Peter Moyo decision a corporate governance headache
JOHANNESBURG – Old Mutual chairperson Trevor Manuel on Friday broke his silence on the ongoing litigation between the group and Peter Moyo, describing the decision by the South Gauteng High Court to reinstate the axed chief executive as a headache for corporate governance.
Manuel told journalists in Parktown, Johannesburg, that the court decision had far-reaching consequences beyond the country’s oldest insurer.
“(We are) unanimously of the view that that judgment is so bad for the company and company law that we have an interest in ensuring that it is overturned on appeal. That is not something we can walk away from. It is a corporate responsibility we have as Old Mutual. It creates a massive headache in the corporate governance space,” said Manuel, who was flanked by members of the executive.
In July, Judge Brian Mashile ruled that Moyo be temporarily reinstated and that the insurer’s decision to suspend and subsequently dismiss him was unlawful.
Mashile also interdicted the 174-year-old company from appointing Moyo’s replacement. Moyo was suspended in May as trust and confidence between him and Old Mutual broke down.
The insurer axed him in June and fired him again last month in an open letter to shareholders.
Moyo received R4 million compensation as part of the six months’ notice of termination. He approached the court for an interdict to reverse the decision, setting the scene for the brutal litigation that has highlighted corporate governance issues. However, Mashile dismissed Old Mutual’s application for a declaratory order seeking to prevent Moyo from returning to work earlier this month.
Mashile also granted the insurer leave to appeal against the July judgment.
Manuel said that Moyo remained fired and would not return to work despite the court ruling.
“Unless you are employed in the building, you do not have access to the building. No purpose, no entry,” said Manuel.
Old Mutual said it had not backed down from its ongoing appeal process against the ruling.
Old Mutual’s lawyers Bowmans sent a letter to Moyo’s legal representative, Mabuza Attorneys, on Thursday, saying it had decided that it would be more appropriate to attempt to de-escalate the litigation between the parties.
“Our client considers that both parties should seek to avoid further proceedings that would not serve to resolve the central issues that exist between them, which concern whether or not your client’s employment has been validly terminated, either by the first or second notice,” said Bowmans.
Old Mutual said it preferred to await the outcome of the pending judgment of Mashile before taking further decisions.
“Old Mutual maintains that its second letter of termination to Mr Moyo remains valid and hence he is not permitted nor required to return to work in the interim,” the company said.