uMngeni finance chief quizzed at inquiry

2011-02-01 00:00

SENIOR counsel for city law firm Venn, Nemeth and Hart (VNH) began cross-examination yesterday at the start of the year’s first sitting of the commission of inquiry into the affairs of uMngeni Municipality.

The law firm came under the spotlight in November when Democratic Alliance councillor Tim Lindsay-White asked the commission to investigate an alleged conflict of interest in the relationship between VNH and the municipality.

Evidence had been led that the law firm wears several hats — it is the municipality’s debt collector, its partners are property developers in the area; it is allegedly one of its major debtors as well as being the municipality’s main source of legal advice.

First in the stand was uMngeni Municipality’s chief financial officer (CFO) Bertus van der Merwe. under cross-examination by Gerhard Roberts SC he denied an inappropriate relationship exists with VNH.

He offered explanations countering the allegations made by Lindsay-White.

Van der Merwe said the appointment of the firm as debt collector is above board and done through a tender process.

He agreed with Roberts that there was nothing wrong with the firm charging 17% commission because it carried the risk and the municipality paid no legal fees, apart from such disbursements as the sheriff’s fee.

He also agreed this was a better deal than they had got from other law firms. Van der Merwe said he had never seen a firm so dedicated to debt collection.

Roberts asked: “And with terms so beneficial to the municipality?”

“Yes,” said the CFO.

Van der Merwe also agreed that property developer Guy Smith, a senior partner with VNH, had written to the municipality and raised in person various discrepancies that developers felt needed to be ironed out over the payment of rates.

Roberts pointed out that it is not a secret that Smith was a developer of the Garlington and Gowrie Estates and that delays in payment of rates could not be attributed to any dealings on the part of VNH.

Van der Merwe said it was a backlog at the Deeds Office and administrative problems within the municipality that were the reasons for delays in rates payments at Garlington and Gowrie.

Evidence was also presented that once all problems on the subdivisions of the estates and the registration of the properties were sorted out then rates were payable retrospectively. So the municipality was not losing out.

Roberts pointed out that the municipality sought the opinion of VNH senior partner Matthew Francis because he is an expert on public law. He demonstrated that several opinions offered to the municipality by Francis were upheld by higher courts.

He said the opinions were in favour of the municipality getting more rates revenue rather than losing revenue.

Join the conversation! encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.

We reserve editorial discretion to decide what will be published.
Read our comments policy for guidelines on contributions. publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Inside News24

Traffic Alerts
There are new stories on the homepage. Click here to see them.


Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.

Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire network.


Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.

Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.