Millions claimed from Prasa without sustainable contracts

Former Prasa attorney Madimpe Mogashoa has confirmed that he received instructions from then-interim board chairperson Judge Nana Makhubele to settle claims brought against the agency by contractor Siyaya Group he told the Zondo commission, he was told to draft settlement agreements without consultation with the agencies internal legal team.

Madimpe Mogashoa represented Prasa on various legal matters, took the stand at the inquiry on Wednesday he said his firm was also involved in six matters, including the R59 million contract settlement with Siyaya.

Mogashoa detailed his involvement it proceedings and engagements with Makhubele in what resulted in Prasa being forced to settle R60m to the Siyaya group of companies.

Siyaya and Prasa had been involved in a legal dispute in 2017 where the engineering company claimed the parastatal owed it millions in unpaid fees for services rendered.

Prasa’s previous board chairperson Popo Molefe and the legal team at the time believed the agency had legal standing and was not required to pay Siyaya. Molefe was later replaced by Mokhubele in October 2017.

Prasa’s legal representatives, Martha Ngoyi and Fani Dingiswayo testified at the commission that Makhubele arrived at her new position and became preoccupied with the legal dispute between Siyaya and Prasa.

She had questions regarding Prasa’s legal motives in not settling the matter. Ngoye had complied with a report motivating why Prasa had a legal basis for not wanting to settle with Siyaya.

But besides these objections, Makhubele moved to push for a settlement. Ngoye said the legal team was sidelined. Mogashoa told the inquiry that he had met with Makhubele on two occasions in December 2017 where Prasa’s internal legal team was no present.

He said he was instructed not to consult with Prasa’s legal team regarding the legal dispute and possible settlement with Siyaya.

Mogashoa said Makhubele said the board had decided that Siyaya’s four cases with the agency had to be settled and he was asked to draft a settlement offer.

“The chairperson said given the content of the interim report, Prasa had decided that it would be in its best interest to settle the matters with the Siyaya group as we would not have enough information to sustain a defense,” he said.

The offers made by Prasa, on Makhubele’s instruction, included settlements of R17m, R15m, R8m, and R7m.

These were cases disputed between 2015 and 2016. Mogashoa said Makhubele also insisted that included in the settlement, there must be a clause on its confidentiality and no admission of liability.

A settlement between Prasa and Siyaya was reached in December 2017 through an arbitration process. However, in April 2018 the agency’s internal legal team successfully won a High Court interdict which prevented the sheriff of the court from paying over the R60m settlement.

Makhubele resigned as Prasa board chairperson in 2018. He is expected to return on 17 August to continue responding to allegations against her of interference in the Siyaya matters.

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