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High Court reserves judgment in Gupta-Gordhan bank case

2017-03-29 10:02

Judgment in Finance Minister Pravin Gordhan's application to get legal protection from intervening in the bank closure of the Gupta's bank accounts has been reserved.

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Last Updated at 07:25
29 Mar 16:35

High Court reserves judgment in Gupta-Gordhan case

Judge President of the Gauteng Division of the High Court Dunstan Mlambo has reserved judgment in the case. 

He first joked, saying: "I am ready to hand down a judgement, ..... but my two judges are not ready."

The court room laughed, before he declared the judgment will be reserved.

Thus ends the two-day hearing.


29 Mar 16:33

Gauntlett: Gupta attorneys were in 'pursuit of scurrilous allegations' against Gordhan

Finance Minister Pravin Gordhan’s advocate Jeremy Gauntlett accused Oakbay and Sahara of going on a “pursuit of scurrilous allegations” against Gordhan.

He said Oakbay accused Gordhan of conspiracy in their “clipping the wings” submission – which was struck from the hearing – while Sahara accused Gordhan of improper conduct.

He believes these arguments deviate from the main argument, about Gordhan’s request to seek legal protection from intervening with banks over the Guptas’ bank closure.


29 Mar 15:58

Sahara was evasive and abused court with unfounded allegation - Gordhan lawyer

Gupta-owned Sahara accused of being evasive, abusing court Finance Minister Pravin Gordhan’s advocate Jeremy Gauntlett accused Sahara of being evasive and said its “abuse of argument” should not be allowed.

Its allegations of Gordhan having an ulterior motive needed facts, which he said it did not provide.

In addition, Sahara “disregarded the strike out to say ... the minister behaved in a scurrilous way”.

The High Court struck out Oakbay’s contention that Gordhan had told business leaders at meeting in February 2016 to “clip the wings” of the Guptas.

“There is no factual foundation for the propositions that are very serious,” he said. “The claim that Gordhan is abusing his office would require facts.”

Sahara recently changed lawyers from its Oakbay lawyers and then brought forward a separate heads of argument that has been highly criticised.

“The stance adopted by the majority of the Oakbay was the responsible one,” Gauntlett said.

With regard to Oakbay’s “division of power” issue, Gauntlett said this argument is “a horse devoid of legs”.

“It is so obvious that the courts will discharge without fear or favour,” he said. “Who else does one go to.”


29 Mar 15:21

Sahara: Court shouldn’t be used as Gordhan’s political battleground  

Sahara advocate AR Bhana argued that the High Court should not be used as a political battleground by Finance Minister Pravin Gordhan.

He was responding to a question by Judge Lebogang Modiba, who asked him why getting clarity on whether executives could intervene citizens against banking decisions.

“There is an indication that there is need for certainty regarding in law if the executive may or may not intervene in these matters,” he said.

“On one hand, you have a minister (Gordhan) who knows the law doesn’t allow him to intervene,” she said.  “On the other, there is evidence of a different interpretation by the conduct of certain members of inter-ministerial committee (ie, Mines Minister Mosebenzi Zwane).”

Bhana responded, saying getting this certainty will “open up a can of worms”.

“It doesn’t justify it,” he said. “He cannot use this as backdoor to achieve support for his position.” “Even if there is uncertainty, it’s not the basis for Gordhan’s application.”


29 Mar 15:11

Sahara argues that there was not dispute with Gordhan  

Sahara advocate AR Bhana doesn’t want the court to rule in favour of Finance Minister Pravin Gordhan’s declaratory order to seek relief from intervening on the Guptas’ behalf in their bank closures.  

He said “this matter will create a bad precedent, where there is no live dispute and where there is a moot point”.  

“The court is being urged to give endorsement of what was always clear in his (Gordhan’s) mind. It encourages parties to come to court to get endorsements going forward.”  

Gordhan (see below) believes there was a dispute. His legal team – as well as that of the banks – believe a ruling on this will ensure everyone knows the rules going forward.          


29 Mar 14:51

Gordhan used office to wage warfare against Guptas - Sahara

Addressing a full bench in the Pretoria High Court on Wednesday, Sahara advocate AR Bhana says Finance Minister Pravin Gordhan used his state resources to continue his warfare against the Guptas.

"It is not one which his office should be advancing," he said.  

“This application was used to insert matters that were irrelevant,” he said. “We are here because the minister had something else in mind.”  

Judge President of the Gauteng Division of the High Court Dunstan Mlambo asked to see the facts for these allegations.  

Bhana pointed to various submissions it made in its heads of argument.


29 Mar 14:35

Regarding the matter of a legal dispute, this is what Gordhan’s heads of argument reads:  

The essential facts are set out in the Minister’s founding affidavit, and are not the subject-matter of any bona fide dispute. Indeed, the founding affidavit has not even been traversed in either of the two substantial affidavits filed on behalf of the Oakbay respondents.  

It is therefore common cause that there has indeed been “a dispute relating to powers of intervention by Government in relations to the closing of private clients’ accounts by registered banks.” (Oakbay merely asserts that it has conceded the correct legal position.)  

The circumstances in which this dispute has arisen, it is likewise common cause, “have considerable importance for the operation of the banking sector of the South African economy, and its regulation by Government.”  

It is also common cause that a controversy relating the closing of the Oakbay accounts and government intervention indeed arose.  

This controversy received both national and international attention.

In the Minister’s assessment the situation renders it “clearly in the public interest, the interest of the affected clients and the relevant banks, and the employees of both that it be authoritatively resolved”.  

This is in the context of extensive public statements by Oakbay attacking the integrity of the banks concerned, which represent a significant part of the South African banking sector, with the latter a vital organ in the national economy.


29 Mar 14:30
Sahara advocate AR Bhana claims there was no legal dispute between the minister and Oakbay by 3 November 2016. He submitted a letter on this date that shows Gordhan saw no legal dispute between the two parties.

29 Mar 14:14
Oakbay legal representative says regarding the FICA application: "I am not going to delve into the merits of that."

29 Mar 14:12
Oakbay legal representative Puckrin: Law is clear that there is not a single person in this case that does not understand the law. Therefore, we say this application is stillborn. The law is what the law is so the order is unnecessary.

29 Mar 14:10

Court proceedings resume: Oakbay legal representative continues with his argument.

Puckrin says Oakbay's point is that it's unnecessary for the court to grant the order sought by Pravin Gordhan.

Questions how Oakbay can be expected to bring this very application.


29 Mar 13:44

RECAP of the morning's proceedings:

Gordhan’s legal team, as well as the banks, have argued that the matter must be determined to provide clearer guidelines for banks and regulatory bodies.  

Reserve Bank advocate Wim Trengove said the governor would like to see the court rule on the matter to bring greater certainty and clarity of political interference for this minister and the next.

Advocate Vincent Maleka on behalf of Standard Bank argued that Gordhan’s declaratory order should be vertically extended to include the cabinet ministers from intervening in banking matters and that there is no reason to confine relief to the minister himself, but it should extend to any act by a minister to intervene in banking matters.

Absa argued on Wednesday that it is important for the court to rule on Gordhan’s declaratory order regarding Gupta-owned companies for legal clarity going forward. The full bench has been questioning why a declaratory order is even required, and why Gordhan didn’t simply apply for an interdict.  

Nedbank said that, as Oakbay conceded that Gordhan had no legal right to intervene on behalf of the company, the question arises as to why they pushed the minister so hard to act unlawfully. Nedbank advocate Alfred Cockrell said the relief the minister seeks is not that Oakbay wrote unlawfully to the minister, the order is to say he has no power with relation to what they are asking. Nedbank said it supports the minister’s relief and said he was entitled to accept such relief as there was a dispute.

FNB advocate AE Bham said by asking Gordhan to pay costs, Oakbay is not taking responsibility regarding their correspondence with the minister, he put forward to the court. “They are trying to deflect from their conduct, by saying the minister was weak kneed and that it is not a problem to lobby – rings hollow or is unstable in the matter to pronounce against minister,” said Bham.  

Oakbay reacted to calls from Gordhan's counsel Jeremy Gauntlett to withdraw from the application hearing by issuing a statement saying it has suffered unjustified and severe reputational damage as a result of the Minister’s application and will continue to argue in court for this unnecessary application, "which is a waste of taxpayers’ money and the court’s time, to be dismissed. As the architect of the application and the campaign to smear Oakbay, if anyone is to withdraw it should be the Minister".


29 Mar 13:27

Finance Minister Pravin Gordhan talking to the press shortly after Ahmed Kathrada was laid to rest:

"The ANC always spoke about working as a team. We have responsibility to steer this country in the right way and we are also the hope of the African continent.  

"You deal with matters in a professional way - you do the best you can, remembering always we are here to serve the public and the national good and if my services are not required anymore then it will be the closing of one chapter and the start of another.

"One has to remain contented. We must just be good activists. We are not perfect human beings. We draw on this generation for our encouragement."


29 Mar 13:03
Court adjourns.

29 Mar 13:03

29 Mar 13:02

Oakbay counsel: There is no present pressure on Gordhan to intervene.

Judge (to Oakbay legal representative): I understand my role as a court to pronounce on the law and in doing that I will look dealing with a minister who in terms of the constitution has certain parameters in which to act. But you say I should not pronounce on Gordhan's request.


29 Mar 12:56

29 Mar 12:54
In markets news, rand spiking to R13.13/$.

29 Mar 12:51

29 Mar 12:50

Oakbay legal representative: The declaratoy order has to mean something and not just be a dead letter, which it is in our opinion.

My question is: what is the actual effect of this order or is it purely hypothetical?


29 Mar 12:47
Puckrin arguing on technical grounds: If in 5 years, for instance, our client opened a bank account - it would be impermissible by law - presuming the law remains the same - but the order would not bind those parties. Therefore, impermissible by law, but not impermissible in terms of this order.  

29 Mar 12:46

Puckrin climbing into Gordhan, says Gordhan has "short-changed" himself.

Says Gordhan has wasted the court's time with an "idle" application that was based on a matter of settled law.


29 Mar 12:42

Gupta counsel C Puckrin arguing that Pravin Gordhan did not give Gupta companies notice that he intended to seek the declaratory order for him not to get involved in the dispute with the banks.

He tells the judge his clients accept that it would be inadmissible to Gordhan to interfere.


29 Mar 12:39

The rand remains fairly positive in what seems to be the calm before the storm.

Currently trading at R13.10/$.


29 Mar 12:35

Standing ovation for Pravin Gordhan at Ahmed Kathrada's funeral:

Neeshan Balton from the Ahmed Kathrada Foundation, speaking at the funeral of the late ANC veteran, related Kathrada's sentiments on Pravin Gordhan's court case:

"When Pravin Gordhan was to appear in court, uncle Kathy said to us: 'I want to be the first one there to accompany him to court.' 

He then asks Gordhan to stand, which he does briefly.

"Irrespective of whether you are a minister or not in the days and weeks to come, you remain true to the values and principles that Ahmed Kathrada would be proud of."


29 Mar 12:18

Oakbay lobbied Gordhan to act unlawfully - FNB

FNB advocate AE Bham said Oakbay said Finance Minister Pravin Gordhan was weak kneed in not intervening on their behalf.

“They lobbied the minister to act in a way he was not able to act.”

By asking Gordhan to pay costs, Oakbay is not taking responsibility regarding their correspondence with the minister, he put forward to the court.

“When they oppose the application, they say that relief is academic. But they undermine their position, by attacking the minister for being weak kneed.”

“They are trying to deflect from their conduct, by saying the minister was weak kneed and that it is not a problem to lobby – rings hollow or is unstable in the matter to pronounce against minister.”  


29 Mar 12:14
Keeping it short, SA Reserve Bank advocate Wim Trengove said the governor would like to see the court rule on the matter to bring greater certainty and clarity of political interference for this minister and the next.

29 Mar 12:12

Oakbay pushed Gordhan to act unlawfully – Nedbank  

As Gupta-owned Oakbay conceded that Finance Minister Pravin Gordhan had no legal right to intervene on behalf of the company, the question arises as to why they pushed the minister so hard to act unlawfully.  

That is the question Nedbank advocate Alfred Cockrell asked the North Gauteng High Court on Tuesday.

“The relief the minister seeks is not that Oakbay wrote unlawfully to the minister, the order is to say he has no power with relation to what they are asking,” he submitted.

“Writing a letter is not unlawful. That is not the question. The question is about whether the minister had the power to do what he was being asked to do,” he said. “It was a curious position adopted by Oakbay in the case.”

“Oakbay accepted that relief sought by the minister is correct. They accept the minister has no power to intervene and has no duty to intervene.”

He said the conundrum for Oakbay with this concession is that if they were not asking him to do this, what were they asking him to do? He cited two themes in possible answers to this:

That they were not asking minister to exercise legal power but to exercise extra-legal power; the other was that they were asking the minister to amend the law going forward.

Regarding the first one, he said “the minister had no extra-legal power to contact the banks to reconsider their decision to close the bank accounts. The minister of state always wears his cap as minister of state – he could not contact (CEO) Mr Brown at Nedbank not as minister of finance to ask you to consider the accounts. The minister could not have made such a phone call. He is circumscribed by the law within which he operates.”

Regarding the second, he said that Oakbay might have been “asking him to change the law to give him the power going forward”.

“This would take a considerable period of time and the minister would have to draft a bill. It couldn’t happen in few weeks Oakbay referred to in the letter to save jobs.”

As such, he said “there is not logical room for Oakbay to manoeuvre to explain their efforts when they conceded that the minister can’t intervene”.

“How do they explain the letters they wrote to the minister? They were asking him to exercise powers they accept now to be unlawful. All of the pieces of the declaratory order for the case falls into place.”

Nedbank said it supports the minister’s relief and said he was entitled to accept such relief as there was a dispute.


29 Mar 11:24

Gupta ruling crucial to set rules for future cases - Absa

Absa bank argued in the North Gauteng High Court on Wednesday that it is important for the court to rule on Finance Minster Pravin Gordhan’s declaratory order regarding Gupta-owned companies for legal clarity going forward.

The full bench has been questioning why a declaratory order is even required, and why Gordhan didn’t simply apply for an interdict.

Gordhan’s legal team, as well as the banks, have argued that the matter must be determined to provide clearer guidelines for banks and regulatory bodies.

Absa advocate David Unterhalter argued that there are further interests at stake in this relief. “There is an important demarcation where public power ends and where private decisions are made,” he argued.

“Drawing that line is fundamentally important to the minister and to the regulators and banks, who are subject the public powers.

“They need to know what realm they are subject to with regard to private and public laws.

“The banks and regulators need to know for the future where that line of demarcation takes place.

“It is important for people who take power in future (ie, new finance minister) and for banks to make decisions in future.

“It’s not just about how the Oakbay matter came to the appreciation of the minister. It’s about the integrity of the banking system.”

Citing Sahara’s application on Monday concerning the separation of powers, he said there is a boundary between executive power and private power.

“That’s where the courts are there to referee and pronounce upon,” he said. “It does not interfere with decision making of minister.

“He (Gordhan) brought this here to ensure he has clarity on the matter for now and future.”

Unterhalter accused Oakbay of contradictory statements with regards to their submission that they have no contention with the relief Gordhan seeks, but that it should be thrown out of court.

“They are not observing strictures of the law that they claim to accept,” he said. “It is important that the court pronounce on this matter,” he said. “It will discipline how people act in the future.”


29 Mar 11:00

Zuma court move in Gupta matter fails

On Tuesday, President Jacob Zuma’s legal representatives declined to join proceedings in the matter between Finance Minister Pravin Gordhan and Gupta-owned Oakbay Investments.

On Monday Zuma entered the case, but the full bench of the North Gauteng High Court didn’t quite understand why he had entered as an interested party.

Zuma’s court intervention, which is being tackled by state attorney counsel M Chaskalson, is with regards to Standard Bank’s extended declaratory order against Zuma and all members of the Cabinet, which it included in its responding affidavit.

The state attorney said Zuma was added to Standard Bank’s responding affidavit “in circumstances where the president and no members of the Cabinet other than the minister of finance are parties to the proceedings”.

Surprised, Judge President of the Gauteng Division of the High Court Dunstan Mlambo wanted to know why Zuma’s team was even at court, remarking that they are not respondents in the case.


29 Mar 10:56

29 Mar 10:41

Meanwhile, EFF leader Julius Malema claims Finance Minister Pravin Gordhan and his deputy Mcebisi Jonas will be fired by President Jacob Zuma after the funeral of struggle stalwart Ahmed Kathrada on Wednesday.


29 Mar 10:39

Where Standard Bank move comes from

Standard Bank is seeking an extended declaratory order following Mines Minister Mosebenzi Zwane's release of a cabinet determination (which was later retracted, as this Cabinet had not approved it), which recommended starting a banking inquiry after the inter-ministerial committee met with Standard Bank and other banks over the Guptas' closed bank accounts. 

“Evidence presented to the IMC (inter-ministerial committee) indicated that all of the actions taken by the banks and financial institutions were as a result of innuendo and potentially reckless media statements, and as a South African company, Oakbay had very little recourse to the law," said Zwane.

READ THE FULL STORY FROM SEPTEMBER 2016 ...


29 Mar 10:33

What Gordhan wants

The basis of this court case is that Finance Minister Pravin Gordhan is seeking the following from the court:

"This is an application for declaratory relief arising from a dispute relating to powers of intervention by Government in relation to the closing of private clients' accounts by registered banks.

"This dispute has arisen in circumstances which have considerable importance for the operation of the banking sector of the South African economy, and its regulation by Government.

"The related controversy has received both national and international attention, and it is clearly in the public interest, the interest of the affected clients and relevant banks, and employees of both that it be authoritatively resolved."

- From Gordhan's founding affidavit.


29 Mar 10:21

RECAP: Finance Minister Pravin Gordhan made an unexpected stop at the Pretoria High Court, where lawyers were locked in debate after Gupta-owned Oakbay and Treasury could not make a deal.


29 Mar 10:20

Standard Bank wants court to prevent ministers from intervening

Standard Bank is arguing that Finance Minister Pravin Gordhan’s declaratory order should be vertically extended to include the cabinet ministers from intervening in banking matters.

“There is no reason to confine relief to the minister himself,” argued advocate Vincent Maleka.

“It should extend to any act by a minister to intervene in banking matters."

Judge President of the Gauteng Division of the High Court Dunstan Mlambo wanted to know why Standard Bank can’t simply get an interdict on an ad hoc basis or bring a new application to court.  

Maleka argued that the court should simply extend Gordhan’s relief. “We support the minister’s relief, but seek to vertically extend it,” he said.

He argued that an extended declaratory order would “resolve the issue once and for all”.

“We know there are a number of ministers who on record have called upon Standard Bank to account,” he argued. “The bank has recorded meetings with the inter-ministerial committee.”  

Explaining how Oakbay has acted against the bank, Maleka said Oakbay Group “has avoided the resolution of the despute through court proceedings”.  

“We have articulated a public campaign against Standard Bank to undermine the legitimacy of this decision.  

“Oakbay have argued that the banks have acted anti-competitively and in a collusive manner,” he said. “If you say this, then the only institution who can resolve this by law is the Competition authorities.  

“Oakbay has not approached the Competition authorities to do this,” he said.  


29 Mar 10:05

29 Mar 10:03

Meanwhile Oakbay has just released this press statement:

Ronica Ragavan, Acting CEO of Oakbay Investments, responds to calls from Jeremy Gauntlett, the Finance Minister’s lawyer, for Oakbay to withdraw from the application hearing: 

“Oakbay Investments has suffered unjustified and severe reputational damage as a result of the Minister’s application. His inclusion of the FIC report and Deputy Minister Jonas’ affidavit, which were both struck off yesterday, clearly demonstrate the motives that sit behind the application. 

“We will continue to argue in court for this unnecessary application, which is a waste of taxpayers’ money and the court’s time, to be dismissed. As the architect of the application and the campaign to smear Oakbay, if anyone is to withdraw it should be the Minister.”


29 Mar 10:01
Advocate Vincent Maleka - on behalf of Standard Bank - has started his arguments in court. 

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