Divorcee entitled to extra R800 000 after tax ruling error
A divorcee is to be paid a further amount of over R800 000 in respect of pension benefits, after she was awarded R3 225 303 – which represented 50% of the value of her deceased ex-husband’s retirement benefit.
A Cape Times report says the SCA awarded this further payment to the ex-wife after she appealed against the decision of the Western Cape High Court. The SCA found the High Court had made an error in the calculation regarding the deducting of tax.
The executor of the deceased’s estate, however, argued her claim to the further payments was ‘vague, unenforceable and void’.
‘A dispute arose between the (ex-wife) and the deceased with regard to the interpretation of the impugned clauses, 9.4 and 9.7,’ the judgment read.
‘Initially, she accordingly instituted action against the deceased, but when he passed away on 24 December 2018, the appellant (Anthony de Graaf NO) was substituted in his capacity as the executor of the estate of her deceased husband. It is the ex-wife’s case, which the High Court accepted to be correct, that she is entitled to 50% of the deceased’s entire pension and retirement annuity benefits accumulated during the marriage as well as after the divorce to the date of the deceased’s exit from the MR pension fund and the Sanlam RA, respectively. (The executor) argued that the ex-wife is not entitled to any portion of the deceased’s pension interest on the bases that the impugned clauses are vague, unenforceable and void. Alternatively, he argues that she is only entitled to 50% of the deceased’s pension interest growth based on an actuarial calculation made by the fund. The amount of R52 649 as at date of divorce increased to R212 803, a growth of only R160 154. Further, alternatively, he argues that at best for the respondent, she is entitled to 50% of the net commuted cash … the amount being R539 224.’
The SCA found there could be little doubt the parties intended that the ex-wife would be entitled to an additional amount, over and above that provided for in the Divorce Act.
According to the Cape Times, SCA Justice Halima Saldulker said the wording of the impugned clauses of the consent paper was ‘not vague, but clear and unambiguous’.
‘Although the respondent obtained success in the High Court, the final result is remarkably different from what she intended to obtain. Therefore, it would be just and equitable not to grant her the costs of the action in the High Court, but to order each party to pay their own costs,’ Saldulker ordered.
Article disclaimer: While we have made every effort to ensure the accuracy of this article, it is not intended to provide final legal advice as facts and situations will differ from case to case, and therefore specific legal advice should be sought with a lawyer.