Gaborone High Court judge, Omphemetse Motumise last week issued a judgment that the attorney refunds the liquidator the sum of P5, 000, 000.00 together with interest thereon at 10% per annum tempora morae.
“The transaction in terms of which P5m was paid from CMB and or the liquidated companies to the applicant (the Transaction) is declared void and stands set aside in terms of the notice,” said Motumise.
The judgment comes after Kanjabanga filed an application seeking for the notice issued by the liquidator to him regarding the P5m to be nullified claiming he was paid the money as legal fees.
Prior to Kanjabanaga’s application, the liquidator had issued a notice to him on February 1, 2021, to set aside the payment made by the liquidated companies to him through a company called Capital Management Africa (CMA) on February 5, 2018.
Judge Motumise said the attorney had not disclosed any lawful statutory defence to the notice as he has failed to plead in his application that when he benefited from the transaction, the assets of CMB and the liquidated companies exceeded their respective liabilities.
“The applicant has failed to show that the transaction should not be set aside as contemplated in section 435(2) of the Companies Act. The transaction is void in terms of the notice. He has failed to discharge the onus that the P5 million was for legal services rendered to the liquidated companies or their directors and is accordingly obliged to repay the liquidator all sums paid in terms of the transaction,” he said.
He explained that the applicant alleged that the funds received in the transaction were for legal fees for representing CMB directors at the time being, Rapula Okaile and Tim Marsland for various legal matters and had relied on an engagement agreement entered into between CMB and Kanjabanga and Associates on October 11, 2017.
The judge stated that Kanjabanga referred to cases such as CMB v BPOPF and CMB v NBFIRA in the agreement, which did not exist or had not commenced in any court in Botswana.
“It is extremely doubtful, and the suggestion is liable to be rejected out of hand as unreasonable or farfetched that an agreement could be signed on October 11, 2017 referencing cases involving NBFIRA and BPOPF when there was no litigation involving the said parties before the High Court or any Court,” said the judge.
Motumise pointed out that the P5m was paid to him on February 2, 2018, rather than October 11, 2017 and that he has failed to explain why the money was paid on February 2, 2018.
He noted that the only reasonable inference to be drawn is that the agreement was a sham and was drafted in a belated attempt to justify the transaction more so that he has failed to provide any fee notes or invoices, let alone taxed bills, justifying the legal services allegedly provided to CMB in which he acted for CMB or its former directors.
“At the hearing of these applications, the applicant sought to hand up from the bar, what he said was a list of cases where he had represented the liquidated companies. When the court pointed out to him that evidence in application proceedings could only be introduced by affidavit, he feigned surprise, saying he did not know that the court would ask for an affidavit,” Motumise said.
The judge lamented that he did not seek leave to file any affidavit introducing the intended evidence and also claimed that the court was aware of cases where he had acted for the liquidated companies and Okaile before it.
Further emphasising that it was just as misconceived and opportunistic to ask the court to take judicial notice of such cases since the burden lies with the beneficiary to establish his case by acceptable evidence why the disposition should not be set aside.
He noted that the attorney was allowed to clarify the transaction at the enquiry and in the liquidator's subsequent correspondence as he spurned both opportunities by refusing to testify or provide the requested information and he was headstrong in the attitude that the information was privileged, even though Okaile had waived any such privilege.
“Finally, Okaile's testimony at the enquiry that the purpose of the transaction was to pay his and Marsland's costs was at odds with the bank statements, which described it as ‘CMA Repayment’, both of which were inconsistent with the alleged retainer agreement. He has failed to discharge the onus that the P5 million was for legal services rendered to the liquidated companies or their directors. There was, therefore, no quid pro quo to CMB,” he said.
Meanwhile Kanjabanga got known to the liquidator when between February 12, 2019 and July 10, 2020, an enquiry was conducted by the Master of the High Court into the affairs of the liquidated companies.
Several witnesses were subpoenaed at the enquiry before the Master to testify on the affairs of the liquidated companies and during investigations conducted by the liquidator of the liquidated companies, it was discovered that Kanjabanga had received P5m from CMB funds through CMA on February 5, 2018.
“Okaile confirmed on oath at the enquiry that on February 2, 2018, an amount of P10m was paid by CMB to CMA's bank account for CMA to pay legal costs incurred by Messrs. Marsland and Okaile purportedly on behalf of CMB. On February 5, 2018, the transaction amount of P5m was transferred from the same CMA account and paid directly to the applicant, allegedly for legal services provided by the applicant to Messrs,” read the judgment.
It further states that he attended the enquiry on February 12, 2019 and on April 25, 2019 in person, and in his capacity as Okaile's attorney and he refused to testify on February 12, 2019 on the pretext that he was not in attendance as a witness despite having been subpoenaed by the Master as such.
According to the judgment he attended on April 25, 2019, but again refused to testify and the liquidator wrote to him on July 24, 2019, asking him to clarify the purpose of the transaction, how the funds of the transaction were distributed and whether there were any documents, such as agreements, supporting the transaction.
It was alleged that he refused to provide the requested information in his letter dated August 6, 2019 and claimed the payments in question had not been made by CMB, and in any event, the information was 'privileged attorney-client information which we are not at liberty to provide'.
