Court orders Metropolitan to transfer client’s funds

Says the language of the policy is clear that transfers to other funds can be done


Metropolitan Life Botswana has lost with costs a case in which its client, Esau Nong Jokonya, was seeking a court order to terminate his retirement annuity policy and transfer the funds to the Botswana Public Officers Pension Fund (BPOPF).

The Lobatse High Court declared Metropolitan’s refusal to terminate Jokonya’s policy and to transfer the funds to BPOPF unlawful. “Consequently an order is hereby issued terminating the aforesaid policy with immediate effect,” said Justice Jennifer Dube in her judgement.

“The respondent is further directed to immediately transfer the applicant’s funds to the BPOPF as per the instruction of the applicant. Also the respondent is ordered to pay the costs of the application at an attorney and client scale.”

The applicant is a former soldier and is currently a lecturer at Palapye Technical College.

Metropolitan had argued that it could not do as Jokonya asked because the policy was administered in terms of retirement annuity rules do not have a provision for a cessation of membership by transferring funds out of it. Metropolitan had told Jokonya that the rules only made provision for a cessation of membership when his contribution ceased and the member was no longer entitled to any benefits from the fund or on dissolution of the fund.

Not so, the applicant’s lawyer, Uyapo Ndadi, returned. Ndadi submitted that the rules of the respondent as well as the applicant’s policy allowed for transfer of funds from Metropolitan to another fund. The judge agreed, noting that the language of Section 7 of the Fund Act was plain, simple and unambiguous.

“I am mindful of the rule of interpretation that where a meaning of a provision is clear from the words chosen by the draftsman, that is the meaning normally to be preferred,” Justice Dube said. “It is not necessary or permissible to search for alternative meaning in the name of equity or fair play. It is only where there is doubt as to the intended meaning that an interpretation exercise needs to be undertaken to arrive at a meaning which achieves the intention of the legislature, and does not render any clause, word or sentence of the Act superfluous, void or insignificant.”

She added that the policy was clear that the person entitled to an annuity in terms of the policy may request the respondent to transfer his lump sum to any registered fund for the purchase of an annuity.

“In my view it is unfair and prejudicial to a member for a fund to refuse to transfer pension in this day and age so long as the transfer is not used for purposes of a member accessing one third cash before the allowable age,” she continued. “The respondent, in my view, has not only misconstrued the Act but has also failed to consider the provisions of the very same policy that it issued to the applicant allowing for transfers to purchase an annuity in any registered fund.”

“The rules of the respondent do not provide for the transfer of the applicants funds to another fund. However, the same rules do not prohibit such transfers. In the result, the application succeeds and I hereby declare that the respondent’s refusal to terminate and transfer the funds of the applicant … unlawful.

“Consequently, an order is hereby issued terminating the aforesaid policy with immediate effect and the respondent is further directed to transfer immediately the applicant’s funds to the BPOPF as per the instruction. Further, the respondent pay the costs of this application at an attorney and client scale.”