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Moyo launches R20m damages claim against individual Old Mutual directors

He wants the board members to pay in their personal capacity, which might have serious implications for directors in corporate SA.

Old Mutual’s axed-but-reinstated CEO Peter Moyo has instituted a R20 million claim for reputational damages against the insurance group’s board members, including chairman Trevor Manuel, in their personal capacities.

If successful, Moyo’s claim and lawsuit could make corporate history and have serious implications for errant company directors across the country. 

This is because courts in SA have usually made adverse findings against companies at a broad level instead of holding individual board members and non-executive directors personally liable for decisions they have taken on behalf of a company and shareholders.

Moyo’s R20 million reputational damages claim against Old Mutual’s non-executive directors (or board members) is in addition to the R230 million he is claiming for contractual damages against the insurance group for firing him on June 18, without subjecting him to a disciplinary process.

To recap: Moyo was fired following a “breakdown of trust” between him and the board. This prompted Moyo to sue Old Mutual for unfair dismissal. The high court in Johannesburg has twice ordered that he should be temporarily reinstated as CEO and blocked Old Mutual from appointing his successor.

In total, Moyo is claiming R250 million in damages from the insurer in the second leg of his lawsuit, wherein he also seeks to declare the non-executive directors, including Manuel, delinquent. Old Mutual spokesperson Tabby Tsengiwe said the insurance group will defend against Moyo’s claim “vigorously”.

Read more here: Why Peter Moyo pitched his damages claim at R250m

In 54-page court papers, Moyo has cited Manuel and 11 other non-executive directors – including, among others, Paul Baloyi, Steward van Graan, Peter de Beyer, Thys du Toit, Sizeka Magwentshu-Rensburg and Nosipho Molope – for his R20 million claim for damages to his reputation.

The court papers have already been issued to Old Mutual.

Moyo’s lawyers said the non-executive directors have made “various insulting and/or false remarks” about Moyo since he was fired including “casting aspersions about his professional integrity” and “falsely portraying him as dishonest and unethical”.

In firing him, Old Mutual accused Moyo of declaring ordinary share dividends — linked to NMT Capital — worth R105 million at the firm’s board meeting on July 4, 2018, which he chaired. NMT Capital is Moyo’s private company, which he co-founded in 2002 with business titans Sango Ntsaluba and Thabiso Tlelai. Old Mutual owns a 20% stake in NMT Capital.  Of the total dividends declared (R105 million), Old Mutual said Moyo wrongfully pocketed dividends worth R30 million, while it wasn’t paid preference share dividends, breaching its rights as a shareholder.

In citing one “insulting” incident, Moyo’s lawyers said Old Mutual made “certain unwarranted racial, xenophobic and afro-phobic slurs” against him, thus violating his “right to dignity”.

In Old Mutual’s response to Moyo’s legal challenge of his dismissal, the insurance group questioned whether he enjoys Black Economic Empowerment status in SA because he was born in Zimbabwe and only acquired South African citizenship after April 1994.

Moyo’s lawyer Eric Mabuza said the lawsuit for damages could take two years to conclude, which might protract his client’s dispute with the insurer. Mabuza added that although the lawsuit might be protracted, Old Mutual would still be barred from appointing a permanent CEO, effectively Moyo’s successor.

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What about those dividends he should not have taken? I have not heard any valid excuse for that.
That aside I can see why he needs these damages, who would employ such a trouble maker going forward…

No he is not a troublemaker. He is fighting for his right which were unfairly violated and thus far the courts agree with him.

WHat needs to happen here is the shareholders should fire the entire board and allow the new board with no hang ups to resolve this matter.

Even if Moyo loses his claim to the R20 million, the lawyers will certainly get it – plus

The love of winning is causing reputational damage to OldMutual. Trevor is no longer fulfilling his roles properly. He is too personal with Moyo and he drags the whole board into his personal attack of Moyo. OM/Trevor is not above the law,they need to respect the courts directive.How these experienced people don’t see that their action are administratively and legally incorrect is unfortunate.

Agree – – –
Playing Race card – not surprised.
But, he should be warned, his entire life – professional and private would now be open for scrutiny. So if he is squeaky clean – ok – – – of not – – he may just be severely embarrassed.
He should also know – no defamation if its TRUE and in PUBLIC INTEREST.
I, for one, would never want to serve on a board with this man or Mr Manuel- not that I am expecting an invitation.

Yes one of the benefits of the legal system. His dealings will be open for public scrutiny. So defamation will be tough to prove by this trouble causer. And then what losses did he suffer if defamation is proven? What are his career prospects going forward?

Mr Moyo has got them OM directors by the ####. OM will be left with no choice but to fire the entire board of directors. Yes, fire the whole board of directors and rehire Moyo.

I’m sorry but that is crazy and will never happen. Institutional investors would protest if he is rehired.

Moyo and Manuel will leave, that’s it.

On what grounds is Moyo leaving? Manuel must leave because he failed as the chair to find an amicable solution to this matter. In fact e has shown his total disdain for the law and ue process by casting aspersions about a judge.

Thus far Moyo has conducted himself with grace only fighting for his rights that are protected by the laws of this country.

That is actually the most practical solution at this point.

So, when did Old Mutual make this great ‘discovery’ that Moyo was a Zimbabwean who only Naturalized into a South African post 1994? How many companies in South Africa are employing Zimbabweans for example who are not even naturalized, and that includes government departments. So, when did Old Mutual get the religion, and what is the matter with that. Is there a date by which one must acquire SA citizenship for him or her to be ‘more South African’ or ‘authentic’ South African, as is implied? And can Old Mutual please give us a clue when that date is.

…or settle with Moyo the R250m. They paid for the chairman’s legal fees didn’t they… Whats good for the goose is good for the gander…

Such is life… Once in a while there comes a disruptor.

“If successful, Moyo’s claim and lawsuit could make corporate history and have serious implications for errant company directors across the country”.

Directors will have liability insurance paid for for by the Coy & Moyo knows that , so its just another Moyo money making scheme !!

Yep, right from the start, Moyo’s shenanigans against OM were ALWAYS about the money. Embarrass them enough, take it public and they will pay me a king’s ransom.

It’s not Moyo who is at fault or initiated the whole thing here and there are court findings directly saying Old Mutual is at fault. What you are saying is really a lie and delusional smear campaign. Your statement supports what Moyo has initiated at the courts. You are the evidence they have harmed his rights and dignity.

The board of Old Mutual must account for it’s shenanigans.

Why should the insurers pay for intentional actions of the board? I don’t think they will get that indemnity payment if Moyo wins against them. Do you get indemnity for intentionally crossing the line?

Moyo must get these boys and girls. Pretty sure they are not taking this as a joke unlike some people.

Let’s see. Moyo declares himself a R30m dividend but pays zero to old mutual on its preference shares. That doesn’t sound right.

So why is OM not suing him for delinquency, damages, etc, etc?

The suing all seems very one-sided. And how did OM lose the first case if Moyo did what they claimed he did? Seems like valid grounds for dismissal to me.

Perhaps the declaration of the dividends followed the correct procedures?

Why has Old Mutual never opposed such acts before? Why didn’t the representative of Old Mutual who sat at the board of NMT representing Old Mutual and reporting to the board (Trevor) never opposed the dividend declaration?

Did the representative Director oppose or abstain when the resolution to declare the dividend was made? Did he/she not follow the resolution of the shareholder (Old Mutual) with regards to NMT?

At NMT, Moyo acts in according to his interests not as OM CEO that’s why OM had a representative there and therefore no wrong doing.

No grounds for dismissal at all that’s why they did not do anything and if there’s anything wrong, that’s at NMT shareholder level, nothing to do with the employment of Moyo as CEO of Old Mutual.

It seems you are on a crusade! Peter is this you? I don’t care much for either side in this saga but can you explain why NMT did not pay OM a preference dividend because without that faux pas there may not be an issue here?

If this guy thinks he’s worth so much money, why does he even have to work for anybody or any corporation. He should be creating and running his own “empire”. eg. Brian Joffe, Elon Musk etc. This question could well be asked of many corporate prima donnas.

Whitey Basson kept geeting paid hundreds of millions each year at Shoprite and this was never an issue.

He is just like Brian Joffe, Elon Musk etc, doing the exact same thing as every one else, just like any CEO of a JSE listed company.

Ummm, Zinger, you appear to be rather biased in your comparisons. You truly cannot compare Moyo with either Musk or Whitey Basson. Did Moyo start up 3 major companies (like SpaceX, Tesla, Boring Company). No. Did he start up a massive company like Shoprite that gives employment to well over 100 000 South Africans? No. Moyo did not initiate the whole thing but his actions did. There are also court findings that state OM was not at fault. Who are we to believe? I am not initiating a ‘smear campaign’ as you state. I have nothing to do with OM except a lousy policy that I am busy cancelling. But my view is that Moyo is playing this for the cash. Because you disagree – for whatever reason – does not give you the right to publicly state I am initiating a smear campaign. I believe that Moyo is after a big settlement, which will eventually be watered down from a ridiculous R250 million to something in double digits. That is my view, OK?

@Dougalan,

That’s your view. No one is disputing that.It means everything to you but absolutely nothing to me as it does not hinge on the truth but fallacy. Everyone has a view, all plus minus 7 billion people on earth do. You should stand by your view. Mandela gave you 27 years of his life at minimum for that.

Yip these guys think they are so great, but no skin in the game and they float from one exec position to another.

The field is playing out, well documented: cause and action resulting in a damaged share price. Methinks, a class action is on its way?

Quite funny to see the divisions within the ANC – over money! Amazing how quickly capitalism can catchon in a socialist environment when you’re within sight of millions in free money!

Zinger, maybe you just exposed your real motive with your statement ‘Mandela gave you 27 years of his life at minimum for that.’ I happen to think extremely highly of Mandela; believe he saved SA from a bloodbath. But to bring in a comment like that – which has absolutely nothing to do with the issue at hand – simply says to me that your real pro-Moyo stance is actually based on racist grounds; that’s your frame of reference here.
But let’s not argue. Let’s simply see how the drama plays out in the end shall we?

Sack the lot of them for allowing such a relationship between OM and NMT to be allowed in the first place!!! If they wanted Moyo as CEO of OM they should’ve bought/ swapped him out of NMT before giving him the role of OM CEO. Where did they expect his allegiance to lie when push came to shove!!??
No consideration for the shareholder’s and employee’s of OM, and I’m afraid to say that this behaviour is becoming endemic on the JSE!! Then to let it become a circus while still feeding at the trough, it’s downright theft!!

So this chap gets paid R50 000 000 per year. He doesn’t own the business, he just works there. The 50 million is therefore paid out of money that belongs to the shareholders.
Let’s assume that part of his package is that he gets one month’s leave, therefore he earns R4.545 million per month for the 11 months that he is present. There are approximately 23 working days per month, therefore he gets paid R197 608 per day, every day. Let’s also assume that he works really long hours, say 12 hrs per day, so he is getting R16467 per hour. Every working hour, every working day, every month of the year. For the next 5 years.
What does he do that is so valuable to society?
It’s no wonder he doesn’t want to lose his job.

About 3 km away from Old Mutual head office in Sandton, is Alexandra, where many people live in abject poverty.
Moyo and Manuel, you have a lot of gall.
I’ve already cancelled my policies and sold my shares with OM.

The entire saga is an embarrassment to corporate SA. Both the Chairman and Mr Moyo were clearly not appointed on merit

The point missed in all these comments is that Moyo’s whole set of recent efforts (suing the board, suing the company for R250m, etc.) are based on the initial really bad judgement from the courts. If we had a decently knowledgeable judge this whole debacle would not have happened. Will there be accountability against the judge? Doubt it. Just appeals, court fees and legal fees.

The point missed in these comments is that Moyo’s whole set of recent efforts (suing the board, suing the company for R250m, etc.) are based on the initial really bad judgement from the courts. If a decently knowledgeable judge had been involved this whole debacle would not have happened. Will there be accountability against the judge? Doubt it. Just appeals, court fees and legal fees.

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