Round two of the legal battle between Old Mutual and on-again-off-again CEO Peter Moyo will be heard in the Gauteng High Court in Johannesburg on Friday as both sides refuse to back down from the feud that has roiled the company’s share price and caused investor concern over uncertainty.
The matter is expected to be heard at 09:00.
Moyo will ask the court to declare Old Mutual’s board, including chairperson Trevor Manuel, in contempt of court for failing to re-instate him in late July. This, after Judge Brian Mashile ruled he should immediately return to work, pending Part B of his application in which he will litigate damages against the JSE-listed insurer and argue that all the non-executive directors should be declared delinquent under the Companies Act.
The financial services giant suspended Moyo in May and axed him in June citing a conflict of interest and an alleged breakdown of trust. Moyo, with over four years left on his contract challenged the dismissal and argued he was being victimised by Manuel and no disciplinary hearing had taken place prior to his dismissal. The company immediately gave notice to appeal the ruling and according to their interpretation, this suspended the order for Moyo to be re-instated.
However, Moyo’s legal team maintains Judge Mashile handed down an interim order and this cannot be suspended by notice to appeal.
Urgent declaratory order
Old Mutual will ask the court on Friday to grant an urgent declaratory order to either find Judge Mashile's ruling as final or suspend the implementation of his directives citing "exceptional circumstances".
They will also file leave to appeal the ruling. In an affidavit filed on August 1, Old Mutual’s head of legal Craig Mcleod said the company could not continue to risk its stability over a dispute with a single employee and “this amounts to exceptional circumstances and shows the applicants will suffer irrevocable prejudice if Mashile's orders are executed”.
Meanwhile Moyo wants the board to within 30 days say why they should not be jailed for six months for disregarding a court order, according to his legal documents filed August 12. He will further argue against granting the company leave to appeal.
Meanwhile two settlement agreements to end the corporate warfare have failed. Judge Mashile tried to have the parties negotiate an agreement in his chambers when they first appeared on July 18. An offer by Moyo’s legal team on August 5 to resolve the impasse was also rejected by Old Mutual. The share price has taken a knock and is down 14.8% since May 24 when Moyo was suspended, amid difficult trading conditions on the JSE. Old Mutual changed hands at R17.88 at 17:00 on Thursday. Moyo in his court papers estimated that R10bn-R15bn had been wiped off shareholder value so far and called it “beyond crisis proportions”.