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Luthuli House to be auctioned over R25m debt?

The ANC headquarters in the Joburg CBD, Chief Albert Luthuli House, could be up for grabs soon after the Johannesburg High Court ordered the sheriff to auction the building.

The order was issued after the cash-strapped party failed to pay a R25-million debt owed to former spooks who were roped in to help with the 2014 provincial election strategy, court documents show.


Sources say an attachment letter will be delivered by the sheriff of the court to Luthuli House tomorrow, an action that is set to cause untold embarrassment to the ANC.

The court papers, which The Sunday Independent has seen, show that the ANC is embroiled in a legal battle with Resurgent Risk Managers, a company owned by Manala Manzini.

Manzini was a former National Intelligence Agency boss with Arthur Fraser, who was also a director of the company but resigned last year when he was appointed as State Security Agency director-general.

According to court papers, in October 2013 the ANC, represented by Ignatius Jacobs, entered into a "verbal agreement” with Barry Fraser, Arthur’s brother, who represented Resurgent to provide election support and strategic services to the ANC during the 2014 national elections.

On Friday, ANC secretary-general Gwede Mantashe said the party's lawyers were dealing with the matter and "we are challenging it".

However, he questioned why any company would enter into a verbal agreement for R20m.

“Ask them to show you a contract,” Mantashe said.

But an intelligence agent, who did not want to be named, said Luthuli House was a national key point and therefore could not be sold.

“These people are taking chances. Luthuli House is a national key point and that is why there is a police van stationed outside the building 24 hours a day," he said.

Several calls to Ignatius Jacobs, who has been cited in the court papers as the person who made the verbal agreement, were not answered this week.

However, a source said Resurgent did deliver on its mandate in terms of the outcome of the elections in which the ANC obtained a resounding 62% majority, despite having a verbal agreement.

In the court documents, Resurgent argues that in terms of the agreement, the firm, with the assistance of third-party service providers subcontracted by it, provided services such as the development of a strategic message and communication framework, the setting up of polling and focus groups, media monitoring and the development of an analytics model for voters.

The “verbal agreement” was that Resurgent would charge the ANC “its usual fee” which would not exceed R20m and included operational and travel expenses.

The fee was payable on submission of an invoice.

Then in May 2014, Resurgent invoiced the ANC for services rendered for R19.95m but the ANC did not pay. The Sunday Independent has seen a copy of the invoice.

On November 9 2016, legal firm Bowman Gilfillan, acting on behalf of Resurgent, wrote a letter of demand to the ANC top six: President Jacob Zuma, his deputy Cyril Ramaphosa, treasurer-general Zweli Mkhize, secretary-general Gwede Mantashe and his deputy, Jessie Duarte.

The letter reads: “We address you upon the instruction of our client, Resurgent Risk Managers Proprietary Limited.

“We are instructed that during August 2013, the African National Congress Elections Secretariat issued a request for proposals for a media partner for the 2014 national elections.

“The fees for the services to be provided by our client to the ANC were also discussed and agreed upon between Fraser and Jacobs on or about 10 October, 2013.



“In accordance with the agreement and the outline, our client duly provided election support and strategic services to the ANC during the period September 2013 to May 2014.

“Our client invoiced the ANC for the fees incurred in providing the said services and issued an invoice for an amount of R19950000.00 to the ANC on May 30, 2014.”

The law firm gave the ANC 10 days to settle and threatened to “institute legal proceedings against the ANC without further notice”.

Resurgent argues in the court papers that: “Despite the lawful demand, the defendant (ANC) has failed to or neglected to pay” them.

The source said the ANC ignored the letter of demand hoping that this whole thing would be delayed and that the debt would prescribe.

When Resurgent did not receive payment in May, it approached the High Court in Johannesburg, which issued a court order for the sheriff to auction off Luthuli House.

Questions which were sent to Resurgent were returned with a terse: “Resurgent does not wish to comment on the matter. Regards, Management.”

Calls to Manzini also went unanswered.

This is not the first time that Jacobs has been embroiled in issues around election war-room strategies.

Jacobs, Joseph Nkadimeng and Shaka Sisulu were also cited in court documents by public relations strategist, Sihle Bolani.

Bolani brought a lawsuit against the ANC after its failure to pay her for what is termed the “black ops” campaigning leading up to last years’ local government elections.

This campaign was intended to disempower opposition parties such as the EFF and the DA by spreading fake news on Twitter, Facebook and on posters.

Jacobs, who was cited as one of the defendants, resigned as general manager in the African National Congress ahead of a disciplinary hearing.

The Sunday Independent
Khabza Mkhize

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