South Africa

Newsflash

Prasa pays lawyers, secures representation in R6bn contracts matter

Prasa pays lawyers, secures representation in R6bn contracts matter
Passenger Rail Agency of South Africa (PRASA) has been ordered to reinstate its Western Cape Regional Security Manager. Archive photo: Ashraf Hendricks

Prasa says they have made payments to their lawyers, Werksmans attorneys, to cover legal costs for a matter to be heard in the North Gauteng High Court on Monday 24 February. The payment comes after Daily Maverick revealed that the rail operator has not paid the law firm, leaving them without legal representation.

“Prasa has this morning (Friday) made a payment to its attorneys. We are awaiting proof of payment in this regard which will be sent as soon as it is available,” said Prasa spokesperson, Makhosini Mgitywa. 

The matter that will be heard in the North Gauteng High Court on Monday 24 February relates to civil proceedings brought against the rail operator by Siyangena Technologies – a former Prasa contractor demanding that it be paid outstanding fees of R2.8-billion. 

The payment comes after Daily Maverick revealed that the rail operator had not paid the law firm, leaving them without legal representation. 

Prasa is said to owe Werksmans about R19-million for work done on the Siyangena matter and other legal services. 

Daily Maverick previously reported that if Prasa does not come out victorious, they could end up paying as much as R5-billion to Siyangena after the interest of the unpaid invoices has been included. 

The company scored tenders worth about R6-billion during Lucky Montana’s reign as CEO at the rail operator. Of the more than R3-billion that the company ended up receiving from Prasa, it is reported that R550-million went into the pockets of Durban-based businessman, Roy Moodley, a known financial benefactor of former president Jacob Zuma. 

Siyangena was tasked to install access gates and other security products at Prasa stations. 

During a media briefing held at Prasa offices in Braamfontein on Friday, 21 February, Mgitywa told journalists that they have received verbal confirmation from Werksmans that they will represent them in court. 

“They assured us that they will be working over the weekend preparing for Monday’s court appearance. We’ve been given the assurance that they will be at court representing us on Monday,” he said. 

The rail operator did not, however, disclose how much money it had paid to the law firm. 

“If the amount that we paid today is not the entire amount, it is the bulk, it is the biggest portion of the amount we are supposed to pay. But issues like these have got to do with the contract between a client and a service provider, we may be comfortable with telling you how much money we have paid them, they may be uncomfortable with us making that public. 

Prasa took the opportunity to also address the service suspension of Shosholoza Meyl following a directive issued by the Rail Safety Regulator. The intercity train is a Prasa subsidiary. Business Day reported that the regulator issued Prasa with a prohibition directive that halts all Shosholoza Meyl operations with immediate effect. 

“Prasa is developing an intervention plan which will be submitted to the rail regulator today,” said Mgitywa. 

The SOE could not disclose how long the train services will be suspended for but said they are working to refund passengers affected. DM

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