‘Forfeiture of PPE funds by Diko-linked company unlawful’
ConCourt still to give judgment on R38.7m
Lawyers representing Ledla Structural Development, a company that was linked to questionable multimillionrand personal protection equipment (PPE) contracts, have argued that the Special Tribunal did not have powers to grant forfeiture orders.
Adv Tembeka Ngcukaitobi yesterday argued at the Constitutional Court on behalf of Ledla that his client’s assets shouldn’t be given to the state.
Ledla is a company linked to Thandisizwe Diko, the late husband of former presidential spokesperson Khusela Diko.
In August 2020, the Special Investigating Unit (SIU) filed an urgent application for the cancellation of the contracts and a preservation order against the various bank accounts into which R38.7m had been deposited.
The R38.7m, which was subject to a preservation order, was forfeited to the state by the Special Tribunal.
The preservation order was for PPE contracts awarded by the Gauteng health department to Ledla.
On Tuesday Ngcukaitobi argued the tribunal did not have forfeiture powers but could grant preservation orders.
He said the tribunal was not a court of law and, as a result, the review proceedings and the forfeiture orders it made are a nullity.
He also contended that the tribunal erred in ruling that it had the competence to order a forfeiture of assets, as it was not empowered to do so by rules of the Special Tribunal.
Due to a number of irregularities and complaints about PPE procurement, President Cyril Ramaphosa issued a proclamation in terms of the Special Investigating Units and Special Tribunals Act, authorising the respondent, the SIU, to investigate maladministration, corruption and breaches of procurement procedure relating to Covid-19, and to take remedial action.
“We’re not challenging the standing of the SIU. It was always common ground that a central issue which was before this court is the status of the tribunal.
“The tribunal has limited powers under section 8 [Promotion of Administrative Justice Act (Paja)]. They don’t include judicial review powers under Paja and they don’t include section 172 powers under the constitution,” he argued.
“On the forfeiture, the act doesn’t grant forfeiture powers. The regulation grants forfeiture preservation orders.”
He further said as things stood, there was nothing stopping parliament from granting the tribunal forfeiture powers.
Representing the SIU, advocate Matthew Chaskalson said Ngcukaitobi conceded there was profiteering during a national emergency.
“They now approach this court to divert attention of case but on jurisdiction. They raise these points now when counsel of the SIU are not available. Jurisdictional points may be interesting but it’s not the time. This is brought by a litigant who is defending an entity that sought to profit from a national disaster disgracefully,” he said.
“The court should not entertain this application.”
Before adjourning court, justice Mbuyiseli Madlanga announced that judgment was reserved.