The Financial Services Tribunal (FST) has set aside a determination by the Pension Funds Adjudicator in a dispute between the South African Institute of Professional Accountants (SAIPA) and its former chief executive, Shahied Daniels, ruling that the Adjudicator lacked jurisdiction to investigate his complaint about the withholding of his pension benefit.
The Tribunal found that section 30H(2) of the Pension Funds Act barred the Adjudicator from proceeding because SAIPA had already instituted High Court action against Daniels. The issues the Adjudicator would have needed to examine overlapped substantially with the civil proceedings.
The Tribunal did not rule on whether Daniels is liable to SAIPA, whether SAIPA’s damages claims will succeed, or whether the Old Mutual SuperFund Pension Fund may ultimately continue withholding the remaining benefit.
How the dispute arose
Daniels was SAIPA’s chief executive from January 2019 until his dismissal on 26 September 2024 following a disciplinary process that began in April that year.
On 23 November 2024 – before Daniels lodged his complaint with the Adjudicator – SAIPA instituted action against Daniels in the High Court in Johannesburg, claiming damages allegedly suffered because of his conduct while CEO.
Following termination of his employment, Daniels received R19 787.81 from his pension savings pot on 22 November 2024. The main amount in dispute was his vested pot fund credit, recorded in the determination as R905 090.18 on 3 April 2025.
SAIPA first asked the Old Mutual SuperFund Pension Fund to withhold Daniels’s withdrawal benefit in November 2024. On 13 December, it submitted a withholding request form, together with a letter explaining the delay, citing the need for a thorough assessment of alleged misused funds.
The Fund ultimately decided on 23 June 2025 to withhold the benefit pending the outcome of SAIPA’s civil action.
Daniels lodged a complaint with the Pension Funds Adjudicator on 11 February 2025, challenging the lawfulness of the withholding. On 15 August 2025, the Adjudicator dismissed the complaint, finding the Fund’s decision lawful under section 37D(1)(b)(ii) of the Act. It accepted that SAIPA had established a prima facie basis, at least for Claims A and B, to justify withholding pending finalisation of the High Court action.
Tribunal raises jurisdiction question
During the Tribunal hearing, the panel raised the question whether the Adjudicator had jurisdiction to investigate Daniels’s complaint, considering section 30H(2) of the Act. The parties were invited to address the issue and were given an opportunity to file supplementary written submissions.
Section 30H(2) states that the Adjudicator “shall not investigate a complaint if, before the lodging of the complaint, proceedings have been instituted in any civil court in respect of a matter which would constitute the subject matter of the investigation”. The Tribunal emphasised that this language is peremptory and broader than requiring identical complaints, causes of action, or relief.
“The enquiry is therefore not whether it would have been convenient, efficient, or fair for the Adjudicator to investigate the complaint,” the Tribunal stated. “The enquiry is whether, before the complaint was lodged, civil proceedings had already been instituted in respect of a matter which would constitute the subject matter of the investigation.”
Parties differed over whether matters overlapped
Daniels argued that the matters were distinct: the High Court case concerned SAIPA’s damages claim, whereas the complaint focused on whether the Fund had lawfully exercised its discretion under section 37D.
The Adjudicator, cited as the first respondent, adopted substantially the same position on the jurisdiction issue. It argued that its function had been confined to determining whether the fund properly exercised its discretion under section 37D.
The Fund (second respondent) took a different view. It argued that Daniels’s characterisation of the two matters was too formalistic, and section 30H(2) requires a substantive examination of the nature, purpose, and effect of the proceedings.
SAIPA (third respondent) aligned itself with the Fund. It argued that investigating the pension complaint required consideration of whether its pleaded claims disclosed misconduct of the kind contemplated by section 37D, whether quantifiable damages existed, and whether there was a sufficient prima facie basis for withholding.
SAIPA’s position was that those enquiries were embedded in, and inseparable from, the claims already before the High Court.
How the Tribunal approached section 30H(2)
The Tribunal said the leading authority on section 30H(2) is the Supreme Court of Appeal’s decision in Cape Town Municipality v South African Local Authorities Pension Fund and Another.
The SCA held that section 30H(2) addresses concurrent jurisdiction between civil courts and the Adjudicator. Where the relevant dispute is first lodged before a civil court, the provision gives priority to the court by excluding the Adjudicator’s jurisdiction.
Importantly, the Tribunal said the SCA had rejected a narrow formulation of the enquiry. Section 30H(2) does not require the earlier court proceedings to concern the same “complaint”. Its wording refers more broadly to proceedings “in respect of a matter which would constitute the subject matter of the investigation”.
In Caesarstone Sdot-Yam Ltd v The World of Marble and Granite 2000 CC and Others, the SCA explained that questions of overlapping proceedings must not be approached mechanically or formalistically.
The enquiry is whether the same issue or substantially the same matter is already pending elsewhere. Differences in the form of relief, the procedural position of the parties, or the precise cause of action do not necessarily prevent such a conclusion where the central issue remains essentially the same.
The Tribunal further referred to Highveld Steel & Vanadium Corporation Ltd v Oosthuizen, in which the SCA held that section 37D(1)(b)(ii) must be interpreted purposively to include a power to withhold payment of a member’s pension benefit pending determination or acknowledgement of the member’s liability.
According to the Tribunal, Highveld Steel shows that a withholding decision is not a free-standing controversy unrelated to the employer’s claim. The withholding mechanism is ancillary to, and intended to preserve the effectiveness of, a pending claim for compensation in respect of conduct falling within section 37D.
The Tribunal also considered Hillhouse v Pidelta (Pty) Ltd and Another. It distinguished that case on its facts and legal issues and said it was in any event bound by the SCA’s decisions in Cape Town Municipality and Caesarstone.
It also dealt with uMgungundlovu District Municipality v Natal Joint Municipal Pension Fund and Another. The Tribunal accepted as a general proposition that a fund’s withholding decision is not necessarily final and may, in an appropriate case, be referred to the Adjudicator.
But it said the existence of a statutory complaint mechanism did not displace the specific limitation in section 30H(2). Where a complaint would require the Adjudicator to investigate a matter already before a civil court, the jurisdictional bar remained operative.
Why the Tribunal found substantive overlap
Applying those principles, the Tribunal upheld the jurisdictional position advanced by the Fund and SAIPA.
It found that the Adjudicator could not determine whether the Fund lawfully exercised its section 37D discretion without investigating the nature and strength of SAIPA’s pleaded civil claims.
Among other things, the Adjudicator had to consider whether SAIPA’s claim was one for compensation for damage caused by theft, dishonesty, fraud, or misconduct as contemplated by section 37D(1)(b)(ii).
It also had to consider whether the claims relied on for withholding were sufficiently particularised and quantified; whether there was a prima facie case or sufficient basis for the Fund to conclude that SAIPA had a reasonable prospect of establishing liability in the civil proceedings; whether Daniels had been given an opportunity to answer the allegations; and whether the competing interests had been balanced.
The Tribunal said these enquiries were not incidental.
“They are rooted in the same pleaded facts, alleged misconduct, alleged loss, and prospective adjudication of liability which forms the subject of the High Court action instituted by SAIPA,” it said.
The Tribunal held that the withholding decision existed because SAIPA asserted a claim contemplated by section 37D and was intended to preserve the effectiveness of the pending civil proceedings.
“The Applicant and the Adjudicator’s reliance on a strict distinction between ‘liability for damages’ and ‘lawfulness of withholding’ is accordingly too narrow,” the Tribunal said.
It added that the lawfulness of withholding could not be investigated in isolation from the High Court claims because the purpose of withholding under section 37D is to prevent an employer’s eventual judgment from being rendered hollow.
The fact that the Adjudicator was not required finally to decide Daniels’s liability did not resolve the jurisdiction question. Section 30H(2), the Tribunal said, is not confined to cases where the Adjudicator would determine an identical cause of action or where the earlier court proceedings sought identical relief.
“The fact that the Applicant framed his complaint as one concerning the Fund’s discretion cannot alter the substance of the matter,” the Tribunal said.
“A party cannot avoid section 30H(2) by characterizing a dispute already before a civil court as a complaint about the consequences or preservation mechanisms flowing from that dispute.”
The Tribunal emphasised, however, that not every complaint about a retirement fund’s conduct will be barred merely because civil proceedings are pending. Section 30H(2) requires a substantive relationship between the civil proceedings and the matter the Adjudicator would investigate.
On the facts before it, the Tribunal found that Daniels’s complaint required an assessment of the same factual matrix and pleaded claims already before the High Court.
It concluded that SAIPA’s civil proceedings and Daniels’s complaint to the Adjudicator sufficiently overlapped to trigger section 30H(2).
What the ruling means for the withheld benefit
Having found that the Adjudicator lacked jurisdiction, the Tribunal set aside the determination of 15 August 2025.
It did not remit the matter to the Adjudicator because, in its view, this would have no practical effect where the Adjudicator lacked jurisdiction to investigate the complaint.
Importantly, the Tribunal did not decide whether the fund’s withholding decision was justified on its merits.
“We do not, and cannot, pronounce on the merits of SAIPA’s civil action nor do we determine, finally, whether the fund may or should continue to withhold the applicant’s benefit,” it said.
The Tribunal nevertheless said the fund remains obliged, for as long as the withholding continues, to exercise its powers lawfully and reasonably and in accordance with its rules. This includes monitoring whether SAIPA prosecutes the civil proceedings without undue delay and whether continued withholding remains justified.
The Tribunal said Daniels is not without a remedy. Any relief concerning the continued preservation, release or partial release of the benefit, insofar as it is tied to the pending civil proceedings, must be sought in the court seized with those proceedings or another competent court.
About R315 000 approved for payment
The ruling also records that, during the Tribunal hearing, the Fund had approached SAIPA to establish whether it would consent to the release of a portion of Daniels’s pension benefit.
The Tribunal said it was informed that about R314 996.65 had been approved for payment to Daniels following SAIPA’s consent.
It understood this amount to represent the difference between Daniels’s available benefit and the amount retained in respect of Claims A and B.
According to what the Tribunal was told at the hearing, the Fund would continue withholding the remainder on the basis that SAIPA had demonstrated a prima facie basis for withholding.
The Tribunal did not make a merits finding endorsing that basis for continued withholding.
Background to the SAIPA-Daniels dispute
Moonstone has previously reported on the dispute between SAIPA and Daniels.
In late 2023, SAIPA placed Daniels and other executives on precautionary suspension pending a forensic investigation. At the time, the executives disputed allegations made against them, and aspects of SAIPA’s governance also became contested.
In September 2024, SAIPA announced that Daniels had been dismissed following a disciplinary process. SAIPA said he had been found guilty on several charges and that its board had accepted a recommendation that he be dismissed with immediate effect.
Daniels subsequently disputed SAIPA’s account of events and indicated that he intended to challenge his dismissal and aspects of the disciplinary process.
The Tribunal’s ruling of 3 July 2026 does not determine those disputes or the merits of SAIPA’s pending High Court claims.
Note: Moonstone asked Daniels and SAIPA for comment on the Tribunal’s decision. Their comments will be added to the article if they are received.
