|Centred on workers|
For their parts, the FSB and its executive officer deny that they breached any duty of care or that they owed obligations to the PEPF that give rise to civil liability. They further deny that they acted with gross negligence or that “a causal link exists between any of the omissions and the alleged losses”.
They add that at all material times the FSB Act provided for the FSB to perform its enforcement function by establishing an enforcement committee to deal with alleged contraventions of the law: “At no material times…(has any) law relating to the enforcement committee conferred any powers on the FSB.”
Then they introduce Richard Kawie (purportedly national benefits coordinator of the SA Clothing & Textile Workers Union) as a third defendant. Kawie, they say, was a trustee or alternate trustee of PEPF. As such, he was obliged to act with due care and in good faith, to avoid interest conflicts “and disclose any facts or circumstances known to him which gave rise or may give rise” to interest conflicts.
But according to the FSB, Kawie had failed to disclose to his fellow PEPF trustees that amongst other things:
- He and Buthelezi were influential in decisionmaking of the TEF (into which TIM was entitled to invest PEPL funds);
- TEF had never been audited;
- An entity to which TEF provided finance, primarily in the form of unsecured loans, was Canyon Springs;
- He exercised effective control over all Canyon Springs’ decisions;
- A material reason for him recommending investment in TEF was his expectation of personal financial gain from Canyon Springs.