Mr Pierrie Andre Leonard Moreau received a lump-sum pension/provident fund payout of R4 639 000 in June 2009, approximately two years before his estate was finally sequestrated on 1 August 2011. At the time, he was facing substantial litigation and a judgment debt owed to Lowveld Cooperative Investments. Shortly after receiving the pension benefit, Mr Moreau transferred R3 500 000 to Iprolog (Pty) Ltd, a company closely associated with him and his then wife, Ms Vanessa Ingrid Moreau, and paid the balance of R1 023 867 directly to Ms Moreau. The monies were used, inter alia, to purchase immovable properties. Mr and Mrs Moreau divorced shortly thereafter, pursuant to a settlement agreement. Following sequestration, the joint trustees of Mr Moreau’s insolvent estate applied to set aside these payments, alleging collusion designed to prejudice creditors and to strip Mr Moreau of assets prior to sequestration. The appellants contended that the monies were protected pension benefits under s 37B of the Pension Funds Act and that the payments were legitimate and pursuant to matrimonial obligations.
The appeal was dismissed with costs, save for a substitution of paragraph 1 of the High Court’s order. The SCA ordered that the payments of R1 023 867 to Ms Vanessa Ingrid Moreau and R3 500 000 to Iprolog (Pty) Ltd be set aside, and that those amounts be repaid forthwith to the trustees of the insolvent estate.
This judgment authoritatively clarifies South African law on the scope of protection afforded by s 37B of the Pension Funds Act, confirming that pension benefits lose statutory protection once paid out prior to sequestration. It reinforces the principle that pension payouts received before insolvency form part of the debtor’s estate and may be attacked by trustees. The case also underscores the robust application of s 31 of the Insolvency Act to undo collusive transactions designed to defeat creditors, particularly in a matrimonial and family-company context.