ABSA Bank Limited v Burmeister and Others

The first respondent, Burmeister, was formerly employed by ABSA Bank Limited and resigned in April 1997. His pension benefits were paid out from the ABSA Bank Pension Fund and transferred to another fund, ultimately being used to purchase a compulsory linked life annuity administered by Sanlam Personal Portfolios (Pty) Ltd. ABSA later obtained default judgment against Burmeister for damages arising from his alleged dishonest and fraudulent conduct during his employment. When the judgment remained unsatisfied, the sheriff purported to attach the annuity. Burmeister applied urgently to set aside the attachment. ABSA opposed and counter-applied, contending that s 37D(1)(b) of the Pension Funds Act entitled it to execute against the annuity.

The appeal was dismissed with costs. The order of the High Court setting aside the attachment of the annuity and dismissing ABSA’s counter-application was upheld.

This case clarifies the limited scope of s 37D(1)(b) of the Pension Funds Act and confirms the strong statutory protection afforded to pension benefits. It establishes that employers may only access pension benefits for losses caused by employee misconduct while those benefits remain in the employer’s pension fund, reinforcing pension security once benefits are transferred.