Durban — The KwaZulu-Natal Growth Fund Trust has missed the Friday deadline to file its responding affidavits and heads of arguments, in its case against Goodlife Dairy company, in the Durban High Court.
Goodlife director Busi Gumede has taken the government entity to court demanding reasons for cancelling the approved funding for her company.
The board and the company are embroiled in a protracted legal battle over the board’s cancellation of R72 million it had already approved for the company to resume its operations in 2020. The company argues that it suffered a financial loss as a result of the board’s decision which it said had no legal basis. The board chairperson, Silas Hlophe, had not responded to a request for comment by the time of publication.
Legal expert Andile Dakela said if one of the parties had missed the court deadline it has the right to apply for condonation – a request for another opportunity to file – but it must be accompanied by valid reasons. It would be up to the judge to accept or reject the reasons.
After several engagements with the board and provincial government, Gumede felt she had no option but to go to court to force the board to rescind its decision. The matter was heard in September by Judge Elijah Nkosi who ordered both parties give oral evidence.
After arguments Judge Nkosi said it would be better that the matter goes to trial with board members being cross-examined on the decision. He did not want to issue a ruling based on the arguments because if the fund appealed, Goodlife would suffer financial prejudice as the matter might drag on until it reached the Constitutional Court, he said.
The fund’s defence team, led by advocate Vi Gajoo SC, argued the funding was cancelled because Gumede opened a new bank account without their consent. Gumede is also alleged to have removed a consultant’s account details from an invoice, replacing it with the company accountant’s banking details.
The Goodlife legal team said the fund contradicted itself in its reasons for cancelling the funding because the fund itself had allegedly asked the company to open a new account since it wanted to be a joint signatory to it.
As for changing the bank details on the invoice, the company said it was also not true because it was a blank invoice from the consultant; the company had told the fund it would want the money to be paid to its accountant, not the consultant – since the fund had said it could not do due diligence on the consultant.
The company said the fund had done due diligence on its accountant and had demanded the company hire a project manager and quantity surveyor, yet it wanted to deal directly with suppliers.
The company said the agreement to fund the company was reached, but, to its shock, it received calls from suppliers saying they had been contacted by the fund asking for their banking details.
The board members listed as respondents in the court papers are then chairperson Siphile Buthelezi, Bongekile Zulu, Khaya Thango, Ashvir Dhuki and Silas Hlophe. The court heard only Hlophe and Zulu were still on the board; it was not clear if the three former board members air their account in court.
The company believed the only reason the funding was cancelled was because it refused to attend a private meeting with one of the board members whom the company believed wanted a bribe. The board had distanced itself from the board member and said it was not aware of the recorded conversation between Gumede and the board member where he allegedly asked for a private meeting.
Previously, Economic Development, Tourism and Environmental Affairs MEC Siboniso Duma said: “We affirm our commitment to ensure we get to the bottom of all issues. For now, we’ve allowed all internal processes to proceed without delay.”
Daily News