Former Pamodzi liquidator loses appeal to be reinstated as court upholds his removal

About 70 former workers of Grootvlei mine near Springs wait to hear whether they can sue Aurora Empowerment Systems (Felix Dlangamandla, File )
About 70 former workers of Grootvlei mine near Springs wait to hear whether they can sue Aurora Empowerment Systems (Felix Dlangamandla, File )

The Supreme Court of Appeal has dismissed an application by Enver Mohamed Motala, who was a joint liquidator of several mining companies known as the Pamodzi Group, to be reinstated as a liquidator.

Motala, who approached the Supreme Court of Appeal, also wanted to be reinstated to the Master of the North Gauteng High Court's panel of liquidators. This was also dismissed with costs.

The panel is kept by the Master from which appointments as liquidators and trustees are made.

The Master's 2011 decision to remove Motala from the panel was a result of his "evasiveness, untruths and previous convictions", a summary of the judgment read.

The lengthy and complex saga dates back to May 2011 when the Master instituted an inquiry into the running of mines formerly belonging to Pamodzi Gold by Aurora Empowerment Systems. Aurora's directors included a grandson of former President Nelson Mandela, a nephew of former President Jacob Zuma and Michael Hulley, an attorney formerly employed by Zuma for his personal matters. Aurora was the preferred bidder for some of the mines.

"It was vital for the retention of the companies' mining rights that they continue to operate and this led to the liquidators concluding agreements with Aurora designed to enable the latter to carry on mining activities while it secured payment and completed the process of purchasing the mines.

"Unfortunately, Aurora's governance and conduct of the mines and their operations became a matter of public concern. Complaints against Aurora were many and serious. Inter alia, it was alleged that the mines were being stripped of their assets," the summary read.

The summary says that following the inquiry, the Master invoked s381 of the Companies Act to hold a formal inquiry with the liquidators, but after Motala refused to answer questions, the Master regarded this as his "failure to perform his duty satisfactorily".

Conflict of Interest

Further information then came to light where the Master received information that Motala had loaned Aurora R3m, which the Master concluded was a conflict of interest that had "helped Aurora limp along at a time when he ought rather to have considered terminating its running of the mines in the interest of creditors".

Motala was then duly removed as one of the Pamodzi liquidators.

In September of 2011, Motala sought to challenge his removal and have himself restored as liquidator, saying the decision to remove him was irrational and unreasonable. Meanwhile a newspaper article had also been published alleging that Motala ahad a number of previous convictions against him. A further inquiry was held where Motala denied these allegations.

"The fact of the matter, however, was that the appellant was indeed the person who had been convicted but under the name of Enver Mohamed Dawood, and that he had lied about this to the Master under oath," the summary read. This further led to Motala being removed from the panel of liquidators.

The Supreme Court of Appeal upheld the Master's decisions, rendering the relief Motala had sought as futile.

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