Elesang v PPC Lime Ltd and Others

• Jurisdiction: South Africa

Elesang v PPC Lime Ltd and Others
2007 (6) SA 328 (NC)

2007 (6) SA p328

Citation	2007 (6) SA 328 (NC)
Case No	1076/2006
Court	Northern Cape Division
Judge	Olivier J
Heard	December 8, 2006
Judgment	December 15, 2006
Counsel	V Haddad for the applicant; W Coetzee for the second respondent; No appearances for the first, third or fourth respondents

Flynote : Sleutelwoorde H

Husband and wife — Divorce — Proprietary rights — Pension fund benefits — Parties married in community of property — Member spouse leaving employment prior to divorce — Becoming entitled to withdrawal pension benefit — Rights of non-member I spouse — Not entitled to pension interest under ss 7(7) and 7(8) of Divorce Act 70 of 1979 — However, entitled in principle to half of member's pension benefit, as forming part of joint estate — Payment of pension benefit into trust account pending finalisation of divorce not contrary to s 37A(1) of Pension Funds Act 24 of J

2007 (6) SA p329

1956 — Semble: Non-member spouse entitled to secure whole of pension benefit pending finalisation of divorce A action.

Headnote : Kopnota

The applicant had instituted divorce proceedings against the third respondent (her husband), to whom she was married in community of property. At the time of institution of divorce proceedings her husband had left his employment and he had thereupon become entitled to payment of a withdrawal benefit by the second respondent (the provident B fund of his erstwhile employers). The applicant had obtained a rule nisi to the effect that the second respondent pay half her husband's pension interest into her attorney's trust account, pending the finalisation of the divorce. On the return day of the rule nisi,

Held, that ss 7(7) and 7(8) of the Divorce Act 70 of 1979 clearly apply only to a pension interest which had not yet C accrued at the date of the divorce and belonged to a party who was still a member of the particular fund at the date of the divorce. These provisions envisage a future accrual of benefits, after the date of divorce. (Paragraphs [15] and [18] at 332I and 333D - E.) The applicant was on the facts not entitled to any relief under ss 7(7) and 7(8) because her spouse would not be a member of the provident fund at the time of the order of divorce being granted because he had left D his employment long before the finalisation of the divorce. (Paragraphs [10] and [18] at 332B and 333C - D.)

Held, further, that a distinction had to be drawn between a pension interest which had not yet accrued, and one which had accrued and in the process been converted to a pension benefit. In the case of a pension benefit, the E accrued right would form part of the joint estate, whereas a pension interest did not form part of the assets of the joint estate under common law. (Paragraphs [14] and [20] at 332G and 333F - G.) On the facts, the accrued right of the pension benefit would be part of the joint estate, one half of the nett value of which the applicant would in principle be entitled to. (Paragraph [21] at 333H - I.) The applicant was entitled to secure at least half of the pension benefits to protect her interest in the joint estate. F (Paragraph [24] at 334E.)

Semble: The applicant might possibly have been entitled to move for an order securing the whole of the accrued pension benefits pendente lite. It was not only half of the pension benefits that formed part of the joint estate, but all of it, and if a case was made out that the third respondent might squander any part thereof to the detriment of the joint estate, the applicant would have been G entitled to protect it pending finalisation of the divorce action. (Paragraph [25] at 334E - F.)

Held, further, that payment of the pension benefits into a trust account pending the finalisation of the divorce action, and possibly an order of that Court in respect of that money, could not amount to a contravention of s 37A(1) of the Pension Funds Act 24 of 1956. (Paragraph [41] at 336I - J.) Amended rule nisi H confirmed.

Cases Considered

Annotations

Reported cases

Burger v Burger and Another 2006 (4) SA 414 (D): applied

Coalcor (Cape) (Pty) Ltd and Others v Boiler Efficiency Services CC and Others 1990 (4) SA 349 (C): dictum at I 353G applied

Commissioner for Inland Revenue, Transkei, and Another v JALC Holdings (SA) (Pty) Ltd and Another 1991 (4) SA 646 (Tk): dictum at 654G applied

De Kock v Jacobson and Another 1999 (4) SA 346 (W): dictum at 349H applied J

2007 (6) SA p330

Ex parte Dean 1946 (1) PH B29 (C): applied A

Magewu v Zozo and Others 2004 (4) SA 578 (C) ([2004] 3 All SA 235): applied

Maharaj v Maharaj and Others 2002 (2) SA 648 (D) ([2002] 2 All SA 34): dictum at 650 - 1 applied

Mngadi v Beacon Sweets & Chocolates Provident Fund and Others 2004 (5) SA 388 (D) ([2003] 2 All SA 279): applied B

Sempapalele v Sempapalele and Another 2001 (2) SA 306 (O): dictum at 311 - 12 applied

Soller v Maintenance Magistrate, Wynberg, and Others 2006 (2) SA 66 (C): applied

Van Aartsen v Van Aartsen 2006 (4) SA 131 (T): compared. C

Statutes Considered

Statutes

The Divorce Act 70 of 1979, ss 1, 7(7) and 7(8): see Juta's Statutes of South Africa 2006/7 vol 5 at 2-203 and 2-205

The Pension Funds Act 24 of 1956, s 37A(1): see Juta's Statutes of South Africa 2006/7 vol 5 at 4-33. D

Case Information

Application by a spouse for payment of one-half of the other spouse's pension interest into a trust account pending finalisation of divorce action. The facts appear from the reasons for judgment.

V Haddad for the applicant.

W Coetzee for the second respondent. E

No appearances for the first, third or fourth respondents.

Cur adv vult.

Postea (December 15). F

Judgment

Olivier J:

Parties and background

[1] The applicant, Mrs Nomthetho Yvonne Elesang, and the third respondent, Mr Marapelo Justice Elesang, are married to each other in community of property. There is one minor child born of their marriage. G

[2] The applicant has instituted divorce proceedings in which she claims, inter alia, one half share of the third respondent's pension interest as at the date of divorce, and maintenance in respect of the minor child.

[3] The third respondent had been in the employment of PPC Lime Ltd (the first respondent) and he had in such capacity been a H member of PPC Lime Employees Provident Fund (the second respondent). The third respondent had, apparently after the issue of summons, left the employment of the first respondent and in the process he became entitled to payment (by the second respondent) of what was referred to (by the deponent for the second I respondent) as a withdrawal benefit.

[4] The applicant then approached this Court for a provisional order to the effect that, pending the finalisation of the divorce action, the second respondent pay half of the amount of the third respondent's 'pension interest' into the trust account of the applicant's attorneys, alternatively J

2007 (6) SA p331

Olivier J

(and in the event that the amount had already been paid to the third respondent) that A the fourth respondent, the Standard Bank of South Africa Ltd, be ordered to pay half of such amount into the said trust account, and that the third respondent, and any other respondent who opposed the application, be ordered to pay the costs jointly and severally.

[5] A rule nisi to that effect was granted. On the return day the application was opposed by only the second B respondent.

[6] The application was founded upon allegations that the applicant was entitled to half of the money by virtue of her marriage in community of property to the third respondent, that the third respondent had neglected to provide financial assistance in respect C of the minor child and that the applicant feared that the third respondent would 'not meet his present or future maintenance commitments and that he (would) abuse the moneys . . . without making provision for the . . . payment of maintenance' and that he would 'waste the pension moneys and that (she would) be seriously disadvantaged thereby'. D

Opposition

[7] These allegations have not been denied by or on behalf of the second respondent and, as already mentioned, the third respondent did not even oppose the application. E

[8] In its opposing papers the second respondent opposed the application on the grounds, broadly speaking:

[8.1]

That the concept of 'pension interest', as envisaged and defined in the Divorce Act 70 of 1979, could only be applicable if, at the time of the divorce, the particular party is still a member of a F fund as envisaged in s 1 of the...