The Pretoria High Court has ruled that PRASA must be repaid almost R60 million. Photo: Brent Meersman
29 November 2018
The Pretoria High Court has ruled that the Passenger Rail Agency of South Africa (PRASA) must be repaid almost R60 million by the East Pretoria Sheriff. The court, on Tuesday, excoriated Judge Tintswalo Nana Makhubele, the former interim chair of PRASA. Judge Neil Tuchten wrote that she “ought not to to undertake any judicial duties until she clears her name of the allegations against her.”
The decision resulted from an allegation that Makhubele, who is a high court judge, had disrupted litigation procedures within PRASA.
On 9 April 2018 the Sheriff removed R56-million from a PRASA bank account to cover a settlement it was ordered to pay to Siyaya Rail Solutions. But, Tuesday’s judgement said PRASA may have been denied a fair hearing.
Advocate Makhubele was appointed a High Court judge in October 2017. After she was appointed a judge, Makhubele was appointed to chair the interim board at PRASA, which was a conflict of interest. She subsequently resigned following exposure of this conflict by commuter activist group #UniteBehind.
Claiming the rail agency owes them for “services rendered,” Siyaya sued PRASA in four separate cases submitted for arbitration. PRASA conducted litigation in response using Group Legal Services (GLS), an internal body of the rail agency. It is reported that Judge Makhubela was an active member in GLS.
Yet Tuesday’s judgment said that Judge Makhubele instructed the GLS to stop its participation in the Siyaya litigation. After senior members of GLS expressed concerns about getting cut off from the litigation, PRASA attorney Diale Mogashoa told them that “Judge Makhubele had barred PRASA’s attorneys from interacting with GLS on the case” on 15 December 2017.
On 21 February 2018, PRASA was ordered to pay several awards to Siyaya entities under a court motion. PRASA officials then opposed the ruling using attorneys at Bowman Gilfillan as the rail agency was no longer under legal oversight of GLS. However, Siyaya challenged Bowman Gilfillan’s “authority to act” in defense of PRASA. Following the court rejecting PRASA from transferring their power of attorney from GLS to Bowman Gilfillan, it granted a judgment to award Siyaya.
GLS officials alleged Judge Makhubele was the cause of Siyaya entities challenging the authority of PRASA attorneys. Officials said that she conveyed information to Siyaya entities from a letter that “enjoyed confidentiality as being a communication between attorney and client.”
The present application called for the Sheriff to repay PRASA “on the ground that the orders were erroneously sought and granted”. The orders made by the court on 9 March 2018 said that attorneys from Bowman Gilfillan “were not authorised to act for PRASA.” However, Bowman Gilfillan’s authority to defend PRASA was approved by the head of GLS, “the very person who had given authority for Bowman Gilfillan to represent PRASA in the enforcement applications” according to Tuesday’s judgment.
“It ought to have taken little imagination to grasp that two factions had arisen within PRASA, one desired that payment be made, the other desired that payment not be made,” wrote Judge Tuchten. For this dispute to be settled through the court is important because there is a consequence of losing millions of public money, said the judgment.
Makhubele said the reason why she chose to intervene in the Siyaya litigation was because she had access to information on an insolvency enquiry into one of the Siyaya entities. However, GLS officials claimed they have never seen a report investigating this apparent bankruptcy. Evidence that this report exists has yet to be disclosed by Makhubele, wrote Tuchten. The judgment also said Makhubele had multiple chances to put the alleged insolvency inquiry report before the court, but failed to do so.
“I am sorry to say that I must say something about the conduct of Judge Makhubele as evidenced by these papers,” wrote Tuchten. “There are questions which demand answers.” One of these questions was: “Did she supply Siyaya with information which they could use against PRASA, and if so, why?” He further wrote, “In general, did she act with propriety in relation to the Siyaya litigation?”
The court has decided to set aside a final judgment as it awaits the outcome of related applications. However, the Sheriff must pay back PRASA the R56 million within five days.