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Divorce and pension fund payouts

In the past if a couple got divorced and the one party in terms of a court order was awarded half of the other party’s pension, such pension payout would only take place once that party retired from his/her place of employment.

This legislature clearly prejudiced the party who was entitled to half of his/her spouse’s pension, as that person would have to wait for years sometimes before receiving that pension money in terms of the court order. The “clean break” principle also says that after the divorce the parties must make a clean break from each other and this would not be the case if a party had to wait long for a payout.

The pension laws changed two years ago and a party is now entitled to immediate payout of his/her pension fund share. This usually occurs within 60 days of the divorce and is clearly only fair as it affords speedy relief to a party needing money.

It happened recently however that a divorcee from Malmesbury went to court claiming immediate payment of her share of her ex-husband’s pension. Her share is R300, 000.00. The new legislature unfortunately does not apply to government pension funds but only to private pension funds, and her ex-husband works as a policeman. The lady in question, Mathilda Wiese (43) claims that she needs the money now as she cannot find work, and cannot wait forever until her ex-husband retires before receiving her half share of the pension.

The lady in question furthermore claims that it is unconstitutional that she should not be paid her share of her ex-husband’s pension immediately, whilst if he had belonged to a private pension fund she would have been paid immediately. I tend to agree with her arguments, as this does appear to me to be a form of discrimination.

Apparently Mrs. Wiese wrote numerous letters to the state asking for payment of the pension before being forced to take action in the Cape High Court against the Minister, the pension fund and her ex-husband. She says the legislature isn’t effective.

I am of the view that the legislature in this regard needs to be changed as soon as possible. I have received many calls from people who can’t access their rights to pension immediately as their ex belongs to a government pension fund. This is simply discriminatory to say the least, and has to be revised.

This article was written by Cape Town divorce attorney, Peter M Baker

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