National Tertiary Retirement Fund v Mokadi

Professor A T Mokadi, former Rector and Vice-Chancellor of the Vaal University of Technology, was dismissed for misconduct in July 2006. His employer requested the National Tertiary Retirement Fund to withhold his pension benefit pending criminal and later civil proceedings for alleged fraud and corruption. Although Mokadi was acquitted of criminal charges and the University later resolved not to pursue the civil damages claim, the Fund continued to withhold his benefit. Mokadi lodged a complaint with the Pension Funds Adjudicator, who ordered the Fund to pay the benefit with interest from 2 June 2010. The Fund paid the capital amount but appealed against the Adjudicator’s power to award interest. The High Court dismissed the appeal, and the Fund appealed further to the Supreme Court of Appeal.

The appeal was dismissed, and the order of the High Court upholding the Pension Funds Adjudicator’s determination (including the award of interest) was confirmed.

The case authoritatively clarifies the scope of the Pension Funds Adjudicator’s discretion under section 30N of the Pension Funds Act to award interest on late-paid pension benefits. It confirms that such interest is not governed by the Prescribed Rate of Interest Act and need not be based strictly on mora, strengthening member protection against delayed payment of pension benefits.