Old Mutual and Peter Moyo cannot work together, says lawyer
Old Mutual does not want axed CEO Peter Moyo to return to the company even if he wins his case next week.
The insurer’s advocate, Ngwako Maenetje, said there was too much bad blood between the two parties for Moyo to return to work. “Even if the application passes, reinstatement is not an option. This is a case about the loss of trust,” said Maenetje.
Moyo, who was at the helm for two years, was fired by the insurance company in June over a breakdown in trust and a conflict of interest linked to NMT Capital, says Old Mutual. At the centre of the breakdown is the payment of ordinary dividends by NMT, co-founded by Moyo, in July 2018 without first paying Old Mutual its preferential dividends and preferential capital. Old Mutual has shares in NMT.
He approached the Johannesburg high court in a bid to obtain temporary reinstatement and to interdict Old Mutual from filling his former role. Old Mutual is opposing the application. After two days of listening to both sides’ arguments, Judge Brian Mashile on Friday reserved judgment until July 26.
Both Maenetje and advocate Dali Mpofu, who is representing Moyo, have advanced arguments that show neither party is willing to work with the other.
Mpofu said because the “ruse” behind Moyo’s firing was victimisation, it was likely to continue if he was reinstated. His colleague, advocate Tembeka Ngcukaitobi, however, said it did not matter that the board did not like Moyo because he had a good relationship with the executives that he worked with on a daily basis. He added that Old Mutual, itself, did not even allege that the company would be unable to function if Moyo were to return.
“It doesn’t matter that there has been acrimony between the two parties, he must go back to his job. This is about a relationship with the board which he meets infrequently. There is no harm if there’s tension between the board and him,” said Ngcukaitobi .
Mpofu said the court could perhaps order that an interim board be appointed.
Moyo has previously claimed in his court papers that the Old Mutual board was divided over his fight with board chair Trevor Manuel. He said one of the independent directors, whose name he says he is prepared to reveal only to the judge if requested, told him that Manuel was “gunning for him” after Moyo raised concerns about his personal legal fees that were paid by Old Mutual and that he was conflicted in the handling of the split of its domestic business from the UK-based Old Mutual.
While Moyo’s legal team claimed this was the real reason behind his axing, Maenetje told the judge on Friday that the insurer owed Moyo no explanation for the termination of his contract because he was dismissed on notice. Although the insurer did give reasons for the board’s loss of confidence and trust in him, they were presented to prevent hearsay and he could not use them to challenge his dismissal, said Maenetje.
He said all that Old Mutual owed Moyo was six months’ salary to comply with the stated notice on his employment contract.
“The notice may be given for any reason that is permissible in law in a sense that it’s not contrary to public policy and the procedure that is required is the giving of the notice, not the holding of a pre-dismissal hearing or disciplinary inquiry. And loss of trust and confidence is a permissible reason,” he said.
Maenetje cited a number of precedent cases where courts ruled in favour of employers because termination clauses trumped common law. One such case was that of former Transnet CEO Siyabonga Gama who was fired by the parastatal in 2018 without affording him a disciplinary hearing, just like Old Mutual did in Moyo’s case.
But Mpufu said this argument was “an invitation for the court to wear blinkers”. He said Old Mutual was asking the court to ignore the reasons for dismissal given in Moyo’s termination letter, as well as the consequences that public statements made by the company about his alleged misconduct had on his reputation
“If you are allowed to terminate on notice and get away with it, which employer in their right mind would elect to have a disciplinary hearing?” asked Mpofu.
He said the court must not be “seduced” by constructions of employment contracts that deviated from the constitutional norm, including the right to dignity.