Sunday, 25 May 2008

Case: Superannuation Complaints Tribunal: pay super to grandma or the son?

Another example of the need to get on with property settlement instead of leaving a mess...

In a recent decision of the Superannuation Complaints Tribunal,the Trustee's decision was to pay 100% of the death benefit for the benefit of the minor son of the Deceased Member, with the Former Spouse as the trustee. The Son was aged 12 at the time of the member's death.

The complaint was brought by the mother of the Deceased Member, who wanted to receive funds to clear overdrafts and credit card debt, mortgage repayments and additional medical expenses and to provide for her grandson "as the [Deceased Member] would have wished". She also claimed that she and her husband (the stepfather of the Deceased Member) were in an interdependency relationship with the Deceased Member at the time of his death. The Tribunal found that the Complainant and her husband had provided the Deceased Member with substantial financial support and received minimal financial support from the Deceased Member. It also found that the person that the Deceased Member had a primary obligation to support was clearly his son.

Amongst other things, the Complainant submitted that the Deceased Member had lived with her and her husband for over 6 years prior to his death. The Tribunal noted conflicting information provided by the Former Spouse as to the domestic living arrangements of the Deceased Member.

While the Tribunal did not make a finding of fact as to with whom the Deceased Member was living at the time of his death, it dismissed the Complainant's submission that she was in an “interdependency relationship” with the Deceased Member, stating that the circumstances of the relationship were not, and could not be expected to remain, ongoing and permanent. However, the Tribunal did find that the Complainant and her husband were partially financially dependent upon the Deceased Member at the time of death. As a result, it set aside the Trustee decision and substituted its own decision to pay 10% of the benefit to the Complainant and her husband jointly and 90% to the Former Spouse as trustee for the son.

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