…the consequences for trustees of retirement funds can be dire…..
In a trial that goes before the South Gauteng High Court this week, four erstwhile trustees of the IF pension and provident funds will be hoping for relief from a determination by the Pension Funds Adjudicator that they be held personally liable for some R17m in expenses which the funds had incurred. The Adjudicator is not party to the litigation.
Should judgment go against the former trustees, each of them would be exposed to pay over R4m from their own pockets. Plus costs of the litigation. Plus legal expenses in the protracted run-up. Whichever way the court decides, the warnings for existing and aspirant trustees are stark (see box).
The two IF funds are umbrella arrangements for a few dozen participating employers and several hundred employees. The former trustees — Gail le Grellier, Renier Botha, David Lepar and Carel Smith (the ‘IF Four’) – seek an order to set aside the Adjudicator’s 2013 determination.
Her declaration was that that the IF Four had managed the funds improperly, causing them financial loss, and directed that they personally pay the funds for the database rebuild they’d commissioned.
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