Premier, officials summoned in fired IDZ CFO’s legal suit

THE East London High Court has instructed premier Phumulo Masualle and members of his executive to give evidence on the dismissal of the East London Industrial Development Zone’s CFO.

Ex-chief financial officer Babalwa Magongwa is suing the ELIDZ for R6-million for alleged breach of contract and unlawful dismissal for protected disclosure.

She was appointed to the position on October 7 2014 and her contract was meant to run from November 1 2014 to October 31 2019.

But Magongwa only worked for four months. She approached the court claiming she was stripped of her duties as CFO after reporting to CEO Simphiwe Kondlo and members of the board that the IDZ was insolvent without a reasonable expectation of trading out of its financial predicament.

The trial before Judge Bantubonke Tokota was delayed for the second time yesterday when Magongwa’s counsel, advocate Denzel Potgieter, and counsel for the ELIDZ Richard Buchanan both said they were not ready to proceed.

The court wants Masualle to testify about an alleged February 14 2015 meeting between himself, Magongwa and former ELIDZ executive manager Sybert Liebenberg when, the CFO claims, they discussed the organisation’s dire financial situation.

He is expected to further testify about an alleged followup meeting on March 16 2015 in a boardroom at Frere Hospital.

Provincial director-general (DG) Marion Mbina-Mthembu, finance MEC Sakhumzi Somyo, the premier’s office’s (OTP) Sthembele Mase, treasury HOD Daluhlanga Majeke, planning and treasury official Joe Mhlomi, economic development and environmental affairs and tourism officials Bongani Gxilishe and Sibongile Jongile and the IDZ’s Zolile Tini have also been called.

OTP spokeswoman Mandisa Titi confirmed to the Dispatch this week that Masualle and the DG were summoned and were “fully cooperating with the court processes”.

Mbina-Mthembu will give evidence on an alleged February 2 2015 meeting between herself and Magongwa about financial irregularities at the ELIDZ. She will also testify on a memo she wrote dated February 9 2015 to Somyo recommending the dissolution of the ELIDZ board.

Somyo will be required to give evidence on MbinaMthembu’s memo and the financial crisis at the ELIDZ including performance bonuses that were paid to employees in September 2014 and a R4-million bailout paid to the entity by his department in March 2015.

The ELIDZ is defending the suit, and it denies that it fired Magongwa unlawfully.

The entity also denies there were persistent irregularities and breaches of corporate governance by its leadership.

Yesterday’s delay was because Potgieter wanted Buchanan to furnish him with further particulars before proceeding.

Tokota said he did not understand why the matter was taking so long to finalise.

“This is frustrating because the case appears to be a straightforward case of breach of contract,” he said.

The matter was postponed to Monday for trial. —