S v Nkola and Others (CC 7/2009) [2012] ZAECBHC 5 (13 June 2012)

About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: Eastern Cape High Court, Bhisho
SAFLII
>>
Databases
>>
South Africa: Eastern Cape High Court, Bhisho
>>
2012
>>
[2012] ZAECBHC 5
|

|

S v Nkola and Others (CC 7/2009) [2012] ZAECBHC 5 (13 June 2012)

IN THE HIGH COURT OF
SOUTH AFRICA
(EASTERN CAPE, BHISHO)
Case No: CC 7/2009
REPORTABLE
In the matter
between:
THE
STATE
And
BONGILE
SAMUEL NKOLA
Accused
No 1
SCHOOL
FUNRITURE & TIMBER PRODUCTS (PTY) LTD
Accused
No 2
FMMC
HOLDINGS (PTY) LTD
Accused
No 3
SETH
OWUSU
Accused
No 4
ZISANI
NOTSHAYE
Accused
No 5
MPANGWA
ZANELE MCALENI
Accused
No 6
Coram:
Chetty, J
Date
Heard:
3 – 5 May 2011; 1 – 4 August 2011; 8 August 2011; 10 –
11 August 2011; 24 – 27 January 2012; 30 January 2012
– 3
February 2012; 8 – 10 February 2012; 13 February 2012; 23
February 2012
Date
Delivered:
13 June 2012
Summary:
C
riminal
Law
–
Fraud –
Misrepresentation constituted by statements of fact embodied in tax
invoices – State adducing no evidence that
accused completed
supporting documentation – Participation by accused not proved
– Intent to defraud not established
JUDGMENT
Chetty, J
[1]
The accused were initially indicted during February 2005 under case
no 36/2005 together with two
other persons on one hundred and
nineteen (119) counts of fraud and money laundering in contravention
of section 4(b)(ii)(bb) read
with sections 1(2), 1(3) and 8 of the
Prevention
of Organised Crime Act
[1]
.
Their erstwhile co-accused fell by the wayside and in terms of a new
indictment served on them four (4) years later under case
no
CC7/2009, the remaining accused –
(a)
Accused no 1,
Bongile Samuel Nkola
, the sole director, owner
and shareholder of accused no’s 2 and 3, in his personal
capacity;
(b)
Accused no 2, School Furniture and Timber Products (Pty) Ltd, a
corporate body within the meaning
of section 332 of the
Criminal
Procedure Act
[2]
(the Act), represented by accused no 1;
(c)
Accused no 3, FMMC Holdings (Pty) Ltd, a corporate body within the
meaning of section 332 of the
Act, represented by accused no 1;
(d)
Accused no 4, Mr
Seth Owusu
, the financial manager of accused
no’s 2 and 3, in his personal capacity;
(e)
Accused no 5, Ms
Zisani Notshaye
, a dispatch clerk in the
employ of accused no 2, in her personal capacity; and
(f)
Accused no 6, Ms
Mapangwa Zanele Mcaleni
, a dispatch clerk in
the employ of accused no 3, in her personal capacity
now stand arraigned
before me on forty-eight (48) counts of fraud.
[2]
Section 332 of the Act governs the prosecution of corporate bodies
and provides in subsection
(1) as follows –
“
(1)
For the purpose of imposing upon a corporate body criminal liability
for any offence,
whether under any law or at common law –
(a)
any act performed
,
with or without a particular      intent, by or
on instructions or with permission,   express or implied,
given
by a director or servant of     that corporate body;
and
(b)
the omission
,
with or without a particular intent, of
any act
which ought to have been but was not
performed by or on instructions given by
a director
or servant of that corporate body,
in the exercise of his
powers or in the performance of his duties as such director or
servant or in furthering or endeavouring to
further the interests of
that corporate body, shall be deemed to have been performed (and with
the same intent, if any) by that
corporate body or, as the case may
be, to have been an omission (and with the same intent, if any) on
the part of that corporate
body.” (the underlining is mine)
[3]
The criminal prosecution has its genesis in a tender awarded to
accused no’s 1, 2 and 3
by the Eastern Cape Department of
Education (the department) to supply certain schools in the Eastern
Cape with school furniture.
The gravamen of the charges is rather
inelegantly formulated as follows –
“
15.
The accused submitted invoice (
sic
)
and/or claim documentation to the Department as payment for their
deliveries. The Department only effected payment for delivered

furniture once the furniture had indeed been delivered at the
respective schools and only when somebody representing the school
had
signed as proof that the amount and good quality furniture had been
delivered /received.
16.
The said signatures (as proof of delivered / received goods) appeared
on two separate documents, namely on so-called “delivery notes”
and/or “goods receipt vouchers”. These said
documents
accompanied amongst other documentation, the invoice, and/or claim
documentation when the accused submitted them to the
Department for
payment. The Department also duly paid the accused the money it owed
as per the amounts as claimed according to
the invoice and/or claim
documentation.
17.
The accused however, before invoicing the Department, made
alterations
on the said “delivery notes” and “goods
receipt vouchers”. The effect of these alterations was that the

said “delivery notes” and “goods receipt vouchers”
suddenly reflected that higher amounts of furniture
were delivered at
the time when the accused submitted their invoices to the Department
for payment.
18.
The Department therefore made payments to the accused on the strength
of false invoices and/or claim documentation, which said
documentation reflected payments for furniture that had in fact not
been
delivered at the time the Department had received the invoice
and/or claim documentation.”
The indictment
furthermore notified the accused of the applicability of subsections
(2), (3), (4), (6), (10) and (11) of section
332 of the Act.
[4]
At the onset of the trial the accused, who were then represented by
Mr
Ford
and Mr
Taljaard
, pleaded not guilty to the
charges and in a written plea explanation alleged,
inter alia
–
“
(1)
That certain alterations were from time to time made to certain
delivery notes and
goods receipt vouchers . . . but that such
alterations were made in good faith by those making them and were
intended to correct
errors and omissions and were not made for the
purpose contended for in the indictment.
(2)
Their right to a fair trial had been
severely compromised by the conduct of the Directorate of Special
Operations (the Scorpions)”
[5]
Admissions made pursuant to the provisions of section 220 of the Act
were to the following effect
–
“
The
Department notified accused no’s 2 and 3 in writing of
the quantity of furniture to be delivered at
each particular school,
After being awarded the
tender and having been notified in writing, accused no’s 2 and
3 delivered quantities of furniture
to the schools identified,
The “Goods receipt
voucher” forms are copied forms supplied by the Department and
the “Delivery note” forms
are forms supplied by accused
no’s 2 and 3,
The Department duly paid
accused no’s 2 and 3 the amounts set out in column G of
Annexure A to the indictment as payment in
respect of the invoices
referred to in column F of annexure A to the indictment”
Annexure A is a schematic
diagram of the various components of the individual charges which is
self-explanatory and, by way of example,
appears thus –
ANNEXURE AVAILABLE ON
PDF
[6]
After various preliminary skirmishes between the state and the
defence, which, for reasons that
will become clear in due course, and
hence require no elucidation, the trial finally got under way several
months later with Mr
Nelson
now lead counsel for the accused.
In the interim, accused no 2 had been liquidated and the prosecution
against it stopped pursuant
to the provisions of section 6(b) of the
Act. During the presentation of the state case, Mr
Cilliers
informed me that he would lead no evidence on counts 1, 2, 14, 15,
23, 26, 27, 30, 32, 42, 44, 45, 46 and 48, expressly abandoned
those
counts and in argument conceded that the accused were entitled to an
acquittal thereanent. In respect of the remaining thirty-four
(34)
counts, he however submitted that the state had discharged the onus
resting upon it.
[7]
The contention that the guilt of the accused had been established
beyond a reasonable doubt was
assailed on three separate and distinct
bases. Firstly, given the fact that the state’s case was based
entirely upon circumstantial
evidence, the inference sought to be
drawn was not only the only reasonable one but was moreover not
consistent with the proven
facts; secondly, the evidence upon which
the state relied for seeking a conviction was unlawfully obtained and
on that ground alone
warranted the accuseds’ acquittal and,
thirdly, the evidence adduced from the state witnesses was of such a
poor quality
that it warranted rejection. As far as the second ground
of attack is concerned, I am unpersuaded that the evidence to which
objection
was taken was in any way either unlawfully obtained or
acquired in violation of any right in the Bill of Rights. The
remaining
grounds however merit serious consideration.
[8]
The state’s case against the accused rests primarily on the
testimony of a number of witnesses
in the employ of the department
i.e. headmasters, headmistresses, their deputies, heads of
departments, educators, officials, administrative
staff and security
staff, governing body members and officialdom of the department. Each
of these witnesses was called to testify
to events which occurred in
2002/2003, in most cases, more than a decade ago. It is not in issue
that whilst some of these witnesses
were interviewed and statements
minuted from them during that period, other witnesses were
interviewed and their statements minuted
shortly before they
testified. Notwithstanding the effluxion of time, all these
witnesses, without exception, steadfastly maintained
that they could
recall the minutiae of the deliveries to their respective schools.
Common sense dictates otherwise. It is not in
dispute that the first
inkling they had that anything was remiss was when they were
interviewed by the Scorpions about short deliveries.
Those interviews
were conducted in the main during 2002 and 2003 and during the trial
during 2011 and 2012.
[9]
It is furthermore not in issue that deliveries were made to the
various schools in the Province
at divers times whether during school
hours or not, over weekends and during school vacations. In several
instances furniture was
received by governing body members and on
occasion by district officials. Furniture destined for a particular
school was moreover
directed to another school and, in the
overwhelming majority of cases, notwithstanding official policy, no
asset registers were
either kept or conscientiously maintained. In
short, a complete aberration of the principals’ and designated
teachers’
duty to maintain a register of assets. Photographs of
certain schools and classrooms moreover attest to a complete lack of
care
for school furniture and other teaching accoutrements. These
witnesses either feigned ignorance of the true state of affairs
existing
at their respective schools or remained steadfast that only
certain limited amounts of furniture was delivered, which they
contended
factually found corroboration in the GRVs and delivery
notes. But, as I shall in due course advert to, these documents do
not by
themselves warrant the conclusion that a fraud was perpetrated
on the department. As the trial progressed a number of unsatisfactory

features which are dealt with seriatim hereafter emerged which
collectively, deleteriously affect the cogency of the argument
advanced by Mr
Cilliers
.
The
Verification/Audit Exercise
[10]
Notwithstanding the adduction of evidence from several witnesses, the
first and only inkling that a verification/audit
exercise had been
conducted into the delivery of the furniture emerged during the
cross-examination of Mr
Dumisani Vincent
Madlala (Madlala)
, a head of department
at the Mabandla Senior Secondary school in Mzimkhulu. He was called
in regard to count 39 and testified that
on some unspecified date,
ten (10) desks were delivered to the school and on another occasion
nine (9) teachers tables. During
cross-examination he was referred to
a statement minuted from him on 3 August 2011 and in particular to a
passage where he referred
to a logbook. I interpolate to say that the
extract from the logbook was annexed to his police statement and
makes no reference
to nine (9) tables. He was asked to proffer an
explanation regarding the fourth (4
th
)
entry on the second page next to the date, 5 November 2003, where the
reason for the visit of one
L. Kasper
was recorded as
“
verification of
furniture”
.
Madlala
,
save for stating that members of the Scorpions visited the school to
investigate the delivery of furniture, proffered to have
no knowledge
of any visit by one
L. Kasper
who, according to the entry on 5 November 2003 visited the school for
“
verification of furniture”
.
His vague recollection was that
Kasper
had in fact met with the school principal, one Mr
Tshabalala
,
since deceased.
[11]
None of the witnesses who testified after
Madlala
adverted to any such departmental audit at their schools. The fact of
the matter is that such an audit was in fact conducted. During
the
concluding stages of the trial, Mr
Cilliers
called Mr
Nkosikaya Tshotsho (Tshotsho)
,
the department’s assistant director of asset management. His
testimony directly contradicts virtually the entire body of
evidence
tendered hitherto that short deliveries had been made.
Tshotsho
testified about a departmental meeting attended by members of the
South African Police Services where an instruction was issued
to his
unit to conduct an audit into the delivery of furniture to the
respective schools. The outcome of this exercise he recounted
in
chief was
“
what I know is that after
the meeting the furniture was checked”
.
Under cross-examination the witness was referred to exhibit 9.11 a
document styled
“
Department of
Education, Internal Audit, Document name: Check list”
,
and confirmed that the names were those of officials in the
department who in fact visited his school and conducted an audit.
The
import of his evidence was clear. Had there been any disparity
between the furniture ultimately delivered and payment received,
he
would have adverted thereto.
[12]
Allied to this hitherto undisclosed revelation is the further factor
that in each of the counts preferred
against and persisted with
against the accused, officials in the employ of the department
certified that the furniture had in fact
been delivered. When the
trial proper commenced Mr
Cilliers
handed in a batch of documents, exhibit C, as an example of documents
to which reference would be made in each of the counts. One
of these
documents headed
“
Payment Transaction
- Form Code 1450”
contains two (2)
affirmations, the first relating to receipt, the second to payment.
The former reads –
“
I
certify that the above order has been executed satisfactorily and the
goods have been received in good order and to specification
and that
all records have been up-dated. Disallowances Advice No applies to
short deliveries and returns”
The latter -
“
I
certify that this order satisfies the requirements as to charges, in
accordance with the contract/agreement tariff that the said
charges
are fair and reasonable, that the payee is entitled to this payment.
That the necessary invoices or other payment documents
are attached,
that the disallowances have been made and that payment is
authorised.”
In argument before me, Mr
Cilliers
submitted that properly interpreted, the
certification merely recorded that
ex facie
the GRVs and
delivery notes, the orders placed had been successfully executed.
That may be so but it is a factor which must be
considered in
conjunction with all the other evidence.
[13]
The exact same forms constituted part of the documentation relevant
to each individual count and it is common
cause that its completion
and signature was a prerequisite to payment being effected to accused
no’s 2 and 3 by the Treasury.
The evidence adduced on behalf of
the state by the entire body of educators is completely at variance,
not only with the affirmations
contained on the aforementioned
document, but moreover with the evidence of
Tshotsho
. There is
no explanation for this anomaly. It is as a result of this conflict
in the evidence presented that Mr
Nelson
submitted that on the
state case itself no under deliveries had been proven and that the
accused were on this ground alone entitled
to an acquittal. The fact
that deliveries may well have followed on the submission of the tax
invoices to the department does not
inure to the benefit of the
accused.
[14]    It
is not in issue that in several instances short deliveries were in
fact made to individual schools. Corrective
measures introduced
subsequently cannot alter this fact. Various witnesses testified that
although the delivery notes reflected
the delivery of a particular
consignment of furniture, those occurred over a period of time and
not necessarily when the first
delivery was made. However upon a
holistic appraisal of the evidence the inference cannot properly be
drawn that it,
per
se
, constitutes fraud.
[15]
It will be gleaned from the aforegoing that the misrepresentation
relied upon is the submission of altered
goods receipt vouchers
(GRVs) and/or delivery notes in substantiation of tax invoices
submitted to the department whereby payment
for the goods reflected
thereon was claimed. Cursory examination of the GRVs and delivery
notes reveal that, at face value, alterations
were indeed effected.
Mr
Nelson
readily conceded that these were done but emphasized that it was
bona
fide
and gleaned from information extrapolated from waybills which
accompanied each delivery. The waybills, he submitted, proved that

notwithstanding the information contained in the GRVs and delivery
notes, all the furniture for which payment was claimed, was
in fact
delivered to the respective schools. The existence of waybills
featured prominently in the prosecution. It first surfaced
in an
opposed application in the Bhisho High Court for an order directing
the National Director of Public Prosecutions to restore
waybills
seized from the premises of the second and third accused pursuant to
a search warrant, issued on 2 July 2003 in terms
of the provisions of
section 29(5) of the
National
Prosecuting Authority Act
[3]
.
In dismissing the application
[4]
the learned judge added the caveat –
“
.
. . the conclusion to which I have come is not that it has been
established that waybills were not amongst the documents seized.
The
effect thereof is only that the applicants have not succeeded in
establishing on a balance of probabilities, on the evidence
placed
before me, that this occurred.”
It is common cause that
certain waybills to which reference will be made hereinafter were in
fact returned to the accused by the
Scorpions. But, as counsel
repeatedly emphasized, these constituted a fraction of what the
Scorpions seized from the accuseds’
premises. It is however
unnecessary for purposes of this judgment to decide this question
because in the final analysis, nothing
turns on this.
[16]
The record of those proceedings was introduced into the trial as
exhibit H by the state in terms of the provisions
of section 235 of
the Act immediately prior to Mr
Cilliers
tendering the
evidence of Mr
Sonwabiso Mboniswa (Mboniswa)
, at the time, one
of the Scorpions’ special investigators.  The record was
handed in, counsel for the state informed
me, to be used,
inter
alia
, to cross-examine the accused when they testified and
Mboniswa
was referred in chief to various annexures to
affidavits and in particular to his evidence in the proceedings
concerning the waybills.
Mboniswa
was a thoroughly unreliable
witness upon whose evidence I can place no reliance whatsoever.
Although the record does not constitute
prima facie
proof of
any fact therein contained, I cannot ignore the fact that the
accused’s defence to the charges was inextricably
linked to the
existence of waybills, a fact confirmed by
Mboniswa
.
[17]
The danger of inferring fraud merely from the apparent alteration of
the GRVs and delivery notes is accentuated
by the following examples
–
Counts whence
waybills feature
Count 48
[18]
Immediately prior to the adduction of evidence in respect of count 40
Mr
Nelson
informed me that Mr
Cilliers
had indicated
that he no longer intended to adduce any evidence on count 48. He
nonetheless, as part of his armoury for cross-examination,
handed up
a batch of documents pertaining to count 48 including waybills which
conclusively established that notwithstanding the
content of a
statement minuted from the head of department Mrs
Mandisa Muriel
Mbalo (Mbalo)
, the GRV and the delivery note upon which the
state premised its case that the accused had misrepresented that it
had supplied
“ten (10) teacher chairs, eight (8) teacher desks,
seventy-two (72) medium chairs and twenty (20) lab tables”, the
tax invoice submitted to the department correctly reflected the
quantity of furniture delivered to the respective school.
Count 45
[19]
When the matter resumed on 24 January 2012 Mr
Nelson
, in a
pattern which would unfold many times, expressed his extreme
displeasure at a sudden change to the order of witnesses of
which
they had been precognised. Anticipating evidence to be adduced in
respect of count 45, a different count was now to be commenced
with
viz
count 8. Nonetheless and as part of his address he handed
in a batch of documents “F45”. The indictment alleged
that
the fraud consisted in the unlawful claim involving nine (9) A-2
dual desks, twenty (20) utility cupboards and eight (8) teacher

cupboards. Counsel for the state in turn informed me that he was no
longer proceeding with counts 1, 32, 44, 45 and 46 and had

reservations whether or not to proceed with counts 28, 30 and 48.
Count 41
[20]
The fraud alleged related to the claim for payment for delivery of
sixty (60) A-2 dual desks, twenty (20)
3-5 dual desks and five (5)
chalkboards. During their examination in chief the witnesses called
by the state
viz
Mrs
Monica Nontobeko Dzingwa (Dzingwa)
,
the principal and her deputy Mr
Joseph Mzwandile Hloaisi
(Hloaisi)
, remained steadfast that only four (4) easels, twenty
(20) utility chairs, two (2) teacher cupboards and twenty-seven (27)
desks
had been delivered to the school. When the waybill was
presented to her during cross-examination she was reluctantly
constrained
to agree that other deliveries in fact occurred. So too,
Hloaisi
.
Count 37
[21]
The misrepresentation relied upon relates to a tax invoice submitted
to the department for payment in respect
of ninety (90) 3-5 dual
desks, one hundred (100) A-2 dual desks, seventy (70) 6-8 dual desks,
ten (10) chalkboards and fifteen
(15) easels. It is not in issue that
on 18 June 2003 the third accused delivered one hundred and seventy
(170) combination desks,
fifteen (15) chalkboards and six (6) easels
to the school. In the course of her cross-examination Ms
Beauty
Noncedo Magadule
(
Magadule
), the educator who appended her
signature to the GRV and delivery note was shown an unrelated waybill
and asked whether she had
seen a similar document previously. She
replied in the negative. When exhibits 37.13 and 37.14 were shown to
her she admitted that
the signature appended thereon was hers. When
the follow-up question was put concerning the waybill, she retracted
her answer and
denied that the signature was hers. It is obvious that
she lied. The waybill established that the full complement of
furniture
was in fact delivered to the school. The fact that some of
the items were delivered on a date later than that reflected on the
GRV and delivery note does not warrant an inference, as the only
reasonable one, of an intent to defraud.
Count 36
[22]
Count 36 involves the unlawful claim of a host of furniture and
paraphernalia. During the cross-examination
of the principal, Mrs
Memorial Balungile Koba
(
Koba
), a waybill reflecting
the delivery of thirty (30) infant chairs and fifty (50) combination
desks was shown to her. She acknowledged
that the signature on the
waybill was that of an educator at the school but proffered to have
no knowledge of such a delivery.
What adds to the confusion is her
admission that the thirty (30) infant chairs reflected on a schedule
prepared by the Scorpions
and which she signed also appeared on the
waybill. The contemporaneous statement which she made to the
Scorpions omits any reference
to either the thirty (30) infant chairs
or the fifty (50) combination desks reflected on the waybill. Mrs
Koba
was moreover a most unreliable witness and the very real
possibility exists that there may well have been further deliveries.
Count 35
[23]
Count 35 involves the unlawful claim of fifty (50) 3-5 dual desks,
one hundred (100) A-2 dual desks, eighteen
(18) teacher cupboards,
eight (8) green boards and fourteen (14) easels. It is common cause
that only the thirty-four (34) 6-8
dual desks and one (1) teacher
table was delivered on 17 February 2003 as per the delivery note kept
by the principal, Mr
Gcobani Mgubuli
(
Mgubuli
). The
submission of the same delivery note (no 5428) reflecting additional
items than the original retained by Mr
Mgubuli
immediately
raises one’s suspicion but the subsequent delivery of
additional furniture as per the waybills, albeit several
months after
the submission of the tax invoice to the department negates any
suggestion of fraud. Although the submission of the
tax invoice
reflecting all the desks and paraphernalia and inviting payment was
premature, an intention to defraud is not the only
reasonable
inference to draw given the
modus operandi
of the companies
and the subsequent admission by the accused that there may well have
been under deliveries.
Count 29
[24]
Count 29 concerns the unlawful claim of two hundred and seventy (270)
9-10 dual desks, nine (9) teacher cupboards
and fifty (50) lab stools
as per the tax invoice submitted to the department during September
2002. The GRV and delivery note upon
which the misrepresentation was
based reflected that three hundred (300) dual desks, ten (10) teacher
cupboards and eighty (80)
lab stools had been delivered on 17
September 2002. During the examination in chief and the initial
cross-examination of the principal,
Mrs
Mpondokazi Maureen Luhabe
(
Luhabe
), she remained quite adamant that only thirty (30)
combined desks and one (1) teacher cupboard had been delivered to her
school.
In response to a question posed by me, she recalled that
subsequent deliveries were made during 2005. Mr
Cilliers
then
referred her to delivery notes dated 2004/2005 which reflected the
delivery of desks and tables to the school. These delivery
notes she
ventured she obtained from the school principal and secretary long
after she had retired and in response to the subpoena
served on her.
Under cross-examination she was asked if she recalled a person by the
name of Mr
Ngozo
at the school. She replied in the
affirmative. A blank waybill was presented to her and she was asked
whether she could recall
having seen a similar document to which she
responded in the negative. She was then referred to a waybill exhibit
29.13 which reflected
a delivery of ninety (90) desks and a signature
by
Ngozo
and a waybill reflecting the delivery of one hundred
and eighty (180) desks signed for by herself. The production of these
documents
prompted her to say that these deliveries were in fact
those made during 2005. Her evidence hereanent is clearly a
reconstruction
and totally unreliable. The desks reflected on invoice
no’s 210433 and 210191 totalled three hundred and three (303).
Simple
arithmetical calculation shows that the desks per the waybills
precisely matched the number of desks on the tax invoice.
Count 28
[25]
Count 28 concerns the unlawful claim relating to the deliveries to
the Mbondoleni J.S School, the allegation
being that whilst the
delivery note and GRV signed for by the chairperson, Mr
Albert
Mbulelo Mdutyana (Mdutyana)
, only reflected the delivery of
twenty-two (22) desks it was forged to reflect additional furniture
and paraphernalia. The tax
invoice forwarded to the department
mirrored the quantity
qua
the forged GRV and delivery note and
constituted the misrepresentation relied upon. A strange feature of
this count is that none
of the witnesses including the principal, Mrs
Peters
, nor
Florence
Muriel Nontutuzelo Mdingi
(
Mdingi
), who admitted her signature on the letter recording
the delivery of forty-two (42) desks and six (6) chalkboards bore any
knowledge
of such a delivery having been made. What adds to the
mystery is that a waybill (exhibit 28.14) reflects the identical
items.
Count 24
[26]
Count 24 involves the Lower Seplan Secondary School in Lady Frere and
relates to the submission of a fraudulent
tax invoice reflecting that
the school received three hundred and fifty (350) desks; twenty (20)
teacher cupboards and seventy
(70) lab stools whereas the only
furniture received by the now deceased Mr
Dyasi
was that reflected on a GRV no 25268 retained at the school. The tax
invoice bears the Provincial Treasury’s stamp and is
dated 13
December 2002. During his evidence in chief the school principal, Mr
Luvuyo Justice Madikwa
(
Madikwa
),
referred to the GRV emanating from the second accused and testified
that
Dyasi
showed him the fifty (50) desks and fifty (50) chairs which had been
delivered. When the third accused’s delivery note was
shown to
him he initially confirmed that twenty (20) teacher desks were
delivered but corrected his evidence by stating that in
fact these
were chairs and not desks. I interpolate to state that the GRV refers
only to fifty (50) desks. He furthermore adverted
to further desks
delivered to the school during 2004. In cross-examination he stated
that one hundred (100) were delivered. Under
further
cross-examination he proffered to have no knowledge of one hundred
and thirty (130) desks being received by one
Zuziwe
Magwaca
(
Magwaca
)
as per a waybill addressed to his school but confirmed that
Magwaca
was a teacher at the school.  When the latter testified she
denied all knowledge of having received the delivery of one hundred

and thirty (130) desks reflected on the waybill bearing her name.
During
Madikwa’s
cross-examination, an entry in a hardcover book, which the witness
had brought with him was referred to which recorded that on
12
November 2003 certain officials
to wit
,
Soka
,
Sokanyile
and
Ndzani
had visited the school. The book furthermore recorded that a certain
Mr
Myotelwa
visited the school on 2 December 2002 and delivered desks and chairs.
Under the rubric
“
remarks
”
in the fourth column on page five (5) of the book
corresponding to the visit by the aforementioned official the words
“
in order”
appear.
The only reasonable inference is that the officials must have been
satisfied that the furniture and paraphernalia had been
delivered in
accordance with the tax invoice.
Count 21
[27]
Count 21 concerns the unlawful claim for sixty (60) 3-5 dual desks,
seventy (70) A-2 dual desks and fifteen
(15) teacher cupboards to the
Masonwabe Senior Primary school in Engcobo. The state case is
premised upon the allegation that whilst
only thirty (30) 6-8 dual
desks was delivered the accused submitted a tax invoice claiming
payment for all the aforestated furniture.
As a precursor to the
adduction of evidence relative hereto, Mr
Cilliers
informed me
that one of the witnesses he intended to call had shown him a copy of
a school register which he intended to refer
the witness, the school
principal,
Nolethu Nobusiwe Jezile
(
Jezile
) to. An
extract from the register, exhibit 21.14 was handed in during the
course of her testimony reflecting that the only furniture
received
at the school during 2003 was thirty (30) 6-8 dual desks. The first
witness called on this count, Mrs
Elizabeth Kulukazi Dolopini
(
Dolopini
), recounted that when she signed the GRV and the
delivery note, the only entry related to the thirty (30) 6-8 desks.
Jezile’s
evidence echoed that of
Dolopini
. During
cross-examination she was referred to the paragraph of her police
statement and confirmed that this was the only furniture
received by
the school. To corroborate her evidence she referred to the entry in
the school register. Further cross-examination
revealed not only the
complete inaccuracy of the register but moreover the unreliability of
her earlier testimony. When the waybill,
exhibit 21.11 was shown to
her by Mr
Cilliers
, she identified both her signature and the
school stamp appended thereon and suddenly remembered that prior to
the delivery of
the thirty (30) desks, one hundred and twenty (120)
desks had been delivered to the school. It is common cause that the
school
register contains no record of this delivery. The very real
possibility exists that the fifteen (15) teacher cupboards could also

have been delivered given the fact that the one waybill discovered
established not only that the one hundred and twenty (120) desks
had
in fact been delivered but also the unreliability of both
Dolopini
and
Jezile
.
Count 20
[28]
Count 20 involves the claim for payment of one hundred (100) 3-5 dual
desks, one hundred (100) 6-8 dual desks
and twenty-four (24) teacher
cupboards. The state contends that although only eighty (80) dual
desks were delivered, the accused
submitted a tax invoice to and
received payment for the entire complement of furniture referred to
above. Mrs
Beauty Yako
(
Yako
), a head of department at
the Vulinkundla J.S. School, testified that the delivery note signed
by her and photocopied for record
purposes recorded the delivery of
only eighty (80) dual desks and surmised that the additional
furniture reflected on the GRV and
delivery note forwarded to the
department with the tax invoice had been entered thereon at a
subsequent stage. When her statement
was put to her wherein she
stated that an additional fifty-nine (59) desks had been delivered to
her school she suddenly recalled
the delivery but added that this
occurred during the school vacation. During cross-examination a
waybill recording the delivery
of an additional eighty-two (82) desks
as a first load was shown to her for comment. She however decried all
knowledge of any such
delivery. The school principal, Ms
Dambisa
Sheila Mbambani
(
Mbambani
) admitted under
cross-examination that her signature and school stamp were appended
to the waybill but could furnish no explanation
for this. It is
common cause that her police statement was only minuted shortly
before she testified when more than ten (10) years
had elapsed since
the delivery. Mrs
Yako
was moreover constrained to admit that
at some stage, fourteen (14) teacher tables were delivered to the
school although she made
no mention of this in her police statement.
It emerged under cross-examination that save for ten (10) teacher
tables, arithmetic
calculations established that two hundred and
eighty (280) desks had been delivered to the school.
Count 17
[29]
Count 17 concerns the alleged forgery of delivery note no 5290 to
reflect more furniture than actually delivered.
It is not in issue
that the items reflected both on the delivery note and GRV and
mirrored on the tax invoice submitted to the
department matched the
items listed on the department’s internal requisition form. The
witnesses who testified on this count,
Mrs
Boniswa Hongo
(
Hongo
) and Mrs
Dideka Sithole (Sithole)
, both
educators at the Nkwenkwezi Senior Primary School in Mthatha, both
confirmed that a person by the name of
Portia Nozambo
was an
educator at the school. When the waybill, exhibit 17.11 was shown to
Mrs
Hongo
she admitted that the name
P.B
Nzambo
was the person she had referred to but bore no knowledge of such a
delivery. So too, Mrs
Sithole
. The latter only made a
statement to the police approximately ten (10) years after the
delivery and although she steadfastly claimed
to bear no knowledge of
any other deliveries, was constrained to concede that according to
the waybill Mrs
Nozambo
had signed for the additional one
hundred (100) desks. The waybill establishes the unreliability of
their earlier testimony and
the very real possibility exists that the
additional items reflected on the tax invoice could also have been
delivered.
Count 16
[30]
Count 16 involves the alleged fraudulent claim submitted to the
department by the second accused for payment
of one hundred (100) 6-8
dual desks and ten (10) teacher cupboards not delivered to the Ross
Junior Secondary School at Ross Mission,
Mthatha. It is common cause
that a delivery note from the second accused recording the delivery
of one hundred (100) dual desks
was handed to Ms
Sindiswa
Iris
Dorothy Nobuntu Nonabe
(
Nonabe
), a head of department
at the school on 6 December 2002. Both she and the school principal,
Mr
Themba George Richman Mtakati
(
Mtakati
) who
testified on this count bore no knowledge of any other furniture
having been delivered to the school. When a waybill, exhibit
16.16
recording the delivery of seventy-five (75) desks was shown to them
under cross-examination both decried any knowledge thereof.
Mtakati
however acknowledged that the recipient,
ex facie
the waybill,
one
Maku
, was an educator at an adjacent school, Maxhela.
Counts 12 and 13
[31]
Counts 12 and 13 concern the Vuselela Combined School, the former
count, the submission of fraudulent tax
invoices by the second
accused and the latter, the submission of similar invoices by the
third accused. It is common cause that
on 3 December 2002, the second
accused’s driver handed a copy of a delivery note no 5275 to
the deputy principal, Mr
Siseko Thompson Simani
(
Simani
).
It is furthermore common cause that the additional items appearing on
exhibit 12.3, the same invoice no 5275 do not appear on
the one
handed to
Simani
. During cross-examination he was referred to
three waybills recording the delivery of three hundred and fifty
three (353) desks
and ten (10) teacher tables to the school. He
identified the two signatures on the first, exhibit 12.3 as that of
the principal,
Mr
Tukwayo
and an educator respectively, and on
the second and third as that of another educator, Mr
Kitshane
and was constrained to concede that an additional three hundred and
fifty three (353) desks and ten (10) tables had been delivered
to the
school and corresponded with the number of items on the tax invoice.
Count 10
[32]
Count 10 involves the Nompumelelo Senior Secondary School in
Queenstown and a fraudulent claim for payment
of four hundred and
fourteen (414) dual desks, seventy-six (76) 6-8 dual desks, sixteen
(16) needlework cupboards and seventy five
(75) lab stools not
delivered. The only witness called by the state on this court, an
educator. Mr
Sandile Dyanti
(
Dyanti
) testified that the
only furniture for which he signed was forty-six (46) desks and
thirty-two (32) utility chairs. It is quite
clear that the additional
items reflected on the GRV and delivery notes were appended at a
later stage. The witness was however
constrained to concede that the
additional items recorded on the waybill, exhibit 10.11 could have
been received by the educator,
G.A. Ramabuda
whose name
appeared thereon.
Count 9
[33]
Count 9 concerns the alleged unlawful claim for payment of twenty
(20) TR desks, ten (10) science tables,
thirty (30) TR chairs and
sixty (60) lab tables from the department. This count is premised on
the alleged forgery of the GRV and
delivery notes by the insertion of
additional items than actually delivered to the school on 7 March
2003. Both witnesses who testified
on behalf of the state, Ms
Balelwa
Kuse
and Mr
Mbangi Patson
Baliso (Baliso)
, an
educator and principal respectively of the Mtebele Junior School in
Queenstown were
ad idem
that only four (4) teacher tables were
delivered to the school. During his evidence in chief
Baliso
acknowledged that the school in fact also received twenty-seven (27)
teacher chairs at some unspecified time after the initial
delivery.
During cross-examination
Baliso
was referred to a statement
which he had made to the Scorpions on 11 November 2003 and
acknowledged having informed them
that during March 2003, four
(4) tables, one hundred and sixty (160) dual desks and twenty-seven
(27) teacher tables had been delivered
to the school, he furthermore
acknowledged that the signatures on the waybill recording the
delivery of sixty (60) lab tables and
twenty-seven (27) teacher
chairs was that of an educator at the school, one Ms
Skepe
.
These documents demonstrate quite unequivocally that the department
was billed for substantially less furniture than actually
delivered.
Count 8
[34]
Count 8 involves the Edlelweni Public Primary School. The state
alleges that the accused forged the GRV and
delivery note to reflect
the delivery of twelve (12) teacher tables, twenty-five (25) teacher
chairs and twenty-five (25) teacher
cupboards whereas only two (2)
teacher tables were delivered on 7 March 2003. Ms
Nomnini Portia
Mcithwa
(
Mcithwa
), the school principal, and the only
witness who testified on this count stated that only two (2) teacher
tables had been delivered
to the school on 7 March 2003. She
furthermore acknowledged having signed a waybill recording the
delivery of one hundred and six
(106) desks to her school. Her
evidence generally was of such poor quality that I can place no
reliance on her testimony that she
only received two (2) teacher
tables.
Count 5
[35]
Count 5 involves an alleged unlawful claim for payment for the
delivery of one hundred (100) 9-10 dual desks
to the Nombulelo Senior
Secondary School in Grahamstown. The state’s contention is that
the fraud is evidenced by an alteration
to the quantity of desks (one
hundred and twenty (120) instead of twenty (20)) actually delivered
on 5 February 2003. It is apparent
from exhibit 5.4, the tax invoice
submitted to the department for payment, that the claim included the
one hundred and twenty (120)
desks. A waybill, which the principal,
Mr
Mthuthuzeli Stanely Koliti
(
Koliti
) acknowledged
bore the signature of the caretaker, one Mr V.G
Ngoqo
,
recorded the delivery to have been effected on 6 April 2003.
Koliti’s
statement however records that the chairs and cupboards had been
delivered during 2002.
[36]
The aforegoing exercise of analyzing the documentary and
viva voce
evidence emphasizes the inherent danger of accepting, as a fact, that
the mere submission of some GRVs and delivery notes, which
at face
value appear to have been altered and albeit amounting to a
misrepresentation, constitutes the offence of fraud. The waybills
to
which I have adverted to in the preceding paragraphs militate against
a finding that the complement of furniture reflected in
the tax
invoices was not delivered to the respective schools. The inference
which I have been asked to draw from the alterations
and additions to
the GRVs and delivery notes
viz
that the accused deliberately
forged same is not the only reasonable one as contended for by the
state. The other inference, equally
consistent with the facts, is
that the person(s) charged with submitting the tax invoices to the
department made adjustments to
the GRVs and delivery notes in
conformity with the details appearing on the internal requisition
documents in the
bona fide
and honest belief that the
requisite furniture had been delivered. It is not in dispute that the
tender awarded to accused no 1
and his companies was substantial.
[37]
The geographic area within which the contractual obligations had to
be performed was vast and it is evident
from the testimony adduced
that the problems which beset the deliveries was to a large extent
the result of a lack of capacity
on the part of the companies. The
lack of sufficient particularity on the waybill to which I have
adverted demonstrates the haphazard
manner in which the deliveries
were effected. The accused must have realized this and no doubt
accounts for the letters written
during early April 2003 to the
department by him on behalf of the second and third accused
concerning possible under deliveries
and damaged furniture.
[38]    Mr
Cilliers
however submitted that the letters were a stratagem
by accused no 1 to not only deflect attention from him but moreover
to negate
any suggestion that he bore knowledge of the under
deliveries. Reliance on the investigation diary, exhibit M, in
support of the
submission is misplaced and speculative in the
extreme. The sensitivity and covertness of the investigation
militates against the
accused having prior knowledge of the
investigation. If he had, it is highly unlikely that the Scorpions
would have been able to
seize the voluminous documents in due course.
[39]    It
is not in issue that by letter dated 11 April 2003 accused no 1 on
behalf of both the second and third
accused addressed letters to all
the district education offices within the Eastern Cape to the
following effect –
“
Our
Ref .No. SFTP/EDU34
11
th
April
2003
ALL DISTRICT EDUCATION
OFFICER
EASTERN CAPE PROVINCE
EASTERN CAPE
Dear Sir/Madam,
SUPPLY AND DELIVERY OF
SCHOOL FURNITURE
Kindly take notice that
the above company has embarked on massive delivery of school
furniture to various schools in your district
in the previous months.
Associated with such a massive exercise, there are unforeseen
problems in relation to shortfalls and broken
furniture.
If there is a situation
that would be similar to the above problems, it would be appreciated
if you could direct any queries or
complaints on the supply and
delivery of school furniture to the above address by post or
telephone to the following distribution
official:
NAME :
NOTSHAYA ZISANI
TEL :
040 656 3085 /
083 6670368
FAX :
040 656 3302
Thanks in anticipation.
Yours faithfully,
DIRECTOR
(B.S. NKOLA)
cc:    HEAD OF
PROVISIONING
DEPARTMENT
OF EDUCATION
ZWELITISHA
ATT:
MR ZIBI”
“
Our
Ref .No. FMMC/EDU1/15
11
th
April
2003
ALL DISTRICT EDUCATION
OFFICER
EASTERN CAPE PROVINCE
Dear Sir/Madam,
SUPPLY AND DELIVERY OF
SCHOOL FURNITURE
Kindly take notice that
the above company has embarked on massive delivery of school
furniture to various schools in your district
in the previous months.
Associated with such a massive exercise, there are unforeseen
problems in relation to shortfalls and broken
furniture.
If there is a situation
that would be similar to the above problems, it would be appreciated
if you could direct any queries or
complaints on the supply and
delivery of school furniture to the above address by post or
telephone to the following distribution
official:
NAME:
ZANELE
MCALENI
TEL
:
047
5312791 / 083 7575968
FAX
:
047
5312935
Thanks in anticipation.
Yours faithfully,
DIRECTOR
(B.S. NKOLA)
cc:    HEAD OF
PROVISIONING
DEPARTMENT
OF EDUCATION
ZWELITISHA
ATT:
MR ZIBI”
[40]    It
will be gleaned from the aforegoing that the fundamental
misrepresentation relied upon consists of the
alterations on the GRVs
and delivery notes to reflect the delivery of more furniture than was
actually delivered on the dates reflected
thereon. In virtually every
single count the alterations made to the GRVs and delivery notes were
effected to ensure conformity
with the description and quantity of
furniture recorded on the department’s internal requisition
forms. When the tax invoices
were thus forwarded to the department
all the furniture and appurtenances in respect of which payment was
claimed had not been
delivered. The statement of fact embodied in the
tax invoices and the documents tendered to validate the claims for
payment, although
stricto sensu
amounting to a
misrepresentation, cannot by itself however found a conviction for
fraud – the state still bears the onus
of proving that the
accused participated in the commission of the offences and, in
addition, that they had the requisite intention
to defraud.
Participation in
the offences by Accused no’s 1, 4, 5 and 6
[41]    In
his written submissions Mr
Cilliers
submitted that the
modus
operandi
devised by the accused involved not only active
participation
inter se
but also of others. By way of example
he referred to the evidence of several witnesses who had testified
that the drivers making
deliveries had pertinently told them that
they had been instructed not to leave any GRVs and delivery notes at
the school. The
difficulty with the submission concerning the alleged
fraudulent complicity of the drivers in the scheme to defraud the
department
is that in several cases the GRVs and delivery notes were
in fact left at some schools. The evidence of Mr
Mlandeli
Mgcotelwa
(
Mgcotelwa
), the erstwhile driver in the employ
of the third accused that the drivers were specifically instructed
not to leave GRVs and delivery
notes at the schools, is in conflict
with the aforementioned testimony.
Mgcotelwa
was an appalling
witness and I can place no reliance on his evidence that one
Zanele
or accused no 4 instructed him not to leave documents at the schools.
He was a thoroughly untruthful witness.  The further
submission
that the dispatch clerks which, in the context of this case, could
only have been accused no’s 5 and 6, completed
the delivery
notes and GRVs in such a manner as to facilitate subsequent false
additions amounts to pure speculation. So too the
submission made
concerning accused no 4. There is no evidence even remotely
suggesting that the GRVs and delivery notes were returned
to accused
no’s 4, 5 and 6 and the submission that accused no 4 turned
a
blind eye
to these shenanigans has no evidential basis. It is
based entirely on conjecture.
[42]
In similar vein, there is no direct evidence that accused no 1
participated in the offences charged. On the
contrary and, as,
adumbrated hereinbefore, accused no 1 alerted the department to the
possibility that there may have been under
deliveries and breakages.
It is inconceivable, given the import of the letters, that he was
aware of the falsity of the documents
forwarded in substantiation of
the payment claims. Notwithstanding certain unsubstantiated averments
in the indictment, there is
no evidence that accused no 1 himself
altered the GRVs and delivery notes nor, for that matter is there any
evidence that any of
accused no’s 4, 5 or 6 themselves had
anything to do with falsifying the documents as aforesaid. The state
adduced no evidence
concerning authorship of the offending documents
save for the bald allegation in the indictment that “
all
the acts . . . were performed or committed by the directors, servants
or agents of accused no’s 2 and 3
”
and
that they
“
acted with a common
purpose or in the execution of a conspiracy”
.
All that the indictment alleged was that accused no 1 was the sole
director, owner and shareholder of accused no’s 2 and
3 whilst
accused no 4 was the
“
financial
manager of accused no’s 2 and 3”
and
accused no’s 5 and 6
“
dispatch
clerks”
on behalf of accused no’s
2 and 3 respectively. The only clue as to the authorship of the
falsified GRVs and delivery notes
emerged during the
cross-examination of witnesses by Mr
Nelson
when it was put to them that such person had passed away.
Conspiracy / Common
Purpose
[43]
I have in the course of this judgment adverted to the allegation in
the indictment that the accused acted
in furtherance of a common
purpose or in the execution of a conspiracy to commit the offences
charged. In our law a conspiracy
connotes an agreement between two or
more persons to commit, or to aid or procure the commission of a
crime. The essence of the
doctrine of common purpose is that if two
or more persons having a common purpose to commit a crime, act
together in order to achieve
that purpose, the conduct of each of
them in the execution of the common purpose is imputed to the others.
However as Snyman
[5]
points out
“
The
basis upon which the doctrine (of common purpose) operates, is the
individual accused’s active association with the common
purpose
. . . the notion of active association is wider than that of
agreement. Agreement, whether express or implied, is merely
one form
of active association.
”
[44]
The state presented no evidence either justifying an inference that
there was such an agreement between the
accused or any active
association between any of them. As adumbrated hereinbefore, it
relied upon the allegation in the indictment
that the accused were
“
directors, servants or agents”
of the two companies. It presented no
direct evidence that any of the accused had completed the GRVs and
delivery notes nor any
evidence from which such an inference could
legitimately be drawn. During argument I invited Mr
Cilliers’
response as to the basis upon which the
state had established its case against accused no’s 5 and 6
beyond a reasonable doubt.
The failure to provide a cogent answer is
not difficult to discern. Save for the bald allegation in the
indictment that they were
dispatch clerks for accused no’s 2
and 3 respectively, no evidence was adduced directly/indirectly
implicating them in either
the completion or submission of the GRVs,
delivery notes or tax invoices to the department. Nor for that matter
was any evidence
adduced that accused no 1 or 4 had anything to do
therewith. The fact that ultimately the department paid accused no’s
2
and 3 is irrelevant. The conduct requirement of the crime,
viz
,
the misrepresentation embodied in the statement of fact upon which
the Eastern Cape Treasury paid accused no’s 2 and 3,
cannot be
attributed to the accused by reason only of the fact that they were
directors, servants or agents of the companies.
[45]    As
adverted to hereinbefore, it was pertinently put to several witnesses
that the person who completed virtually
all the documentation
forwarded in substantiation that the goods had been delivered had
since deceased. The clear and only inference
to be drawn from the
letters written by accused no 1 is that he bore no knowledge of the
falsity of these documents. It follows
from the aforegoing that the
misrepresentation relied upon cannot be attributed to any of the
accused. Simply put, this dearth
in the evidence adduced on behalf of
the state, is destructive of its case and the onus which rests upon
it has accordingly not
been discharged.
[46]
There is however a further matter which invites comment. During the
course of the trial a litany of accusations
and allegations of
impropriety were levelled against the prosecuting authority and those
entrusted with the investigation of this
matter. During the
cross-examination of the police witnesses it was put to them that the
investigation was accuated by ulterior
motives to persecute accused
no 1. What was put is pure speculation and nothing more. The obvious
alterations and additions to
the GRVs and delivery notes constituted
sufficient reason to initiate the investigation undertaken by the
Scorpions and it scarcely
behoves accused no 1 or the other accused
to now register a complainant thereanent.
[47]
All that remains is a formal pronouncement of my verdict, which is
that:
Each
of the accused is found not guilty of the crime of fraud.
D. CHETTY
JUDGE OF THE HIGH
COURT
Obo
the State:
Adv
Cilliers,
National
Director of Public Prosecutions
Obo
the Accused:
Adv
Nelson S.C / Adv Taljaard
Instructed
by
Gordon
McCune Attorney,
140
Alexander Road,
King
Williams Town,
Telephone:
043 642 1519,
Direct
Fax: 086 649 3110
[1]
Act
No, 121 of 1998
[2]
Act
No, 51 of 1977
[3]
Act
No, 32 of 1998
[4]
An
appeal to the Full Court was dismissed.
[5]
Criminal
Law, C.R Snyman, 4
th
Edition at p263.