The municipal manager and executive mayor of Groot Kei Municipality in the Eastern Cape were sentenced to 30 days in prison for failing to provide information dating back to 2007 to the Municipal Workers Retirement Fund, as required by a court order.
In a judgment handed down on 22 August by the High Court: Eastern Cape Division – Makhanda, Groot Kei Municipality, along with its municipal manager, Lawrence Mambila, and executive mayor, Ngensisile Tekile, were found in contempt of court for defying a prior court order. The order required the municipality to provide information dating back to 2007, including the identity of the pension fund receiving contributions, the name and address of the employer or pay-point making the deductions, and the contact details of the responsible person at the “employer”.
Mambila and Tekile were sentenced to 30 days imprisonment, suspended for 30 court days on condition of compliance with the previous order. The sheriff and police were authorised to enforce the imprisonment if the condition was not met.
In delivering judgment, Acting Judge BB Brody said there was no doubt that once the lists are received by the fund, substantial sums will be due by the municipality to the fund for non-compliance.
“The municipality, by ignoring the previous court orders, has led to a conflict between itself and the fund which will have consequences for all members of the fund throughout South Africa,” said Judge Brody.
What went before
The ongoing saga between the municipality and the fund dates back to 2007 and reflects a pattern of non-compliance. The fund first sought judicial intervention in 2019, filing an application to compel the municipality to provide crucial pension fund information from as far back as January 2007. Despite a court order issued on 5 February 2019, the municipality failed to act, prompting a contempt of court application on 16 April 2019. The court found both the municipality and its municipal manager in contempt, sentencing the manager to 30 days in prison, suspended for 20 court days, contingent on compliance with the order.
Even with the sheriff’s authority to enforce the order, the municipality ignored it. A writ for the imprisonment of municipal manager Olwethu Kwababaana was issued, but his resignation rendered enforcement impossible.
Protracted correspondence between the fund and the municipality from August 2019 to February 2022 yielded no results, as the municipality continued to withhold the legally required information.
On 13 September 2022, a further court order imposed personal liability on the municipality and its officials, demanding compliance and awarding costs on an attorney-client scale. Yet again, the municipality failed to furnish any information, leading to the current contempt application brought on 7 August 2023.
The municipality claimed that documents were destroyed in a fire in May 2018, but this defence was only raised in the current application, not in previous proceedings.
The fund argued that the required information – which should have been provided monthly since 2007 – was not extensive and could (regardless of a fire or not) be reconstructed or obtained electronically.
The municipality’s defence included claims of attempting to settle out of court and providing some documentation through their legal representative. However, the fund challenged the veracity of these claims. The fund noted that the municipality had years to furnish the required information but elected to do nothing.
The broader implications of non-compliance for fund members
The High Court condemned the municipality and its officials for contempt of court, emphasising their repeated disregard for legal obligations under the Pension Funds Act. The municipality’s liability was established under section 13A(2), and the personal liability of Mambila and Tekile was based on sections 13A(8)(c) and 13A(9)(b).
The judge highlighted that “the essence of a contempt offence lies in violating the dignity, the repute or authority of the court”, stressing the importance of upholding the rule of law and court authority.
Citing the Fakie vs CCII Systems case, the judge detailed the elements of contempt: a court order, service of the order, knowledge, non-compliance, and wilful misconduct. The fund had proven these elements, shifting the burden onto the municipality and officials to show their non-compliance was not wilful or in bad faith.
The judge noted, “In argument, it was clear that the order, and the terms thereof, were known to the respondents and there was no doubt that they had received the personal liability order,” yet they failed to provide the required information, “and in particular, the second respondent, in violation of the personal liability order”.
The court dismissed the “destroyed in fire” defence as implausible, noting it was raised only in the current proceedings and not before. The judge questioned, “that we live in a world where records are usually kept electronically and digitally,” and found no justification for why the information could not be retrieved.
Furthermore, the judge pointed out, “No document, or schedule, was put up by the respondents in this application to even suggest that the municipality, and the remaining respondents, had attempted to comply with the court order, and to furnish the fund with the required information.”
The Constitution mandates that all Organs of State, including municipalities, must adhere to judicial rulings and that non-compliance could result in a violation of the Constitution, which is the supreme law.
The judgment underscored that South Africa’s constitutional democracy demands strict adherence to the rule of law, highlighting that municipalities must respect court orders to ensure good governance.
“The failure to comply can lead to mismanagement, inefficiency, and a loss of public trust,” the judge said.
