As a result, the Thomson Fund contended that the transfer of the employees, who joined the Thomson Fund, should be accompanied by a transfer of their proportionate interest in the Altron Fund reserve accounts.
The Altron Fund refused to pay over the benefits from the reserve accounts. This prompted the Thomson Fund to file a complaint with the Adjudicator in The Adjudicator ruled that it did not have jurisdiction to determine the complaint because the Registrar had issued a certificate approving the transfer under section 14 of the Pension Funds Act; that for the Adjudicator to then investigate and determine the matter would constitute a review of the Registrar's decision which the Adjudicator has no power to do.
It was the second Adjudicator, Advocate Ngalwana, who first articulated a coherent principle of restraint that precluded the Adjudicator from exercising jurisdiction over section 14 transfers. According to Jeram, Ngalwana's view was informed by the concern that a "determination by the Adjudicator to set aside the Registrar's decision concerning a section 14 transfer would imply a power of review and control over the administration".
In such a case, the correct procedure is for the complainant to approach the Appeal Board of the Financial Services Board for a review of the Registrar's decision. If, however, the challenge is that the trustees acted unconstitutionally or ultra vires or arbitrarily in sanctioning the transfer for submission to the Registrar, then the certificate cannot save their conduct and this office must look into the complaint. After Mamodupi Mohlala was appointed Adjudicator, she investigated the matter between the Altron Fund and the Thomson Fund and in ruled on the merits of the case.
The Altron Fund then brought an application in the High Court to review and set aside the determination of by the Adjudicator. The main contention of the Altron Fund was that unless and until the Adjudicator's decision in was challenged in the High Court pursuant to section 30P of the Pension Funds Act it remained final and rendered the Adjudicator functus officio. The Altron Fund maintained that the determination was null and void because the Adjudicator was functus officio with respect to the determination, which dismissed the matter for want of jurisdiction.
In other words, the determination by the Adjudicator had the effect of a final judgment, and thus rendered the determination invalid. On the other hand, the Thomson Fund countered that the dismissal of the complaint for want of jurisdiction was not in any way dispositive of the merits of the complaint, and that since this application was one of review and not an appeal it was necessary to join the Adjudicator as a party to the proceedings.
In resolving this dispute, Beasley J observed that the matter in the determination was within the jurisdiction of the Adjudicator, presumably because it fell within the definition of a complaint in the Pension Funds Act. In other words, for Beasley the threshold question was whether to characterise the functions of the Adjudicator as administrative or judicial.
In his view, if it was found that the Adjudicator performs administrative functions, then PAJA would ordinarily apply, and persons aggrieved by a decision of the Adjudicator and who wish to review such decision would have to bring an application pursuant to PAJA.
In addressing this question, Beasley first noted the definition of "administrative action" in PAJA, which provides:. Based on the above definition and the facts of the case, Beasley found that the decision of the Adjudicator fell within the definition of administrative action because it adversely affected the rights of the Altron Fund, and also because the Adjudicator was a natural person who performs a public function in terms of an empowering provision, namely, the Pension Funds Act.
The Thomson Fund disagreed with this view and submitted that while the decision of an Adjudicator might appear to constitute administrative action it was nevertheless judicial rather than administrative. He observed that the application in Old Mutual Life Assurance Company was brought by way of an appeal against the Adjudicator and decided on the basis that the Adjudicator had erred in a number of respects on the facts and that the reasons for his decision could not be sustained.
For Beasley J, Old Mutual Life Assurance Company was decided on an appeal in the ordinary strict sense, which was different from the present matter where the application was expressly limited to a review and setting aside of the determination.
To substantiate its claim and demonstrate the intention of the legislature in the Pension Funds Act, the Thomson Fund pointed to the nature of an award made by a commissioner of the CCMA under the Labour Relations Act 66 of According to the Labour Relations Act, an award of a commissioner has to be certified but it does not contain provisions similar to sections 30E and 30O of the Pension Funds Act.
As a result, it maintained, such an award by a commissioner is not deemed judicial in character but remains administrative action. The award remains a CCMA arbitration award. It is not transformed into a court order as a result of the certification process".
There was another basis on which the Thomson Fund objected to the proposition that the Adjudicator performed administrative functions and that PAJA consequently applies.
It maintained that if this proposition was sustained it would render section 30P of the Pension Funds Act obsolete and redundant. Judge Beasley rejected these arguments of the Thomson Fund and reasoned that pursuant to the definition of "administrative action" in PAJA what are expressly excluded from that definition are functions exercised by a "judicial officer of a court referred to in section of the Constitution".
According to Beasley J, the Adjudicator does not function as a court nor is he or she a judicial officer of any court referred to in the hierarchy of the various courts in section of the Constitution, nor can the Adjudicator be deemed to be such by operation of section 30O of the Pension Funds Act. In Judge Beasley's view, section 30O merely provides that the decision of the Adjudicator shall be equated to that of a court of law, and maintains that its legislative purpose was to facilitate the process of execution following upon such decision, while section 30E was designed to circumscribe the type of order which the Adjudicator can make.
Thus, Judge Beasley concludes that the Adjudicator's functions are administrative and not judicial, and that PAJA applies in all instances where an aggrieved party seeks to review a decision of the Adjudicator. In addressing the effect of his decision on applications brought under section 30P of the Pension Funds Act, Beasley J reasoned that his conclusion does not emasculate the right of appeal by aggrieved parties under that section. Instead, he observed that where the relief sought is confined to review proceedings these must proceed in accordance with PAJA.
If, on the other hand, an aggrieved party seeks to challenge an Adjudicator's determination on grounds of both appeal and review, then the review portion must similarly be brought within the framework of PAJA, and presumably an appeal in terms of section 30P of the Pension Funds Act would follow its normal process. The High Court decision in Altron is problematic in many respects and should be rejected.
The decision does little to aid in clarifying pension law in South Africa. In the face of conflicting opinions from other High Courts, it creates uncertainty in the law regarding the functions performed by the Adjudicator. While the High Courts are not bound by decisions of High Courts in other divisions, they are bound by decisions of the Constitutional Court.
In this section, I examine whether Altron is consistent with the Constitutional Court jurisprudence in Sidumo. In a divided opinion, the Court ruled that the statutory arbitration at the CCMA constitutes administrative action under section 33 of the Constitution. Section 33 provides in relevant parts:.
Just administrative action. Everyone has the right to administrative action that is lawful, reasonable and procedurally fair. Everyone whose rights have been adversely affected by administrative action has the right to be given written reasons. The Justices disagreed on a number of issues, including whether or not a distinction should be drawn between an independent and impartial tribunal governed by section.
Section 34 provides: "Everyone has the right to have any dispute that can be resolved by the application of law decided in a fair public hearing before a court or, where appropriate, another independent and impartial tribunal or forum. On the one hand, Justices Navsa, O'Regan and Sachs, who wrote separate opinions, expressed the view that the proceedings at the CCMA are bound by the constitutional provisions of both section 34 and section For O'Regan J, the fact that tribunals perform adjudicative or judicial functions does not automatically mean that their functions are not governed by section 33 of the Constitution.
For O'Regan J, this is in conflict with the substantive understanding of section 33 of the Constitution, and would lead "directly to the arid classifications of our old administrative law. Justice Sachs makes a similar point by encouraging a move "away from unduly rigid compartmentalisation so as to allow judicial reasoning to embrace fluid concepts of hybridity and permeability".
He maintains that the question of whether it is "a judicial function or an administrative action "displays undue subordination to formal classification of rights, and insufficient regard for the manner in which rights overlap and basic values animate and bind discrete rights together".
On the other hand, Justice Ngcobo reasoned that the proceedings at the CCMA were judicial in character and fell to be governed by section 34 of the Constitution. I am persuaded by Ngcobo J's opinion that a distinction has to be drawn between section 34 and section 33 tribunal proceedings. Despite the rights in these sections being related, a distinction between them is important because the protections afforded by them are distinct.
It is to emphasise and protect generally, but also specifically for the protection of the individual, the separation of powers, particularly the separation of the judiciary from the other arms of the state. Section 22 achieves this by ensuring that the courts and other fora which settle justiciable disputes are independent and impartial.
It is a provision fundamental to the upholding of the rule of law. Furthermore, the Constitutional Court recognises the distinction between sections 34 and 33 tribunal proceedings, particularly in cases involving the commitment of recalcitrant witnesses to prison. In De Lange v Smuts 90 and Nel v Le Roux NO, 91 the Court ruled that the power to commit a recaciltrant witness to prison is a judicial and not an administrative action in character. In both cases, the Court recognises that there are certain powers that may only be exercised by a court or tribunal contemplated in section 34 and not any other because of separation of powers considerations.
Thus, this suggests that there are instances where a distinction may be properly drawn between section 34 and section 33 tribunal proceedings without upsetting the concerns raised by Justices O'Regan and Sachs in Sidumo.
One commentator agrees with the need to draw such a distinction and observes:. In other words, where the tribunal does not perform a judicial function but rather an administrative function, it must still adhere to similar notions of impartiality in its decision-making.
This time, however, the decision-maker's discretion will not be fettered by section 34 of the Constitution but rather by section 33 standards of fairness guaranteed by the Constitution must apply to all types of proceedings: where the proceedings are judicial, the guarantee is provided for in section 34; and where they are administrative, the guarantee is provided for in section 33 of the Constitution.
It is thus crucial to correctly characterise the nature of the action being performed in the tribunal as either judicial or administrative. As a result, I defer to Ngcobo's opinion to determine the broader question examined in this article, namely, whether the Adjudicator performs administrative or judicial functions.
Perhaps the most preferred aspect of Justice Ngcobo's opinion in Sidumo relates to the standard that should be applied when determining whether or not tribunal proceedings are governed by section 34 or section 33 of the Constitution. While the Court in Sidumo found and concluded that the CCMA performs administrative functions contemplated in section 33 of the Constitution, I argue that applying Ngcobo's opinion in Sidumo to the Adjudicator leads to a different conclusion for two main reasons.
First, Sidumo was confronted with a dispute involving the CCMA, which has a completely different statutory design to that of the Adjudicator. Secondly, the functions of the Adjudicator are different from those of the CCMA, and this difference demands a different outcome.
In Sidumo Justice Ngcobo ruled that the CCMA is a tribunal within the meaning of section 34 of the Constitution because it performs judicial functions. The determination of disputes capable of being decided by the application of law, Ngcobo J reasoned, is not confined to courts of law because this may be done by another independent and impartial tribunal. It is wrong to say that because the organ of state in question is not vested with judicial authority under the Constitution therefore all its actions, regardless of their nature will remain administrative action To do so is to focus the enquiry on the arm of government performing the function and not on the nature of the function that is being performed.
Similarly, the functions performed by the Adjudicator involve a determination of facts and the application of the Pension Funds Act in order to decide whether in relation to the administration of a fund, the investment of its funds or the interpretation of an application of its rules, the decision of the pension 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; whether 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; whether a dispute of fact or law has arisen in relation to a fund between the fund or any person and the complainant; or whether an employer who participates in a fund has not fulfilled its duties in terms of the rules of the fund.
These are disputes that may be adjudicated upon by the High Court but which in a quest for a procedurally fair, economical and expeditious dispute resolution framework, the Pension Funds Act permits to be submitted for adjudication by the Adjudicator. As some commentators have observed, "the rationale for allowing tribunals and forums other than courts [like the Adjudicator] to perform judicial functions is obvious. Specialisation, expertise, the need to consider local circumstances and the need for the adoption of expeditious, informal and inexpensive procedures justifies the establishment of other independent bodies by legislation".
Like the CCMA, as observed by Ngcobo J, pension adjudication by the Adjudicator bears the hallmarks of a judicial function because there is typically a lis between a complainant and a respondent in which the Adjudicator is called upon to apply a recognised body of legal principles in a manner consistent with fairness and impartiality. Given that the sole function of the Adjudicator is to determine the facts and apply them to the provisions of the Pension Funds Act and other applicable laws, it is inescapable to conclude under the authority of Sidumo that this exercise is judicial in nature.
To further explain the similarity between the Adjudicator and courts of law, the High Court in Old Mutual Life Assurance Company has ruled that the Adjudicator must be independent and impartial in exercising his or her functions and established a principle that holds the Adjudicator to the same standard as a court of law. Accordingly, the protection afforded by section 34 is that when the Adjudicator decides a dispute, he or she must be impartial and independent and must decide the dispute in a fair and public hearing.
Moreover, the Court has ruled in Nel v Le Roux NO that decisions made in the exercise of judicial functions do not amount to administrative action. First, as indicated above, the Adjudicator is another independent and impartial tribunal contemplated in section 34 because he or she resolves pension disputes, which are capable of being decided by the application of the Pension Funds Act. Although the Adjudicator is a creature of the Pension Funds Act, which determines the nature and scope of his or her powers, the powers to decide pension disputes derive from section 34 of the Constitution.
Secondly, the functions performed by the Adjudicator are no different from those performed by the High Court when it is seized with the same kind of pension dispute.
Unlike Beasley J's view in Altron , section confirms that the Adjudicator's functions are no different from those of any High Court that could decide the same matter. It is apparent from the provisions of section of the Pension Funds Act that the same functions performed by the Adjudicator may be performed by the High Court, and that their decisions will have the same legal effect because both perform judicial functions.
Another significant attribute of Justice Ngcobo's opinion in Sidumo is the point he makes about the irrelevance of a tribunal not being a court of law as contemplated under section of the Constitution; that the fact that the CCMA is not a court of law and does not exercise judicial authority under the Constitution is irrelevant.
What is important is whether the conduct of resolving pension disputes is administrative action as contemplated in section 33 of the Constitution. Contrary to Ngcobo J's view on this point, Beasley J placed particular emphasis on the fact that the Adjudicator was not a court in terms of section of the Constitution and did not exercise judicial authority. By doing so, Beasley J misses the point and misapplies the law and standard developed by the Constitutional Court in determining these matters.
It is at this point that Beasley J exhibits a formalistic view of the law which goes contrary to Sidumo, other judicial views, and transformative adjudication. There are other characteristics of the Adjudicator which are distinguishable from the CCMA and confirm his or her performance of judicial functions. There are three most significant characteristics in this regard. The first relates to the qualifications of the Adjudicator. The insistence on legal expertise suggests the expectation of performance of judicial rather than administrative functions by the Adjudicator.
Other countries appoint High Court judges on the basis of similar to those qualifications contained in the Pension Funds Act. The qualifications of the Adjudicator differ completely from those of the commissioners of the CCMA in section 1 of the Labour Relations Act 66 of and in practice. Based on these observations, and the qualifications of the Adjudicator in the Pension Funds Act, which are equivalent to those of High Court judges, it is clear that the legislature sought to create another independent and impartial tribunal contemplated in section 34 of the Constitution.
The second characteristic is the right to appeal contained in section 30P of the Pension Funds Act. Unlike the Labour Relations Act, which only generates the right to a limited review under section 2 a that is similar to that contained in section 33 1 of the Arbitration Act 42 of , section 30P of the Pension Funds Act provides parties before the Adjudicator with the right to appeal to the High Court.
From the wording of section 30P 2 it is clear that the High Court's jurisdiction is limited by section 30P 2 to a consideration of the merits of the complaint in question. The dispute submitted to the High Court for adjudication must therefore still be a complaint as defined. Moreover, it must be substantially the same complaint as the one determined by the Adjudicator. While the Court also considered section 30P as providing a right to appeal in the wider sense, this provision distinguishes, in a considerable way, the CCMA from the Adjudicator, and accords the Adjudicator the same status as a court of law by virtue of his or her performance of judicial functions.
The last characteristic relates to the overall powers of the Adjudicator, which point to an intention by the legislature to create an adjudicative tribunal rather than an administrative tribunal. In section 30D of the Act the Adjudicator is charged with the duty of disposing of complaints in a procedurally fair, economical and expeditious manner.
Despite this, he nevertheless performs the same function which a court of law would perform had such court been seized of the matter. There are indications in various sections of the Act which point to this. For example, section 30E 1 a states that the Adjudicator shall investigate any complaint and may make the order which any court may make. Section 30H 2 does not permit an Adjudicator to investigate a complaint where proceedings have already been instituted in a civil court.
Section 30H 3 and section 30I provide that proceedings before the Adjudicator are equated to the commencement of an action which would interrupt the running of prescription.
Finally, section 30M requires the Adjudicator to lodge his determination with the clerk or registrar of the court which would have had jurisdiction had the matter been heard by a court. Section of the Act deems a determination by the Adjudicator to be a civil judgment of any court of law had the matter in question been heard by such court.
Similarly, in Otis Judge Hurt examined and summarised the functions of the Adjudicator and confirmed:. It is apparent from the provisions of sections 30D, 30E, 30F, 30L, 30M and of the Act that the intention of the legislature was to constitute a complaints forum which would, for all practical purposes, be equivalent to a court of law but which was not bound by the formalities of procedure which might ordinarily have the effect of delaying adjudication and causing the parties to incur substantial expenses for legal representation.
The absence of formal procedural requirements does not, however, detract from the nature of the function which the Adjudicator must perform which is, plainly, a judicial function. He is required to give reasons for his determination which, in itself, precludes him from making a determination capriciously or basing it on matters which are not of record before him. Therefore, unlike the CCMA, which has a distinct statutory set-up and function, the Adjudicator was intended to perform judicial functions.
The CCMA is not a court of law. A commissioner is empowered in terms of section 1 to conduct the arbitration in a manner he or she considerers appropriate in order to determine the dispute fairly and quickly, but with the minimum of legal formalities.
There is no blanket right to legal representation. The CCMA does not follow a system of binding precedents. Commissioners do not have the same security of tenure as judicial officers. This Tribunal suggests that the Respondent fund ought to place greater emphasis on the legally binding decisions of this Tribunal, which is a specialist pensions Tribunal, rather than on non-binding legal opinions, which are by definition merely opinions. The Respondent should also take cognisance of the fact that the Respondent fund in the Cockcroft matter has not instituted section 30P proceedings and is abiding by this Tribunal's determination.
As regards the Respondent's response in the instant complaint, it has not placed any new facts before this Tribunal that warrants a shift from the position adopted in the Cockcroft matter. It is important to point out that decisions of the Adjudicator are reported in the South African Butterworths Pension Law Reports since Moreover, in practice the Adjudicator has followed their own precedents and when deviating therefrom has explained the reasons thereof just like any court of law would do.
Furthermore, the argument that the Adjudicator follows a system of binding precedent is supported by the legislative history of the Pension Funds Act contained in the Mouton Committee Report where it was recommended that the Adjudicator should have the power to make decisions with binding effect, and to ensure that its proceedings were similar to court proceedings. The deceased had no children, but at the time of her death the applicant was residing with the third respondent, with whom the applicant shared a mutually dependant relationship.
Following an investigation by the retirement fund, the third respondent was identified as a beneficiary, resulting in the applicants lodged a complaint with the PFA. The first complaint was upheld and the retirement fund was ordered to investigate whether the third respondent qualified as a dependant of the deceased.
Subsequent to the second investigation, the apportionment to the third respondent was significantly reduced. The PFA however did not consider the second complaint, having taken the view that its initial order was final and binding.
The Court found this not to be materially different and stressed that complainants cannot keep raising new issues on the same set of facts, in an effort to get the desired result which, in this case, was the total exclusion of the third respondent as a dependant. The Court also invoked its powers under section 30P 2 of the Pension Funds Act, which allows it to consider the merits of the complaints.
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