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THE FINANCIAL SERVICES TRIBUNAL

 

CASE NO: PFA53/2022

 

In the matter between:

 

R S GURNEY N.O.                                                      FIRST APPLICANT

 

T M GURNEY N.O.                                                      SECOND APPLICANT

 

G N CROOKS N.O.                                                     THIRD RESPONDENT

 

and

 

Z MKHIZE                                                                   FIRST RESPONDENT

 

M A LUKHAIMANE                                                     SECOND RESPONDENT

 

THE PENSION FUNDS ADJUDICATOR                    THIRD RESPONDENT

 

NATIONAL BARGAINING COUNCIL FOR THE

ROAD FREIGHT AND LOGISTICS

INDUSTRY (“NBCRFLI”)                                           FOURTH RESPONDENT

 

TRANSPORT SECTOR

RETIREMENT FUND (“TSRF”)                                 FIFTH RESPONDENT

 

SALT EMPLOYEE BENEFITS (PTY) LTD                 SIXTH RESPONDENT

 

 

For the appellant: Adv T Pretorius For the PFA: Adv G-M Goedhart SC

 

 

DECISION

 

 

Re: Reconsideration of PFA decision – jurisdiction – time bar – procedure – onus – bias

 

 

1            This application for reconsideration under sec 230(1) of the Financial Sector Regulation Act 9 of 2017 is a sequel to the determination of this Tribunal in the similarly named case under reference number PFA 43/2021 of 7 September 2021. The Tribunal panel (which was the undersigned) in that case upheld the reconsideration application and, as required by sec 234(1), remitted the matter to the Pension Funds Adjudicator (‘the PFA’) for reconsideration.

 

2            As happen previously, the parties waived their rights to a hearing before a full panel of the Tribunal and the hearing was held virtually.

 

3            After reconsideration, the PFA again upheld the complainant’s (Mr Z Mkize’s) complaint and issued a determination in the same terms in the present case, PFA53/2022, as she did in PFA 43/2021.

 

4            Dissatisfied, the applicants filed the present application and decided to cite the PFA not only in her official capacity but also by name and for good measure referred to her simply as ‘Lukhaimane’ throughout and not with reference to her title or as Ms Lukhaimane and used language that one does not expect in matters such as this. It was said (albeit with some hyperbole on her behalf):

 

In its second reconsideration application, the applicant has launched an unwarranted vexatious attack against the Adjudicator. Whilst the Adjudicator, as a public servant, has developed a thick skin and allegations of bias etc. come with the territory, the applicant's application is exceptional and goes further to the heart of whether this matter can be remitted for reconsideration. Every negative superlative known to the legal profession has been thrown at the Adjudicator without any basis or substance.

 

5            Counsel for the applicants submitted that there was a lot of white dust in the case, some (ironically) caused by the applicants. Although the matter eventually fell within a narrow compass, it is nevertheless necessary to relate more, and I shall take wholesale from the earlier decision to simplify matters, making it unnecessary for the reader to refer back to it to understand the case.

 

6            This is from the first decision:

 

·             The applicants are the trustees of Roseleigh Estates Trust and are cited in their capacities as trustees. For the sake of convenience, I shall refer to the applicants as ‘the Trust’. The Trust conducts farming operations but also a transport business. Because of the latter it falls under the Bargaining Council, the fourth respondent.

 

·             It is a requirement that such members must be participating employers of the Fund, the fifth respondent, and that its employees must be registered, and their pension contributions paid to to the Fund in terms of its rules and sec 13A of the Pension Funds Act 24 of 1956. The fifth respondent, Salt, administers the Fund.

 

·             The first respondent, Mr Z Mkize (‘the complainant’), was employed by the Trust since 1 November 2010 until his dismissal on 31 August 2018. Being dissatisfied with the quantum of his withdrawal benefit as calculated by Salt, he filed a complaint with the PFA, the third respondent, against the Trust for having failed to register him timeously as a member of the Fund and for having failed to pay all his contributions to the Fund.

 

·             The PFA upheld the complaint.

 

·             The dispute which is the subject of the reconsideration application concerns an aspect of the determination, namely that the Trust was ordered to submit outstanding contribution schedules in respect of the complainant for the period November 2010 and April 2011 to March 2018 to the Fund; the Fund to compute the arrear contributions due by the Trust, together with late payment interest; and the Trust to pay to the Fund the arrear contributions together with late payment interest as computed. The Fund mut then pay the complainant his withdrawal benefit.

 

·             The application for reconsideration is based on a single proposition: the complaint was filed by the complainant with the PFA on 6 August 2020. Sec 30I of the PF Act contains a three-year time bar. Consequently, the complaint about non-payment of the contributions for the period preceding August 2017 fell beyond the jurisdiction of the PFA.

 

·             The Trust accepted that a determination for payment as from August 2017 March 2018 would be in order.

 

7            The decision then dealt with the provisions of sec 30I of the Pension Funds Act 24 of 1956 read with the Prescription Act and concluded that the disputed contributions had become prescribed and therefore it remitted the matter to the PFA as it was obliged to do in terms of sec 234(1). The ratio decidendi of the Tribunal was the following:[1]

 

·             Time limits for lodging of complaints with the PFA are laid down in sec 30I:

 

(1)         The Adjudicator shall not investigate a complaint if the act or omission to which it relates occurred more than three years before the date on which the complaint is received by him or her in writing.

(2)         The provisions of the Prescription Act, 1969 (Act No. 68 of 1969), relating to a debt apply in respect of the calculation of the three-year period referred to in subsection (1).

 

·             The Tribunal has explained before that the reference to the Prescription Act in sec 30I relates to the calculation of the three-year period and nothing else. The PFA deals with “complaints” as defined in sec 1, and not necessarily “debts”, the subject of the Prescription Act with a specific meaning.

 

·             There is a difference between a time bar and prescription. In this case, Parliament found it convenient to use the time calculation the Prescription Act for calculating the time bar. It did not incorporate the Prescription Act into the PF Act.[2]

 

·             The cross-reference is in the main to sec 12(2) and (3) of the Prescription Act, which state that –

 

(2)         If the debtor wilfully prevents the creditor from coming to know of the existence of the debt, prescription shall not commence to run until the creditor becomes aware of the existence of the debt.

(3)         A debt shall not be deemed to be due until the creditor has knowledge of the identity of the debtor and of the facts from which the debt arises: Provided that a creditor shall be deemed to have such knowledge if he could have acquired it by exercising reasonable care.

 

8            The PFA, during reconsideration, accepted the correctness of the Tribunal decision but, during the reconsideration process, concluded that the Trust had not established the date when prescription (or the time bar) began to run in terms of sec 12(3) of the Prescription Act and that, therefore, the complaint was not time-barred.

 

9            The Trust refused to engage meaningfully with the PFA during the process of reconsideration, its attitude being that the PFA had to issue a determination in accordance with the findings of the Tribunal about prescription, namely that the disputed payments had become prescribed and that she could not ‘overturn the decision of the Tribunal’ because she was ‘constrained to follow the decision of the FST’. This argument was abandoned during the hearing.

 

BIAS

 

10         Before I proceed with the substance of the case, I wish to dispose of other dust that bedevilled the record.

 

11         First, there is the decision in the High Court where the Trust sought a review of another decision of the Tribunal in relation to another employee of the Trust, namely Mr MN Mkize. I was not a member of that Tribunal panel but disagreed with it in PFA 43/2021 and I did not apply its reasoning which was in any event not in accordance with a previous decision of the Tribunal, namely Vokwana (supra). My decision in PFA 43/2021 was followed by a full panel of the Tribunal in a later matter of Super Rent v Hlungwana PFA 73/2021.

 

12         Reverting to the High Court decision, the application was not opposed by the Tribunal or the PFA, both following legal convention and practice. Mr MN Mkize could not afford representation and the matter was dealt with as an unopposed matter. The Court made an order without giving reasons and Mr Pretorius had to accept that a decision without a ratio could hardly serve as a precedent because there is no ratio decidendi. That the Court found that the particular complaint had become prescribed is uncontentious. The problem is that the order may otherwise have been beyond the court’s jurisdiction – something that the PFA wishes to have decided by higher authority, and an application for leave to appeal has been filed. (It is not without interest that the Trust at the hearing abandoned its request for a similar order as that granted by the High Court before the Tribunal.)

 

13         Although one may infer that the decision of the High Court adopted a reasoning similar to that in PFA 43/2021, the decision has no effect on the present case and need not be considered any longer. The complaint of the Trust that the PFA filed submissions about the decision which indicates bias is without substance. The Trust relied on the judgment and the Tribunal requested the PFA’s input. The fact that the PFA wishes to appeal is not proof of bias especially since Mr Pretorius could not explain whence the jurisdiction of the High Court came for the ancilliary order it issued.

 

14         Another attack based on bias was the fact that the PFA briefed counsel to appear before me. As I explained during the hearing, the PFA never takes part in hearings before the Tribunal. All she does is to file, if appropriate, additional reasons in terms of the Tribunal rules. It was different in this case. I requested the PFA to appoint counsel as amicus because of the plethora of issues and allegations and the fact that Mr Mkize was represented by a para-legal who probably does not have the right of appearance and in any event did not appear.

 

15         Ms Goedhart, on behalf of the PFA, justified her appearance on the basis that the PFA was personally under fire, relying on Hyperchemicals International v Maybaker Agrichem 1992 (1) SA 89 (W) at 92A-D. In the event Mr Pretorius accepted that the appearance of Ms Goedhart was not an irregularity and the hearing proceeded on that basis.

 

16         The final answer to this part of the case is that the Tribunal is not a review court and does not have PAJA powers. It reconsiders matters. As we have often stated before – The Tribunal is not a review ‘court’ as defined in the Promotion of Administrative Justice Act 3 of 2000 (‘PAJA’). Reviews are concerned with process and reconsideration with result. But that does not necessarily mean that review grounds may not overlap with appeal[3] or reconsideration grounds. This is especially the position where a flawed process impacts on the result, for example, where the PFA omitted to have regard to a jurisdictional fact. If the PFA’s decision were to be set aside by the Tribunal on the ground of bias, it will nevertheless have to remit the matter to the PFA. What may then happen is not the subject of this decision.

 

THE RELATIONSHIP BETWEEN SEC 30I AND THE PRESCRIPTION ACT

 

17         As said before, sec 30I creates a time bar and it does not incorporate the Prescription Act wholesale. Cf. Premier Western Cape v Lakay 2012 (2) SA 1 (SCA). The time bar relates to ‘complaints’, and complaints are not necessarily debts. A ‘complaint’ is defined in the Pension Funds Act as follows:

 

“complaint” means a complaint of a complainant relating to the administration of a fund, the investment of its funds or the interpretation and application of its rules, and alleging—

 

(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         Mr Mkize is a complainant as defined by the Act and his complaint fell under (d), namely that the employer, the Trust, had not fulfilled its duties in terms of the rules of the fund. The failure to fulfil those duties relate to a period prior to three years before the filing of his complaint. The complaint did not relate to a failure of the Fund to pay him his full entitlement – i.e., accusing the Fund of maladministration – which disposes of Mr Mkize’s spokesman whose argument was for no apparent reason fully related in the PFA’s determination and has since been restated by the representative in written submissions.

 

19         Then on to the Trust’s final submissions on the issue. There is first the legal argument and, in the alternative, the argument on fact.

 

20         It will not be unfair to restate the legal argument in the following terms: (a) Section 30I concerns a time bar and not prescription; (b) the PFA has no discretion to extend the period in which a complaint should be filed, such discretion having been removed by the repeal of sub-section (3); (c) the calculation of the three-year period starts on the date on which ‘the act or omission to which it relates occurred’; (d) if the complaint is not received by the PFA in writing within three years thereafter the complaint is time barred and the PFA may not consider the complaint at all; (e) sub-section (2) is in conflict with sub-section (1) and should, accordingly, by ignored; (f) accordingly, sec 12 of the Prescription Act plays no role and that the previous decisions of the Tribunal, on which Mr Pretorius otherwise relied, were wrongly decided.

 

21         I have no problem with a submission that the Tribunal’s panels could have been wrong but the essential submission in (e) and (f) is hardly worthy of a response. Reading sec 30I as a whole and in context of the definition of ‘complaint’ it means, as Ms Goedhart submitted, that the three year period referred to in sections 30I(1) and (2) does not begin to run until the complainant has knowledge of the identity of the the employer and of the facts from which the debt arises, as contemplated by section 12(3) of the Prescription Act. (The proviso to sec 2(3) did not arise during argument.)

 

22         But there lies a rub. Ms Goedhart, with reference to case law, submitted that the Trust (‘as defendant’) had to allege and prove with dates that the complaint had become prescribed. Superficially attractive, the argument cannot be accepted. At this stage the PFA has to decide a priori whether she has jurisdiction and that she can only have if the complaint is not time barred. It is not for a respondent (like the Trust) to prove that the PFA does not have jurisdiction – it is the other way round. One would otherwise merge the procedural in limine issue with substance.

 

23         In particular, and this I wish to stress, no one must prove anything beyond doubt, reasonable or otherwise.

 

KNOWLEDGE: THE PROCESS

 

24         The alternative leg of the argument is that the complainant always knew that the Trust was not contributing to the Fund and consequently always had the necessary knowledge of the facts underlying his complaint. The PFA did not, in the first determination make any finding on this issue because it did not arise in the context of her then approach to time barring and prescription. The determination nevertheless cited the facts alleged by the parties relating to the issue.

 

25         In the second determination the PFA addressed the issue of knowledge head-on and in the course thereof relied on the facts alleged during the first round. During the consideration the PFA addressed some questions to the Trust. The Trust did not answer because (as said before) its attitude, which it at the hearing conceded was without merit, was that the PFA was bound by the decision of the Tribunal and could not revisit the issue. This attitude, in part, led the PFA to conclude that the Trust had no answers to the questions put.

 

26         Before reciting the facts, two procedural issues raised by the Trust must be addressed. The first is its reliance on the so-called Plascon-Evans principle: since the Trust was the respondent in first instance its version should be preferred in the event of a dispute between the Trust and the complainant.

 

27         There is a serious misapprehension about the functioning of administrative tribunals and the processes that apply in courts. The function of an administrative tribunal is to reach a conclusion as to what is probable on the facts and allegations of the parties. It is not functioning as a court and court rules do not apply: e.g., Heatherdale Farms (Pty) Ltd v Deputy Min of Agriculture, [1970 (1) SA 487(T). The only procedural requirements are those laid down in PAJA.

 

28         The second procedural argument was that the PFA should have held an oral hearing, allowing the Trustees to cross-examine the complainant. The PFA dismissed the request, inter alia on the ground that a personal hearing between unrepresented (as the PF Act requires) parties would not be a fruitful exercise. It is unnecessary to deal further with the approach of the PFA because the Trust made no attempt to show that the discretion as to how the matter should be dealt with was improperly exercised. See sec 30J(1) of the PF Act. It may also be noted that the hearing before the Tribunal was a rehearing, and the Trust did not apply to lead oral evidence.

 

KNOWLEDGE: THE FACTS

 

29         The function of the Tribunal is to reconsider the facts. Much time and effort and costs have been expended on collecting facts and there has to be a point at which the bus must stop. Since all the facts are on record and the Tribunal is in as good as the PFA to assess the facts this decision sets out the reasoning of the Tribunal on the same facts.

 

30         One aspect that does not enter the assessment of the time bar is the fact that the arrangement on which the Trust relied was void or illegal. The versari in re illicita doctrine does not apply in criminal law and does not apply to time barring.

 

31         The complainant’s complaint was, on its face, time barred because more than three years had elapsed about the ‘old’ non-payments. The complainant’s version was that he never knew that fund contributions were not deducted from his salary because he never received salary slips. This version is inherently improbable. Why did he not ask for slips? How did he think his salary was calculated? Did he not speak to the other drivers?

 

32         His other answer that he was aware that monies had to be deducted from his salary as is the case with any other employer but that he did not ask is inherently improbable.

 

33         The long and the short of the Trust’s version of the complainant’s knowledge that contributions were not deducted and not paid since the inception of his employment is that it had entered an agreement with its drivers, who were dissatisfied with the Council and the Fund, to pay them their full salary including the statutory deduction and that the drivers would be personally responsible for their benefits. (This is nothing novel in labour relations.) This agreement was in writing, it is said, and a copy was produced. All drivers who subsequently joined were aware of the arrangement, accepted it and were accordingly paid.

 

34         The agreement contains drivers’ rules and sets out the remuneration payable to the drivers. It details the amount payable to drivers (such as the complainant). The total is made up of a ‘basic as per bargaining council’, benefits, overtime, performance bonus and then provides the total. The evidence that cannot be contested is that the ‘benefits’ included the employer’s and the employee’s fund contributions.

 

35         The PFA held that this agreement was not of assistance to the Trust for a number of reasons that, unfortunately, do not bear scrutiny.

 

36         The PFA found that the ‘agreement’ was concluded between the Trust and some drivers before the complainant was employed by the Trust during 2010. The agreement was not dated and the allegation of the Trust was that it was concluded during or about 2010. The complainant was employed on 1 November 2010 and although his signature does not appear on the document there are other reasons to find that he knew or accepted the terms of the agreement at least as far as fund deductions are concerned.

 

37         The Trust relied on two affidavits sworn to by other drivers for purposes of the matter of Mr MN Mkize. The highwater mark is the affidavit of a former driver and now farm manager of the Trust. He relates the history of the agreement and then said that ‘all drivers subsequently employed by the trust were aware that their basic salary included the Trust’s pension fund contributions.’

 

38         Although vague, there is corroboration. The Administrator informed the PFA that the complainant’s contributions had been received for the period December 2010 to March 2011. The PFA’s finding that these payments contradict the Trust’s version but the logic escapes me. It confirms the Trust’s version – it had to pay those contributions because the drivers were still registered, and it would have taken time to implement the scheme allegedly proposed by Mr Huygens.

 

39         Further corroboration lies in the fact that all the other pay slips do not reflect any deductions or payments to the Fund save for the period April 2018 to September 2019 (which includes the period for the pay slops that the complainant had lodged namely for July and August 2018). These, the PFA found, also contradict the Trust’s version but that is, with respect, not logical. The evidence of the Trust was that the agreement lapsed in April 2018, which means that it had to follow that contributions would have been deducted and paid to the Fund since April 2018.

 

40         One of the bases on which the PFA based her conclusion is the fact that the Trust did not answer her questions. I shall consider them one by one.

 

41         Question 1: When was the complainant employed by the employer? If it was on 1 November 2010 (as stated by the complainant) or March 2011 (as stated as the employer) then why is there a payslip reflecting a pay period for 14 September 2010 -13 October 2010 (see annexure 2 of the employer's response)?

 

The relevance of the question is not understood. The PFA had already found on the complainant’s version that the complainant had been employed since I November 2010, and that finding was never in issue. The issue was why the fund deductions were not made since April 2011.

 

42         Question 2: What is the date on which the alleged agreement titled "Driver Rules" was entered into?

 

The Trust stated ‘during or about 2010’. The two affidavits confirm the agreement. Any closer dating would not have assisted. We know that the ‘implementation’ as far as payment to the Fund was concerned was April 2011. And the case was that all drivers who had not been parties at the time subsequently knew that there were not deductions.

 

43         Question 3: If indeed the complainant verbally agreed to the terms of the "Driver Rules" document (as alleged by the employer) then why are the amounts shown on the agreement under clause 21 not reflected in the payslips provided by the employer?

 

The significance of the agreement was not the final amount but the fact that it corroborated that the employees would be paid an amount without fund deductions. The final amount in the agreement was subject to adjustment as the agreement itself stated. The real point is that the basic as reflected on the play slips included more than the basic according the the Council and that fund deductions were not indicated.

 

44         Question 4: If indeed the complainant never received payslips from the employer (as alleged by the complainant) then how is it possible that he was able to attach payslips to his complaint form?

 

This was a question for the complainant, whose answer I found to be improbable.

 

45         Question 5: On what dates does the employer allege that the payslips were given to the complainant? Can the employer provide proof that all payslips were given to the complainant on the relevant dates?

 

It is suggested that the question is unrealistic. How does one ‘prove’ this? Is the suggestion that the pay slips that were provided were fabricated? Once again, this is not a criminal case with an accused who has to prove his innocence.

 

46         To conclude on this aspect of the matter, the Trust erred in not attempting to answer the questions but that did not, in my view, add to the issue.

 

47         There are two versions relating to pay slips. The Trust provided the PFA with many. They all indicate that for the relevant period no deductions had been made. I unfortunately disagree with the PFA’s conclusion that under these circumstances it has been established that no pay slips were issued. If they were not issued, that would have had to apply to the whole work force – something that is not probable in the labour market.

 

48         I therefore conclude that the PFA did not have sufficient reason to accept that she had jurisdiction in this matter and the decision must be set aside.

 

 

ORDER:

 

The decision of the PFA is set aside and the matter remitted to the PFA under sec 234(1) of the FSR Act.

 

 

Signed on behalf of the Tribunal on 20 February 2023.

 

 

LTC Harms

 

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