Lawyers of Zimbabwean and former Old Mutual chief executive Peter Moyo, want to see the company’s directors jailed for refusing to reinstate him – and for them to be blocked from serving on any other company’s board.
Old Mutual fired Moyo in June 2019, after suspending him for alleged conflict of interest due to his involvement with a financial services company that he helped found in the early 2000s.
The legal battle between him and the company dragged on until March 2020. But his attempts to challenge his dismissal were thwarted when Old Mutual won the case in January 2020 after appealing earlier court judgments ordering it to reinstate Moyo as CEO.
Almost two years after their last face-off, Moyo was back in court on Wednesday.
The Johannesburg High Court was initially scheduled to hear his contempt of court application in November last year. He had also applied to the court to have all Old Mutual directors who sat on the board at the time of his axing declared delinquent.
Moyo’s legal team, namely Advocate Dali Mpofu and Advocate Tembeka Ngcukaitobi, told the court that Old Mutual’s refusal to allow Moyo back into his office after the court ruled that he should be temporarily reinstated deserved punishment comparable to what was meted out to former President Jacob Zuma.
Zuma was sentenced to 15 months in jail for contempt of court in June this year. He has, however, been released on medical parole.
Mpofu told the court on Wednesday that there should not be one set of rules for people like Zuma and another one for company directors like Old Mutual board chair Trevor Manuel.
He pointed out that in Zuma’s case, the Constitutional Court was very clear that the sentence for contempt of court should send a message that court rulings need to be respected.
He said the contempt of court on the part of Old Mutual directors was even worse than Zuma’s because there were “multiple and serial” counts of non-compliance followed by disrespectful remarks by Manuel about Judge Brian Mashile, who ordered Moyo’s temporary reinstatement.
Manuel publicly apologised for the remarks he made in a press conference where he said it would be unfortunate if an individual who happens to wear a robe overturned a full board’s decision.
Judge Mashile ordered Old Mutual to temporarily reinstate Moyo to his CEO position in July 2019. But Old Mutual applied to appeal his ruling. Since it was appealing, it barred Moyo from returning as CEO.
Old Mutual is, however, arguing that it complied with the court order since it reinstated Moyo’s contract and then fired him on a six-month notice period afterwards. It argues that only his physical being was not allowed into the building because of the irreparable breakdown in his relationship with the board.
The court order had also interdicted Old Mutual from appointing another CEO. But it appointed its current CEO Iain Williamson on an interim basis. It only made him permanent in July 2020, months after it won its appeal. Mpofu argued that those were two counts of contempt of court.
The third count is related to Manuel’s utterances about Judge Mashile being an individual who happens to wear a robe. Mpofu said this made Manuel guilty of “scandalising the court”.
But he said the other directors could not be exonerated from those remarks either because Manuel made those remarks in their presence, and they didn’t distance themselves.
He said some of them also made public statements that Old Mutual would never take Moyo back as its CEO, despite the court ordering the company otherwise.
“The court must not see those utterances in isolation. That would be the biggest mistake because if you see them in isolation, you might say maybe it was a slip of the tongue. Look at them in the context of those other utterances…Look at it in the context of repeated defiance of court orders,” said Mpofu.
Mpofu said if the court found that Old Mutual and its directors were guilty of contempt, then the argument for declaring the board members delinquent directors was as good as done.
Old Mutual’s lawyers were due to respond to the contempt of court accusations and Manuel’s remarks about Judge Mashile in detail yesterday.
Wim Trengove, who is representing Old Mutual’s directors, said they would show that the directors were not guilty of contempt of court on any count.
“If they were not guilty of contempt of court, then grounds for delinquency also fall away,” he said.
Trengove added that even if the court were to find the directors guilty of contempt of court, their conduct still did not meet the grounds for declaring them delinquent. He said the directors did not breach their fiduciary duties to Old Mutual.
“The fact that they might have been guilty of insulting a judge or of some other misconduct would not constitute a breach of the fiduciary duty to the company,” he said. – Fin24.com