THE SUPREME COURT OF APPEAL OF SOUTH AFRICA
JUDGMENT
Not Reportable
Case No: 64/2015

In the matter between:

MERVYN MOHAPI
APPELLANT

and

DE BEERS PENSION FUND
FIRST RESPONDENT

PENSION FUND ADJUDICATOR
SECOND RESPONDENT

Neutral citation:
Mohapi v De Beers Pension Fund (64/2015) [2016] ZASCA 14
(11 March 2016)

Coram:
Cachalia, Tshiqi, Pillay and Swain JJA and Victor AJA

Heard:
29 February 2016

Delivered:
11 March 2016

Summary: Pension Fund Rules – Interpretation – member’s entitlement to
retirement on the grounds of medical infirmity – precluded where member fairly
dismissed from employment – also precluded where employer of the opinion that
member not incapable of carrying working on the ground of medical infirmity.

ORDER

On appeal from: Gauteng Division, Pretoria (Tuchten J sitting as court of first
instance).

1 The appeal is dismissed with costs.
2 The following words are deleted from paragraph two of the order of the court a
quo:
‘The decision of the trustees of the respondent, De Beers Pension Fund, conveyed
to the complainant, Mervyn Mohapi, in a letter dated 13 September 2000, repudiating
the complainant’s application for ill-health retirement benefits, is confirmed.’

JUDGMENT
_______________________________________________________________
Swain JA (Cachalia, Tshiqi and Pillay JJA and Victor AJA concurring):
[1] This appeal reveals a prolonged history of failed attempts, over a period of
some 16 years, by the appellant, Mr Mervyn Mohapi, to qualify for retirement on the
grounds of medical infirmity from his employment with the first respondent, De Beers
Pension Fund (the fund), a pension fund duly registered in terms of s 4 of the
Pension Funds Act 24 of 1956 (the Act). He has maintained throughout that he is
entitled to ill-health retirement benefits in terms of the rules of the fund.
[2] Mr Mohapi’s troubles began when he was informed of his dismissal from his
employment with the fund by way of a letter dated 24 May 2000. Thereafter, and in
pursuit of his contention that he was no longer capable of working, because of ill-
health and accordingly qualified for retirement on this ground, Mr Mohapi on two

occasions sought and obtained determinations in his favour from the second
respondent, the Pension Fund Adjudicator (the adjudicator). The office of the
adjudicator was established in terms of s 30B of the Act and has as its objective in
terms of s 30D of the Act, to dispose of complaints lodged in terms of s 30A (3) of
the Act in a procedurally fair, economical and expeditious manner.
[3] The first determination by the adjudicator issued on 8 June 2009 was based
upon a complaint lodged by Mr Mohapi in which he alleged that the board of trustees
of the fund had exercised its powers improperly in September 2000 in refusing to
grant him an ill-health retirement benefit. The adjudicator set aside the fund’s
decision and directed the board to ‘re-exercise its discretion and refer the
complainant for psychiatric evaluation to determine if the complainant qualifies for an
ill-health retirement benefit in terms of Rule A3.4.1 within 30 days of this
determination’.
[4] In accordance with the determination, the fund arranged for Mr Mohapi to
consult with a psychiatrist, Dr Bosman, obtained additional assessments and a
further medical report, all of which were considered by the fund’s Ill-Health Sub-
Committee (the IHSC). The IHSC resolved unanimously to recommend that the fund
reaffirm its original decision not to award an ill-health retirement benefit to Mr
Mohapi. The trustees of the fund approved the recommendation of the IHSC and
refused Mr Mohapi’s application.
[5] This decision gave rise to Mr Mohapi’s second complaint lodged with the
adjudicator on 22 February 2012, in which he alleged inter alia, that the decision by
the fund was in excess of its powers, or was an improper exercise of those powers.
The adjudicator found that the board was obliged in terms of Rule A3.4.1 to exercise
its discretion to determine if Mr Mohapi was entitled to an ill-health benefit, or not.
The adjudicator’s enquiry was not whether the board was wrong in repudiating the
claim, but rather whether the decision was reasonable on the evidence before it. The
adjudicator recorded that Dr Bosman had found that Mr Mohapi was ‘permanently
medically unfit for any work in the open labour market’ and that the employer,
namely the fund, had ‘confirmed that Mr Mohapi was permanently disabled’. It is
clear, however, that Dr Bosman never stated that the employer had confirmed that

Mr Mohapi was permanently disabled. The fund had also never accepted that he
was incapable of working. The adjudicator nevertheless found that the board’s
decision to repudiate Mr Mohapi’s application was unreasonable and accordingly set
it aside. It declared that Mr Mohapi qualified for an ill-health retirement benefit in
terms of Rule A3.4.1 and ordered the fund to pay him his ill-health retirement
benefits.
[6] Aggrieved at the determination of the adjudicator the fund applied in terms of
s 30P of the Act to the Gauteng Division, Pretoria for an order setting it aside and
replacing it with an order dismissing Mr Mohapi’s complaint. The court a quo
(Tuchten J) granted such an order and thereafter granted leave to appeal to this
court.
[7] The resolution of the dispute and the outcome of this appeal fall within a
narrow compass which requires an interpretation of the provisions of Rule A3.4.1 of
the rules of the fund. This rule provides as follows:
‘A3.4.0  Ill health retirement
A3.4.1  A MEMBER who, in the opinion of the EMPLOYER is considered to be no longer
capable of carrying on working as a result of medical infirmity, may at the sole discretion of
the TRUSTEES having obtained the opinion of a medical practitioner:
(a)
Retire in terms of Rule A3.4.2 where the infirmity has resulted in permanent
disability precluding further employment or gainful occupation with the
EMPLOYER or elsewhere;
(b)
Retire in terms of Rule A3.4.3 where the MEMBER is able to perform any
occupation with any employer for which he is or could reasonably be
expected to become qualified or suited, taking into account his degree of
disability and his knowledge, training and education, ability, experience and
age. This need not be with the existing employer, includes self-employment
and does not have regard to the availability of work opportunities.
A3.4.2 . . .’

[8] The interpretation of the rule has given rise to two areas of dispute between
the parties, namely:

(a)
Whether Mr Mohapi’s dismissal with effect from 15 September 2000
precluded approval by the trustees of his retirement from employment on the
grounds of medical infirmity; and
(b)
Whether the fund, qua employer, formed the requisite opinion that Mr
Mohapi was no longer capable of carrying on working as a result of medical infirmity.
[9] The resolution of both of these issues requires an examination of the
circumstances surrounding Mr Mohapi’s dismissal in 2000. He was originally
employed by the De Beers Benefit Society and then the fund from 1991 to 2000.
During March 2000 Mr Mohapi applied to the fund for ill-health retirement whilst
employed by the fund as a senior accounts clerk and accordingly whilst he was a
member of the fund. In May 2000 he was summoned to a disciplinary hearing to
answer two charges. The charges were that he had failed to enter a cheque for
R10 000 in the cash book and had failed to enter the correct cheque numbers on a
number of ledger cards.
[10] The fund avers that Mr Mohapi pleaded guilty to both charges which he
disputes. Mr Mohapi stated at the disciplinary hearing that there were mitigating
factors in that he suffered from a number of medical conditions that impacted on his
performance. He argued that his deficient work performance was not the result of
incompetence or a bad attitude, but was attributable to his medical ailments which
included back pain, migraine headaches and depression.
[11] In the dismissal letter dated 24 May 2000 referred to above, the fund
informed Mr Mohapi of the outcome of the disciplinary hearing in the following terms:
‘The findings are as follows:
In terms of both charges you admitted guilt. You, however pleaded mitigating circumstances
in that you have a number of medical conditions that have an impact on your work
performance. You quoted various medical practitioners advice and I refer to a letter which
states that this will be a permanent condition. You stated in the inquiry that your work
performance is not as a result of incompetence nor attitudinal but rather as a result of your
various medical ailments.

In light of the above and the fact that you stated that you would not be able to perform any
other duty in the organisation your employment with the De Beers Pension Fund is
subsequently terminated on grounds of incapacity. However, as you have applied for an ill
health retirement, you will be regarded as suspended and remain on full benefits pending the
outcome from the Board of Trustees on whether or not you qualify for ill health retirement.
On the date of the decision your benefit will cease.
You have the right to appeal this decision in writing by the close of business on Friday 26
May 2000.’
[12] Mr Mohapi, on 25 May 2000, unsuccessfully appealed against the finding of
the disciplinary hearing. Through his trade union, the National Union of Mine
Workers (the union) he then lodged an application with the CCMA on 30 June 2000
to overturn his dismissal on the ground that it was substantially and procedurally
unfair. The application was, however, out of time and a subsequent application for
condonation for the late filing of the application was refused.
[13] On 13 September 2000 the fund sent a letter to Mr Mohapi informing him of
the outcome of his application for ill-health retirement in the following terms:
‘Re: TERMINATION OF SERVICES
My letter refers. On the 24 May 2000 upon the conclusion of a disciplinary enquiry you were
dismissed for incapacity. You were, however, suspended with full benefits pending the
outcome of your application for Medical retirement.
We have subsequently been informed by the Trustees that your application has not been
successful. I wish to inform you therefore that your suspension is over and as you were
dismissed all benefits will cease with effect from 15 September 2000.’
[14] The union then lodged a second application with the CCMA to set aside his
dismissal. It was alleged that Mr Mohapi suffered from ill-health and his dismissal
was accordingly inconsistent with fair labour practice and was procedurally unfair.
This application was again unsuccessful.
[15] Mr Mohapi’s dismissal from the fund in September 2000 must accordingly be
deemed to be fair as correctly conceded by his counsel. The issue of whether his

dismissal thereby precluded approval by the trustees of his application for retirement
from employment on the grounds of ill-health, must be examined in this context.
[16] In support of his contention that he was still employed by the fund, and was
therefore capable of retiring from the fund, when his application was considered by
the fund, Mr Mohapi made several submissions. The first submission relies upon a
retrospective operation of the first determination made by the adjudicator on 8 June
2009. It is submitted that the effect of this determination was that Mr Mohapi was in
the same position as he was just before 13 September 2000. On this date the fund
informed him that the trustees had rejected his application and he was dismissed
with effect from 15 September 2000. In other words, the argument was that he was
still employed on this date.
[17] The inherent fallacy in this argument is the assumption that the fund and the
employer are the same person and that the controlling mind of both the fund and the
employer is the same organ, namely the trustees. However, the decision of the
trustees of the fund, qua employer, to dismiss Mr Mohapi as an employee and its
decision, qua fund manager, to refuse his application for ill-health retirement benefits
are two entirely distinct functions. The determination by the adjudicator only set
aside the refusal of his application for benefits and had no bearing whatsoever upon
his dismissal.
[18] Secondly, it is submitted that the fund, qua employer, was aware in May and
September 2000 that Mr Mohapi could still appeal the trustees’ decision to refuse his
application which could be reversed on appeal, with the result that the trustees could
not have contemplated that his dismissal would stand, even if the trustees’ refusal of
his application was set aside. There are two answers to this submission. The first is
that the dismissal would stand until overturned, which Mr Mohapi unsuccessfully
attempted to do. The second is that no appeal lay against the trustees’ refusal of Mr
Mohapi’s application. His only remedy was an application in terms of s 30A of the Act
to the adjudicator, which even if successful, the trustees could not have
contemplated would result in his dismissal being set aside, as such a result was not
competent in law.

[19] A further submission by Mr Mohapi to address the problem presented by the
requirement that in order to ‘retire’ within the meaning of that term in Rule A3.4.1 a
member of the fund has to be employed at the time, was that the word ‘retire’ in Rule
A3.4.1 meant ‘retire from the fund’ and not ‘retire from employment or service’. In the
context of this rule, however, it is quite clear that what is being addressed is the
situation where a member is ‘no longer capable of carrying on working as a result of
medical infirmity’. In addition Rule A3.4.1 forms part of those rules falling under the
heading ‘Calculation of Retirement Pension’ in which it is clear that what is being
dealt with is retirement from service. There is no basis for the meaning which Mr
Mohapi seeks to attribute to the word ‘retire’ in Rule A3.4.1.
[20] It is accordingly clear that after his dismissal in September 2000, Mr Mohapi
was precluded from being granted retirement on the grounds of ill-health, whilst his
dismissal stood. For the same reason his application could not be granted by the
trustees when they reconsidered it in August 2009, after the first determination by
the adjudicator in June 2009.
[21] This conclusion renders it strictly unnecessary to consider the second area
of dispute between the parties for the determination of the appeal. I will, however, do
so for the sake of completeness. The issue is whether the fund, qua employer,
formed the requisite opinion that Mr Mohapi was no longer capable of carrying on
working as a result of medical infirmity, in terms of the rule.
[22] The cornerstone of Mr Mohapi’s argument rests on the contents of the letters
dated 24 May 2000 and 13 September 2000 set out above. Great reliance is placed
upon the statement in the letter dated 24 May 2000 that Mr Mohapi’s employment ‘is
subsequently terminated on grounds of incapacity’. It is submitted that incapacity is
not the same thing as misconduct, or poor work performance.
[23] In order to determine whether the fund formed the requisite opinion,
inferences have to be drawn from the objective facts to determine the fund’s state of
mind. In order to do so, the contents of the letters in question cannot be viewed in
isolation but must be viewed in the context of the evidence as a whole. The court a
quo concluded that ‘the facts show incontestably that the employer did not hold the

view that Mr Mohapi was no longer capable of carrying on working as a result of
medical infirmity. The evidence before me shows that the employer was of the view
that Mr Mohapi was probably malingering’.
[24] The evidence relied upon by the court a quo was contained in affidavits of
employees of the fund, filed by the fund in response to the second complaint lodged
by Mr Mohapi with the adjudicator. These employees were involved in the
disciplinary proceedings against Mr Mohapi in 2000, although the affidavits were
deposed to only in July 2013.
[25] Ms Templehoff who wrote the letter of dismissal dated 24 May 2000 stated in
her affidavit that she ‘felt that he exaggerated his medical condition’. She added that
‘[t]here were times when I observed him at work and he seemed to have pain and
could not sit or walk properly, but during lunch time without fail, he would leave the
office and walk to town and be seen walking fine by all of his co-workers. He would
not shuffle his feet bit by bit like he would do in the building, but walk just fine with
normal strides and a normal pace’.
[26] Mr Kevin Flynn, the author of the letter dated 13 September 2000, stated in
his affidavit that he ‘was of the opinion that Mr Mohapi was lazy and used any reason
to book off sick. He was once observed doing a little dance when he thought nobody
was looking, even though he complained of chronic backache’.
[27] In addition, Mr Gavin Heale, whose name appears on the heading of the
letter dated 24 May 2000, states in his affidavit that he observed Mr Mohapi outside
the elevator looking around and ‘when he thought there were no witnesses he
watched the elevator movement indicators and when it started on its way down, he
proceeded to gently lie down on the floor. When the elevator doors opened a few
seconds later, he started to shake and moan’. He stated that he ‘was witness to a
number of Mr Mohapi’s escapades and was also party to the start of the disciplinary
process, [which] started to put an end to them’.

[28] It is therefore quite clear that there is no basis for the submission made by
counsel for Mr Mohapi that the contents of these affidavits were simply an
‘afterthought’ by the fund attested to some 13 years after the events referred to.
[29] In addition, the fund in the founding affidavit before the court a quo referred
to the fact that in its response to Mr Mohapi’s application for an ill-health benefit, it
had commented ‘it is felt that although Mr Mohapi may well have a back problem, his
incapacity to work to the required standards is more to do with his mental attitude’.
This averment was simply ‘noted’ in Mr Mohapi’s answering affidavit and never
denied. Considering all of the above the court a quo correctly concluded that the
fund had never formed the requisite opinion that Mr Mohapi was no longer capable
of carrying on working as a result of medical infirmity.
[30] The appeal must accordingly fail. As regards costs, counsel for the fund only
asked for the costs of one counsel. Counsel for the fund pointed out that the second
sentence of paragraph two of the order of the court a quo is erroneous, superfluous
and should be deleted. I agree.
[31] It is ordered that:
1 The appeal is dismissed with costs.
2 The following words are deleted from paragraph two of the order of the court a
quo:
‘The decision of the trustees of the respondent, De Beers Pension Fund, conveyed
to the complainant, Mervyn Mohapi, in a letter dated 13 September 2000, repudiating
the complainant’s application for ill-health retirement benefits, is confirmed.’

K G B Swain

Judge of Appeal

Appearances:
For the Appellant:
S Khumalo

Instructed by:

Cheadle Thompson & Haysom Inc, Johannesburg
McIntyre & Van der Post, Bloemfontein

For the First Respondent:
P B J Farlam  SC (with M M Mokhoaetsi)

Instructed by:

Des Rabé Attorneys, Durbanville

Phatshoane Henney, Bloemfontein