The ANC has labeled an application by an events company to have the party liquidated over an outstanding bill of R11.9-million a "publicity tactic".
A disgruntled supplier has applied to the high court to have the ANC liquidated in order to salvage millions owed to it.
A high court liquidation order against the ANC was launched by events company VWV Group on Friday, for about R11.9-million.
The R31-million total cost relates to the party's centenary celebrations in January, where the company was booked to do a show.
ANC treasurer-general Mathews Phosa blasted the company, saying that the timing of the application meant that it was politically motivated.
"To date, the ANC has paid R20-million of this money to VWV, with an outstanding amount of R11.9-million only. VWV was appointed to put together an ANC historic stage production to be showcased during the centenary celebration in January 2012. The production was subsequently cancelled when the performance was washed out by rain, long before the scheduled show," Phosa said.
"Surprisingly, VWV did not have insurance to cover such events and in spite of the company not having executed its duties on the day, the ANC has paid over two-thirds of the R20-million of the total contracted R31-million."
The ANC and VWV Group were in mediation meetings until 13 December, when the company unilaterally ended the process. Speaking to NewsFire, the company chairperson Mark Steinhobel said that they were advised that the meetings were pointless.
"There was never a dispute that money is due. There was no need for mediation, it was just a stalling tactic," he said.
"There is a lot of money outstanding and we are talking about many struggling artists here. This is absolutely unacceptable behaviour by the ANC."
'Abuse of the legal process'
The company will seek to have the High Court rule as soon as possible.
The ANC has not been served papers yet, according to Phosa, and found out about the application from the media.
"Clearly this is a publicity tactic by the VWV Group and its owners in order to compromise the ANC during an important decision-making conference this weekend."
According to sources, the ANC and VWV agreed to a schedule of payments once the event was completed. The R20-million was paid, then further payments ceased.
The contract stipulated that in such an event, mediation would happen. The date was supposed to be 21 December, but the ANC's lawyer said that he was not available, and also the meeting would be pointless as there was no dispute. Then VWV's counsel advised the company to go for liquidation.
In a statement, the ANC's lawyer Brian Kahn said: "There is ample legal authority for the proposition that in circumstances such as this, a liquidation application is regarded by the courts as an abuse of the legal process and 'in terrorem', with the result that the court would be asked to dismiss the application with costs against VWV and its attorneys on a punitive scale."
The court date is yet to be determined. – NewsFire.