Mungo Soggot
Ahigh court judge last week rubbished the attack launched by former Land Bank chair Bonile Jack against Helena Dolny, describing Jack’s allegations as “defamatory and baseless”.
Judge Nico Coetzee dismissed Jack’s allegations, contained in a letter to President Thabo Mbeki and leaked to the press, in his judgment upholding Dolny’s bid to block the Land Bank’s current efforts to discipline her.
Judge Coetzee also said it appeared the bank had misinterpreted an inquiry into Jack’s allegations by a Johannesburg law firm. He suggested the bank had improperly relied on the lawyers’ probe to find Dolny, the bank’s managing director, guilty of misconduct for pushing through the salary increases of six senior employees, including herself.
These powerful aspects of Judge Coetzee’s findings constitute the latest in a series of blows to the credibility of Dolny’s detractors.
l Firstly, Jack accused Joe Slovo’s widow of corruption and racism in her allocation of Land Bank loans – only to have it revealed that he was piqued because she had rejected one of his private company’s loan applications. Jack was on the Land Bank board when his company applied for the loan – despite a bank rule barring directors from benefiting from loans.
l Then an inquiry by law firm Edward Nathan and Friedland cleared Dolny of racism and corruption charges, but raised “corporate governance” concerns about the salary issue.
In his judgment last Friday, Judge Coetzee upheld Dolny’s application for an interdict barring the Land Bank board and the Minister of Agriculture and Land Affairs, Thoko Didiza, from holding a “sanction hearing” for her involvement in the salary increase.
He gave Dolny 30 days to apply to court to have this decision taken on review, saying he believed she would succeed.
Judge Coetzee said the Land Bank board had treated Dolny unfairly, unconstitutionally and improperly.
The judge torpedoed the board’s efforts to try and avoid a full disciplinary inquiry into the salary issue. After the lawyers’ report was released, the Land Bank board said it would proceed with a full disciplinary inquiry about the salary issue on the basis of the report’s findings.
But on November 23, Dolny was informed that the bank had changed its mind; it would no longer have a full inquiry, but would instead hold a hearing to determine Dolny’s punishment on the salary issue. It was this “sanction hearing” that Dolny successfully interdicted.
Judge Coetzee said the Land Bank board’s turnaround constituted a “serious and material misdirection”, and showed the board had prematurely found Dolny guilty of misconduct.
He noted that while the report said Dolny’s handling of the salaries raised questions of corporate governance, her actions did not amount to misconduct. The essence of the charge against Dolny was that she had steamrollered the increases through despite the reservations of some board members.
Judge Coetzee said it was clear that the bank had found Dolny guilty of misconduct, incorrectly assuming that the first leg of a disciplinary inquiry had been finalised. The judge reportedly said that this was not what Michael Katz, who headed the inquiry, had found.
He said Katz found that it was not in keeping with good corporate governance for Dolny to ignore the misgivings of some board members in implementing the salary increases. He said this was a “far cry” from acting improperly, adding that acting improperly requires “wilful or negligent action which is blameworthy”.
Judge Coetzee went on to say that Dolny had believed that legislation governing the Land Bank allowed her to handle the salaries of the top six employees. Dolny also took legal advice before pushing through the salary increases.
According to the notes on his judgment, Judge Coetzee said: “Even if she had misconstrued the provisions of the Act, it did not necessarily mean that she had acted improperly.”
The judge’s questioning of the board’s interpretation of the lawyers’ report follows the filing, in court, of a letter by Didiza expressing disquiet about the board’s reading of the report. Didiza’s letter was to the new non- executive chair of the Land Bank, Sam Mkhabela.
The disciplinary action against Dolny is being driven by an ad hoc committee, chaired by Mkhabela. That committee is named as the third respondent in Dolny’s court application. It is understood that some members of the full Land Bank board have not been privy to the decisions on how to handle Dolny, and are, in fact, opposed to the way the matter has been handled.
Didiza’s letter says: ” I have studied carefully both the actual report and your proposed actions. It is, however, not clear for me what you as the board are recommending on the overall findings, bearing in mind that the investigation was conducted in a manner that is restrictive and severely qualified by themselves [the lawyers].
“This may have an influence on the weight to be given to both the factual findings as well as the recommendations of the lawyers’ report. This is especially true with regard to whether disciplinary proceedings regarding the implementation of the salary increases must be implemented.”
Didiza’s letter, dated September 8, continues: “I must emphasize that I am of the opinion that applicable labour law must be followed scrupulously in this regard.”