Ensuring that the Blessee survives post the Blessor’s death.

Ensuring that the Blessee survives post the Blessor’s death.

There is an expression that is often used that declares that nothing is certain but death, well that is true. However a lot of things surrounding death seem to be uncertain; we often ask what the wishes of the deceased were, it is sad that we cannot ask the dead any questions to demystify the situation. In this note we will investigate what happens to the terminal benefits of the deceased employee. Terminal benefits may be in the form of provident fund, severance or pension fund. The employer can operate either of them or both severance pay and provident fund. The focus of this note will be on provident fund.

As many employees would recall during the first day of employment there are a lot forms to be filled in, one of such forms is usually termed “beneficiary nomination form”. In this form the employee may have to fill in name of the next of kin and beneficiary.  For some married employees, they fill in their spouses as both next of kin and beneficiary. For single employees they may fill in parents as next of kin and siblings as beneficiaries. Some employees, whether married or single they fill in their lovers as beneficiaries and it is this practice that lends some employers in court.

Next of kin and beneficiary are clearly different, W.C.M Maqutu in Ntsihlele v Retsilisitsoe Night Ntsihlile & Others explained that Next of kin is just a person to be called should the employee suffer injury or die, this person is not in anyway a beneficiary of the employee. The beneficiary is simply entitled to the benefits deriving from the employment contract.

It is important to draw the reader’s attention to the fact that when the employee fills in the name of the beneficiary, be it his wife, parents, sibling or mistress he is entering into a what is referred to as a contract for the benefit of a third party; stipulatio alteri. This type of contract forms part of Lesotho law because it is part of Roman Dutch law. Stipulatio alteri allows two people to validly contract for the benefit a third party. All that the third party has to do is to accept the benefit. In Qobolo Israel Tshabalira Rakoto v Marelebohile Katiba & Another CIV/APN/152/90  the deceased employee signed an agreement to the effect that the benefits deriving from his contract of service be bestowed to his wife upon his death. The father of the deceased employee instituted proceedings in court requesting to be declared the heir which will result in him getting the benefits of his son. The issue before court was whether the father has any title to sue. The court held that where an employee chooses who should benefit in the event of his death, that person becomes the beneficiary by virtue of the stipulation, the status of such beneficiary does not matter, his relationship with the deceased employee is irrelevant. In this matter whether or not the beneficiary was the employee’s lover, wife or heir it did not matter, all she had to do was to accept the benefits.

From the number of cases read on this matter, it is obvious that there is a misconception by the public that the heir of the deceased employee is entitled to the benefits of the deceased employee or that husband and wife are seen as one therefore such benefits are automatically theirs by virtue of community of property. The case of Mahao v Lesotho Electricity Company & Others (C of A (CIV) No.8/09) articulates this point. The late employee of LEC was cohabiting with Mareitumetse (2nd respondent) and he appointed her as the beneficiary to the LEC provident fund in terms of a form styled Beneficiary Nomination form. The employee died a bachelor and his family appointed his sister as the heiress to his estate. On the basis of her appointment she sued the LEC to prevent it from dispatching the proceeds of the provident fund to Mareitumetse. The court of appeal said this case revolves around conflict between the law of inheritance and the principle of stipulation alteri; contract for the benefit of a third party. This principle is part of our law and as soon as the third party (Mareitumetse in this case) accepts the stipulation made in her favour in a contract, she is entitled to enforce it. The appeal was dismissed and Mareitumetse was entitled to receive the disputed money.

Another important issue for spouses to appreciate is that such benefits are not part of the joint estate hence they can be given to any other person. In Charumbia v Charumbia 2010 3 BLR 148, the High Court of Botswana said the terminal benefits are claimable upon termination of employment, before then they are not claimable, they only become asserts of the employee when he claims them. The practice is that after the order of divorce is granted parties then deal with the sharing of assets of the joint estate. In this case the gratuity of a spouse was claimable after the degree of divorce was granted and as a result it could not be shared despite it having accrued during the subsistence of the marriage. This position is the same in Lesotho because it our common law. It is therefore important not to assume that by virtue of being an heir to someone’s estate one will automatically be entitled to their terminal benefits or by virtue of being married in community of property.

It is unfortunate that the dead cannot correct what they have done, because if they did may be some would come back and say “I forgot to change my beneficiary after I got married let me change it”. In Rakoto v Marelebohile Katiba & Another CIV/APN/152/90  the court said the reason why someone was made the beneficiary does not at all affect the position of the law, once it is established that the person written as a beneficiary is the one claiming the benefits that is the end of the story, whether she is the ex lover, ex wife or the blessee she will get the benefits.

With these blessor/blessee relationships taking root in our communities, this note serves to caution families that  there is cause to be worried about such relationships, especially regarding the existence of stipulatio alteri principle in our law.

Prepared by the department of Labour, Industrial Relations and Property Management at Sello-Mafatle Attorneys. For more information contact us on 22317748 or emails us sellomafatle@leo.co.ls/corporatelegal@sellomafatle.com


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