Protektor Preservation Pension Fund v Bellars and Others (4913/2008) [2008] ZAKZHC 108; 2009 (4) SA 455 (D) (24 July 2008)

Protektor Preservation Pension Fund v Bellars and Others (4913/2008) [2008] ZAKZHC 108; 2009 (4) SA 455 (D) (24 July 2008)

The court held that the statutory definition of 'pension interest' in the Divorce Act must be interpreted in the context of preservation funds, where the employer/employee relationship is artificial and maintained only for tax purposes. The severance of this relationship upon total withdrawal from the fund is equivalent to 'resignation from office' as contemplated in the Act. Accordingly, the after-tax withdrawal benefit available to the member at the date of divorce constitutes the pension interest for the purposes of section 7(8) of the Divorce Act. The court found that the relief sought by the applicant was appropriate and granted the declaratory orders as prayed.

Citation
[2008] ZAKZHC 108
Parties
Applicant: Protektor Preservation Pension Fund; Respondent: Sheralynn Bellars; Respondent: Robert Henry Bellars; Respondent: Registrar of Pension Funds
Court
High Courts - Kwazulu Natal
Jurisdiction
South Africa
Judgment Date
24 July 2008
Case Number
4913/2008
Procedural Posture
Declaratory Application / Motion Proceedings
Outcome
Application granted. Declaratory orders issued as sought in paragraphs 1 and 2 of the notice of motion.
Judges
Levinsohn
Legal Topics
Divorce Act Interpretation, Pension Interest, Preservation Fund, Declaratory Relief
Family and Children Civil Procedure Divorce Act Interpretation Pension Interest Preservation Fund Declaratory Relief

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Parties

Protektor Preservation Pension Fund

Applicant

Sheralynn Bellars

Respondent

Robert Henry Bellars

Respondent

Registrar of Pension Funds

Respondent

Procedural Posture

Declaratory Application / Motion Proceedings

Legal Issues

  1. 1 Whether the definition of 'pension interest' in section 1 of the Divorce Act applies to preservation funds in the context of divorce.
  2. 2 Whether 'resignation from office' in the Divorce Act should be interpreted to mean termination of the employer/employee relationship for preservation funds.
  3. 3 Whether the after-tax withdrawal benefit is included in the pension interest for purposes of divorce.

Ratio Decidendi

The court held that the statutory definition of 'pension interest' in the Divorce Act must be interpreted in the context of preservation funds, where the employer/employee relationship is artificial and maintained only for tax purposes. The severance of this relationship upon total withdrawal from the fund is equivalent to 'resignation from office' as contemplated in the Act. Accordingly, the after-tax withdrawal benefit available to the member at the date of divorce constitutes the pension interest for the purposes of section 7(8) of the Divorce Act. The court found that the relief sought by the applicant was appropriate and granted the declaratory orders as prayed.

Court Disposition

Application granted. Declaratory orders issued as sought in paragraphs 1 and 2 of the notice of motion.

Orders

  • It is declared that the words 'on account of his resignation from office' in the definition of 'pension interest' in section 1 of the Divorce Act 70 of 1979 refer to the termination of the employer/employee relationship in accordance with the definitions in the applicant's rules.
  • It is declared that the definition of 'pension interest' in section 1 of the Divorce Act includes the after-tax withdrawal benefit payable to a member if he or she had opted to take a total withdrawal benefit as at the date of divorce.