Phala Phala panel report: Court questions evidence that Ramaphosa engaged in paid work

The definitions of “paid work” and “remuneration” were at the heart of arguments between African Transformation Movement (ATM) legal representative, Advocate Kessler Perumalsamy, and Western Cape Judge President Nolwazi Mabindla-Boqwana and Judges Mark Sher and Ncumisa Mayosi.

On Thursday, the Western Cape High Court judges sat through the second day of the arguments in President Cyril Ramaphosa’s review application of the Section 89 Independent Panel report on the Phala Phala burglary in February 2020.

In November 2022, an independent panel appointed by then-National Assembly Speaker Nosiviwe Mapisa-Nqakula found that there was “prima facie” evidence that Ramaphosa may have violated sections 96(2)(a) of the Constitution and 34(1) of the Prevention and Combating of Corrupt Activities Act (PRECCA), with the aim of keeping the investigation of the burglary private.

On Wednesday, Ramaphosa’s legal representative, Advocate Wim Trengove SC, argued that the panel did not consider the entirety of the president’s responses before coming to the conclusion that he had a case to answer.

He also argued that the panel exceeded its mandate by investigating or considering matters outside the four charges against Ramaphosa, and that it misconceived its mandate because it applied the wrong test. This is a debate about “prima facie” and “sufficient evidence”.

‘Paid work’ and ‘remuneration’

The first charge the president must answer to is whether he is guilty of serious misconduct because he did other paid work in contravention of the Constitution.

The second is whether he failed to comply with section 34 of PRECCA, the third is whether he committed serious misconduct because he exposed himself to risk of conflict between his private interests and his official responsibilities, and the fourth is whether he is guilty of serious misconduct because he gave an unlawful instruction to Major-General Wally Rhoode regarding the investigation of the theft.

Advocate Perumalsamy argued that there was a link between the foreign currency found at Ramaphosa’s farm and Ramaphosa’s engagement in other paid work.

“The source of the currency is directly relevant to whether the president did other paid work. Here’s the sum of money; that money must be accounted for. The president says, ‘I don’t do paid work, I don’t contravene section 96-2a’,” argued Advocate Perumalsamy.

“To know where the money comes from is important to assessing whether the president engaged in the act of other paid work. The source of the foreign currency is also relevant to charges 3 and 4.”

Where is the evidence?

Judge Mark Sher asked Perumalsamy to point him to the evidence suggesting that Ramaphosa handled the transaction himself.

“Is there any evidence, anyway, that the transaction which is alleged to have taken place was a personal transaction, and that the money which is referred to in relation to that transaction was in fact payment for work done?” asked Sher.

“Is there any evidence in that regard, even by way of suggestion? I’m not aware of anything like that. It was a transaction allegedly done between a Mr [Sylvester] Ndlovu, who was the lodge manager, as I understand it, and Mr Hazim. There is no suggestion that the president knew about Mr Hazim coming to the farm, as peculiar as it was, the fact that it occurred on Christmas Day.

“Because any transaction on the charge as it was put up, any transaction that was done by that farm, even if it was for one buffalo and no foreign currency was involved, any such transaction would constitute paid work.”

The court heard that the basis for this charge was Ramaphosa’s speech at an ANC event where he said: “I’m a farmer, I trade in animals.”

Ramaphosa’s ‘involvement’

Advocate Perumalsamy argued that the president’s involvement in the transaction is what led to the charge of other paid work. The involvement includes Ramaphosa’s alleged instructions to Ndlovu on handling the money.

“He said to Mr Ndlovu, ‘ Wait until Mr [Hendrik] Von Wiellgh is back before we determine how the money should be handled, the banking of the money. He said, ‘Wait until Mr Von Wiellgh returns from his leave before the money is processed’,” argued Perumalsamy.

“The panel says the nature of the discussion that the president had with Mr Von Wiellgh shows that the president is indeed actively involved in the running of the farm. He has first-hand knowledge of which buffalo were substandard. Those were the buffalo that were sold. He has knowledge of those buffalo being a drain on the farm. He even informed Mr Von Wiellgh that he knew of potential buyers from the Middle East and other African countries.

“On the president’s version, he is the one who instructed Mr Ndlovu to keep the money on the farm until the general manager, Mr Von Wiellgh, returned to work. After the alleged sale of buffalo to Mr Hazim, Mr. Ndlovu told Mr Hazim that he would report the sale to the president.

“The fact that the president clears sales transactions, can give instructions on how to manage cash sales, and discusses potential buyers, suggests strongly that he oversees operations in the business.”

‘Good faith’

However, Judge President Nolwazi Mabindla-Boqwana raised another argument of “good faith” that the president had previously advanced.

“If the president says, well, even if I’m wrong in my interpretation of what paid work is, but my conduct was in good faith, or my interpretation is in good faith, would that not be a sufficient, at least, proposition named on his behalf?” asked Mabindla-Boqwana.

Perumalsamy conceded: “Let me say upfront that I openly accept that the panel isn’t absolutely clear on this particular issue in relation to the other paid work charge. I think the case is a lot more compelling in relation to the other charges. But we do say this, if you do have foreign currency, that is an indication that you’re doing other paid work, firstly, especially considering the version of the president that he buys and sells.”

What is work?

Responding to the argument of buying and selling as other paid work advanced by Advocate Perumalsamy, Judge Sher said the defence had not referred to any definition of work despite their reliance on it to argue that Ramaphosa engaged in other paid work.

“None of you has referred to the definition of work. What does it mean to say you’re undertaking work? Firstly, that must be shown. And then it must be shown that it’s paid,” said Sher.

“Work is a specific word used in the context of an employment relationship. It is important to note that the legislature uses the word, it’s in the constitution as well, paid work, not deriving funds from foreign currency. It doesn’t say that a president may not do, it says a president may not undertake other paid work.

“So if that is correct, what is the relevance of the fact that foreign currency came in relation to a transaction which the farm does? Does the ATM take any issue with any of the provisions that were referred to by Mr Trengove? In other words, the Executive Members Ethics Act, the Executive Members Code, is there any issue with that?”

“No. We don’t take any issue with that,” responded Advocate Perumalsamy.

“So, to cut to the chase, if you don’t take issue with any of those provisions and they allow a president to have financial interests and to hold an interest in a closed corporation which trades, what is the basis of the finding that the president concluded or did paid work by the fact that there was some transaction on Christmas Day involving foreign currency under dubious circumstances on Christmas Day? What is the relevance of that in relation to the charge?”

‘Different angle’

Advocate Perumalsamy said the panel did consider the meaning of paid work, but not in the context of employer-employee relationships. He said the panel considered the president’s obligation not to be distracted from his office, and any work for financial gain would do exactly that.

“They [panel] define these words to mean any business carried out or service rendered for gain or personal benefit by an employee outside of his or her employment in the relevant department for which remuneration is received. The word business is defined, and so on, and then we see no warrant in limiting paid work to employment,” argued Perumalsamy.

‘What did the panel consider?’

Judge Ncumisa Mayosi asked Perumalsamy to explain what process the panel undertook to come to the charge of other paid work. Ramaphosa has previously argued that the panel did not consider all his submissions.

“I’m more interested in how the panel then assessed or dealt with what was before it in relation to this charge. What it had before it was the motion, the additional submissions from the members of the NA to the extent that they supplemented the evidence in relation to this charge and what it had before it, of course, was the president’s response,” said Judge Mayosi.

“In his response, the president said compliance with the Executive Members Ethics Act and the code is compliance with Section 96.1. So in other words, if I comply with those provisions, I’ve complied with Section 96.1.

“And he then sets out in his response in detail the provisions of the Executive Ethics Act, the provisions of the code that he’s relying on, one.

“Two, he also then sets out in detail how he divested himself from his various interests in order to avoid conflicts. Because one of the other parts of this charge says that he misled the public in 2014 when he said blind trust.

“The panel then decides this charge, based on its definition of paid work. Secondly, the panel decides this charge based on the 2019 discussion with Mr Von Wiellgh regarding what to do with what.

“Consider those two issues: the discussion in 2019 with Von Wiellgh and its interpretation of paid work. It does not appear to me to have assessed the president’s version unless I’m wrong. Where did that assessment take place in relation to this charge of exculpatory?”

Different interpretations?

Advocate Perumalsamy said the panel did interpret the words ‘other paid work’ and applied them to the president’s alleged involvement in the farm operations.

“The panel does an exercise, and it interprets words to mean a particular thing. We may disagree with that interpretation, but it is its interpretation of what other paid work means. It then applies that interpretation to the facts and the facts are, as it understood it, that the president is actively involved in the affairs of the farm. The panel mentions all those facts: buyers and sales, animals, is aware of the buffalo that’s substandard, gives instructions about how the money should be handled and so on. It did consider those facts.

“It [the panel] started off by looking at the statement in Limpopo where the president says ‘I buy and sell’. Then it went on to give meaning to the words other paid work.

“It then says I have to do a contextual interpretation of what those words mean. It says, in my understanding of what those words mean, you shouldn’t be distracted from your responsibilities. So even if you’re not, this isn’t an employment relationship; if you are actively involved in business operations that generate income, we consider that to be paid work. We might have a different interpretation and apply the facts differently. We might consider those facts differently. But there was certainly a rational connection between the evidence that the panel had, in particular the evidence of the president.”