Urgent court application sought to bar Cida’s liquidation

Students at the beleaguered and now closed Cida City Campus are pinning their hopes on an urgent court application which the institution’s staff members have brought to the Johannesburg high court. 

The matter was scheduled for a hearing on Tuesday but it has been moved to Thursday.

Danny Phillip Mncube and 55 others – all identified as staff members – brought the application against the provisional liquidators. The applicants want an order barring Cida’s liquidation.

Their affidavit, which the Mail & Guardian has seen, expressly says they seek an “interdict prohibiting asset-stripping by the selling off of specific assets” belonging to Cida. 

They also  want the court to “compel the liquidators to consult the creditors on any offers to purchase [Cida] as a going concern, which would enable it to continue to operate and offer an education to its students”.

Cida’s students, who numbered 420 in 2014, haven’t been registered. 

The institution is now facing the final phase of liquidation over its R30-million debt to creditors, and has been deregistered by the department of higher education and training on grounds that it can no longer support itself financially.

Once the pride of free university education in the country, Cida now remains deserted, with only a security guard stationed at its entrance to turn away strangers.

‘It’s really painful ‘
The M&G visited Cida in Lyndhurst, Johannesburg, this week, and found it a shadow of its former self. The buzz of students is gone; no cars stream in and out of the institution. This dire reality is playing out at a time registrations are underway across South Africa’s higher education institutions.

The campus burst on to the scene in 1999 as a groundbreaking, free institution, which offered Bachelor of Business Administration degrees to uplift thousands of poor black matriculants. An institution whose sustainability depended on donors, its fortunes dwindled after founder Taddy Blecher, an accomplished social entrepreneur, resigned in 2007.

Speaking on the phone from Soweto, a student, who asked not to be named, told the M&G that provisional liquidators from the Tshwane Trust first ordered students to vacate premises on December 10 last year. This was because a buyer had still not been found. 

“We’re stranded right now. I’m also home now not doing anything,” she said.

“Students really need Cida. You can’t find an institution in the country that is free. Most of my fellow students are at their homes in KwaZulu-Natal, Mpumalanga and other parts of the country as we speak. It’s really painful.

“We don’t have our [academic] transcripts. But at the same time they are not opening the school. They are not saying anything to us. We can’t apply to [continue our studies] anywhere else without the transcripts.”

An offer on the table
The Legal Resources Centre, a public interest and human rights law clinic, is representing the Cida staff in the matter. Sarah Sephton, the centre’s regional director in Grahamstown, Eastern Cape, explained why they got involved: “This university offers a very important service, which is free tertiary education to poor black students.

“We believe it should be kept open, and there’s a viable buyer, which the liquidators should accept.”

Sephton is referring to a New York-based education firm called Africa Integras. The applicants accuse the liquidators of the “repeated rejection of amended offers by Africa Integras, without regard to the views of creditors”.

“The liquidators had the power and opportunity to sell the [institution] as a going concern and have failed to do so, thus prejudicing the staff and current students, as well as future generations of students,” their affidavit reads.

“It appears that the primary concern of the liquidators may be to sell the individual assets for the highest value and maximise their fees. 

“Whatever the decision to close [Cida] and to refuse to entertain any offers that might enable it to operate, the decision failed to have any regard to the interests of creditors, students, staff and the public interest”.

But in their court papers, which the M&G has obtained, Tshwane Trust denied that they prevented Africa Integras or any other interested buyer from buying Cida.

They argue that the firm “does not have the financial resources or ability to pay the purchase” price of R40-million. “We’re not prepared to accept anything less than an unconditional [offer] to pay the full purchase consideration in the amount of R40-million”.

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