Ledla heads to ConCourt to overturn ruling in Gauteng PPE tender saga

Ledla Structural Development is turning to the Constitutional Court (ConCourt) in a last-ditch bid to overturn a Special Tribunal ruling that millions of rands in illegal proceeds the company scooped from a massive government personal protective equipment (PPE) contract be finally forfeited to the state.

Ledla initially attempted to convince the Special Tribunal to grant it leave to appeal the ruling, but failed.

Ledla then tried its luck at the Supreme Court of Appeal (SCA) in Bloemfontein, but again was unsuccessful.

Now, the company is pinning its last hopes on the apex court, which is set to hear the matter in May.

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Some of the first PPE graft allegations to emerge in South Africa after the advent of the pandemic centred on about R125 million worth of contracts the Gauteng health department awarded Royal Bhaca, which was at the time owned by the now late Madzikane II Thandisizwe Diko, whose wife, Khusela Diko, was also a spokesperson for the Presidency and known to be close to then Gauteng Health MEC Bandile Masuku.

The contracts were eventually cancelled due to the conflict of interest but Diko appeared to have still scored from the department through another contract – valued at R139 million – which was subsequently awarded to what the authorities have since said was in fact a front company: Ledla.

In December 2020, the Special Investigating Unit (SIU) got an order from the Special Tribunal for millions of rands which had been frozen in bank accounts belonging to Ledla and two of its directors – Rhulani and Kgodisho Lehong – to be forfeited to the state.

In Ledla’s application for leave to appeal before the Constitutional Court, chair of the board of directors Molatelo Lehong insisted various findings made by the Special Tribunal, including that Ledla was a “substitute” for Royal Bhaca “whose sole director was [Diko], a close family friend of [Masuku] then MEC for health in the Gauteng government” were “incorrect”.

“There is no law that prohibits a friend of a MEC from doing business with a department for which the MEC is responsible. There is no such law,” he charged.

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“The only law requires that related persons should recuse themselves from whenever decisions are made in relation to related parties.

“It is accordingly wrong to elevate the personal decision of Royal Bhaca to cancel or terminate its award with the department, based on public perceptions of what is good or bad, as decision grounded in any law.”

But the SIU, which is opposing the application, says the application is a red herring.

SIU attorney Stella Zondi said in the papers the application did not raise any “genuine constitutional matters or arguable points of law”.

“The applicants are in truth simply aggrieved by the factual findings and the application of the law by the Special Tribunal.

“Through the intended appeal, they want to remain illegitimate beneficiaries of a contract that was awarded to [Ledla] irregularly and unlawfully and they do not wish to part with the proceeds they derived,” she said.

The matter is to be argued on 24 May.