IN THE HIGH COURT OF SOUTH AFRICA
GAUTENG LOCAL DIVISION, JOHANNESBURG	
	
Case No: 043822/2022
NOT REPORTABLE
NOT OF INTEREST TO OTHER JUDGES
REVISED	

			
In the matter between:		
		
DAVID KESELWE LEKOTA	Applicant	
		
and		
		
SENTINEL RETIREMENT FUND	Respondent	
		
Delivered:  This judgement was prepared and authored by the Judge whose name is reflected in it and is handed down electronically by circulation to the parties/their legal representatives by email and by uploading it to the electronic file of this matter on CaseLines.  The date for hand-down is deemed to be 7 September 2023.	
JUDGEMENT
DUNN AJ:
Introduction and background
1.	The applicant, Mr David Keselwe Lekota (Mr Lekota), was a contributory member of the respondent, i.e., the Sentinel Retirement Fund (SRF).  
2.	On 30 September 2018, Mr Lekota, who had been employed by Far West Gold Recoveries Pty Ltd, took his early retirement and completed the requisite documentation in respect of his retirement benefits.
3.	It is common cause between the parties that Mr Lekota exercised an irrevocable option to receive a maximum lump sum payment equivalent to one-third (1/3) of his pension benefit and for the remainder to be paid on a monthly basis as a lifelong annuity.  The relevant application form called ‘Application for Retirement Benefit’ comprises some six pages and was signed by Mr Lekota on, it would appear, 5 October 2018.  
4.	The option admittedly exercised by Mr Lekota is reflected on the second page of this form under a section captioned ‘Section 1: Lumpsum Option’ where the maximum one-third lump sum is appropriately selected and marked, as well as a section captioned ‘Section 2: Pension Options for Members with No Spouse’ where a five (5) years ‘Terms Certain Guarantee’ is also appropriately selected marked.  In making this selection, Mr Lekota self-evidently decided not to select a full (i.e., 100%) withdraw of his retirement benefit/s.
5.	The fourth page of the abovementioned application form is captioned: ‘Acknowledgement: Option to Elect Retirement Benefit’ and the portion of it that is currently germane to the issues in this matter provides as follows:
‘2. 	I understand that: 
a.	…;
b.	…;
c.	In terms of the Fund’s rules read with the current legislation and income tax practice, a maximum of one-third of the capital value of my benefit may be commuted for a lump sum.  The balance is payable as a monthly pension.  This is subject to certain exceptions which may or may not apply to me;
d.	…;
e.	The Fund’s rules also provide other options relating to my benefit which have been explained to me;
f.	The available options are subject to the Rules;
g.	…;
h.	It is incumbent on me: 
i.	To ensure that I understand the options available to me and their consequences;
ii.	To elect options best suited to my needs and if necessary, to obtain advice from a financial advisor or intermediary;
iii.	To ensure that in completing the form, i.e. elect the option that I intend to elect;
i.	The fund is entitled to assume that I understand my options and to give effect thereto;
j.	Once the Fund gives effect to my options, I cannot revoke or change them.  This includes: 
i.	My choice to take a retirement benefit (if I am eligible for another benefit);
ii.	An election to commute less than one-third of my benefit for a lump sum, or to not commute at all (i.e. to take the entire benefit as a monthly pension);
iii.	Any other options elected, subject to eligibility (including terms certain guarantee, spouse’s pension, second and third tier options, etc.);
3.	I also acknowledge that by signing this document: 
a.	I waive any right to claim that I was not informed of the consequences of my elections; 
b.	I will have no basis to dispute the validity of any elections through the courts, the Pension Fund Adjudicator or any other forum, or to seek an order that the Fund must change any option/s that I elected;
c.	I understand that my reasons for electing these options or any subsequent change in my financial or personal circumstances do not affect what is stated here.
4.	I understand this declaration and sign it voluntarily and without duress.’
(Own underlining).
6.	During or about September 2022 Mr Lekota instituted motion proceedings (the application) against the SRF for an order that the latter is to make payment to him of all the retirement benefits the SRF holds under industry number A 3672281 within thirty (30) days from the date of this court’s envisaged order together with costs of the application.
7.	The basis upon which Mr Lekota avers that he entitled to all such retirement benefits is essentially that he selected the maximum one-third (1/3) lump sum on the abovementioned application form for retirement benefits:
‘… with the view that my retirement benefits will be paid in full and the Respondent’s office bearers never explained this to me when I handed in the application.  Have [sic] I know that my retirement benefits were not to be paid in full then I would never [sic] chosen such option for a Maximum 1/3 lump sum.’
(Own underlining).
8.	In the remainder of Mr Lekota’s founding affidavit he explains how drastically his circumstances have changed since his retirement and after the initial receipt of his selected retirement benefits.  It is quite evident that Mr Lekota is in dire financial straits and that he is quite unable to pay many of his crippling debts, including the tuition fees owed for the tertiary education of his children.  It is unnecessary to repeat the detail of these debts as they are fully set out in the founding affidavit.  
9.	Mr Lekota approached the SRF on various occasions and requested it to pay him the whole of his retirement benefit/s in a lump sum.  The SRF refused to do and explained to Mr Lekota that he could not revoke the option he had elected and which already had been put into effect.
Mr Lekota’s various attempts to commute his retirement benefit/s and the Pension Fund Adjudicator’s determination
10.	As a result of the SRF’s refusal to accede to Mr Lekota’s request for the whole of his retirement benefit/s to be paid to him, Mr Lekota initially approached the Financial Sector Conduct Authority (FSCA) and lodged an enquiry with it against the SRF in which he, after setting out his financial dilemma in some detail (including the threatened repossession of his motor vehicle by Nedbank), proceeded to request that the SRF must: ‘… change my retirement to withdrawal to be able to settle my car and be able to pay my sons school fee [sic] as well as leading a better life compared to now please.  The life I am leading is suicidal is like I never worked before [sic].’
11.	After considering the enquiry lodged by Mr Lekota, the FSCA notified him that it was not in a position to instruct the SRF to reverse any decision as it (i.e., the SRF) was acting legally in terms of its rules that were binding on it.
12.	Aggrieved by the FSCA’s decision, Mr Lekota next lodged a complaint with the Pension Fund Adjudicator (the Adjudicator) on or about 20 August 2019.  
13.	Almost eight months later, on 29 April 2020, the Adjudicator published a nine page written determination (the PFA’s determination) in terms of section 30 M of the Pension Funds Act 24 of 1956 (the Act).  
14.	An analysis of the PFA’s determination shows that the adjudicator:
14.1.	was fully cognisant of the nature of Mr Lekota’s complaint;
14.2.	correctly identified the issue to be determined, i.e., whether or not Mr Lekota is entitled to commute his retirement benefit to a cash lump sum;
14.3.	considered the SRF’s comprehensive response to the complaint;
14.4.	comprehensively and rationally reasoned why the complaint ought to be dismissed on, among others, the following grounds, namely:
14.4.1.	that the rules of SRF are supreme and binding on it, on its officials, members, shareholders, beneficiaries and anyone claiming from the fund;
14.4.2.	that Rule 3.5 of SRF’s Rules in essence provides that when a member leaves his employer’ service he becomes an interim member with the option to make an election within twenty-four (24) months to become a non-contributory member or claim a benefit;
14.4.3.	that Mr Lekota provided the SRF with his retirement benefit application on 5 October 2018 in which he elected to commute a one-third cash lump sum benefit coupled with a five year guarantee period, and in which application he also did not name or identify a spouse;
14.4.4.	that, in view of the provisions of Rule 5 of SRF’s Rules, Mr Lekota, who was over the age of 50 years, was indeed entitled to an early retirement benefit;
14.4.5.	that, having regard to the provisions of Rule 5.2.1 of the SRF’s Rules and the requirement in the definition of ‘pension fund’ in section 1 of the Income Tax Act 58 of 1962 (the ITA) and specifically paragraph (ii) (dd) of the proviso thereto, a member of the SRF is only permitted to take the entire retirement interest as a cash lump sum if it does not exceed the amount of R247 500.00;
14.4.6.	that, in the present instance, since Mr Lekota was paid a one-third cash lump sum benefit in the amount of R285 724.79 (before tax) he was clearly not entitled to receive his entire retirement benefit in a lump sum as it exceeded the prescribed amount of R247 500.00.  Mr Lekota also receives a monthly pension in the amount of R3 948.55;
14.4.7.	that, by virtue of the provisions of Rule 3.5.5 of the SRF’s Rules, Mr Lekota, who elected to receive an early retirement benefit in the form of a maximum one-third lump sum payment, is not entitled to revoke his election of this option;
14.4.8.	that the maxim caveat subscriptor was applicable, based on the locus classicus on this topic, i.e., George v Fairmead (Pty) Ltd 1958 (2) SA 465 (A) at 470B – E, and that Mr Lekota was bound by his signature to the application form for his retirement benefit/s;
14.4.9.	that Mr Lekota is bound by the SRF’s Rules by virtue of the provisions of section 13 of the Act, that his election is irrevocable, and that he cannot commute his monthly pension, which he is already receiving, to a cash lump sum; and
14.4.10.	that Mr Lekota’s complaint should be dismissed and, accordingly, was also dismissed.
The effect of the PFA’s determination
15.	Section 30 O of the Act, which is captioned ‘Enforceability of determination’, provides as follows:
‘(1) 	Any determination of the Adjudicator shall be deemed to be a civil judgment of any court of law had the matter in question been heard by such court, and shall be so noted by the clerk or the registrar of the court, as the case may be.
(2) 	A writ or warrant of execution may be issued by the clerk or the registrar of the court in question and executed by the sheriff of such court after expiration of a period of six weeks after the date of the determination, on condition that no application contemplated in section 30P has been lodged.’
(Own underlining).
16.	Section 30 P of the Act, which is captioned ‘Access to court’, provides as follows:
‘(1) 	Any party who feels aggrieved by a determination of the Adjudicator may, within six weeks after the date of the determination, apply to the division of the High Court which has jurisdiction, for relief, and shall at the same time give written notice of his or her intention so to apply to the other parties to the complaint.
(2) 	The division of the High Court contemplated in subsection (1) may consider the merits of the complaint made to the Adjudicator under section 30A (3) and on which the Adjudicator’s determination was based, and may make any order it deems fit.
(3) 	Subsection (2) shall not affect the court’s power to decide that sufficient evidence has been adduced on which a decision can be arrived at, and to order that no further evidence shall be adduced.’
17.	The PFA’s determination was published on 29 April 2020.  The application in these proceedings was instituted on or about 14 September 2022.  The application was not instituted, and also does not purport to have been instituted, in terms of section 30 P of the Act.  In any event, Mr Lekota has also not endeavoured to explain why the application, if it was intended to have been brought in terms of the latter section, was not instituted timeously.
18.	I must agree with the submission made by the SRF’s counsel that there is simply no conceivable cause of action to be found anywhere in Mr Lekota’s application (inclusive of his replying affidavit).  Mr Lekota is not only bound by the election he made at the time he applied for his retirement benefit/s (i.e., an irrevocable option to receive a maximum lump sum payment equivalent to one-third (1/3) of his pension benefit and for the remainder to be paid on a monthly basis as a lifelong annuity), but that he is also bound by the PFA’s determination, which determination – in the light of the provisions of section 30 O (read with section 30 P, i.e., where the determination has not subsequently been changed by a court with the requisite jurisdiction pursuant to an application seeking such change) of the Act affords the SRF the defence of res iudicata in these circumstances.  
19.	Mr Lekota’s ongoing complaint, right from the outset through all its different phases referred to above, is exactly the same complaint and for that reason too it falls to be dismissed on the basis of the res iudicata plea invoked by the SFR.
Conclusion
20.	In the result the application is dismissed.  Ordinarily, the SRF would be entitled to a costs order in its favour given the justifiable success it has achieved in this application.  However, the SRF in a spirit of generosity agreed to waive any costs order that it would have become entitled to.  I must commend it for this fine gesture vis-à-vis a person in dire financial distress. 
_____________
EW DUNN
Acting Judge of the High Court
Gauteng Division, Johannesburg
Counsel for the Applicant: In person (assisted by a court translator, Mr Ngxito.
Counsel for the Respondent: Adv H Drake.
Instructed by: Shepstone & Wylie Attorneys, Sandton. 
Date of hearing: Tuesday, 5 September 2023
Date of Judgment: Thursday, 7 September 2023.
Judgment handed down electronically