PRASA chairperson links to State Capture

Board Chairperson Judge Makhubele conspired with Siyaya lawyers

#UniteBehind calls for Judge Makhubele to be removed from the PRASA board immediately.

When the Board of a state-owned entity, unlawfully led by a Judge, and with the support of Executive Management facilitates unlawful payments to the companies of a person who is known to be corrupt, against the advice of their Legal and Finance departments, and in open defiance of a court challenge to their authority, then the Minister responsible together with Treasury must act. So must the South African Police Service and the Judicial Services Commission. This is not a fictional story. Every day, people die on our trains because of this corruption, state capture and maladministration at the Passenger Rail Agency of South Africa (PRASA).

#UniteBehind is preparing further urgent legal action against the Interim Board of PRASA led by Justice T.A.N. Makhubele, Natalie Skeepers, Professor John Maluleke, Magdalen Reddy and Xolile George, for conspiring to pay Siyaya Rail Infrastructure Solutions and Technology and Siyaya DB Consulting Engineers (in liquidation). Today, we learned that at least R56m of PRASA money in a Standard Bank account has been attached by the Sheriff and paid over to attorneys appointed by Siyaya.

Secret Settlement with Siyaya:

Together with Acting Group CEO Cromet Molepo, the Interim Board allowed about R56m to be transferred from their banks and attached by the Sheriff. Justice Makhubele initiated a secret settlement with the Siyaya Group and their legal representatives process by deliberately excluding PRASA’s Legal Department from about mid-December 2017. She made offers to the Siyaya Group in defiance of Court proceedings in the Western Cape High Court which challenges both the Interim Board’s appointment and the 1 December 2017 resolution that purported to give her power to appoint lawyers and facilitate unlawful payments, and to obstruct anti-corruption investigations and court matters.

PRASA lied to the Western Cape High Court:

#UniteBehind and Equal Education launched an urgent application against the Minister of Transport and PRASA on 22 December 2017 questioning the authority of the interim Board and its resolution of 1 December 2017 which suspended its Legal Panel central to anti-corruption activities. PRASA executives lied about the status of the Board’s resolution and then supplemented their lie with the “truth” in an affidavit in order to facilitate exit looting. Since 8 February 2018, Justice Makhubele, the PRASA Interim Board of Control and company secretary Lindekhaya Zide were warned by #UniteBehind that their attempts to pay the Siyaya Group under the guise of an arbitration settlement order would be illegal. Then Acting-Chief Financial Officer, Yvonne Page (who has since resigned) refused to pay the “settlement agreement” with Siyaya and we imagined all would be fine. Justice Makhubele, her Board and Cromet Molepo were advised of their unlawful actions by the PRASA Group’s Legal Department on many occasions.

Justice Makhubele’s legal advice says PRASA Board decisions unlawful:

After #UniteBehind wrote to the President, Chief Justice, the Speaker of Parliament and the Judicial Services Commission (among others) to alert them to breaches of the separation of power by having an appointed judge serve on the PRASA Board, Justice Makhubele sought legal advice from ENSafrica. Since 28 February 2018, Justice Makhubele and the PRASA Interim Board have known that all their decisions taken between 19 October 2017 and 4 February 2018 have been unlawful.

  • We understand for the period 19 October to 4 February 2018, there was no representative of the Department of Finance Based (National Treasury) appointed to the Interim Board. In addition, we understand that the Interim Board has been making decisions based on its own rules and procedure … Based on the jurisprudence and legal principles described above, our view our view is that the defect in the composition of the Interim Board (19 October 2017 to 4 February 2018) and possibly also the Interim Boards application of its own quorum and majority voting rules, are all likely to be considered material non-compliance with the requirement of the Legal Succession Act, if challenged, affecting the validity of decisions taken by the Interim Board during the period of its tenure.
  • (Paragraph 6.7. ENSafrica Legal Advice dated 28 February 2018).

Since 28 February 2018, Justice Makhubele and members PRASA Interim Board have been aware that their resolution of 1 December 2017 was unlawful. And, there was no “if” in the legal challenge to its validity, since #UniteBehind and Equal Education have challenged its legality. As an officer of the court and a judge, Justice Makhubele ought to have informed the Western Cape High Court of the legal advice she received, and suspended any implementation of the decision. PRASA Board did nothing of the sort, instead, they hastened to facilitate the payments to Siyaya through an order of court.

Justice Makhubele conspired with Siyaya attorneys against PRASA’s lawyers

On 9 March 2018, PRASA’s attorneys opposed Siyaya’s attempt to make the settlement agreed with the consent of the arbitrator an order of court because PRASA finance had refused to pay. PRASA’s Legal Department learned of the Siyaya legal action by accident on 5 March 2018 and moved to oppose the order of court. Instead of following legal advice from PRASA attorneys, Justice Makhubele responded to the Siyaya attorneys in a text message saying: “Those attorneys [opposing the payment of R59m] have no authority. PRASA Legal Panel has been suspended since 1 December 2017.” This knowingly invokes what Justice Makhubele knew to be an unlawful resolution from her own legal advice and a resolution that is under challenge in the court’s as justification to pay Siyaya. There can be no lawful explanation of why the attorneys for Siyaya had direct access to Justice Makhubele against PRASA and the public’s interest.

Legal advice to tender her resignation: ENSafrica found that since 1 January 2018, Advocate Makhubele SC has been a judge governed by the Judicial Services Commission Act (No.4 of 1999) and the Code of Judicial Conduct issued under it. The specific legal advice given to Justice Makhubele on 28 February 2018 stated the following:

  • And, we would note, the longer the Chairperson remains a member of the Interim Board, without tendering her resignation and winding up her PRASA-related affairs, the greater the risk of a successful constitutional challenge based on the Minister’s failure to terminate the Chairperson’s position so as to avoid the possibility of violating the separation of powers principle.
  • (Paragraph 4.2.14 ENSafrica Legal Advice dated 28 February 2018)

Justice Makhubele and the PRASA Board did not see fit to inform Minister Blade Nzimande of this legal opinion which holds that unless she resigns he is legally obliged to remove her as PRASA Interim Board Chairperson. It is public knowledge that Justice Makhubele and other PRASA officials met with Minister Nzimande on 12 March 2018. She also failed to inform him that all the decisions taken by PRASA’s Interim Board between 19 October 2017 and 4 February 2018 were “materially non-compliant”, that is, unlawful.

Justice Makhubele decided to appoint ENSafrica to represent her and the Interim Board against #UniteBehind in our attempts to recover the unlawful payment of about R56m to Siyaya, despite the PRASA Legal Department having asked the Board to apply for a rescission of the Court order a week ago.

#UniteBehind calls on the Minister of Transport, Dr. BM Nzimande to:

  • – Remove Justice Makhubele as PRASA Interim Board Chairperson immediately.
  • – Remove all Interim Board members who were involved in passing the resolution of 1 December 2017 which suspended the Legal Panel involved in anti-corruption work and Board Members who were advised by ENSafrica that their decisions taken between 19 October 2017 and 4 February 2018 were unlawful.
  • – Institute charges under the Prevention and Combatting of Corrupt Activities Act and the Public Finance Management Act against the Interim Board members responsible for conspiring to pay the Siyaya Companies owned by a corrupt individual whose contracts with PRASA are unlawful.
  • – Appoint a new Board with members of integrity, skill competence and qualifications who will take their constitutional duty to provide a safe, reliable, quality rail service to all people in South Africa.

For more information contact Organiser Zukie Vuka 0813693753 or Media and Communications Officer Matthew Hirsch 0832904145