Durban - Assets belonging to the eThekwini Municipality were attached by the Sheriff of the Court yesterday to satisfy a R30 million debt owed by the municipality to a private company.
The assets were attached after a company called Daily Double Trading 479 CC, trading as Pholobas Projects, took the municipality to court.
The matter stems from a case brought by the company against the city and a subsequent judgment that was handed down in April this year by the Durban High Court.
In terms of that judgment, the city was ordered to pay the company the sum of R30m plus interest at the rate of 10.5% from February 2, 2018 to the date of final payment.
The city was also ordered to pay the costs of the application.
It is understood that the city appealed the judgment but the appeal was dismissed.
According to the judgment, an initial matter was launched in July 2017 in which the company had sought an order declaring that the city’s cancellation of two contracts was unlawful. It further sought an order that the city’s blacklisting of the company also be declared unlawful and for the court to rule that the city was indebted to the company in the sum of R44m.
After the matter came before court, there was an attempt to settle it. In February 2018, the city’s attorney wrote to the company’s attorney with a settlement offer of R30m which was accepted.
However, when no payment was made, the company brought a second application to have the settlement made an order of the court and it’s this matter that the judgment deals with.
The judgment states that the matter regarding the settlement agreement was directed for the hearing of oral evidence due to the disputes over the agreement and whether it had been authorised by the city and by whom.
At the hearing of oral evidence, the legal team for the company led the evidence of its witness; however the city closed its case without leading any evidence.
Anusha Ganas, the lawyer representing the company, would only confirm to The Mercury yesterday that it had served the municipality with a writ of execution on Wednesday. She declined to comment further.
Pictures which The Mercury were sent yesterday showed office phones, computers and cars belonging to the municipality’s electricity department being attached.
The incident stunned councillors and workers unions alike, who described it as deeply embarrassing.
IFP councillor Mdu Nkosi said this was just another incident in a series of embarrassing incidents of late that were causing serious harm to the image of the municipality.
“This matter should not have gotten this far, if the court has made a decision, the municipality should have complied unless they were challenging the decision in court, they could not just leave the matter hanging, this is deeply embarrassing for the municipality.
“This is also very traumatic for the workers. Imagine being at work and the sheriff telling you to stand up because they want to take your chair and the computer you are using,” Nkosi said.
Queen Mbatha of the Independent Municipal & Allied Trade Union (Imatu) said the situation would negatively affect the workers.
“Imatu is saddened by the occurrences in the city. Our members will suffer the consequences of the employers mishandling tender issues. Tools of trade, vehicles, computers and furniture have been (taken).
“We currently have a problem with the shortages of tools of trade and now this. The level of frustration which our members is going to experience is excessive,” she said.
Xolani Dube of the South African Municipal Workers’ Union (Samwu) said they had been made aware that assets were being seized by the sheriff of the court.
“This is deeply embarrassing and it is something that the council must deal with, you can’t have such a big municipality having its assets seized by the sheriff. We don’t know what was taken but whatever was taken is something that the workers need to be able to work and deliver services to the community,” said Dube.
EThekwini Municipality’s spokesperson Msawakhe Mayisela said: “The city can confirm that the Sheriff of the Court attached vehicles, equipment and furniture from one of our electricity buildings.”
He said this was after a warrant of execution which was granted in a matter involving the city and Daily Double Trading 479 CC, as the applicant.
Mayisela said the offices at Jeff Taylor Crescent have had to be partially closed and staff was moved to other offices so that work is not hindered.
“The decision by the applicant to attach the city’s assets is as a result of a court case the city lost earlier this year where the service provider was awarded approximately R30m. We took a decision to appeal and were informed yesterday that we lost the appeal. This led to the incident this morning.
“The city has complied with the order to the best of its ability. Our legal team is looking into the matter. Customer Services at the offices will not be affected,” he said.
DA councillor Thabani Mthethwa said the head of electricity, Maxwell Mthembu, must confirm the extent of the attachment of the unit’s equipment, vehicles and any other tools of the trade.
“It is unfathomable how the unit or the city’s legal compliance unit would allow the situation to reach this stage. A report on this matter particularly on the judgment was never tabled at any committee, Exco or even council for consideration, despite it clearly being months old.
“At this stage, we are unsure how far reaching or devastating this will be on the delivery of services in this unit. We need answers on how the unit will cope with these tremendous losses and how it will impact on service delivery.”
THE MERCURY