T H E L E A D I N G I N D E P E N D E N T J O U R N A L FO R T H E S U P E R A N N U AT I O N A N D I N S T I T U T I O N A L F U N D S M A N A G E M E N T I N D U S T RY SEPTEMBER 2010
Volume 24 - Issue 8
Time catches up with tardy trustee 10 2010 ELECTION Should the industry be feeling a little green?
A recent determination handed down by the Superannuation Complaints Tribunal should serve as a warning to trustees that they must be up to date with their members’ changing circumstances.
S 11 FRAUD There’s more to super benefits payments than meets the eye
14 TECHNOLOGY
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18 ADMINISTRATION Navigating a changing superannuation landscape For the latest news, visit superreview.com.au MANDATES
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NEWS
uperannuation fund trustees need to take account of changed circumstances when dealing with the death benefit nominations of members, according to a recent determination handed down by the Superannuation Complaints Tribunal (SCT). The determination saw the Tribunal overturn the decision of a Trustee on the basis that the fund member had signed the death benefit nomination nearly 16 years prior to her death, and it had failed to take account of her changed circumstances (specifically, a marriage). The SCT’s decision made clear that superannuation fund trustees had to be more proactive in seeking to make contact with members over their changed circumstances, and can not simply assume that letters had been received. The case heard by the Tribunal in July revolved around a decision by the superannuation fund trustee to pay death benefits to the members’ parents rather than to her husband because she had nominated the parents as her benefit recipients when she had 3
EDITORIAL
The SCT’s decision made clear that superannuation fund trustees had to be more proactive in seeking to make contact with members over their changed circumstances.
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TECHNOLOGY
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joined the fund in 1991. The Tribunal panel, which included SCT chair Jocelyn Furlan and leading superannuation lawyer Noel Davis, overturned the Trustee’s decision on the basis that notwithstanding the member’s original nomination, the fund had failed to recognise the husband as a ‘Dependant’ for the purposes of the Superannuation Industry (Supervision) Act (SIS Act). “Under section 10 of the SIS Act, the word ‘Dependant’ is defined as including any person with whom the person in question had an interdependency relationship,” the Tribunal said. “One of the requirements for there to be an interdependency relationship between the deceased member and her parents is that they were living together. That was not the case. Consequently, it
ADMINISTRATION
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APPOINTMENTS
is the Tribunal’s view that the parents were not in an interdependency relationship with the deceased member within the meaning of the SIS Act and there is insufficient evidence that they came within any of the other elements of the definition of ‘Dependant’ in the SIS Act,” the Tribunal said. It said that although the parents had been nominated by the deceased member to receive her benefit, “that nomination was made well before her marriage”. “Furthermore, in order for the Trustee to be able to give effect to the nomination and pay a benefit to the parents, the parents had to come within the definition of ‘Dependant’ in the trust deed. It is the view of the Tribunal that there is insufficient evidence that the parents came within that definition.” SR 23
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