De Graaf NO v Camilleri
| Jurisdiction | http://justis.com/jurisdiction/166,South Africa |
| Judge | Saldulker JA, Mocumie JA, Meyer JA, Nhlangulela AJA and Daffue AJA |
| Judgment Date | 03 August 2023 |
| Citation | 2023 JDR 2825 (SCA) |
| Hearing Date | 12 May 2023 |
| Docket Number | 565/2022 |
| Court | Supreme Court of Appeal |
Saldulker JA (Mocumie and Meyer JJA and Nhlangulela and Daffue AJJA concurring):
This appeal is against the judgment of the Western Cape Division of the High Court, Cape Town, per Nziweni AJ (the high court), which granted payment in favour of the respondent, Ms Christine Susan Camilleri, against the appellant, Mr Anthony Robert de Graaf NO, the executor of the estate of her late husband, Mr Raymond Camilleri (the deceased) for a claim in respect of his pension interests. Payment was awarded in the amount of R3 225 302.66 with interest thereon, which represented 50% of the value of the deceased’s retirement benefit, as a defined benefit member of the Munich Reinsurance Company Pension Fund (MR pension fund), net of tax, less
2023 JDR 2825 p4
Saldulker JA (Mocumie and Meyer JJA and Nhlangulela and Daffue AJJA concurring)
an amount which the fund had previously paid to the respondent directly. Additionally, the respondent claimed and was awarded payment of an unspecified sum equivalent to 50% of the deceased’s net entitlement as at date of his withdrawal from the Sanlam Retirement Annuity Fund (the Sanlam RA), net of tax, less the sum of R10 619.42, which had previously been paid to her.
The deceased and the respondent were married in 1983, out of community of property, with the exclusion of the accrual system. On 2 August 1999, they were divorced and a consent paper which was concluded by them was incorporated in the divorce order that was made an order of court. The deceased’s pension interests in the MR pension fund and the Sanlam RA are dealt with in paragraph 9 of the consent paper, which is set out below:
It is recorded that Plaintiff is a member of Munich Reinsurance Company Pension Fund.
Plaintiff consents to an endorsement being made in respect of the aforementioned Pension Fund, that 50% of his pension interest as at date of his divorce as defined in the present Divorce Act, No. 70 of 1979 is due to Defendant.
Plaintiff undertakes to communicate the provisions of this paragraph to his Pension Fund in order that Defendant’s entitlement herein is endorsed in the relevant records. Plaintiff undertakes to furnish proof to Defendant of his having advised the Pension Fund of the aforesaid endorsement as soon as such endorsement has been effected.
In addition to what is stated above, Plaintiff specifically agrees and undertakes to pay an additional amount to Defendant at the time of his withdrawal from the fund, so as to ensure that she receives one-half of the nett entitlement to him as at date of withdrawal from the fund, (i.e. nett of all taxes). Such “additional amount” shall be paid in the same manner as Plaintiff receives his payments from the Pension Fund.
It is further recorded that Plaintiff is the holder of Sanlam Retirement Annuity Policy No. 9282632X0.
Plaintiff consents to an endorsement being made in the records of Sanlam that 50% of his pension interest as at the date of divorce as defined in the present Divorce Act is due to Defendant. Plaintiff similarly undertakes to communicate the provisions of this paragraph to Sanlam in order that Defendant’s entitlement herein is endorsed in the relevant records. Plaintiff undertakes to furnish proof to Defendant of such endorsement as soon as such endorsement has been effected.
In addition to what is stated above, Plaintiff specifically agrees and undertakes to pay an additional amount to Defendant at the time of his withdrawal from the Fund, so as to ensure
2023 JDR 2825 p5
Saldulker JA (Mocumie and Meyer JJA and Nhlangulela and Daffue AJJA concurring)
that she receives one-half of the nett entitlement to him as at date of withdrawal from the Fund, (i.e. nett of all taxes). Such “additional amount” shall be paid in the same manner as Plaintiff receives his payments from Sanlam.’ (My emphasis.)
Sub-clauses 9.1 to 9.3 and 9.5 and 9.6 concern the appellant’s pension and retirement benefits in the MR pension fund and the Sanlam RA, respectively, and are worded in the standard form used by practitioners at the time. However, and contrary to the usual clauses dealing with pension interests, the parties’ agreement contains two further clauses, to wit 9.4 and 9.7, the interpretation of which is the central issue in this appeal.
A dispute arose between the respondent and the deceased with regard to the interpretation of the impugned clauses, 9.4 and 9.7. Initially, she accordingly instituted action against the deceased, but when he passed away on 24 December 2018, the appellant was substituted in his capacity as the executor of the estate of her deceased husband. It is the respondent’s case, which the high court accepted to be correct, that she is entitled to 50% of the deceased’s entire pension and retirement annuity benefits accumulated during the marriage as well as after the divorce to the date of the deceased’s exit from the MR pension fund and the Sanlam RA, respectively. The appellant argues that the respondent is not entitled to any portion of the deceased’s pension interest on the bases that the impugned clauses are vague, unenforceable and void. Alternatively, he argues that the respondent is only entitled to 50% of the deceased’s pension interest growth based on an actuarial calculation made by the fund. The amount of R52 648.73 as at date of divorce increased to R212 802.57, a growth of only R160 154. Further alternatively, he argues that at best for the respondent, she is entitled to 50% of the net commuted cash amount paid to the deceased which he elected to commute, less the R52 648.73, the amount being R539 224.
The high court concluded inter alia, as contended for by the respondent, that the impugned clauses providing for additional payments should be interpreted to mean that the deceased agreed to pay to the respondent 50% of his entire retirement benefits in the MR pension fund and in his Sanlam RA which were accumulated during his marriage and also the period after divorce. The high court further held that the
2023 JDR 2825 p6
Saldulker JA (Mocumie and Meyer JJA and Nhlangulela and Daffue AJJA concurring)
impugned clauses were not vague, as submitted on behalf of the appellant, and made an order for the payment in the amount reflected above. Aggrieved, the appellant applied for leave to appeal the judgment and order, which was refused by the high court. This appeal is with the leave of this Court.
Some background is necessary. The deceased worked for Munich Reinsurance Company, initially as a manager in foreign shipping, and later as manager of the Cape Town branch, where he dealt with all aspects of insurance, both short and long term, life policies and pension funds. The respondent was a secretary at Munich Reinsurance Company when she married the deceased. At the time of the divorce, the deceased was a member of the MR pension fund. The deceased also held the Sanlam RA. On 2 August 1999, the date of divorce, the deceased’s pension interest in the MR pension fund, as defined in s 1 of the Divorce Act 70 of 1979 (the Divorce Act), was R105 297.46 and R21 238.84 in the Sanlam RA. The respondent was unable to withdraw 50% of these amounts assigned to her until the deceased’s exit from the MR pension fund and Sanlam RA respectively, and neither did the amounts attract any growth. This was as a result of the existing law at the time.
On 17 December 1999, the deceased married Ms Teresa Camilleri (Teresa) in community of property. When the consent paper was concluded, the deceased and Teresa were already living together and planning to marry. Teresa is the surviving widow of the deceased. In 2011 and years before the deceased retired, the MR pension fund paid to the respondent at her request R52 648.73, being 50% of the deceased’s pension interest in the MR pension fund, assigned to her in terms...
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