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[2011] ZAGPJHC 61
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Bonitas Medical Fund and Others v Registrar of Medical Schemes and Others (33735/10) [2011] ZAGPJHC 61 (27 May 2011)
IN THE
HIGH
COURT OF SOUTH AFRICA (
SOUTH GAUTENG
)
JOHANNESBURG
CASE NO
:
33735/10
DATE
:
2011-05-27
REPORTABLE
(In the electronic reports)
I
n
the matter between
BONITAS MEDICAL
FUND & OTHERS
....................................
Applicant
and
REGISTRAR OF
MEDICAL SCHEMES & OTHERS
.............
Respondent
J U D G M E N T
WILLIS
,
J
:
[1] This is an
application for the appointment of a curator of the Bonitas Medical
Fund in terms of
section 56
of the
Medical Schemes Act, 131 of 1998
.
[2]
The
matter has had a protracted history. The Deputy Judge President of
the South Gauteng High Court appointed me to case manage
the matter,
and apart from the formal orders that have been made in Court, I have
had innumerable consultations in my chambers
with a galaxy of legal
luminaries representing different parties. I have also had telephone
calls at my home of an evening, seeking
that I make interventions on
an urgent basis, which, I may record, I have declined to do.
[3]
Finally,
after much haggling, and negotiation, interim orders, reports that
were filed by certain experts, all the parties save
for the Union,
the National Union of Metalworkers of South Africa, (NUMSA), have
reached an agreement that a curator should be
appointed, and that
this curator should be Mr Molokome Joseph Maluleke.
[4]
It
needs to be emphasised that this application for curatorship has not
been brought about because the Bonitas Medical Fund is in
any
financial difficulties. This is a very important point that needs to
be emphasised, so that there is no panic or alarm in
the larger
community in South Africa. The Bonitas Medical Fund is, I
understand, the second largest medical aid scheme in the
country.
[5]
The
dispute has been about the management and control of the Fund, and I
regret to say, one has begun to get suspicious, although
I cannot
make any final conclusion in the matter thatt it is about an all too
depressingly familiar South African story: it is
a fight about
spoils. It is tragic that this hectic, tense, contest has gone on,
because clearly, it seems to me, there are strong
personal interests
that are frustrating the interests of the members of the scheme.
[6]
Be
that as it may, I have attempted on a number of occasions to suggest
to parties that they should try to resolve their difficulties
regarding the management and avoid a curatorship order. I have
publicly appealed for commercial statesmanship. I have requested
that
the parties please transcend personal interests and look after the
greater interests of this very important scheme. Sadly,
I have not
succeeded, but mercifully, in the end, agreement has been reached
that curatorship, unfortunately, is a necessary route
to follow. I
hope that it will be a very interim form of curatorship, in order to
set things back on track so that a properly
convened meeting of
members can determine the management and control of this Fund.
[7] This
is,
in the end, I sincerely believe the only way to go, and if I
understand NUMSA correctly, they too, who applied to intervene
at a
very late stage, namely only this morning, agreed that a curator
should be appointed. I may mention that I made an order
authorising
the intervention of the Union, NUMSA, and I also wish to place on
record the fact that I am pleased that this application
met with no
serious opposition from other parties. It is right that the voice of
the Union should be heard.
[8]
The
only issue in contention now is whether instead of Mr Maluleke being
appointed as a curator, the appointment of a curator should
go to one
Mr Thabane Frances Zulu. It is true that Mr Zulu has an impressive
track record, and a distinguished
Curriculum
Vitae.
There can be no inherent objection
to his being appointed. Certain allegations were made against Mr
Maluleke, but these have
been untested and Mr Maluleke was
represented in Court by Mr Labuschagne, who was ready, vigorously, to
contest any unfortunate
allegations being made against Mr Maluleke.
Therefore I wish to emphasise these allegations against Mr Maluleke
are untested,
unproven and not accepted by the Court.
[9]
Mr
Maluleke has acquaintance with the affairs of the Fund, and that,
obviously, is an advantage in taking care of the Fund until
such time
as new management has been properly vested in the Fund, in terms of
proper elections, where proper procedures have been
followed.
[10]
This
morning I mooted with counsel the possibility of appointing a
triumvirate, which would include both Mr Maluleke and Mr Zulu,
and
perhaps a third person as a tie-breaker, or a vote giver in the event
that Mr Maluleke and Mr Zulu could not agree. The representatives
of
the parties were unable to agree on this formula, and I may say that
I have got sympathy with the protestations of Mr Bava,
that it would
be cumbersome and unworkable. The history, for what it is worth,
throughout the world from the Roman era to the
present, is that
triumvirates are very seldom successful instruments to resolve
problems, except on a strictly short-term basis.
[11]
Counsel
for the different parties prevailed on me to act like Solomon of Old
Testament fame. I certainly do not have Solomon's
qualities, and in
the end, ultimately, I am faced with this fact: NUMSA, at a late
stage, has come to "the party".
It is the only interested
party to protest against the appointment of Mr Maluleke. Mr Maluleke
has the support of all the others,
who have been at loggerheads, and
I am aware at how extraordinarily difficult it has been for the
parties to reach agreement on
(a) the going into curatorship of the
Fund, and (b) the appointment of Mr Maluleke. Balancing all this
out, it seems to me that
the most sensible course is to go with the
appointment of Mr Maluleke.
[12]
A
draft order has been prepared, which has been signed by all the
parties. An order will be made in terms of that draft marked
X, and
an order is also made in terms of Prayers 1, 4, 7, 8, 9 10, 11 and 12
of the notice of motion dated 24 May 2011.
[13]
I
wish to place on record that I have invited Mr
Brett
,
counsel for the Registrar of Medical Schemes, and also for the
Council for Medical Schemes, to draft a consolidated order which
will
include the draft marked X today and these various Prayers in the
notice of motion. It suddenly occurred to me that I should
indicate
today that an order is made in terms of the draft marked X, and in
terms of the Prayers, but that the order that will
ensue from this
Court on Monday 30 May will be a draft marked Z, that reflects the
consolidated orders made today. The reason
for the consolidation is
that clearly this is an important order that is going to be made.
There are a lot of different parties
that will be interested in
reading it and seeing it. Who knows, the newspapers may even be
interested in it? It is important
that there should be no confusion
at all as from Monday morning what the order of the Court is.
[14]
Therefore,
in summary, an order is made in terms of the draft marked X and in
terms of prayers 1, 4, 7, 8, 9, 10, 11 and 12 of the
notice of motion
dated 24 May 2011.
POSTEA:
[15]
The order, marked “Z” which was signed by me in chambers
in Johannesburg on the 7
th
day of June 2011, reads as follows:-
The
National Union of Metal Workers of South Africa, Sipho Mjwara,
France Mabelebele, Lucky Mbageni and William Modisha are granted
leave to intervene in the application under case number 2010/33573.
Bonitas
Medical Fund (“
the Scheme
”)
is placed under curatorship in terms of section 56 of the Medical
Schemes Act 131 of 1998 (“
the Act
”).
Molokomme
Joseph Maluleke is hereby appointed as the Scheme’s curator
(“
the curator
”).
The
curator shall have the following powers ~
3.1) generally to take control of
and in the place of the board of trustees and principal officer
manage the business of the Scheme
in accordance with the provisions
of the Act and the Scheme’s rules;
3.2) to exercise all executive powers
which would ordinarily vest in and be exercisable by the board of
trustees or principal officer
of the Scheme in terms of the Act or
the Scheme’s rules;
3.3) to incur such expenses and costs
on the Scheme’s account as may be reasonably necessary or
expedient for the purposes
of the curatorship and control of the
business and operations of the Scheme;
3.4) to engage the services of any
professional advisors reasonably required to assist for the purposes
of the curatorship and
the control of the business and operations of
the Scheme;
3.5) to institute, defend, settle or
compromise any legal proceedings on behalf of the Scheme and in its
name and for those purposes
to appoint and instruct attorneys and
counsel;
3.6) to operate the Scheme’s
existing bank accounts and to open and operate any new banking
accounts in the name of the Scheme
as might reasonably be required
for the purposes of the curatorship; and
3.7) to dispose of shares held by the
Scheme in any company whose main object and business is not directly
related or connected
to the business of a medical scheme.
The
curator is directed to report on his curatorship to the first
applicant and the Scheme’s members within two (2) months
from
the date of this order which report shall include a statement of his
findings and recommendations concerning the Scheme’s
affairs
and the continuation, if necessary, of the curatorship.
The
curator is directed to report on the Scheme’s affairs to the
first applicant every two weeks during the aforesaid period
of two
(2) months.
The
curator is directed to take all steps which are necessary to convene
a special general meeting of the Scheme at which a new
board of
trustees shall be elected and which meeting shall take place no
later than ninety (90) calendar days from the date on
which the
order is granted.
The
applicants are empowered temporarily to vary the respondent’s
rules to the extent which may be necessary to convene
and hold a
special general meeting of the respondent’s members to elect a
new board of trustees within a period not exceeding
ninety (90)
calendar days from the date on which this order is granted.
The
curator shall be entitled to reasonable remuneration and
disbursements, as might be allowed by agreement with the first
applicant, alternatively, failing such agreement as may be
determined later by this Court and that such remuneration shall be
paid by the Scheme and shall be a first charge upon the Scheme’s
assets.
The terms of office of Mpungose
Bongani Phumlani; Mncube Michael Sibusiso; Willem Frederik Van
Heerden; Zulu Mdumuseni Petros;
Seobi Mokone Nicodemus; Koch Lugene;
Schoombie Sonja and Dolamo Mokgoatji Josiah as members of the
Scheme’s board of trustees
shall come to an end on 27 May
2011.
The proceedings instituted by the
Council for Medical Schemes against Mpungose Bongani Phumlani,
Mncube Michael Sibusiso, Willem
Frederik Van Heerden, Zulu Mdumuseni
Petros and Seobi Mokone Nicodemus in terms of section 46 of the Act
are hereby withdrawn
and the Council for Medical Schemes reserves
the right to reinstate such proceedings against any of the aforesaid
individuals
in the event that any of them is elected or appointed as
a member of a board of trustees of a medical scheme which falls
under
the Council for Medical Schemes’ regulatory authority.
Gerhard Van Emmenis is divested of
the powers and functions of the Scheme’s board of trustees
with effect from 27 May 2011.
Gerhard Van Emmenis’ term of
office as the Scheme’s acting principal officer shall come to
an end with effect from
27 May 2011.
It is noted that the application
under case number 2011/4206 has been withdrawn.
The costs of the Registrar, Council
for Medical Schemes and Gerhard Van Emmenis in the application under
case number 2011/4206
shall be paid by the Scheme including all the
reserved costs and such costs shall include the costs occasioned by
the employment
of two counsel and shall be paid on an attorney and
client scale.
The term of office of Mpungose
Bongani Phumlani; Mncube Michael Sibusiso; Willem Frederik Van
Heerden; Zulu Mdumuseni Petros;
Gerhard Van Emmenis and Seobi Mokone
Nicodemus as directors of Bonitas Marketing (Pty) Ltd and Pegma 36
(Pty) Ltd, as the case
may be, shall come to an end on 27 May 2011.
It is noted that
the application under case number 2010/02947 has been withdrawn and
it is directed that the Registrar and the
Council for Medical
Schemes’ costs of that application shall be paid by the Scheme
including all the reserved costs and
such costs shall include the
costs occasioned by the employment of two counsel and shall be paid
on an attorney and client scale.
It is
noted that t
he application under case
number 2010/48594 has been withdrawn and is directed that the
Registrar and the Council for Medical
Schemes’ costs of that
application shall be paid by the Scheme including all the reserved
costs and such costs shall include
the costs occasioned by the
employment of two counsel and shall be paid on an attorney and
client scale.
The
appeal in terms of section 49 of the Act against the inspection
(that includes the resultant report) into the affairs of Bonitas
Marketing Company is hereby withdrawn.
The
investigation report will only be used by the Registrar in the
performance of its regulatory duties after Willem Van Heerden
and
Gerhard Van Emmenis having made representation against all
allegations pertaining to them contained in the report.
The relief sought by the aforesaid
intervening parties in the counter-application is refused and no
order as to costs is made
in relation to that relief.
The costs of the Registrar, Council
for Medical Schemes, Mpungose Bongani Phumlani, Mncube Michael
Sibusiso, Willem Frederik Van
Heerden, Zulu Mdumuseni Petros and
Seobi Mokone Nicodemus in the application under case number
2010/33573 shall be paid by the
Scheme including all the reserved
costs and such costs shall include the costs occasioned by the
employment of two counsel and
shall be paid on an attorney and
client scale.
_________________________
N.P.WILLIS
JUDGE OF THE HIGH COURT
APPEARANCES:
Counsel
for the Registrar of Medical Schemes and for the Council of
Medical Schemes
Adv
JJ Brett SC (with him Adv KN Tsatsawane
Attorneys
for the Registrar of Medical Schemes and for the Council for
Medical Schemes
Eversheds
Counsel
for NUMSA
Adv
D Wood
Attorneys
for NUMSA
Xulu
Liversage Inc
Counsel
for Bonitas Medical Fund
Adv
A Bava SC (with him Adv R Moultrie and Adv A Stein
Attorneys
for Bonitas Medical Fund
Gildenhuys
Lessing Maltji Inc
Counsel
for the trustees of the Bonitas Medical Fund
Adv
JH Dreyer SC
Attorneys
for the trustees of the Bonitas Medical Fund
Couzyn
Hertzog & Horak
Counsel
for Mr Maluleke (the curator)
Adv
EC Labuschagne SC
Attorneys
for Mr Maluleke (the curator)
Rooth
& Wessels Attorneys
DATE
S
OF HEARING: 21 December 2010
4 February
2011
3 March 2011
11 March 2011
27 May 2011
30 March 2011
DATE OF
JUDGMENT:
27 May 2011