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Response from Jonathan Mort, legal advisor (and manager?), Shell South Africa Pension Fund

Jonathan Mort, Legal Advisor and Manager, Shell SA Pension Fund 

 

Jonathan Mort, Legal Advisor and Manager, Shell SA Pension Fund

 

INITIAL RESPONSE FROM MR MORT

From: Jonathan Mort <[email protected]>
Date: Fri, 27 Mar 2009 16:34:39 +0200
To: <[email protected]>
Subject: FW: Royal Dutch Shell Pension Fund Conspiracy and Deception

Dear Mr Donovan
 
I have some comments on your draft article, and should be grateful if you would, as you have indicated in your email to Mr Brandjes, hold over publication of your article until you receive those. I shall send them to you by no later than Monday, 30th March 2009.
 
Your sincerely
Jonathan Mort 

SUBSTANTIVE RESPONSE FROM MR MORT

From: Jonathan Mort <[email protected]>
Date: Mon, 30 Mar 2009 21:50:41 +0200
To: John Donovan <[email protected]>
Subject: SHELL ARTICLE

Dear Mr Donovan
 
I refer to the draft article you intend publishing on your website http//royaldutchshellplc.com, as set forth in an email from yourself to Mr Brandjes on 25 March 2009 at 18h28. Thank you for giving me the opportunity of correcting some facts of which you may not have been aware.
The reader of the draft article will conclude that I am incompetent, negligent and worse because the thrust of your article is that:
·        There ought to be independence as between a pension fund (on the one hand) and the interested parties, including the employer (on the other).  This is entirely correct.

·        I appeared to act in conformity with the above principle, apparently acting on behalf of the Shell SA Pension Fund, while – in truth – being in “secret collaboration” with Shell SA, the employer.  I am accused of conspiracy with the employer, unethical conduct, and falsely claiming that the Shell SA Pension Fund is not controlled or influenced by the employer.  As you will see below, this is not true.

Your assertion is based on an email which I sent on Sunday, 15 February 2009 at 08:01 AM.  This email was sent to Ms Wanjiru Kirima, the Principal Officer (or manager, in UK parlance), of the fund who is also an employee within the Shell group of companies, and to several courtesy copy recipients.  The courtesy copy recipients were:
·        Mr Johan Geldenhuis, the fund actuary who is an employee of Alexander Forbes;

·        Mr T. Wood, the chairman of the fund’s board of trustees and who is an employee of the employer;

·        Mr Charles Abrahams, whose further details I do not know;

·        Someone whose email address is [email protected] <mailto:[email protected]> ;

·        Mr Justin Martin, who is Mr Purchase’s solicitor.

The content of the email was a draft response to Mr Purchase’s email to me on 13 February 2009 at 08h42 PM, and was intended to be sent to Ms Kirima, Mr Wood and Mr Geldenhuis.  I subsequently received input from Mr Geldenhuis.  That input was inserted as a third paragraph into my draft response, and sent to Mr Purchase on 18 February 2009 at 07h42.  The email was otherwise unaltered.
It is apparently my draft response (per the email of 15 February 2009) to Mr Purchase (on 18 February 2009) which has driven you to the conclusions of conspiracies, collaborations and unethical conduct so liberally sprinkled through your article. The truth is more mundane, entirely proper, and (sadly for your website) considerably less newsworthy than the spectacular claims made in your draft article.
I have served as legal adviser to the fund for the last 10 years.  Where there is a dispute with  the fund which I am asked to manage, I receive instructions from certain persons involved in the management of the fund.  The established practice is for me to receive those instructions from the chairman of the board of trustees, the principal officer and the fund actuary.  This is so, whether or not the chairman of the board of trustees is an employer appointed trustee or (as has been the case for most of the period of my appointment as legal adviser to the fund) a member or pensioner elected trustee.    (Note that prior to Mr Wood’s appointment as chairman of the board in 2007, the chairman of the board of trustees was Mr Les Tucker, a pensioner?elected trustee who acted as chairman of the fund for 7 years).  It should be noted that there are 8 trustees, 4 of whom are appointed by the employer and 4 of whom are elected by the members and pensioners.
For as long as I have been the legal adviser of the fund:
·        The employer has always utilized the services of Bowman Gilfillan Inc., a large law firm in South Africa, as its legal advisers;

·        The employer has utilised the services of Jacques Malan & Associates, a firm of consulting actuaries, as its actuarial advisers in relation to the fund and Johan Geldenhuis has never advised the employer.  

When it came to responding to Mr Purchase’s email of 13 February 2009, I pressed the “Reply to all” prompt and substituted Ms Kirima for Mr Purchase.  In a bona fide error, I should have deleted, but erroneously did not, the other persons in the courtesy copy address list. My transmission of the draft response to these persons was an error, an  embarrassing one, and even though sent early on a Sunday morning, not excusable.  But there was nothing sinister about sending it to Mr Wood, Ms Kirima and Mr Geldenhuis as these three persons are all – in their capacities above – duly appointed representatives of the fund, and from whom I am required, as legal adviser to the fund, to receive instructions in responding to Mr Purchase’s email.  It is not within my power to decide from which representatives of the fund I must receive instructions.
I have no interest in promoting the interest of the employer in the fund.  To the contrary, your allegations that I have done so (at the expense of the fund and the fund membership) are simply not true.  I would like to think that I have consistently endeavored to give advice which is correct in law and which does not prefer the employer at the expense of those entitled to benefit from the fund, including the former members of the fund in the apportionment of its surplus.  By way of example, I mention that it was I who suggested to the tribunal that the former member representative (Mr Peter Sutherland) be represented by senior counsel in the surplus tribunal hearings (at the expense of the fund) so as to ensure that the employer (which through Bowman Gilfillan Inc. was represented by senior counsel at those hearings) was not at an unfair advantage. There was no limit to the budget enjoyed by Mr Sutherland for this purpose, and the fund did not similarly bear the costs of the employer’s legal expenses.  I have also never provided legal advice to the employer or had my invoices for services to the fund paid by the employer.
As regards the substance of Mr Purchase’s complaints  against the Fund, these must be understood in the broad context of the requirements applicable to the apportionment of surplus.  My letter to Mr Purchase dated 9 September 2008 in that regard is attached.  I am sure Mr Purchase will not mind if I send it to you as he has sent you other correspondence between himself and me.
Of course, there are aspects of the statutory surplus apportionment requirements which – it could compellingly be contended – are manifestly unfair:  
·        The fact that where surplus was moved from one fund to another, the former members of the transferee fund do not share in the surplus apportioned by the transferor fund.

·        The fact that pensioners do not have their minimum pension increase adjusted for the pensions which were underpaid, although the minimum benefits paid to former members are adjusted.

·        The fact that where there is evidence of improper use of surplus by an employer which must be repaid, the current shareholders of the employer bear the cost of repaying that even if there has been a change in shareholding, that improper use was lawful at the time and there is no recourse to the shareholders who benefitted from the improper use.

·        And there is the very issue that Mr Purchase complains of, which is that he must, 20 years after having left employment, produce detailed information about his withdrawal from the fund in order to be eligible for the minimum benefit.  This is so, notwithstanding that he could not have known – when he withdrew from the fund – that that information would be subsequently required.  And it does not assist him that there was no requirement, at the time that he left the fund, that either the fund or his employer retain records relating to his service or his withdrawal benefit or for any particular length of time.  

These, however, are criticisms which must be leveled at the prevailing legislation, and not at the fund or its representatives.
It has been pointed out to Mr Purchase on a number of occasions that there is  no room for the fund to exercise a discretion to pay him his minimum benefit.  The only discretion which exists is one to pay a claimant where the fund considers that the claimant has a lawful claim, in the sense that he will be successful if pursued in a court of law.  If this is so, there is a discretion to meet this claim out of  the general assets of the fund rather than to defend an indefensible claim.  Unless the claim is a lawful one, however, it does not qualify for the exercise of this discretion. The fund has considered the claim by Mr Purchase, and does not consider it to amount to a lawful claim which would entitle the trustees to exercise a discretion in his favour.  My advice to the fund in this regard would have been no different whether or not I was required to confer with different representatives of the fund.
I have also referred Mr Purchase to Mr Sutherland, the person required by statute to represent the interests of former members of the fund such as Mr Purchase.  I understand they have corresponded and I believe that Mr Sutherland would not have hesitated to recommend to Mr Purchase that he pursue his claim in court if he thought it had merit. You could contact him if you wished to obtain his opinion about the merits of Mr Purchase’s claim. His email address is [email protected] <mailto:[email protected]> . He is a pensioner of another multinational oil company, and has no relationship with the employer.
Yours sincerely
 
Jonathan Mort

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