Daughter challenges stepfather after he inherits majority from her mother's R7.9 million death benefit

An aggrieved chartered accountant took the Pension Fund Adjudicator (PFA) and Allan Gray to the Financial Services Tribunal (FST) after her stepfather was allocated a major portion from her mother's death benefit.

Hayley Marie Ward who was 25 years when her mother died, was unhappy after Allan Gray Retirement Fund (AGRF) and Allan Gray Pension Preservation Fund (AGPE) nominated Waynne Millard, 63, to receive 58% from her mother's R7.9 million death benefit. 

The deceased, Gail Pamela Millard, 58, died in August 2023. She was married to Waynne for 18 years.

In her first marriage, she had three daughters, Hayley, Andrea Lynne Ward and Michelle Robin Ward.

Gail had over R7.9 million in the AGPE and over R24,000 in the AGRF.

In the AGPE, she nominated Waynne to receive 10%, Hayley 30%, Michelle 28%, and Andrea was allocated 32%. In respect of the AGRF, her nominations were 20% each for three beneficiaries except for Michelle who was allocated 40%.

Before releasing the funds, Allan Gray conducted an investigation and determined that Wayne and the deceased’s mother were factually her dependents. Even though daughters are legally her dependants, they were not dependent on their mother at the time of her death.

Based on information gathered after the investigation, Allan Gray re-allocated the death benefit as follows:

Disenchanted, Hayley lodged a complaint with the PFA in April 2024. The crux of the complaint was that Allan Gray used the incorrect life expectancy for Waynne hence an excessive portion of the death benefit had been re-allocated him. She argued that he was unjustly enriched, and this prejudiced her and her siblings.

She said had the correct facts and figures been used, Allan Gray ought to have allocated at most 19% of the total death benefit to Waynne and not 58%.

The PFA dismissed her complaint, and she sought relief at the FST.

Amongst other things, the FST looked at the evidence used by Allan Gray to allocate the funds.

It was established that Waynne was retired and financially dependent on his wife. His monthly expenses were over R33,000 and they exceeded his monthly income of R11,584 and he had a shortfall of R21,639.

After his wife died, he received over R1 million from Momentum Life and inherited 50% of the property they shared. He also received an accrual claim of nearly R250,000.

The deceased's mother is a widow, retired and was financially dependent on her daughter. 

She lives in rent-free accommodation; she had access to her daughter's credit card and would use it whenever needed.

She receives R2,100 pension from government and inherited R100,000 from her daughter's estate.

From the three daughters, it was revealed that Hayley was single and earns R85,000 as an accountant. She received over R1.2 million from Momentum Life and a further R264,422.

Andrea is also single and works in Ireland where she earns R116,000 as a manager. Like Hayley, she received over R1.2 million from Momentum Life and a further R264,422.

Lastly, Michelle is married and lives in the in the UK, where she earns R30,000 as a plant nursery. She inherited the same amounts as the sisters.

The FST said it was worth noting that Allan Gray did not completely disregard the nominations made by the deceased.

"The applicant’s (Hayley) complaint that the nomination by the deceased should have been entirely disregarded by the Funds in regard to the surplus because the Funds had already re-allocated an amount in excess of the nomination to Mr Millard is without foundation," said the FST.

The FST said it found no reason to interfere with the PFA's decision.

sinenhlanhla.masilela@iol.co.za

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