The clash over Nkosana Makate’s payout from cellphone giant Vodacom has taken yet another nasty turn.
This time, a senior advocate has landed up being the subject of a high court application; Makate’s funders are questioning his experience as an arbitrator to preside over such a big money case.
Michael Mabena SC was appointed by the chairperson of the Pretoria Bar Council to oversee a dispute between Makate and funders of his case against Vodacom. The arbitration proceedings started months before Makate’s victory at the Constitutional Court in April.
The parties are embroiled in an ongoing dispute over whether Makate had validly cancelled his funding agreement involving the Sterling Rand, a nominated company, Raining Men Trade and businessman Chris Schoeman. In the first blow since Makate won his case against Vodacom in April, his funders took him to court last month claiming he was in on a plot by various lawyers to oust them from the deal.
Now Schoeman has launched a second high court bid. This time he wants the court to set aside Mabena’s appointment, citing a lack of experience and the complexity of the case. Mabena, who attained silk status in 2011, declined to comment because of his work in the matter.
Norman Davis SC, chairperson of the Pretoria Bar Council, also cited as a respondent in the case, said because no relief was being sought against the Bar, it would not oppose Schoeman’s application. This decision may be reviewed if new information came to light. Davis said the Bar, as a rule, only appointed arbitrators it deemed competent.
Schoeman, who previously claimed he virtually emptied his bank account when he took up Makate’s case in 2011, facilitated additional funding through Sterling Rand while Raining Men Trade was then allegedly installed as the nominated company to handle the case.
But lawyers for Makate have charged that the funders had, at some point, failed to make payments to cover Makate’s case, thereby invalidating the initial funding agreement. This is the subject of the arbitration hearing.
Schoeman’s attorney, Amish Kika, said the outcome of the latest application would determine the next step in the Please Call Me matter.
“This application is fundamental to the integrity of the adjudication of the issues between the funders and Mr Makate and will deal with important legal issues like the interplay between litigation funding and the contingency fees act.”
The funders and some of the lawyers involved are in line for a substantial slice of Makate’s expected payout. By order of the court, 50% of the proceeds of the settlement will be held in trust until the dispute with funders is resolved.
Schoeman wants the high court to order that this arbitration be heard in open court by a retired judge or a panel of two judges instead of Mabena.
The reason, Schoeman states, is: “The conduct and credibility of senior members of the legal team will be an issue. I submit that is not desirable for a colleague, albeit a senior counsel, to have to make such findings. The conduct of all parties concerned should be openly ventilated and scrutinised before a judge of the high court and not hidden behind a veil of secrecy in arbitration.”
He also contends that the law firm, Umika Gopichund Attorneys, nominated to hold half the proceeds from his settlement with Vodacom in trust until the dispute between the funders and lawyers is resolved, is unlikely to have the required indemnity cover to hold funds of R500-million and R1-billion, respectively.
He said the firm was registered with the Law Society for the Northern Provinces only one day before it was nominated, that it operated from a residential property and uses a mobile number.
Attorney Umika Gopichund said she was aware of this latest application and intends opposing it insofar as it relates to her or her firm.
Schoeman, she said, has made “frivolous comments in his application against myself, which I take exception to, and reserve my rights to institute an action for defamation against him”.
Gopichund said she is not involved in Makate’s case against Vodacom and has been instructed only to hold 50% of the funds payable, pending the outcome of the current dispute.
“The true nature of Umika Gopichund Attorneys is that it is a registered law firm, which has complied with all the requirements of the Law Society of the Northern Provinces, and holds a certificate of good standing from the said law society. I am a competent attorney with more than 13 years of post-admission experience, whose credentials have never been questioned throughout my career. I have administered trust accounts for clients previously and have an unblemished record with the law society,” she added.
Makate’s lawyer, Wilna Lubbe, said: “In this application Mr Schoeman wants to set aside the arbitration which he had initiated himself. Bizarre! It is not an urgent application, it is vexatious.” Her instructions, she said, are to oppose it.
Makate, the man at the centre of it all, is undeterred: “I remain resolute. I’ve won a bigger battle. This is by no means insurmountable. We just have to ensure that there is progress so negotiations with Vodacom can resume.
“But we need to make sure we stick to principles.”