The high court in Pretoria on Friday rejected a bid by the Post Office to have its bank accounts released, part of a battle by a cellphone service provider to recover R50m.
“The court ruled that the application to have its bank accounts released is devoid of all merits. All their bank accounts have been attached and they remain attached since Monday and Tuesday,” said Bernard Hotz, of Werksmans Attorneys.
“The judge asked counsel for the Post Office if they could pay the R50m and counsel in open court admitted that they can’t afford to pay.”
Asked if this was an admission that the Post Office’s financial affairs were in disarray, Hotz replied: “That’s putting it mildly”.
Post Office spokesman Khulani Qoma said, however, that the company was still trading.
“Please note that our bank accounts have not been frozen at all, hence we paid our employees today,” he said in an SMS on Saturday.
Hotz is acting for Nasasa Cellular, which entered into a five-year agreement with the Post Office on 13 September 2004, for the latter to sell its cellphones and contracts at its outlets countrywide. It was hoped the collaboration would result in profits for both parties.
However, the Post Office failed to honour the agreement and cancelled it in October 2007. In December that year, several years of litigation began, with Nasasa initially claiming R1,3bn in damages.
On 15 January this year, a settlement agreement that the Post Office would pay Nasasa R50m was made an order of the high court in Pretoria. The money was to have been repaid by the end of that month. But the Post Office failed to honour this agreement.
On Thursday, the Post Office applied to the high court to stop the enforcement of a warrant of execution granted to Nasasa, pending an application for a recission of the 15 January court order. It also wanted to be able to use its bank accounts to trade and pay salaries. The accounts are held with the four major banks and the Postbank.
The sheriff of the court would now approach the banks to determine how much money was in the Post Office’s bank accounts and which properties could be attached, in a bid to get the R50m.
Qoma said the initial agreement and the settlement contravened the Public Finance Management Act and the Post Office wanted the court to make a determination on this.
“The Post Office is trading and is able to pay. For example, our employees were paid today,” he said. — News24
