APPEAL TO WITHHOLD HEAD TEACHER’S PENSION DISMISSED

MBABANE – Don’t touch pension benefits except where that judgment is in respect of maintenance!

The Supreme Court has declared that pension benefits of public officers should not be a subject of an attachment by order of the court for satisfaction of any judgment or pending determination of civil proceedings to which such persons were party except where that judgment is in respect of maintenance.

Usually, the State would approach the courts for an order to withhold pension benefits for civil servants who had been dismissed for misappropriation of funds. Most of the culprits were head teachers and officers from law enforcement agencies.

Dismissed

The Supreme Court made this declaration in the matter of Lucky Mhlanga who was employed as a head teacher until May 24, 2016 when he was dismissed for failing to account for funds in the amount of E114 333.75.

 During the time he was employed by government, he was a contributing member of the Public Service Pension Fund. On March 23, 2017, government initiated proceedings in the High Court for an order interdicting the Public Service Pension Fund from paying out any pension benefits to Mhlanga pending the final determination of an action for damages it had instituted against him. 

The matter was first heard by the full bench of the High Court which comprises of Justices Mbutfo Mamba, Mumcy Dlamini and Sipho Nkosi. 
Judgment was delivered on August 1, 2018 wherein the full bench of the High Court held that Section 32(2) of the Retirement Fund, which permitted such attachment, was inconsistent with Section 195 (6) of the Constitution and therefore was invalid.

Section 32 (3)  provides as follows; “A retirement fund may deduct an amount from a member’s benefit in respect of; (a) an amount representing the loss suffered by the employer due to any unlawful activity of the member and for which judgment has been obtained against the member in a court or a written acknowledgment of culpability has been signed by the member and provided that the aforesaid written acknowledgment is witnessed by the member and who had no less than eight years of formal education (b) an amount for which the employee is liable under a guarantee issue by the employer for purposes of obtaining a housing loan; provided that an original notarised document exists which confirms that the guarantee was made.”

 Invalid

The full bench of the High Court found that Section 32(2) of the Retirement Fund Act, which permitted such attachment, was inconsistent with Section 195 (6) of the Constitution and therefore was invalid.

Government, being dissatisfied with the judgment of the full bench, noted an appeal against the judgment. The appeal was heard and determined by Chief Justice Bheki Maphalala, Judge Phesheya Dlamini, Judge Majahenkhaba Dlamini, Judge Robert Cloete and Judge Stanley Maphalala.
During the argument of the appeal, the State contended that the High Court erred in law in holding that Section 196 (1) of the Constitution was a provision of general application. 

Section 195(6) of the Constitution of the Kingdom of Eswatini provides as follows: “Pension benefits of public officers shall not be subject of attachment by order of court for the satisfaction of any judgment or civil proceedings other than in respect of maintenance.”
It was further government’s contention that the full bench of the High Court erred in law and in fact by holding that Section 32(2) of the Retirement Fund Act 6/2005 was inconsistent with Section 195(6) of the Constitution.

 In dismissing the appeal the Supreme Court judges said it was of the view that the provisions of Section 32(2) should be amended by the Legislature.
“The provision of Section 32 (2) shall be read and interpreted as if without the existing wording ‘an amount representing the loss suffered by the employer due to any unlawful activity of the member and for which judgment has been obtained against a member in court or,” said the Supreme Court.

Legislature

The court went on to grant the Legislature a period of 12 month from the date of its judgment to amend the legislation accordingly.  The Supreme Court said: “Otherwise the said portion of Section 32(2) shall be deemed to be struck down.”

Respondents in the matter were the Government of Eswatini, Public Service Pension Fund and the Financial Services Regulatory Authority (FSRA).
Mhlanga was represented by Bonginkhosi Xaba while appearing for Eswatini Government was Principal Crown Counsel Ndababenhle Dlamini. For the respondent was senior lawyer Kenneth Motsa of Robinson Bertram.

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