South African court orders Cadac pension fund curators to fix 20-year rules mismatch

Gauteng High Court in Johannesburg has ordered the curators of the Cadac Pension Fund, a South African defined-benefit pension fund placed under curatorship in December 2010, to address a long-running mismatch between the fund’s registered rules and how it operated, following litigation involving its former executive chairman and businessman, Simon John Nash, Cadac (Pty) Ltd and former and current fund members.

The dispute centres on the fund’s closure to new members in March 2003, despite the subsequent admission of members and acceptance of contributions. The court record shows that the fund’s rules and its practical operation had diverged for years.

Cadac fund dispute stretches back to 2003

The fund’s trustees resolved in 2003 to close it to new entrants and stop member and employer contributions from March 1 that year. The amendment was subsequently approved by the Financial Services Board under section 12(4) of the Pension Funds Act.

However, a section 14 transfer certificate issued in February 2009 allowed 59 people, including Nash, to transfer from the Optimum Umbrella Pension Fund into Cadac Pension Fund.

The trustees later sought to regularise the position through Amendment No. 4, which proposed reopening the fund retrospectively and changing its structure. The amendment was not registered after regulatory requirements remained outstanding.

Nash pension claim brings dispute to court

Nash subsequently sought payment of his pension benefits, which the litigation records place at approximately R36 million.

The curators later informed Cadac and members that the fund had been closed since March 2003 and that contributions received after that date had been unlawfully accepted. They instructed the administrator to stop accepting further contributions and refund those already received.

The decision triggered further litigation, with the Supreme Court of Appeal in October 2021 granting interim relief preventing the curators and administrator from refusing contributions or refunding them while the broader dispute continued.

Court sends curators back to consultation

The latest proceedings focus on how the discrepancy between the fund’s legal rules and its historical operation should be resolved.

Earlier reports by the curators had identified the mismatch and recommended amending the rules to “normalise” the fund. The litigation record also shows that affected members sought orders requiring the curators to regularise their status within the fund.

Judge MP Motha found that the curators’ 2020 decision had been taken without giving Nash, Cadac and affected members an adequate opportunity to make representations.

The court consequently set aside the decision and remitted the matter to the curators.

They must consult Cadac, Nash, current and former members and pensioners, explain the proposed amendment and submit amended rules to the pension regulator within 90 days.

The curators must also support the regulatory application with information and reports requested by the regulator and report the regulator’s decision to the applicants and court.

$2.2 million pension claim remains unresolved

Nash was the chairman of the two JSE-listed companies, Cullinan and Sable Holdings, at the time the alleged offences were committed. He is also the executive chairman of Karrimor Industries and Cadac (Pty) Ltd, a famous commercial manufacturer of outdoor leisure and gas appliances. While he managed the company for decades, it was originally established long before his tenure; his association came via Cullinan Holdings in 1995. Nash is most widely known for his involvement in one of South Africa’s longest-running financial corporate scandals: the “Ghavalas scheme” pension fund surplus-stripping saga.

The ruling does not itself order payment of Nash’s approximately R36 million ($2.2 million) pension claim. Instead, it requires the curators to address the regulatory and procedural issues surrounding the fund before the dispute over members’ rights and benefits can be resolved.

The Cadac Pension Fund has been under curatorship since December 2010, while related litigation has reached the High Court and Supreme Court of Appeal on several occasions. A February 2026 appellate judgment also dealt with litigation and curatorship costs arising from the broader dispute.