immunity
What did businessman and banker Christo Wiese have to hide from the inquiry into the reasons for the collapse of Cape- based conglomerate Tollgate? Absolutely nothing, he says.
Then why did he seek to do a deal which involved him repaying R900 000 to the Tollgate liquidators in exchange for a guarantee that he would not be called to give evidence? Wiese says his action was purely a matter of “damage control”.
The dismissed Tollgate inquiry commissioner, advocate Bertrand Hoberman, reveals the “deal” in the course of an affidavit submitted by him to the United Kingdom courts and made public this week.
Invited to attend an urgent Sunday meeting, Hoberman recounts how it was put to him by advocate Gavin Woodland, representing the liquidators, that Wiese was “seeking to do a deal whereby he would make a payment of a substantial amount to the liquidators in return for the receipt of an immunity, meaning I would agree not to subpoena him to give evidence …
“I was not prepared to entertain the proposal about which I had serious misgivings.”
Asked to comment, Wiese confirmed he was at one stage a director and shareholder in Duros (later to become Tollgate). He sold his 10% stake in the company in 1988 but remained a director until September 1989.
A month after he left the Duros board, Wiese concluded the sale of certain companies to Duros. “We argued a bit because I insisted a premium would be necessary. Duros eventually agreed to pay about 18% above the prevailing market price, roughly R900 000.”
After Tollgate’s collapse, its liquidators suggested that the premium should be repaid.
Wiese says he agreed to this but only because he sought to remove himself from the Tollgate arena entirely – “[the Tollgate inquiry], under Hoberman, had been turned into a circus” – by making the repayment a suspensive sale on an agreement that he would be absolved for giving evidence to the inquiry.
“I decided it would be much better if I could distance myself completely from an inquiry in which everyone was being painted as a crook except [Julian] Askin, who had fled the country,” adds Wiese.
“I quite understood that Hoberman’s response was at least partially governed by the fact that he was awaiting the decision of the Cape Supreme Court to an application [made by Absa] for his dismissal as commissioner.”
After Hoberman was replaced by advocate Jules Browde on the instruction of the court, Wiese says he immediately effected the payment agreed upon and said he was prepared to give evidence.
He was not subsequently called before the inquiry on the basis that Browde considered it unnecessary.
Whatever the reasons given by the court for its decision to recuse Hoberman, unsatisfactory though some of these are, what remains at the end of this saga is that too many unanswered threads are left hanging.
At least part of the reason for this is the continued insistence on holding Section 417 hearings in camera – there is neither justification nor validity for considering evidence relating to the failure of public companies in secret sessions.
For instance, why did Browde “not read the whole record of the evidence led before me [Hoberman]”?
This is among the principal matters to emerge from an affidavit submitted to the United Kingdom Court Appeals, which met this week to consider an application by Julian Askin, Tollgate’s chair at the time of its collapse, for his action against Absa to be heard in Britain.
Approached for comment, Browde’s response was that he was too busy to discuss the matter.
In any event, he said, he had given his reasons in his final report and referred this writer to an apology on the same subject in The Sunday Independent of September 13 last year.
Withdrawing the implication that Browde had decided unilaterally not to read earlier evidence, the newspaper says: “In fact, commissioner Browde was released from scrutinising the earlier evidence by the Tollgate liquidators and creditors and was directed to focus on specific evidence.”
“If that is so,” says an attorney asked for comment, “it is certainly unusual. It’s the first time I’ve ever heard of the course of a legal inquiry being directed by anyone other than the commissioner appointed to run it.”
Hoberman was appointed Tollgate commissioner in March 1993. An application by Absa for his removal was heard in the Cape Supreme Court in November 1996, nearly four years later.
Hoberman points to evidence led by Absa employee Christo Faul in which he discloses that David Brink, Absa chair at the time, and Absa CEO Danie Cronje decided in May 1996 to apply for his recusal.
The fact that the application was launched only six months later and at the very time that Hoberman was calling for further documentation from Absa to supplement what little had been delivered heightened Hoberman’s suspicion that the timing “was more than coincidental”.