ANCYL faces liquidation over R17m debt

Julius Malema was apparently involved in a road rage incident in Polokwane, Limpopo, on Tuesday evening. File photo: Motshwari Mofokeng

Julius Malema was apparently involved in a road rage incident in Polokwane, Limpopo, on Tuesday evening. File photo: Motshwari Mofokeng

Published Dec 1, 2013

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Johannesburg - Unless it pays its creditors more than R17 million, the 69-year-old ANC Youth League might exist in name only.

Its current and former leaders, which include government ministers and Economic Freedom Fighters leader Julius Malema, could be hauled to a liquidation hearing.

If the provisional liquidation order granted to Z2 Presentations, an event management company, last month is made final, liquidators will manage the ANCYL’s affairs, including its bank accounts, which will be frozen.

Other creditors owed money by the league may also file their claims after the final liquidators are appointed by the master of the high court, provided there are prospects of getting their money.

Z2 Presentations’ lawyer Marius van Rensburg said the provisional liquidation meant the league did not exist at the moment.

“They can’t take legally binding decisions,” Van Rensburg said.

He said the league could not vote in internal ANC elections as it did not have any legal standing.

Van Rensburg said the league had not filed an appeal by Friday.

He said the next step, should the liquidation be made final on January 27, would be a probe by liquidators appointed by the Johannesburg High Court.

Z2 Presentations organised the league’s chaotic 2008 Bloemfontein congress in which its ex-president Malema was elected. It failed to pay Z2 Presentations R7.7m, which has increased to R17m, including interest and legal fees.

According to the league, the ANC will go to court in January to show why the provisional liquidation, which it describes as “politically motivated”, cannot be made final.

The liquidators’ investigation will look for the league’s assets and bank accounts, according to Van Rensburg. It may also issue subpoenas on former and current youth league leaders to appear before the liquidation hearing.

The league’s imminent liquidation also means trustees of Brett Kebble’s estate may never recover the R1.7m they are claiming.

“I doubt we will lodge any claim,” trustee Bantubonke Nduna said this week.

The trustees – Nduna, Francina Venter and Frederick Klopper – were demanding R865 000 from the league, including interest.

The money was paid to hotels in Johannesburg and Cape Town between June 2004 and April 2005.

The trustees’ claim against the league was struck off the Johannesburg High Court’s roll in October because of Z2 Presentations’ application to liquidate the league.

“Any action against an entity or person stops once a liquidation application is made,” Nduna said.

In court papers, the league’s then treasurer-general Phumezo Mqingwana said the league used R400 000 of Kebble’s money to erect a tombstone and hold a rally in the Eastern Cape in honour of founder member Mxolisi Majombozi in October 2004.

The balance was used to pay for the league’s end-of-year roadshow in Kyalami, Midrand.

According to Mqingwana’s plea on behalf of the league, Kebble also bankrolled the annual commemoration of struggle icon Solomon Mahlangu’s life on April 6 that year.

The league’s 2004 congress had been expected to cost about R11.2m, but the actual expenditure was R16m, according to a budget prepared by Mqingwana.

Kebble also funded the congress, in which Sports Minister Fikile Mbalula replaced Public Enterprises Minister Malusi Gigaba as league president.

The league admits the demand made by the trustees, but denies any liability to pay, saying Kebble was “a registered ANC member in the Western Cape (and) believed its structures were important organs of participatory democracy”.

“Kebble, by donating to the ANC, was maintaining an institution of democracy which enabled him to acquire his wealth, which in turn enabled him to operate his businesses,” Mqingwana said.

The league denies Kebble was insolvent when he made the donations. It argued his companies operated in a building in the Joburg CBD and had offices in Melrose Arch.

The league has dismissed Acting Judge ARG Mundell’s judgment as “flawed”, saying it is a voluntary political association and not a “corporate body”.

Van Rensburg denied the liquidation was politically driven.

“It’s purely for commercial reasons,” he said.

ANCYL spokesman Bandile Masuku opted not to respond to Van Rensburg’s statements, saying it was his (Van Rensburg’s) opinion.

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Sunday Independent

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