Court gives Hlaudi Motsoeneng seven days to pay back R11.5m ‘success fee’ with interest

Former SABC COO Hlaudi Motsoeneng has seven days to pay back the more than R11.5m “success fee” paid to him by the public broadcaster in 2016.

This week the high court in Johannesburg declared that the decision by the former SABC board to pay Motsoeneng the fee was unlawful and invalid and set it aside.

The court has ordered Motsoeneng to repay the amount within seven days and with interest at the rate of 15.5% per annum calculated from September 13 2016 to date of payment.

In the event Motsoeneng fails to pay within seven days, the SABC Pension Fund is ordered to pay the amount to the SABC or all the pension proceeds where the proceeds do not amount to R11,508,549.12.

Judge JL Khan has also ordered Motsoeneng to pay the costs of the application together with the costs of two counsel.

Motsoeneng was paid the amount by the then SABC board under questionable circumstances for negotiating a deal with MultiChoice for broadcast rights, including access to the SABC archives.

The broadcaster, under a new board, approached the high court in 2017 to review and set aside the decision by the former board to pay Motsoeneng the special fee and recover financial losses suffered by the SABC.

Special Investigating Unit (SIU) spokesperson Kaizer Kganyago said the court action was informed by the SIU investigation into the affairs of the SABC, which revealed it irregularly paid money to individuals and entered into contracts to the detriment of the public broadcaster.

The SIU later joined the SABC case and wanted Motsoeneng to also pay back a further R10.2m spent on irregular appointments, salary increments, suspensions and unlawful dismissals during his reign as COO. The two parties later withdrew this claim as Motsoeneng had taken the public protector report which identified these on review.

The ex-SABC boss responded to the civil claim lodged by the SIU to recover R21m from him with his own counterclaim against the public broadcaster.

In his counterclaim, filed in the same high court, Motsoeneng denied wrongdoing, arguing that he was entitled to outstanding compensation for his business “innovation” and for raising capital for the cash-strapped SABC.

He claimed the deal netted the public broadcaster a R1.19bn profit.

Motsoeneng argued it was his “ingenuity” that earned this profit for the SABC, and said he negotiated the deal outside his job description as COO and should therefore be compensated.

“The amount raised helped to establish SABC Encore on channel 156 and the SABC 24-hour news channel. These channels were not hosted on the SABC channels for which [Motsoeneng] was employed, but constituted an innovation which the SABC could utilise for its expansion and digital migration,” read his court papers.

He contended the decision of the board to approve the payment of his “success fee”, calculated at 2.5% of the R1.19bn less R1m, is valid and binding on the SABC and the R11.5m already paid to him in the form of a bonus was only a part payment of the total owed to him.

The SABC “has an obligation to pay the remainder of the monies which constitute part of the 2.5% of the R1.19bn to the defendant,” read the court papers.

The court said it could not draw the conclusion that Motsoeneng was acting in his private capacity to secure the pilot projects.

“This seemingly is an afterthought when things went wrong for him and the payment of the success fee was discovered.”

Khan said as the COO, Motsoeneng’s key accountabilities included being responsible for platform management and content generation activities of the SABC, including developing local, continental and global partnerships with relevant industry players.

He was contracted to direct corporate strategy and operational growth of the corporation to improve profitability and quality of the service offering in the designated areas of responsibility.

“The success achieved with MultiChoice is what he was employed to achieve and for which he earned his salary of R3,683,600 per annum,” said the court.

It also found that none of the SABC's policies allowed for a success fee.

SIU head advocate Andy Mothibi welcomed the judgment, saying it was a continuation of implementation of the SIU investigations outcomes and consequence management to recover monies lost by the public broadcaster.

“There are other cases enrolled in the high court and in the Special Tribunal awaiting adjudication and will result in further recoveries for the SABC,” Mothibi said.

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