Windhoek
Former members of the Rössing Pension Fund, who were unhappy with the share of a N$454 million surplus the Fund wanted to avail to them, scored a major victory in the High Court yesterday.
The members, represented by Advocate N.M. Arendse as instructed by Clement Daniel Attorneys, took the Fund and Rössing to court after a decision was made to give the former members only 15% of the surplus, while the mine was to get 33% and the current and active members of the Fund 52%.
The disgruntled former members first approached the court on September 2012 to review and set aside the decision. The applicants claimed that the trustees of the Fund that rubberstamped the allocation proposed by the mine did not have the necessary powers to make the decision.
The members, however, abandoned their first application after being advised it was defective, only to re-launch it during August 2014.
The mine and the trustees opposed the application and raised various objections, including lack of standing, incompetent relief sought, non-joinder of the current members of the Fund, no proper pleadings of the grounds of review, an unnecessary delay in launching the application and that the relief sought is academic, as the funds were already disbursed to the current members.
Judge Shafimana Uitele dissected each and every one of the objections and found them not convincing or agreeable.
On the question of locus standi, the judge said Advocate Andrew Corbett, who acted on behalf of the mine on instructions from Bossau & Co Legal Practitioners, placed form before substance and his complaint can simply be solved by having regard to the term “former member” in the rules of the Fund.
He said in his view the applicants have a direct and substantial legal interest in the outcome of the proceedings and thus have the necessary legal standing.
In relation to the objection that the court cannot review the decision of the Fund, as it does not constitute an administrative body, Judge Uitele said the trustees of a pension fund may in some cases as the present one perform a public function, which makes them amenable to judicial review.
On the issue of the non-joinder of the current members of the Fund, the judge was of the view no need exists for the joinder of the current members, as the Fund represented them.
With regards to the question whether the grounds of review have been pleaded or not, the judge was of the opinion that a statement by the initiator of the application, Winston Groenewald, in his founding affidavit, where he said: “We further submit that the decision of the trustees, along with the diktat by the second respondent (Rössing) effectively emasculated the trustees of their powers in the circumstances and that the first respondent (the fund) subsequently failed in its fiduciary duty to the applicants and current members of the pension fund”.
According to the judge this clearly demonstrate the pleading of the grounds.
On the question of the unreasonable delay of the application, Judge Uitele dismissed the objection and said in his view five months to bring a complex application such as this not an unreasonable delay.
In relation to the claim that the application is redundant, as the surpluses were already paid out to the active members of the Fund and the Fund will face insurmountable obstacles in reclaiming the monies already paid over, the judge said that even if that was true, he considers the matter one that clearly warrants the attention of a court.
He said the facts of the matter concern surplus funds generated by a defined benefit pension fund, which is likely to arise again in litigation, as Namibia has no legislation to provide guidance to trustees of a fund on how to deal with surpluses.
Judge Uitele said the crux of the matter is whether the trustees used their powers, or simply followed the dictates of the mine: “I am accordingly of the view that the trustees did not exercise their own discretion. They merely acted as a rubber stamp for Rössing.”
They passed the buck to Rössing or acted under the dictates of Rössing. It follows that the decision to allocate 52% to active members and pensioners, 33% to Rössing, and only 15% to the former members is unlawful and a nullity, Judge Uitele said, before concluding that the defendants must pay the cost of the application.