MASERU — A group of MKM creditors has told a judge to recuse himself from a case in which they want the company’s liquidation stayed. Through their lawyer, Advocate Koili Ndebele, the 11 creditors told Acting Justice John Musi on Thursday that they feared he might be biased against MKM. The applicant’s fears, Ndebele said, were based on the fact that Justice Musi has already ordered MKM’s liquidation. Ndebele told the court last Thursday that his clients were also worried that Chief Justice Mahapela Lehohla had last month issued a directive saying all MKM-related cases should be heard only by Justice Musi. Justice Musi, a South African judge, was hired to preside over the MKM case after a number of the High Court judges recused themselves from the case. In June he ordered MKM’s liquidation to end court battles that have been raging since November 2007 when the Central Bank of Lesotho closed the company on allegations that it was operating banking and insurance businesses without a licence. He also appointed Daniel Gerhardus Roberts from Webber Newdigate and Chavonnes Badenhorst from St Clair Cooper as provisional liquidators. MKM argued that this was in violation of the law which says only the Master of High Court can appoint liquidators. Ndebele argued that by appointing the provisional liquidators Justice Musi arrogated himself power he did not have.
“His Lordship’s conduct had actually showed that he is likely to prejudice the applicants in this matter,” Ndebele said in court. “It is also prudent to bring to the attention of this court the fact that on November 4, the Chief Justice issued out a directive No 1 of 2011 informing all the relevant stakeholders that all cases relating to MKM companies shall not be heard by any other judge in Lesotho but shall be heard by Acting Judge Musi.”
“His Lordship had appointed provisional liquidators without specific explanation. The appointment was not based on law”. Ndebele said he had communicated with the Master of the High Court and discovered that the provisional liquidators had been appointed illegally. He said he had assumed that Justice Musi was conversant with the law that he ought to have not appointed the liquidators. “We have shown that once a judge in a judgment had expressed his opinion, whether it was right or wrong, he couldn’t sit in a subsequent hearing.” “You are totally disqualified from listening to the matter. That is why we are saying His Lordship cannot sit. He is likely to favour them (D G Roberts and C S St Clair Copper). His Lordship should actually recuse himself. “We submit that applicants cannot come before His Lordship because he had shown incompetence. There is a likelihood of bias. We cannot expect the court to oppose the law. The previous conduct brings up prejudice,” Ndebele said. Advocate Ndebele also queried the chief justice’s directive to make Justice Musi the only judge responsible for the MKM case.
“A reasonable man questions why Justice Musi yet we have so many judges in South Africa and Lesotho who could hear this matter. The judges had not said they cannot hear this matter,” Ndebele said.
Ndebele said the chief justice’s directive “was a clear violation of my clients’ constitutional rights to a fair hearing.” However, Justice Musi was not pleased about Ndebele’s insinuations that Justice Lehohla had vested interest in the matter when he directed that only he should deal with the MKM case. “I cannot allow such serious allegations to be left hanging over the Chief Justice of Lesotho,” Justice Musi said. “There are insinuations made about him. I don’t know where favouritism comes from. I have only dealt with the MKM case. “Is the allocation of cases not the prerogative of Chief Justice? Did you ask him whether he had interest in the matter?” “Have you asked him why he allocated the case to Musi AJ? You are challenging his directive!” Justice Musi quipped. Justice Musi postponed the matter on grounds that the Chief Justice should be served with papers for him to respond to the allegations made about him in the court. Advocate Chris Edeling represented the provisional liquidators, the Master of High Court, the Attorney General and MKM companies in liquidation. Four MKM companies are in liquidation after they could not account for M300 million of the M400 million they unlawfully collected from depositors. Nearly 500 000 people have their money locked up in the companies.
Estimates say the creditors are unlikely to recover more than 19 lisente of every loti they invested in the company and the liquidation might take more than five years to complete.
