KEY POINTS
- A daughter contested Allan Gray’s decision to award 58 percent of her mother’s pension death benefit to her stepfather.
- The Financial Services Tribunal ruled the allocation was consistent with dependency assessments.
- Financial independence of the daughters weighed against their claims of unfair enrichment.
A chartered accountant failed to reverse the R7.9 million pension death benefit distribution when Allan Gray Retirement and Pension Funds directed most of the funding to her stepfather after her mother’s death.
At 25 years old Hayley Marie Ward filed her dispute regarding pension death benefit distribution before the Pension Funds Adjudicator (PFA) and later the Financial Services Tribunal (FST) after her mother Gail Pamela Millard died in August 2023.
The main point of her grievance revolved around Allan Gray Retirement and Pension Funds selecting Waynne Millard, her 63-year-old stepfather, to receive 58 percent of her mother’s death benefit.
Original allocations vs final distributions
Gail and Millard Millard spent 18 years together as husband and wife. The Allan Gray Pension Preservation Fund (AGPE) distribution in Gail’s pension nominations showed allocations of 10 percent to Waynne and 30 percent to Hayley and 28 percent to Michelle and 32 percent to Andrea.
The distribution resulted in distribution of 10 percent for Waynne along with 30 percent for Hayley and 28 percent for Michelle while Andrea received 32 percent. Allian Gray Retirement Fund (AGRF) followed a distribution pattern which gave each daughter 20 percent except Michelle who received double that amount at 40 percent.
A subsequent review by Allan Gray redirected 58 percent of Gail Miller’s death benefits to Waynne Millard due to his financial dependence status. At the time of the death, the daughters held legal dependent status yet did not qualify as financially dependent beneficiaries.
The issue regarding financial dependency and life span duration
According to Hayley Ward her stepfather received an unfair death benefit distribution through Allan Gray because of their use of incorrect life expectancy information. Her analysis demonstrated that her stepfather’s share of the death benefit should have been no larger than 19 percent. The PFA denied her claim in April 2024 so she took her dispute to the FST.
The tribunal used evidence to verify Waynne’s retirement status and his dependency on his wife. His financial costs exceeded R21,000 each month beyond his monthly income of R11,584. The inheritance included 50 percent of his shared property worth over R1 million alongside R250,000 of accrual claim funds.
The government pension paid to Gail’s mother as a dependent amounts to R2,100 while she inherited R100,000. Through the relationship she received residential benefits and permission to use her daughter’s credit card.
The daughters had complete financial autonomy after the deceased passed away. Each of Hayley and Andrea generated monthly earnings exceeding R85,000 and both received matcheeding benefits alongside equivalent payments from Momentum Life and other entities. Based at GBP30,000 monthly salary in the United Kingdom the beneficiary Michelle received equivalent equivalent financial benefits.
Tribunal upholds original allocation concerning death benefit
The tribunal stressed Allan Gray avoided disregarding deceased nominations through their assessment of dependents’ financial requirements.
According to the FST the candidate’s argument about the Funds disregarding the deceased beneficiary’s full nomination was baseless because they already provided benefits in excess of the nomination to Mr. Millard.
The panel from the Financial Services Tribunal decided that the PFA’s decision could not be challenged which confirmed the stepfather’s status as the primary beneficiary.
