LAST year, the Western Cape High Court delivered a significant ruling in the high-stakes legal tussle between the Sekunjalo Group of Companies (Sekunjalo) and Nedbank.
The court dismissed Nedbank’s appeal against the interim interdict granted to Sekunjalo in June.
This decision, however, is merely a chapter in an ongoing legal battle with an uncertain final outcome, as Nedbank’s hearing to overturn this ruling is scheduled for later this month in the Supreme Court of Appeal in Bloemfontein.
The origins of this legal saga can be traced back to June when an interim interdict temporarily safeguarded the conglomerate’s bank accounts. In response, Nedbank promptly sought to appeal the ruling.
They argued that their interpretation of Section 23(1) of the Equality Act allowed them to challenge any order issued by the Equality Court, including interim ones.
Nevertheless, Judge Mokgoatji Dolamo of the Equality Court disagreed in July last year with Nedbank’s stance, emphasising: “The logical conclusion of this line of reasoning is that any order will include interim orders. I do not subscribe to this wide interpretation of this section.”
Sekunjalo expressed its satisfaction with that judgment, underscoring its alignment with the interests of justice. Nedbank’s rationale for wanting to close Sekunjalo's accounts is about reputational risk.
Judge Dolamo, in his Equality Court ruling, noted that without substantial evidence of such risk, it did not amount to irreparable harm to the bank.
Despite Nedbank’s arguments to the contrary, the court acknowledged the broader constitutional issues at play and emphasising their national significance.
The forthcoming appeal in the Supreme Court of Appeal represents a pivotal moment in deciding the fate of Sekunjalo’s bank accounts.
Addressing Nedbank’s argument that providing banking facilities to Sekunjalo pending the hearing of the main review application would pose a reputational risk, Judge Dolamo remarked: “Without any proof of such risk, in my view it does not amount to irreparable harm.”
In terms of whether there was any other compelling reason for the appeal to be heard, the judge stated that the bank had not presented a convincing argument. In this regard, the opposite holds true in this case.
The genesis of this legal battle appears to be the report of the Mpati Commission, which investigated alleged impropriety at the Public Investment Corporation. This report was compiled by commissioners Gill Marcus and Emmanuel Lediga and has been the source of contention.
Although the commission never definitively proved any misconduct by Sekunjalo, the ensuing report has been weaponised by detractors of group.
Advocate Willem Heath, an independent retired judge tasked by Dr Iqbal Survé, executive chairman of Sekunjalo, to objectively review the Mpati report, described it as a “grave injustice” to Sekunjalo, prompting the group to approach the courts for an official review.
The Heath review of the report revealed several significant findings, which include the fact that Sekunjalo Investment Holdings (SIH) was never part of the terms of reference of the Mpati Commission; the term “malfeasance” cannot be applied to Sekunjalo, as they have done nothing wrong; the conduct, findings, and recommendations of the Mpati Commission were tainted by illegality; and the commission failed to comply with its own terms of reference and its rules.
It is a testament to Sekunjalo’s unwavering determination to protect its interests and reputation in the financial industry. The ultimate verdict in this enduring legal struggle has the potential to reshape the landscape of financial justice, transformation, and corporate rights.
The case will be heard in the Supreme Court of Appeal on November 14.
* Dlamini is editor of the Sunday Independent