatment against the official source before relying on the case.
Judgment reading view
Judgment text
The complete available source text.
North Gauteng High Court, Pretoria
Judgment
REPUBLIC
OF SOUTH AFRICA
IN
THE HIGH COURT OF SOUTH AFRICA
GAUTENG DIVSION, PRETORIA
29/3/2017
CASE NO: 61555/14
Reportable: Yes
Of interest to other judges: Yes
Revised.
In the matter between:
MUNICIPAL EMPLOYEES' PENSION FUND FIRST
APPLICANT
AKANI
RETIREMENT AND ADMINISTRATORS SECOND
APPLICANT
and
PENDELANI
MIDAS
MUDAU FIRST
RESPONDENT
VH
EMBE DISTRICT MU
NICIPALITY SECOND
RESPONDENT
JUDGMENT
RAULINGA J,
1. In their Notice of Motion the applicants seek the following relief:
1.1 Setting aside paragraph 6 of the award (''the order'') of the Pension Fund Adjudicator (''the Adjudicator'') on 7 July 2014 in the dispute between the first respondent (as applicant) and the first and second applicants and second respondent (as first, second and third respondent), respectively.
1.2 Replacing the order of the Adjudicator with the following order:
"The claim of the first respondent (applicant in the proceedings before the Adjudicator) is dismissed.
1.3 Ordering whomsoever of the respondents that opposes this application to pay applicants' costs.
2. As it is evident from the Notice of Motion, this application is brought in terms of section 30P of the Pension Funds Act, No 26 of 1956 (''the Act'') to review and set aside a decision and order of the Adjudicator, made in favour of the first respondent, on 7 July 2014, (''the determination''). n that determination the Adjudicator effectively decided that an amended Rule adopted by the first applicant, the Municipal Employees Pension Fund (''the Fund''), and registered by the Registrar of the Financial Services Board (''the Registrar''), should not be applied against the first respondent. Instead, the Adjudicator applied the old, pre-amended Rule.
3. The applicants submit that, as a result, the first respondent became entitled to receive a withdrawal benefit, consequent on his withdrawal from the Fund, of more than twice the amount he was entitled to under the amended Rule.
4. The Fund and its administrator (''Akani'') submit that the Adjudicator's decision is liable to review for two independent reasons:
4.1 First, the Adjudicator lacked jurisdiction to determine that the effective date of the amended Rule was inapplicable and her decision is consequently invalid;
4.2 Second, and in any event, the Adjudicator's decision was based on material errors of fact and law; and
4.3 Therefore, the determination is liable to be reviewed and set aside, and the amended Rule falls to be applied against the first respondent.
5. On the other hand, the first respondent submits that, in terms of section 30H of the Act, the Adjudicator has jurisdiction to determine the dispute because the first respondent lodged a complaint as defined in the Act. Furthermore, the determination is valid and correct in law, because, the withdrawal of benefits occurred before the amended Rule was registered by the Registrar. The application should therefore, be dismissed with costs.
6. Parties are ad idem on the factual matrix of this case. During 2013, the Fund received a statutory actuarial advice to amend its withdrawal benefit structure. At the time Rules 37(1)(a) and (b) of the Fund's Rule provided for withdrawal benefits to be paid at a rate of three times the value of contributions made ("the Rule''). According to the actuarial report, that rate meant that withdrawal benefits exceeded the accumulated contributions received and the Fund consequently ran the risk of not meeting its liabilities. Consequently, the Fund's actuaries recommended an immediate reduction of the withdrawal benefits offered by the Fund.
7. As a result of this advice and on the 21 June 2013, the management committee of the Fund determined to amend Rules 37(1)(a) and (b) with effect from 1April 2013, such, that the withdrawal benefit would be calculated at a rate of 1.5 times contributions ('the Rule amendment" or "amended Rule").
8. On 1July 2013, the Fund distributed a circular to its members explaining the need for the Rule amendment, and notifying them that the withdrawal benefit would be amended with effect from 1 April 2013.
9. Shortly thereafter, on 22 July 2013 the Fund applied to the Registrar for Rule amendment to be registered. Ultimately, the Registrar registered the Rule amendment some eight months later, on 1April 2014, but afforded it an effective date of 1 April 2013, retrospectively.
10. This must be understood against the backdrop that the first respondent resigned from employment with the second respondent, with effect form 31 May 2013 and consequently also withdrew from the Fund. His withdrawal benefit was calculated and paid on 16 October 2013 in accordance with the amended Rule.
11. The first respondent, dissatisfied with his withdrawal benefit, lodged a complaint with the Adjudicator on 2 December 2013, arguing that the Fund had decreased his withdrawal benefit without any prior communication and that he was entitled to an amount of R 2 140 313.19 (being the Fund credit reflected in his benefit statement of 31 October 2012) instead of R 648 637.42 which was paid to him on 16 October 2013.
12. The first applicant sent a Circular to its members regarding the amendment of Rule 37 of its Rules on 1July 2013. At that time the first respondent was no longer a member of the first applicant and was already notified by the second respondent. As already stated above, on 1April 2014 the Registrar approved and registered the amendment Rule 37 with retrospective effect from 1 April 2013. After the complaint was lodged with her, the Adjudicator made a determination in favour of the first respondent on 7 July 2014.
13. When the matter commenced, the applicants moved an application for condonation from the bar, for the late filing of the application (which was one day after the six week period laid down by section 30P of the Act). The first respondent having consented to the condonation, I accordingly granted same.
14. I start first with the nature of the complaint which was lodged with the Adjudicator and the content of the determination made by her on 7 July 2014.
15. The applicants submit that the first respondent's complaint lodged with the Adjudicator on 2 December 2013, was that the Fund had "decreased his withdrawal benefit without any prior communication" and that he was entitled to an amount R 2 140 313.19 (being the Fund credit reflected in his benefit statement of 31 December 2012).
16. In her determination, the Adjudicator captured the first respondent's complaint as follows:
"The complainant submits that the first respondent decreased his withdrawal benefit without any prior communication. The complainant further submits that the withdrawal benefit due to him at the time of his resignation was R 2 140 313.19. However, he was only paid a withdrawal benefit of R 646 437.42 by the first respondent, he was advised that the benefit has been reduced as per advice of its actuary..."
17. Section 1of the Act defines a "complaint" as:
"relating to the administration of a fund the investment of its funds or the interpretation and application of its rules, and allegation.
(a) that a decision of the fund or any person purportedly taken in terms of the rules was in excess of the powers of that fund or person, or an improper exercise of its powers;
(b) that the complainant has sustained or may sustain prejudice in consequence of the maladministration of the fund by the fund or any person, whether by act or omission;
(c) that a dispute of fact or law has arisen in relation to a fund between the fund or any person and the complainant; or
(d) that an employer who participates in a fund has not fulfilled its duties in terms of the rules of the fund, but shall not include a complaint which does not relate to a specific complainant."
18. It seems to me that the subsections in the definition of a "complaint" are disjunctive and not conjunctive. This means that the presence of one allegation will qualify the alleged "complaint" as a "complaint" .In my view, the "complaint" as lodged by the first respondent to the Adjudicator and captured by her in her determination is encapsulated in section 1of the Act that defines a "complaint". This is encapsulated in subsections (a) and (b) of the section, in that the complainant by inference alleges that the decision of the fund or any person purportedly taken in terms of the rules improperly exercised its powers and further, that the complaint relates to the application of the rules alleging a dispute of fact or law. The complaint, in the main relates to the administration of the fund and the interpretation and application of its rules.
19. It is my considered view, that the submission by the applicants that the Adjudicator lacks jurisdiction in that the purported "complaint" didn't constitute a complaint, is misplaced.
20. In support of their argument, the appellants rely on the decision in Shell and BP SA Petroleum Refiniries v Murphy NO 2001 (3) SA 683(0) “Shell and BP''). As stated in Shell and BP case, it is indeed true that the Adjudicator is a creature of the Act. His function is to consider complaints lodged with him in terms of section 30A (5) of the Act. In Shell and BP, the matter pertained to the payment of contributions by the employer to the fund, in which the actuary had advised the employer to take a contribution holiday
in view of actuarial surplus due to the actual investment return that had exceeded the assumed investment returns. The Adjudicator's
determination in that case involved administration expenses and the maintenance of the solvency of the fund. The Court in Shell and BP correctly held that the matter did not relate to the administration of the fund, the investment of the fund and the interpretation and application of its rules. Moreover, the Court was more concerned about the correctness of the decisions and the consequent
determination. The main thrust of the complaint was the issue of the administration expenses and in addition the respondent, in that case, complained that the applicant was taking advantage of the fund's substantial surplus to the prejudice of the members' expectations.
21.The context of the case must be read with reference to what was said in TEK Corporation Provident Fund and Others v Lorenz 1999 (4) SA 884 (SCA, in which the Court stated inter alia, that 'the Court a quo overlooked the distinction between a defined benefit scheme in which the employer's contribution is fixed and must be paid irrespective of the state of the fund, and a scheme like the present in which it is not and liability to contribute arises only when it is necessary in the estimation of the fund's actuary to venture the financial soundness of the fund. In the former class of the case there is an existing and continuing liability to contribute and using the existence of a surplus to avoid the making of the contributions could not be justified. In the latter class of case, of which the present is an example, there is no predetermined and continuing liability to contribute. The liability arises only when need arises. Present a surplus, absent a need and absent a liability. The employer is therefore not being relieved of a liability and is receiving no benefit to the detriment of the fund or members'.
22. In casu, the employer is not entitled to a contribution holiday, as long as a member is still on its roll of employees, the employer is obliged to contribute, which in turn entitles the first respondent to his benefits which have been accumulating since his first day of employment in 2003 until his departure in May 2013.
23.Although there are certain similarities between the facts in this case and those in Joint Municipal Pension Fund v Grobler and others 2007 (5) SA 629 (SCA) (''Grobler'') one must also recognize certain distinguishing features in both of them.
24. In Grobler, before the first respondent (i.e. Grobler) was retrenched he was in the employ of the first appellant and was a member of the second appellant. Just under 14 months before his retrenchment, the rules of the second appellant were amended in a manner which had the effect of very considerably reducing the retrenchment benefit payable to the first respondent. The first respondent laid a series of complaints with the pension fund Adjudicator but the Adjudicator decided that, because the amendment had been registered, he had no jurisdiction to consider the complaints.
25. Whereas in this matter, the first respondent resigned from second respondent with effect from 31 May 2013 and was not aware of the statutory Actuarial Report which was received by the Fund during February 2013. The first applicant, on 21 June 2013, resolved during its meeting to amend its Rule 37 based on the Statutory Actuarial Valuation Report to apply with retrospective effect from 1 April 2013. The first applicant only sent the circular to its members on 1 July 2013 regarding the amendment of Rule 37 of its Rules, which was not received by the first respondent. At that time the first respondent was no longer a member of the first applicant and was already notified by the second respondent. The first applicant only applied to register the amended Rule on 22 July 2013, which was only registered on 1 April 2014 with retrospective effect from 1 April 2013. By that time the first respondent was already paid an amount of R 646 437.42 on 16 October 2013 and had also lodged a complaint on 2 December 2013 with the Adjudicator. I will deal with the effect of this distinction herein below.
26. As stated above, one other distinction between this case and Grobler is that in Grobler the Adjudicator declined to consider the complaints, because at the time the complaints were lodged with him, the amendments were already registered by the registrar. The SCA on hearing the appeal in Grobler and after considering the provisions of section 12 of the Act, decided to grant relief on the complaint regarding the invalidity of Rule 49 of the rules, stating that "the reference in Rule 49 to 'established benefit' is, in my opinion, a reference to the benefit that has accumulated at the time the amendment is made. It is not a reference to the right to claim a benefit that has finally matured. As indicated that right might never arise. An interpretation of Rule 49 according to which the trustees, on the eve of an event that would entitle a member to claim the benefits that have accumulated during his or her membership of the fund, are empowered to amend the rules so as to remove or reduce such benefits, is one that would permit an intolerable injustice. One can only conclude that the framers of the rule could never have intended it to have that meaning. What the rule means, I consider, is that the trustees may amend the rules in such a way that further benefits will not accumulate from the time the amendment is made (which will enable the member to make other arrangements to
replace them) but that the member may not be deprived of benefits that have accumulated by the time the amendment is made". The Court also upheld the complaint that the first respondent had an established benefit which was a reference to the benefit that accumulated at the time the amendment was made. It must be mentioned that although the Court considered the other complaints subscribed under section 12 of the Act, it categorically stated that the three powers in Section 12 did not entail the making of validity of the rule amendment. Therefore the Adjudicator had no power to consider the first respondent's complaint in that regard meaning the invalidity of the Rule.
27. Section 12 (2) of the Interpretation Act 33 of 1987 (''the interpretation Act"), finds application in this matter because the amendment Rule repealed the older Rule. Section 12(2) (c) of the interpretation Act provides that where a law repeals any other law, the repeal should not "affect any right, privilege, obligation, or liability acquired, accrued or incurred under any law so repealed. See also Mahomed v Union Government 1911AD at 11. At the time when the Registrar registered the amendment Rule on 1April 2014, with retrospective effect from 1 April 2013, the First respondent was already paid an amount of R 646,437.42 on 16 October 2013 and had already acted in that he availed himself to a right accrued to him by lodging a complaint with the Adjudicator on 2 December 2013, which act is within the meaning of the enactment. One must also be mindful of the fact that 'acquired' is an expression which implies individual effort more clearly than 'accrued'. This was confirmed in Dys v Dys 1979 (3) SA 1170 (D).
28. In the Landmark judgment in Natal Joint Municipal Pension Fund ("Natal Pension Fund'') v Endumeni Municipality 2012 (4) SA 593 (SCA - which must now be regarded as the Locus classicus on the subject - Wallis JA took cognisance of the significant developments in the law relating to the interpretation of documents
and restated the law in the following terms:
"[18] The present state of the law can be expressed as follows:
Interpretation is the process of attributing meaning to the words used in a document, be it legislation, some other statutory instrument, or contract, having regard to the context provided by reading the particular provision or provisions in the light of the document as a whole and the circumstances attendant on its coming into existence. Whatever the nature of the document, consideration must be given to the language used in the light of the ordinary rules of grammar and syntax; the context in which the provision appears, the apparent purpose to which it is directed and the material known to those responsible for its production. Where more than one meaning is possible, each possibility must be weighed in the light of all these factors. The process is objective, not subjective. A sensible meaning is to be preferred to one that leads to insensible or unbusinesslike results or undermines the apparent purpose of the document. Judges must be alert to, and guard against, the temptation to substitute, what they regard as reasonable, sensible and businesslike for the words actually used ... The inevitable point of departure is the language of the provision itself; read in context and having regard to the purpose of the provision and the background to the preparation and production of the document."
29. Wallis JA went on to say the following in that judgment at paragraph [26]:
"In between these two extremes [where, at one end, the language of the provision, read in context, seems clear and admits of little or no ambiguity, and, at the other end, where the context makes it plain that adhering to the meaning suggested by apparently plain language would lead to glaring absurdity] in most cases the court is faced with two or more possible meanings that are to a greater or lesser degree available on the language used. Here it is usually said that the language is ambiguous, although the only ambiguity lies in selecting the proper meaning (on which views may legitimately differ).In resolving the problem, the apparent purpose of the provision and the context within which it occurs will be important guides to the correct interpretation. An interpretation will not be given that leads to impractical, unbusinesslike or oppressive consequences or that will stultify the broader operation of the ... contract under consideration."
30.The purpose of the amendment Rule provision and its context is not meant to lead to oppressive consequences to the first respondent, instead it is meant to give a sensible and reasonable meaning to the language used in the enactment. This is an objective approach which can alleviate the plight of the first respondent instead of taking its acquired right away. Such an approach does not stultify the broader operation of the Rule, because its validity is not challenged. The amendment will still be achieved if interpreted in a purposive and contextual manner. See Take and Save Trading CC and Others v Standard Bank of SA Ltd 2004 (4) SA (SCA) [6]. The contextual approach is not limited to the immediate grammatical context of the words in a linguistic sense, but also their context in the enactment, having regard to its apparent purpose and object - Aktiebolaget Hassle and Another v Triomed (Pty) Ltd 2003 (1) SA 155 (SCA) [1].
31. Reverting to the determination of the Adjudicator in this case, she didn't consider the invalidity of the Rule 37 of the rules of the fund. All what the Adjudicator considered was that the Rule cannot operate with retrospective effect to the first respondent because his benefit had already accrued by the time the amendment was registered. This was in fact confirmed by the Registrar when the Adjudicator solicited her interpretation of the Rule amendment. Importantly also is that the first applicant through its Board made a decision to amend the Rule after the first respondent had withdrawn from the Fund. The Rule was also amended and registered
after the first respondent was paid an amount of R 646 437.42 and had already lodged a complaint with the Adjudicator. Moreover, when the first respondent enquired why he was paid a lesser amount than he had expected, he was informed by the Fund that the benefit was reduced as per its Actuaries advices. This is an indication that at that time no decision had been taken as regards the status of the Rule amendment. Furthermore, the amendment was not yet approved by the Registrar. The approval and the registration of the amendment occurred long thereafter.
32.I turn now to deal with the powers of review of the Adjudicator's determination and whether this, court may set aside her orders.
33. The Public Administrative Justice Act No 3 of 2000 (“PAJA'') will only be applicable if the Adjudicator's decision constitutes an administrative action as defined in section 1 of PAJA. Section 6 allows for the judicial review of administrative action and in terms of subsection (2) the Court has the power to judicially review an administrative action if certain requirements are met - President of the Republic of South Africa and others v South African Rugby Football Union and others 2000 (1) SA 1 [CC] para [1434]. It seems to me that those are not in dispute and there is no need for me to regurgitate same.
34. The essence of public power in the context of section 33(1) of the Constitution (and also PAJA) is illustrated in the matter of Masetha v President of the Republic of South and Another [2007] ZACC 20; 2008 (1) SA 566 (CC) par 78 that:
(a) The holder of a public power must act in good faith and not misconstrue his/her power;
(b) Public power should not be exercised arbitrarily or irrationally;
(c) The requirement of rationality includes that the public power must not act in a way that is procedurally unfair;
(d) There must be lawfulness in the conduct of the person exercising the public power, which apart from the substantive requirement, also incorporates that there must be procedural fairness and that public power must not act in a biased manner.
35. Since this is a review application which is sufficiently framed to consider review relief, all the requirements mentioned above are relevant in this case.
36. The application is brought in terms of Section 30P of the Act, to review and set aside the decision and order of the Adjudicator, in favour of the first respondent. The Adjudicator effectively ruled that the first applicant cannot adopt and apply a proposed amendment Rule of its rules before such amendments are approved and registered by the Registrar of the Board. Instead, the first applicant applied it before the rule was registered by the Registrar.
37. I have no doubt in my mind that the Adjudicator acted in good faith and did not misconstrue her powers, nor did she exercise her power arbitrarily or irrationally. She acted in a way that is, procedurally fair and her conduct was lawful and not biased. She cannot be faulted.
38. The conclusion above is sustained by the analysis of the following chronological events and the legal principles pertaining thereto.
39. The first applicant sent a circular to its members regarding amendment of Rule 37 of its rules. At that time the first respondent was no longer a member of the applicant and was already notified by the second respondent. The first respondent categorically states in his answering affidavit that he was never notified by the first applicant of the impending amendment. The first applicant makes a bald statement in both the founding affidavit and supplementary affidavit that their members were informed of the amendments. There is no evidence to support these allegations in that no annexures are attached to that effect. Moreover, the first respondent was no longer a member of the first applicant at that time.
40.The first respondent resigned on 31 May 2013, which preceded the decision of the Board on 21 June 2013. The amendment was only approved and registered by the Registrar on 1 April 2014. It follows that he amendment was not yet valid and enforceable when the first respondent's claim for benefit payment was made. Payment was made on 16 October 2013. On its own version, the first applicant states that the first respondent's pension claim benefit was reduced on the advice of its actuaries.
41. It is also evident as gleaned from the Adjudicator's determination that when the Registrar was approached for an interpretation of the amendment she stated that whilst a Rule amendment may be approved with retrospective effect, it cannot be applied before it is registered and also it cannot be applied to benefits that have accrued before the amendment was registered. This is supported by what was held in Mostert NO v Old Mutual Life Assurance Company (SA) 2001(4) SA 159 (SCA) and TEK Corporation Provident Fund v Lorenz 1999 (4) SA 884 (SCA).
42. There is a common law prima facie rule of construction that a statute (or any amendment or legislatively authorised alteration thereto) should not be interpreted as having retrospective effect. The presumption against retrospective arising from this rule may be rebutted, either expressly or by necessary implication, by provisions or indicators to the contrary in the enactment under consideration. n an appropriate
case the language of the enactment, far from rebutting the presumptions, may fortify it. Worksman Compensation Commission v looster [1997] ZASCA 58; 1997 (4) SA 418 (SCA) at 424 F-G.
43. The presumption against retrospectivity is underpinned by procedural fairness. Even in the case where the provision of the Act expressly permit for retrospectivity (as in the instant case); the basis of presumption is elementary consideration of fairness (which dictates that individuals should have an opportunity to know what the law is and to conform their conduct accordingly). Landgraf v USI Film Productions et al [1994] USSC 10; 511 US 244 (1994) at 265, quoted with approval by Farlam AJA in National Director of Public Prosecutions v Caralus and others 2000(1) SA 1127 (SCA) at 1139 C -D, at 1145 A the learned Judge referred to 'the legal culture against retrospective where there is unfairness'.
44. The ability to arrange one's affairs in the shadow of the law is an essential requirement to the rule of law. The point was made as follows by the American Supreme Court in Papachristou v City of Jacksonville [1972] USSC 42; 405 US 156 (1972) at 162:
"Living under a rule of law entails various suppositions, one of which is that "[all persons'1are entitled to be informed as to what the State commands or forbids" Lonzetta v New Jersey [1939] USSC 61; 306 US 451, 453. A similar point was made by Mokgoro J in President of the Republic of South Africa and Another v Hugo 1997 (4) SA 1(CC) at para [102].
"The need for accessibility precision and general application flow from the concept of the rule of law. A person should be able to know of the law, and be able to conform his or her conduct according to the laws".
(Taken from the judgment of De Villiers l in Bareko NO and Another v Genco Ltd and Others 2006 (1) SA 432).
In a constitutional democracy and human rights such as ours, a litigant or a party in a dispute must be given meaningful and adequate
opportunity to make submissions to the Fund on the appropriateness of the Rule amended before its approval. Prior notice is directly
relevant to the notion of natural justice. This was not the case in this matter, no prior notice was given to the first respondent.
45. It is clear from the chronology of events that the first respondent was not noticed about the impending Rule amendment prior to it being registered and the effective date thereof. He was not aware that it would be operative with retrospective effect. It was only when he enquired about the reduction in his claim benefit that he was informed that it was done on the advice of the first applicant's actuaries. It is evident that the application by the applicants to the Registrar to approve and register the amendment of Rule 37 was made on 22 July 2013, this was after the first respondent had resigned from second respondent on 31 May 2013 and the amendment was only registered on 1April 2014.
46. The elementary considerations of fairness form the basis of the presumption against retrospectively. Statutes are presumed not to apply retrospectively particularly where prejudice will be caused to persons who are holders of certain rights. There is no dispute that the first respondent joined the second respondent in 2003 and when he resigned in 2013 he had already covered a period of ten years in the employment of the second respondent. He had an established benefit that had accumulated at the time the amendment
was made. Therefore he cannot be deprived of benefits that had already accumulated by the time the amendment was made on the 1 April 2014.
47. I must reiterate that the first respondent is not challenging the validity of the amendment, as the applicants would want to believe, but he is merely challenging its unfair retrospective application on him. As already stated above the Adjudicator, also, did not pronounce on the validity of the Rule amendment but the unfair application thereof to the first respondent.
48. One other important issue is the late filing of a supplementary affidavit by the applicants long after the first respondent had filed its answering affidavit. The first respondent filed its answering affidavit on 16 September 2014 and the applicants filed their supplementary affidavit on 21 July 2015. This is ten months after the first respondent had filed its answering affidavit.
Although the supplementary affidavit was admitted into evidence, its weight is diminished by the impact its delay has on the case of the first respondent. By the time the supplementary affidavit was filed, the applicants were aware of the defences in the case of the first respondent. They realized the perilous effect of their founding affidavit which provided only a skeleton and no meat in it. They tried to make their case in the supplementary affidavit which they failed to make in the founding affidavit. They were also aware that it is not permissible for one to make a case in the replying affidavit. The only pathway to survival was through a supplementary affidavit. I am afraid, even this route was not helpful to their case. I cannot attach much weight to the supplementary affidavit.
49. I find no ground on which the determination of the Adjudicator can be reviewed and set aside.
49.1 Condonation for the late filing of the application is granted.
49.2 The application is dismissed with costs.
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TJ
RAULINGA
JUDGE OF THE GAUTENG HIGH COURT, PRETORIA
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