SA Rugby boss ordered to pay Stellenbosch University R37m
Arbitration award against Jurie Roux in relation to unauthorised expenditure throws into question his appointment by rugby’s world governing body
SA Rugby CEO Jurie Roux has been ordered to pay more than R37m to Stellenbosch University after an arbitration hearing into the unauthorised allocation of funds to the institution’s Maties rugby club. The award throws into question his appointment to a new role at World Rugby.
Alasdair Sholto-Douglas SC, who acted as arbitrator in the dispute, ordered Roux to pay Stellenbosch University R37,116,402 relating to the unauthorised channeling of funds to the Maties rugby club and associated activities, according to an arbitration award dated December 23 2020. In addition, Sholto-Douglas ordered Johannes Christiaan de Beer to pay the university the sum of R1,904,511. Both amounts will bear interest until fully repaid. Roux and De Beer were also ordered to pay the university’s legal costs.
“Roux’s conduct in allocating the university’s funds to the four cost centres constituted a breach of his employment contract, which gave rise to the university suffering damages in the amount alleged in the particulars of claim, namely R35,312,004,” Sholto-Douglas said in his award ruling. “I find also that he breached his contract of employment by incurring expenditure of R1,804,398 on behalf of the university in relation to the Western Province Rugby Institute when he was not authorised to do so, and in circumstances where the university had not, in fact, incurred such an obligation. The total sum of the damages is, therefore, R37,116,402.”
Stellenbosch University first discovered that Roux had allocated the funds during an investigation into perceived irregularities in the student fees office by KPMG in November 2012. The investigation led to the conclusion that the opening balances of the cost centres had been manipulated using a program within the university’s computerised accounting system.
The use of the program to allocate funds to the cost centres in question left no digital audit trail, though Sholto-Douglas accepted Roux’s submission that an audit trail existed in the form of written notes contained in a box that subsequently went missing. Roux was one of two people who had access to the program.
Burden of proof
The university issued a summons in the Western Cape High Court on June 19 2015 claiming damages from Roux and De Beer, both of whom are accountants, on the grounds that they had breached their employment contracts with regard to the misallocation of funds. However, on May 15 2019, the parties agreed to refer the dispute to arbitration.
Roux was first employed by the university from May 23 1994, initially acting as financial administrative officer. However he quickly rose through the ranks to become financial director between 2002 and 2007, followed by senior director of finance and asset management from 2007 to 2010 when he left the university. Roux also occupied the roles of treasurer and chair of the Maties rugby club during his tenure, with De Beer taking over as chair after Roux left.
During the arbitration hearing, evidence was submitted to Sholto-Douglas over almost three weeks followed by three days of legal argument. Sholto-Douglas noted that Roux responded to the allegations against him with “bare denials” while carefully avoiding disclosing his defence until late in the proceedings.
“The way Roux pleaded his case indicated a reluctance on his part to disclose his case,” Sholto-Douglas said in his ruling, noting that Roux’s strategy was to put no version to counter the university’s allegations. This placed the burden of proof on the university to prolong the arbitration and precluded Roux from attempting to prove a case he had not pleaded, Sholto-Douglas said.
While a statement posted on Stellenbosch University’s website said that there is an “automatic right to appeal the final arbitration award”, the outcome is likely to throw into question Roux’s appointment by World Rugby. Afrikaans newspaper, Rapport, said in April that Roux would be leaving his post at SA Rugby at the end of 2020 to take up a position at rugby’s global governing body.
SA Rugby said in a statement posted on its website that it has referred the matter to its legal advisers and will make no further comment until the outcome of any possible appeal is known.
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