Ngewu and Another v Post Office Retirement Fund and Others v Post Office Retirement Fund and Others

Case No. Lower Court Judgments Hearing Date Judgment Date Majority Author Vote
CCT 117/11 Application for direct access
7 Feb. 2013 7 Mar. 2013 Van der Westhuizen  J. Unanimous

The applicant, Ms Phumla Ngewu, challenged the Rules of Post Office Retirement Fund (“the Fund“) and the Pensions Funds Act 24 of 1956 (“the Act“) on the grounds that they do not allow for a share of a Post Office employee’s pension fund to be paid out to the employee’s spouse when there is a divorce.  The Pension Funds Act does contain a provision that entitles a former spouse of a member of a private pension fund registered under the Act to receive an immediate payment of a share of the member’s pension interest. The applicant claims that it is unfairly discriminatory that this provision does not apply to the Post Office Retirement Fund.

In January 2012 the Fund sought to postpone the Ngewu case in order to allow Parliament to rectify the defect and the case was postponed until 7 February 2013.  No amendment had been made by the time the case was due to be heard, but the parties had agreed this differentiation had not rational basis , and the question was whether proposed amendments to the the Post Office Act 44 of 1958 (“the Post Office Act“) to remedy the defect would be sufficient.  Prior to the hearing the parties agreed to a draft order under which the Post Office Act would be declared invalid due to its failure to incorporate the “clean break” principle. The “clean break” principle means that a divorced spouse can make a “clean break” by claiming their share of the former spouse’s pension interest at the time of the divorce.  The parties proposed that section 24A of the Government Employees Pension Law, Proclamation 21 of 1996 (“GEPL“) be read into the Post Office Act if, after eight months, the legislature failed to amend the Post Office Act to remedy the defect.By way of background, section 24A of the GEPL had been inserted by the  Government Employees Pension Law Amendment Act, 19 of 2011 (“GEPL Amendment Act“) after the GEPL had been declared unconstitutional in a case of  Wiese v Government Employees Pension Fund in the Western Cape High Court.  The Wiese case went to the Constitutional Court for confirmation of the order of invalidity, and Ngewu sought to join her challenge to the challenge in that case.  However, before the Wiese case was heard Parliament passed the GEPL Amendment Act. 

The Constitutional Court, however, found that direct access should be granted in this case, and that the case should be heard despite the fact that it had not been heard in any lower court.

The Constitutional Court, in a judgment by van der Westhuizen J, noted the agreement of the parties but stated that such an agreement does not bind the Constitutional Court, which has “the responsibility…to be satisfied that legislation is indeed inconsistent with the Constitution and thus invalid, before declaring it so and that the remedy proposed is in accordance with the Court’s constitutional mandate and established jurisprudence.” In other words, parties cannot by agreeing legislation is unconstitutional make it so, and the Constitutional Court must verify that this is the case.

The Constitutional Court then went on to briefly analyse the law and found:

Sections 10 to 10E of the Post Office Act, the relevant provisions dealing with the administrative and financial matters of the Fund, are clearly unconstitutional. Because of the omission of the “clean break” principle there is a differentiation between the payment of divorced spouses’ interests regulated by the Pension Funds Act and the Government Employees Pension Law Amendment Act on one hand, and the payment of divorced spouses’ interest governed by the Post Office Act on the other. The differentiation is irrational as it has no basis.  It does not meet the requirement of validity before the law and equal protection and benefit of the law contained in section 9(1) of the Constitution.
Sections 10 to 10E of the Post Office Act where therefore declared invalid, but the declaration was suspended for eight months (to 7 November 2013) to allow the legislature to remedy the defect.  If the legislature does not take action with the time allowed the Constitutional Court provided a draft provision in an annexure to its judgment to be read into the Post Office Act as section 10F that provides for the “clean break” principle.

One thought on “Ngewu and Another v Post Office Retirement Fund and Others v Post Office Retirement Fund and Others

  1. Pingback: Ngewu and Another v Post Office Retirement Fund and Others | ConCourtBlog

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