The Financial Services Tribunal (FST) has set aside a determination by the Pension Funds Adjudicator after finding that a dispute over an employer-held disability policy fell outside the Adjudicator’s jurisdiction because the benefit was not administered by the retirement fund under its registered rules.
The ruling, dated 28 October 2026, applies an existing line of Tribunal authority holding that a dispute over an unapproved benefit provided through an employer-held policy falls outside the Adjudicator’s jurisdiction when the benefit is not administered by the retirement fund. The description of a benefit as “unapproved” is not decisive by itself. The essential question is whether the benefit is provided and administered under the fund’s registered rules.
What distinguishes Mapungubwe Institute for Strategic Reflection v Msimang and Others from the earlier decisions is that the Adjudicator assumed jurisdiction. In Bouah v Sanlam Umbrella Provident Fund and Others (2024) and Peters v Pension Funds Adjudicator and Others (2025), the Tribunal upheld the Adjudicator’s refusal to investigate complaints concerning employer-held disability policies. In the latest decision, the Adjudicator determined the complaint and issued directions concerning the benefit.
Employer held the policy
The dispute arose after Liberty repudiated an income-protection claim involving Velaphi Zakhele Msimang. The policy was held by Msimang’s former employer, the Mapungubwe Institute for Strategic Reflection (MISTRA), rather than by the Corporate Selection Umbrella Retirement Fund No. 2.
Msimang suffered a stroke around the end of 2015. The decision refers in different places to late December 2015 and about 2 January 2016. His employment with MISTRA ended on grounds of medical incapacity on 31 January 2017. He continued receiving his salary until his employment ended and he obtained other employment in June 2017.
The record showed that MISTRA notified Liberty of the stroke and requested income-protection disability claim forms on 11 January 2016. Liberty supplied the forms and said the required documents included a confidential medical report completed by a doctor and a statement completed by the claimant.
On 22 January 2016, MISTRA forwarded the forms and information about the claims procedure to Liberty Life, which acknowledged receipt two days later. The decision does not explain precisely what the material contained or why these communications did not satisfy the policy’s notification requirement.
The decision records that a completed claim was pursued only in November 2025. Liberty repudiated it on the basis that notification had occurred outside the policy’s six-month period.
The Adjudicator found that the policy placed the notification obligation on MISTRA, that the employer had failed to fulfil this obligation, and that the failure caused the repudiation. The Adjudicator directed the Fund to assess within two weeks whether Msimang qualified for the disability benefit and made a consequential payment order if the assessment was favourable.
The decision is inconsistent about which party was ordered to pay the benefit. Its introductory summary says the Fund was directed to assess and, if the assessment was favourable, pay the benefit. Its detailed account of the order says MISTRA was required to pay if the assessment was favourable.
MISTRA made no submissions before the determination was issued. The Adjudicator’s office sent communications to the organisation’s email address on 7 January and 4 February 2026 but received no response.
After MISTRA applied for reconsideration, the Adjudicator acknowledged that the application raised a jurisdictional issue and consented to the matter being remitted so that the issue could be considered fully.
Fund was not authorised to administer the benefit
The Fund said under oath that it did not assess or adjudicate claims under the employer-held policy. It said determining whether an insured event had occurred and whether a benefit was payable under that policy fell within Liberty’s mandate as insurer.
The Tribunal found that the Fund’s Special Rules recorded the insured disability portion as nil. The Fund’s registered rules neither conferred on nor required the Fund to administer the monthly disability-income benefit claimed by Msimang.
The Tribunal said an order directing a fund to perform a function not conferred by its registered rules was incompatible with section 13 of the Pension Funds Act. Section 13 makes a fund’s registered rules binding on the fund, its members, shareholders, and anyone claiming under those rules.
An employer-held policy did not become part of the Fund’s registered rules merely because it was associated with membership of the Fund. The notification obligation arose under MISTRA’s policy, not under the Fund’s rules.
The grievance arose from the repudiation of a claim under the employer-held policy. It did not concern the administration of the Fund, the investment of its assets, or the interpretation and application of a rule providing the claimed benefit. It therefore did not meet the definition of a “complaint” under the Pension Funds Act.
The Tribunal also relied on JG Afrika (Pty) Ltd Staff Pension Fund v Liberty Corporate and Another (2023), which held that an employer and a retirement fund are separate legal persons and neither is the other’s alter ego. The earlier decision also confirmed that the Tribunal has no original jurisdiction where the Adjudicator lacks jurisdiction.
Applied to the facts of MISTRA, these principles meant that the employer and Fund could not be treated as interchangeable. Obligations arising from the notification provisions in MISTRA’s policy could not simply be treated as obligations of the Fund under its registered rules.
Having found that the grievance was not a “complaint” under the Pension Funds Act, the Tribunal did not need to decide whether the Adjudicator’s findings on breach and causation were sustainable on the full record. Nor did it decide whether Liberty’s repudiation was contractually or legally correct.
Liberty subsequently declined the claim
After the reconsideration application was lodged, Liberty Life completed the assessment required by the Adjudicator’s determination.
The insurer declined the claim on 21 July 2026, finding that continuing disability, as defined in the policy, had not been established for the period from 1 January to 31 May 2017. It also recorded that Msimang had continued receiving his salary until his employment ended and had obtained other employment in June 2017.
Msimang argued that the interests of justice favoured allowing Liberty Life to complete the contractual assessment contemplated by the policy. The Tribunal said the argument had become moot because the insurer had completed the assessment and declined the claim.
The Tribunal upheld MISTRA’s reconsideration application, set aside the Adjudicator’s determination, and remitted the matter for further consideration on jurisdictional grounds.
