Friday Jun 04, 2021
Service providers in Pakistan don't particularly care for their customers. This is especially true in bureaucratized institutions. The path to opening a bank account, getting a driver’s license or obtaining an identification document is beset on all sides by the inequities of unintelligible forms, meaningless notarisations and the tyranny of uncooperative officials.
A hapless customer seeking a private or public service, much like the Greek figure Sisyphus, is condemned to provide useless information on archaic forms, and doing the exact same thing the following day, when the said information didn’t contain a specific attestation or wasn’t notarized by a particular grade of Civil Servant.
This leads to a peculiar irony where despite signing a multitude of forms, they remain oblivious to their legal rights in the service itself.
Bureaucratized institutions operate within a strict duality; to demonstrate fidelity to their internal standard operating procedure (SOPs), however asinine they may be, and to always immunize themselves against any kind of legal action. The Customer’s rights remain a distant second.
An example of such institutionalized apathy is with respect to legal nominations. A nomination, as the word suggests, is bequeathing property after your death. A legal heir can be nominated to receive funds in a bank account or shares in a company. A nomination is distinct from a gift or a transfer of the property, where ownership of property is relinquished in one’s lifetime.
You, or a sibling could be nominees in your father’s bank account. A favourite uncle may have preferred you over his own children as a nominee for their substantive shareholding in a listed company. You can even be nominated under law if you weren’t related to the deceased; perhaps you did them a kindness, (or maybe you imagined the whole thing).
Except that such nominations are not worth the paper they are printed on.
Our superior courts have long been uncomfortable with nominations because they effectively circumvent the laws of Succession; where all legal heirs of the deceased are entitled to receive a portion of the estate, as per their divinely pre-ordained, Quranic shares. These include spouses, children, or even the deceased’s parents, if they’re alive.
Succession certificates are granted by courts, after determining the Quranic shares of all legal heirs and their entitlement in the deceased’s estate. A nomination allows a single nominee to gain title to the asset, overriding other legal heirs of the deceased.
For a country where litigation on property matters is initiated almost as a blood-sport, nominations in bank accounts, shares or other investment products are routinely challenged by disgruntled legal heirs and validated by courts.
You would think that this would spur financial institutions into action in adopting a consistent policy in dealing with the issue of successions and nominations.
Instead, banks usually freeze bank accounts of the deceased until a succession certificate/letter of administration is provided by the legal heirs, but they might still allow the survivor of the joint account (the either/survivor doctrine), to transfer all the sums in a new account, oblivious that the legal heirs of the deceased are entitled to half the funds in that account as well.
The resultant legal action ensures that either the bank account remains frozen, or the funds have already been encashed by the survivor, thereby initiating a fresh hell of legal disputes.
Another example of such disconnect between service providers and their customers is manifested in a judgment of the Sindh High Court, reported as Muhammad Shahid Farooq vs Jamshed Ali Khan [2017 CLC 1227], where the Court was adjudicating upon a routine succession matter which included National Saving Certificates as part of the estate of the deceased.
The deceased had nominated a legal heir to receive the certificates, which the nominee promptly encashed, prompting a swift challenge by the remaining legal heirs.
National Saving Certificates is perhaps the most ubiquitous financial institution of Pakistan. Its certificates include fixed income investment products that are trusted by small, medium and large savers across the land.
The Court, whilst invalidating the nomination on the touchstone of the laws of Succession, adopted a Scorched Earth policy, ordering that the National Savings amend all of its applicable rules, to the extent that all nominees would hold the certificates in trust for the remaining legal heirs until Succession Certificates were obtained.
The National Savings did what most over-bureaucratized institutions do when ordered to comply with Court directives. They dragged their feet for four years before retrospectively amending their existing rules invalidating every single nomination, in supposed compliance with the orders of the Court.
For the sake of posterity, they published the official amendments to the said rules on their website, which for all purposes could have been in Sanskrit; indecipherable for the ordinary person, without a legal background.
What the National Savings failed to do was to formulate a mechanism where all their certificate holders would be clearly informed that their nominations would have no effect, unless they included all their legal heirs.
They also did not broadcast or amplify the legal effect of the amendments in the media, so that their deposit holders could amend their current nominations and be aware of their legal positions in light of their estate.
They simply did not do enough to keep their deposit holders informed of these changes, which was their legal and constitutional right as owners.
Without the benefit of this information, an existing nominee of a National Savings Certificate may operate under the fallacy that they are still entitled to the fruits of a National Saving Certificate upon the death of the nominator. This could metastasize into litigation if the legal heirs claimed their share and the nominee refuses to hand it over.
Compounding the problem is the issue of whether some, or all of the legal heirs reside abroad, as they would need to authorise the nominee through a Power of Attorney, allowing them to encash the certificates on their behalf, which creates crippling delays in the distribution of the estate.
For institutions like the National Savings or other similarly placed organizations such as banks, this is a classic case of “Not my circus; not my monkeys”.
Improving communication and standards of services to customers is not a priority because a Pakistani consumer is not conditioned to pursue punitive legal action against a service provider. Even if they do, a spluttering judicial system ensures that the said legal action would be delayed for years, in a form of a judicial purgatory. The apathy thus endures.
All this is a kind of a psychological violence unleashed on the deceased’s family, already reeling with the death of a loved one, who are then forced to become actors in a theatre of bureaucratized cruelty.
To be clear, this is not a legislative/legal reform issue. It’s a common sense one, which requires service providers to formulate policies which take ownership of their customers, as opposed to using them as a vehicle for indemnifying themselves.
The most immediate impact of this would be a reduction and an ultimate cessation of further litigation, already clogging up a broken judicial system. That alone is an aim worth aspiring for.
Ali is a barrister who practices in Lahore. He tweets at @RezaAli1980