Durban - They kissed and made up, but the truce was short-lived and now city officials and Durban bus company boss Mandla Gcaba are again at legal war, with Gcaba accusing the city of reneging on their agreement and “behaving as a law unto itself”.
In an urgent application which will come before the Durban High Court next week, Gcaba wants a money judgment against the eThekwini Municipality for more than R132 million, for subsidies which he says the city owes and has not paid for the bus service.
This money, he said, was supposed to have been deposited into a ring-fenced account run by an “intervention team”, set up as part of the settlement agreement signed by both parties on March 1 this year. The task team and account were set up to end year-long litigation in which the city was seeking to liquidate Tansnat, alleging Gcaba was using its bank accounts as his own.
Now the agreement, which was supposed to bring stability to the bus service, is in jeopardy.
And while Gcaba, in his affidavit, complains that the city is not being transparent about why it has withheld the subsidies, he speculates that it may, in opposing his court application, accuse him of also “shielding” money and not depositing all income into the new account.
He discloses that income from bus special hires, about R329 000, had not been paid over but used by Tansnat “to assist employees” in respect of death and funeral expenses, pending payment from the provident fund.
“A stop has been put to this practice and while the money is still owing, we will make every effort to make payment in full prior to the launching of this application,” he said.
Gcaba also disclosed that a R7 million refund from Shell also had not been paid into the account. He says the refund was paid into the old Tansnat account and was subject to a condition imposed by Shell that it be used to augment an existing guarantee against which the petrol company would supply diesel on credit.
“This was not a normal unconditional payment into the Tansnat account,” he said.
Gcaba said Tansnat had continued doing business while the new account was set up “and it may well be that in the process certain monies were paid out from the old account after the new one was set up”.
“This requires the requisite accounting exercise to be done by the auditors, if any monies fall to be repaid Tansnat tenders its full co-operation and repayment of all amounts the auditors lawfully stipulate.”
The settlement agreement also made provision for the appointment of an adjudicator to investigate claims by each party that the other owes it money.
Gcaba says former chief justice Sandile Ngcobo has agreed to the appointment, but the six-month agreement period would need to be extended because it was likely adjudication would now only take place early next year. “The municipality’s attitude to the extension is not known. But we anticipate it may well seek to challenge that.”
The city is intent on taking back the bus service and is establishing the legal entity required to run it and receive subsidies from provincial and national government.
Asked for comment, eThekwini head of communications Tozi Mthethwa said the city would not go into “the merits or demerits” of the issue. “Our position is that all matters relating to the bus service will be dealt with through the intervention team set up to guarantee that bus operations run smoothly in the best interest of residents. The matter is currently in court, therefore the city cannot comment further.”
The Mercury