nottheaverageactuary

Actuarial news and views from Cape Town and beyond

Denial of pension fund payout to same-sex spouse

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Mr. Louis Von Maltitz was an employee of Beka (Pty) Ltd from 16 May 1994 and was involved with Mr. Rory Martin from February that year. Von Maltitz was a member of the Beka provident fund until his death on 22 April 1998. Since their involvement, Von Maltitz and Martin shared a home and were in an intimate relationship till his death, which was about 3 years.

However, Beka refused payment to Martin of the spouse’s pension as well as the lump sum payments on the basis that the complainant falls out of the definition of “spouse”. Beka’s response to the complainant’s claim was justified by part 6 of their rules pertaining to the payment of death benefits and more particularly part 6.2. Part 6 stated the following:

“The Board of Trustees of the BEKA Provident Fund has reviewed and considered your claim based on the following:

  1. The Board can only rule within the Rules of the BEKA Provident Fund.
  2. The Spouse’s pension is covered under point 6.2 (3) of the Rules of the BEKA Provident Fund and reads:  In the case of a married Member who leaves a Qualifying Spouse, an annual pension equal to 50% of the Member’s annual Remuneration is paid to him/her until his/her death. 
    The definition of a Qualifying Spouse is as follows:
    Qualifying Spouse in regard to a Member means the woman/man with whom the member at the time of his/her death was joined in Marriage, and if a member at the time of his/her death was joined in marriage with two or more spouses, only that one of them whom he/she first married, provided that the spouse is a Dependant.
    Marriage means:

    • a legal marriage
    • a union which is recognised as marriage in accordance with any indigenous law, custom or religion; or
    • a union of a man and a woman in respect of whom the Board has been satisfied that the parties cohabited as if married.

The Board of Trustees regret to advise that in view of the Rules of the BEKA Provident Fund none of the above rules and its definitions allow you to qualify for Spouse’s pension as a result of the untimely death of Mr Louis von Maltitz.”

Included in the letter to Martin was a statement that said: “cohabitation of persons of the same sex is not at this stage being recognised as marriage.” This did not sit well with Martin’s lawyer, Mr. Berger, who then informed them that their set of rules were invalid on the grounds of unfair discrimination based on sexual orientation and marital status as stated in section 9(3) of the Bill of Rights:

 “The state may not unfairly discriminate directly or indirectly against anyone on one or more grounds, including race, gender, sex, pregnancy, marital status, ethnic or social origin, colour, sexual orientation, age, disability, religion, conscience, belief, culture, language and birth.”

On 8 June 1999, after an ongoing court case John Murphy, the pension funds adjudicator, communicated to the complainant that any rule that is inconsistent with the Constitution should be regarded invalid, and that he is to make any further order which is just and equitable.

“…I make the following order:

  1. The definition of “marriage” in the respondent’s rules is declared to be invalid to the extent that it  discriminates against same-sex domestic partners, in violation of the Bill of Rights, by omitting same from inclusion in the  class of persons entitled to enjoyment of the spouse’s pension.
  2. The respondent is ordered to amend its rules in order that part (c) of the definition of Amarriage@ read as follows:
    A union of two adults, whether of the same or opposite sex, in respect of whom the  Board is satisfied that the parties cohabited as if married.
  3. The respondent is ordered to pay a spousal pension to the complainant in accordance with its rules, so amended, as follows:
    4.1 the payment in respect of the year from 22 April 1998 to 21 April 1999 is to be made within six weeks of the date of this determination, together with interest from 22 April 1999 to date of payment, at the rate prescribed in respect of a judgment debt in terms of section 2 of the Prescribed Rate of Interest Act, 1975;
    4.2 annual payments thereafter are to be made on or before 21 April of each succeeding year for the lifetime of the complainant.
  4. The respondent is ordered to pay the lump sum death benefits, being the risk death in service lump sum benefit and the benefit relating to contributions for retirement benefits, together with interest from 22 April 1999 to date of payment, at the rate prescribed in respect of a judgment debt in terms of section 2 of the Prescribed Rate of Interest Act, 1975, to the complainant in accordance with its rules, within six weeks of the date of this determination. “

This case is clear evidence of the development of South Africa, even with regards to pension funds, since democracy was declared. The Constitution does not take discrimination of any form lightly!

The full details of the case can be found at:

http://www.pfa.org.za/Determinations/PRE%202003/D3F0F73D-531C-4ABF-9ACD-CA9223822BAB.pdf

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One thought on “Denial of pension fund payout to same-sex spouse

  1. It’s nice to see sense prevailing in the end – but a pity that they had to take the legal route!

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