Phone row parties just won't hang up
Nkosana Makate and his former funders in the Please Call Me matter are heading to arbitration next month, as a battle over whether his financiers are entitled to a share of his settlement with Vodacom escalates.
But it seems that arbitration could again be delayed as the funder, Raining Men Trade, intends to launch an application to remove the arbitrator, advocate Andrew Mabena, citing various conflicts of interest.
Thomas Samons, Raining Men Trade's business rescue practitioner, said on Friday the arbitration was set down for eight days towards the end of June, "where we are calling witnesses. It's got to do with Makate's submission that the original agreement is no longer valid and that the nomination of Raining Men did not in fact take place. So, we say of course the original agreement is still in place and the nomination did take place."
Samons said Raining Men had also informed Makate's attorneys of the application to remove the arbitrator. They have 20 days left to file the application.
"We're looking at a long-haul litigation still. It will be long before we get to the arbitration," he said.
He said he knew that Makate's attorneys had advised him to settle. There is a 2016 court order that the funders are entitled to half of Makate's award. According to that order, Vodacom must pay half the award into a trust account until arbitration is concluded.
"We have told his attorney that we are not stuck on that order. I'm in a position to offer him a settlement number because I've got my side of funders to refund. There's a minimum amount which I can consider," Samons said, but declined to reveal the amount, saying he would have to consult creditors first.
However, Makate said: "There is no talk of a settlement. There is nothing that can be offered to them. That ship has long left the harbour. We are proceeding with the arbitration on 19 June as ruled by the arbitrator."
At stake is half of R49m, the alleged settlement amount that Vodacom CEO Shameel Joosub approved as compensation for Makate in January this year.
The amount is cited in court papers filed in April this year by Raining Men Trade, but it has not been officially confirmed by Vodacom or Makate due to confidentiality agreements. Makate intends to challenge the settlement in court, claiming earlier this year that it was a "insult" to him.
Raining Men Trade is in business rescue but Samons filed an urgent application in the Pretoria high court last month to delay arbitration with Makate, saying he had not had sufficient time to prepare as he was appointed in January this year.
Makate gave Vodacom the idea in 2000 for a service that could allow for text messages requesting a call back to be sent between subscribers, with or without airtime. Vodacom developed and commercialised the idea but reneged on an agreement to compensate Makate.
The matter has spent over a decade in court with the Constitutional Court ruling in 2016 that Vodacom and Makate had to negotiate reasonable and fair compensation.
Raining Men Trade claims its representative, Chris Schoeman, a lawyer, made an agreement in 2011 to finance Makate's litigation. Makate, in his replying affidavit, claims the agreement was cancelled in January 2014 after the case flopped in the high court.
He appealed against the high court judgment and won his case against Vodacom in the Constitutional Court. Raining Men Trade returned, trying to enforce the funding agreement. The parties disagreed and went to court, which referred the matter for arbitration.
The arbitrator says in court papers that he told the parties about the arbitration in November last year and would be neglecting his duties were the proceedings delayed or postponed.
Makate claimed the business rescue proceedings were a "sham" because Raining Men Trade was a shelf company without any business and was used as a vehicle to channel his payout from Vodacom.
Samons said companies previously linked to the matter, Sterling Rand and Black Rock, were never properly nominated or accepted the nomination.
"It was left to Raining Men to take up the nomination later and the reason for that is because the funding came from all sorts of different parties. They kept asking for new companies in which they could participate in the litigation funding. But eventually it all settled on a company called Raining Men, which is now in business rescue."