Sapo breaches R50m court order payment

It failed to honour a settlement agreement with a cellular service provider after being sued

THE SOUTH African Post Office (Sapo) has been left scrambling for answers after failing to explain if it has made a settlement payment of R50 million, ordered by the court, to a service provider by the end of January.

The Post Office had by yesterday not responded to enquiries from The Star on breaching the court order to pay R50m and facing the attachment of its assets.

Lawyers for Nasasa Cellular, which had originally sued Sapo for about R300m for breach of contract, refused to comment yesterday because of the sensitivity of the matter.

In responses sent early this week, Sapo acting chief executive Mlu Mathonsi acknowledged that their annual report, tabled in Parliament, had noted a nearly R300m contingency liability for a court case.

Sapo had been sued by Nasasa for breach of contract in 2004, but in January this year it reached a settlement in court to pay the company R50m.

Mathonsi said the issue of nearly R300m was covered in their budget for last year.

“The issue of a contingency for a potential legal liability of the amount of R296.725 million for the SA Post Office, as captured in Note 43 of the 2014 integrated annual report, relates to the potential liability in a matter involving the SA Post Office and Nasasa Cellular and others,” he added.

Mathonsi admitted that the matter was settled in court recently. “This matter was settled amicably by the respective parties, and neither of the parties is permitted under the confidentiality and non-disclosure provisions of the contract to divulge any details or contents of the settlement,” he said.

But Sapo is now in breach of the law after failing to honour the court order.

The State Liability Act calls on a state department or entity to pay a settlement within 30 days. The act further allows an open window for the plaintiff to contact the relevant department or Treasury to make the payment before sending the sheriff to attach property.

In the court order, issued on January 15, in the high court in Pretoria, Sapo was to have made the final payment of R50m by the end of January.

“The Post Office will pay Nasasa the sum of R50 million in full,” the court order states, adding that the money would be paid in four instalments from last October until the end of January.

The settlement followed the contract Sapo gave Nasasa Cellular in 2004, but later the Sapo scrapped the contract.

As part of that agreement, Nasasa was to provide Sapo with telecommunications and cellphone products.

Nasasa was to provide cellphone contracts, handsets, starter packs, airtime and accessories to 1 250 Post Office outlets countrywide.

The target was to access the market using Sapo for various services, with Nasasa the service provider for these telecommunications and cellphone products.

The battle has been raging since 2007.