Be­lea­guered SA Ex­press gears up for yet another le­gal bat­tle

The Citizen (KZN) - - News - Ber­nade e Wicks

With the dust from its failed bid to avoid busi­ness res­cue barely set­tled, SA Ex­press is al­ready gear­ing up for another le­gal bat­tle – this time over more than R4.7 mil­lion which global bag­gage ser­vices com­pany Bag­port says it is owed by the ail­ing sta­te­owned air­line.

The two are set to face off in the Supreme Court of Ap­peal (SCA), in Bloem­fontein, on Mon­day, to ar­gue the va­lid­ity of a 2017 set­tle­ment agree­ment – in terms of which SA Ex­press agreed to pay up within three days and which was in 2018 made an or­der of the court.

SA Ex­press says the set­tle­ment agree­ment is in­valid and there­fore un­en­force­able.

But ac­cord­ing to Bag­port – and a judge of the High Court in Jo­han­nes­burg – this is not the case.

SA Ex­press and Bag­port have been at log­ger­heads over the money – which re­lates to bag­gage wrap­ping ser­vices pro­vided in Septem­ber and Oc­to­ber 2014 – for sev­eral years now.

Bag­port first ap­proached the court to try and re­coup the money in 2016 but be­fore the mat­ter could be heard, the par­ties met and agreed to set­tle, with a set­tle­ment agree­ment be­ing wrapped up early the fol­low­ing year.

Three months later, though, with pay­ment still out­stand­ing, Bag­port once again turned to the court and asked for the set­tle­ment agree­ment to be made an or­der of the court. SA Ex­press op­posed the ac­tion but af­ter hear­ing sub­mis­sions from both sides, the judge in 2018 ruled in favour of Bag­port and granted the or­der. SA Ex­press is now ap­peal­ing this de­ci­sion in the SCA.

The air­line’s case, in part, is that the set­tle­ment agree­ment was signed “un­der du­bi­ous cir­cum­stances”.

It ar­gued in the high court that the rel­e­vant sig­na­tures were not ob­tained; that the for­mer chief ex­ec­u­tive “was not au­tho­rised or did not ac­quire the re­quired ap­proval and/or au­thor­ity to bind [SA Ex­press] by con­clud­ing the set­tle­ment agree­ment”; and that the agree­ment breached the Pub­lic Fi­nance Man­age­ment Act.

In 2018, then newly ap­pointed Fi­nance Min­is­ter Tito Mboweni an­nounced a R1.2 bil­lion bailout for SA Ex­press.

Then last Septem­ber, Mboweni an­nounced the car­rier would re­ceive an ad­di­tional R300 mil­lion from gov­ern­ment and, just last month, it was re­ported that it would be al­lo­cated another R164 mil­lion for the 2020/2021 fi­nan­cial year.

Ear­lier this month, SA Ex­press was fi­nally placed in court-man­dated busi­ness res­cue, fol­low­ing an ur­gent ap­pli­ca­tion launched by another one of its con­trac­tors – trans­port and lo­gis­tics com­pany Ziegler – over R11 mil­lion in un­paid bills.

The air­line said in a state­ment at the time that “the court went over and above what it was re­quired and granted or­ders not sought by the ap­pli­cant” as well as that it in­tended ap­peal­ing.

Spokesper­son for SA Ex­press Mpho Ma­jat­ladi yes­ter­day de­clined to com­ment on the Bag­port mat­ter, say­ing it was sub ju­dice.

Agree­ment was signed un­der du­bi­ous cir­cum­stances

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