The Mpumalanga High Court froze the R44.7 million pension of the late former Deputy President David Mabuza, underscoring the risks of unclear estate planning and outdated beneficiary nominations.
DISPUTE OVER BENEFICIARIES
Mabuza’s daughter, Tamara Silinda, and her mother, Emunah Silinda, are challenging the sole beneficiary status of Mabuza’s widow, Nonhlanhla Mnisi. They argue that they relied on him financially and should be recognised.
A Home Affairs record suggests Mabuza was not legally married at the time of his death, bolstering the Silindas’ claim.
Mpumalanga High Court Acting Judge Johannes Hendrickus Roelofse issued an interdict against Alexander Forbes, the pension administrator, ordering it to keep the funds frozen until the court resolves the matter.
THE LIVING ANNUITY FACTOR
Before retiring, Mabuza allegedly transferred his pension into a living annuity, a retirement product that pays income from invested capital. These products fall under the Long-Term Insurance Act and the Income Tax Act, and they strictly bind insurers to the listed nominations.
Consi Kalamaras, Senior Manager at Alexander Forbes, explains, “A living annuity allows nominated beneficiaries to receive the remaining capital. Insurers must follow the nominations exactly.”
The dispute now turns on whether Mnisi received a valid nomination and whether the Silindas can prove financial dependency.
ESTATE PLANNING LESSONS
Legal experts say Mabuza’s case highlights common pitfalls in estate planning. To avoid similar disputes, South Africans should:
- Update wills and pension nominations regularly
- Clearly identify all dependents
- Seek legal advice for complex estates
COURT BATTLE AHEAD
The High Court’s interim order keeps the pension locked until a full hearing decides the rightful beneficiaries. Lawyers warn such cases often drag on for months or even years.
