Old Mutual on its victory against Moyo

Instead of getting R250m in damages the former CEO must pay the insurer’s legal costs, while it’s ‘business as usual’ for the company: Tabby Tsengiwe, GM of public affairs and sustainability.

FIFI PETERS: This is an upbeat story and an important story. Old Mutual’s former CEO, Peter Moyo, is facing a hefty legal bill after the court threw out his damages claim against the company for the manner in which it dismissed him.

If you dial back three years, you’ll remember that Moyo thought he was unfairly and unlawfully dismissed and he took his employer on. This time he has been looking for R250 million, which is what he would’ve earned for the duration of his employment contract with Old Mutual had he not been fired in 2019. The court maintained previous judgments, including one by a full bench, that Old Mutual had acted correctly and lawfully in the dismissal of Mr Moyo.

We have Tabby Tsengiwe, the general manager of public affairs and sustainability at Old Mutual, with us to help make sense of the legal proceedings and where things currently stand. Tabby, thanks so much for your time. I think even a ‘happy new year’ is in order. It’s the first time I speak with you in 2022.

On to the matters at hand for today, how much exactly does Peter owe Old Mutual after this ruling?

TABBY TSENGIWE: Good evening, Fifi, and I’ll start off by saying happy new year to you too, even though it’s the second month of the year. It’s the first time we are speaking. At this point we would not be able to disclose the amount because, remember, the current matter that has been dismissed relates to the trial was over the last 10 days – and we have no indication of what that amount would be. But it has definitely been dismissed with costs.

FIFI PETERS: So this is just the latest actions in the past 10 days, it’s not the entire proceedings that we have seen unfold before our eyes in the past three years?

TABBY TSENGIWE: Yes.

FIFI PETERS: Can you just let us know then, Tabby, the legal significance of this latest court ruling and what it means for Old Mutual in the broader scheme of things.

TABBY TSENGIWE: Essentially what it means for Old Mutual is that the board acted lawfully in terminating Mr Moyo’s contract in 2019. This leads to the upholding of what we have been consistent in saying around the issue of corporate governance, and what happens when a board essentially loses confidence in its CEO – as has been the case with this matter between Old Mutual and Mr Moyo.

FIFI PETERS: All right. That loss of confidence obviously relates to the benefiting from dividends from his company NMT Capital, which should not have taken place ahead of monies that were owed to Old Mutual. I’m really scratching the surface here, trying to think about where things began, because this case has been going on for so long. Just the latest dismissal for damages of R250 million – is that appealable still?

TABBY TSENGIWE: That would be for Mr Moyo and his legal team to decide in terms of what direction they take.

FIFI PETERS: All right. So that option is available to them should they wish to pursue it?

TABBY TSENGIWE: I would assume that is available to them. It is an avenue that is open to Mr Moyo should [he] choose to take that route.

FIFI PETERS: Right. Tabby, as you said, this particular judgment is covering the trial and the action that has taken place recently. There has been a whole lot of in-and-out court action for yourselves and Mr Moyo’s legal team, and I understand we are still looking at another application that the court has yet to decide on regarding the non-executive directors and the delinquency claims that Mr Moyo has put before them. What can you tell us about where things are regarding that particular case?

TABBY TSENGIWE: Mr Moyo has the issue of the [in his opinion] delinquent directors. Judgment on that case is still pending; the content of the court’s judgment is still pending as well. So those are the two outstanding judgments.

FIFI PETERS: Do you know when we’re likely to receive any judgment or any word from the court on those two cases?

TABBY TSENGIWE: At this point we don’t have word from the court as to when that judgment will be handed down, but we await that.

FIFI PETERS: Would you say that it has been ‘business as usual’ at Old Mutual outside of this in-and-out court action? I ask that intently, because [if] you look at the share price of Old Mutual and you speak to market commentators – and everybody has looked past it, they are looking at Old Mutual and looking at the risks faced by the pandemic, and perhaps claims that might be a lot more than you’ve budgeted for due to variants that may emerge that we don’t yet know of – has the business also taken this approach in terms of this legal case, as in ‘it’s business as usual’ despite it?

TABBY TSENGIWE: Fifi, I remind the listeners again that it was never Old Mutual’s choice to go to court. It is an avenue that Mr Moyo took back in 2019, emanating from an issue around a conflict of interest that arose from his contract. As we have said as Old Mutual, this is not the route we would have chosen; however, Mr Moyo did take us to the court. It has certainly been business as usual at Old Mutual.

As you would also know, coming out of this we were also granted by the court the right for Old Mutual to proceed and appoint a permanent CEO. That was done last year when Mr Ian Williamson was appointed as our permanent CEO, and we are carrying on with business as usual.

FIFI PETERS: I suppose it goes without saying that basically at this point it’s too late to come to a deal – or is that option also open in which the matters currently at hand could be settled outside the courts?

TABBY TSENGIWE: There has been so much progress on this case. As you said, Fifi, with various rulings that have been in Old Mutual’s favour I would not be one to close off anything, but at this point we are proceeding with what is in front of the courts.

FIFI PETERS: All right. Tabby, thanks so much for your time. We’ll leave it there. Tabby Tsengiwe is the general manager of public affairs and sustainability at Old Mutual.

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