In terms of the Pension Funds Act, No 24 of 1956 and the Government Employees Pension Law Amendment Act, No 21 of 1996, the pension interest is payable at the time of divorce. This is known as the 'clean-break' principle).
Until recently, however, a payment governed by the Post Office Act is only payable upon termination of membership by the member in the fund (through death, retirement or resignation).
In the decision of Ngewu and another v Post Office Retirement Fund and others  1 BPLR 1 (CC), the Constitutional Court had to decide when pension benefits accrue to divorced spouses where Mrs Ngewu was married to a Post Office employee who was a member of the Post Office Retirement Fund. It was common cause that Mrs Ngewu was entitled to a 50% share of her husband’s pension interest. However, under the rules of the Fund, her share would not accrue upon divorce but only when Mr Ngewu terminated his membership in the Fund.
All parties agreed that the Post Office Act, No 44 of 1958 was unconstitutional in so far as it did not provide for the payment of the pension interest at the time of divorce.
The Constitutional Court held that this differentiation violated the right of equality before the law and equal protection and benefit of the law. Consequently, the Constitutional Court declared s10 to 10E of the Post Office Act unconstitutional but ordered that the declaration of invalidity be suspended for eight months for the legislature to cure the defect. The defect was subsequently cured in terms of the Government Employees Pension Law Amendment Act.
As a result of the judgments in the present case as well as the Wiese v Government Employees Pension Fund and Others (CCT 111/11) 2012 (6) BCLR 599 (CC) case, the assigned portion of the pension interest would be deemed to have accrued as is payable on the date of the divorce order.
The decision in MB v DB 2013 (6) SA 86 (KZD) concerned a divorce action between parties married out of community of property with the application of the accrual system. The issue was which party bore the onus of proof with regard to the nature and quantum of the assets excluded in their antenuptial contract from forming part of the accrual in the defendant’s (the husband’s) estate. The plaintiff (wife) relied on the evidence of a chartered accountant to prove the value of the husband’s estate and, therefore, of her potential share of the accrual. The husband led no evidence to demonstrate how he had dealt with the excluded assets over time, instead contending, inter alia, that:
Lopes J held that it was the husband, being the one in possession of all the facts relating to the assets reflected as excluded in the antenuptial contract, who bore the onus of proving which assets were to be excluded and why; to demonstrate what had happened to those assets, how they were converted from time to time, and what their present values were that fell to be excluded from the calculation of his net worth.
The operative moment when the value of the respective estates of the parties had to be assessed was at litis contestatio, (ie, close of pleadings) not when the divorce order was made.
Because the husband led no evidence to demonstrate how the excluded assets were dealt with by him from time to time, the court held that it would not be possible to determine what had happened to those excluded assets without making reasonable deductions from the discovered documents.
The court reasoned that South African courts should follow the approach to evidence adopted in a number of English cases when dealing with failure by a party to discharge his or her duty to disclose financial information in divorce proceedings. In terms of the approach followed in English law, courts were entitled to draw inferences (where they can be properly made) and to take notice of inherent probabilities in deciding whether or not assets formed part of the non-discloser’s estate.
The court accordingly ordered the division of the husband’s estate, the exact details of which fall outside the scope of the present discussion. The husband was ordered to pay the costs of the present action.
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Bertus Preller is a Family Law and Divorce Law Attorney in Cape Town.