By Staff Reporter
The Lesotho government has come out guns blazing, pouring scorn on last week’s utterances by Frazer Solar GMBH, widely distributed in local media, describing them as ‘lies’.
This, after Frazer Solar contentiously claimed that Lesotho prime minister Moeketsi Majoro’s legal team were bent on delaying the Frazer Solar-Lesotho government court proceedings laid in South Africa’s High Court, Gauteng Local Division in Johannesburg.
Solar power company Frazer Solar GmbH was awarded a R855-million in damages by a South African court after the Lesotho government reportedly reneged on a contract, which was purportedly to be funded by the German government, as part of a wider programme to turn Lesotho into a net exporter of electricity.
A global enforcement action was filed in the District of Columbia in the US, paving way for the seizure of Lesotho’s assets around the world. These include royalties paid to Lesotho’s government by the Trans-Caledon Tunnel Authority as well as payments for power from Eskom Holdings SOC Ltd. Lesotho’s share in the Mauritius-based West Indian Ocean Cable Co. was also reported to have been provisionally seized.
Following South Africa’s application to intervene in the legal battle late last month, Frazer Solar said in this week’s media statement that such an application was irregular.
“This highly irregular step was intentionally taken to delay the court hearing…On Monday 8 November, two days before the hearing was due to start, the Court ordered a delay with a new hearing date yet to be determined but likely to be in 4 to 5 months.
“Lesotho Prime Minister Moeketsi Majoro’s legal team have offered to delay a critical hearing in the South African High Court two days before it was due to start, gifting Frazer Solar a critical win in its ongoing legal dispute. The decision belies previous statements about the urgency of freeing up much-needed funds. If the prime minister was sure of his case, why offer the delay?
“It’s not the action of a man who expects to win. Despite months of rhetoric from Dr Majoro on the strength of his government’s case at the first real test, he has wavered. We have no difficulties with Lesotho government’s demand that the hearing be delayed and royalties remain frozen. In one fell swoop, they have undermined their own case for urgency and their allegedly dire need for the financial royalties,” Frazer Solar said in a media statement.
The controversial statement has drawn the ire from Lesotho’s Attorney General, Rapelang Motsieloa, who has fired a broadside at the company claims to be based in Germany despite reports suggesting it is not registered in that country.
“Frazer Solar’s media statement is rubbish. Prime minister Majoro has nothing to do with South African government’s bid to intervene in the court case. He did not even know there was such an application by that country’s government to intervene until Tuesday (last week),” Motsieloa suggested.
He said the Lesotho government lawyers were alerted by Frazer Solar lawyers that South Africa’s government sought to intervene in the court case. The country’s court application was filed at the high court on October 29.
Contrary to claims that Majoro’s legal team were delaying the court hearing, on November 2, Frazer Solar lawyer, Hilton Peterson of Peterson Hertog Attorneys, sought that the Lesotho stay of awarding of damages and the application by Trans-Caledon Tunnel Authority (TCTA) as well as that of the South African government to intervene “be postponed to a date to be determined by the Registrar” of the high court with Justice K. Matojane residing.
The company sought that its proposal be urgently drawn to the high court judge ‘with a view to convening a case management meeting as soon as he is able to do so’. The company said it would not be possible for the main case to proceed on November 10-12 due to the application filed by the South African government to intervene despite accusing Majoro of causing delays.
The main case was set for hearing from 10-12 November.
“Our lawyers have indicated that there was no problem if Frazer Solar sought postponement We had no problem to proceed with the hearing …because the order for the stay of issuing award in favour of Frazer is still in force,” said Motsieloa.
He recalled that at the time the company claimed Majoro had colluded with South African government, the prime minister was out of the country attending the COP26 Climate Change Summit in Glasgow, Scotland. He was not aware of the South African court application to intervene in the case.
In this historic case Frazer Solar was awarded damages by the South African arbitrator Vincent Maleka for the kingdom’s alleged breach of a deal suspiciously struck between the government and the German company involving supply of solar energy and power equipment to Lesotho over four years. The deal was allegedly signed in 2018.
Subsequently, Frazer Solar in April this year applied to the high court in Gauteng petitioning it to endorse the arbitration award and allow the company to garnish Lesotho revenue from the water royalties from South Africa in terms of the treaty signed in 1986.
That prompted Majoro to request a reversal of the award amounting to 50 million sterling pounds (about M856 million) to Frazer Solar as damages.
On November 4, lawyers representing the Lesotho government, noted that Frazer Solar had requested an urgent case management meeting “with His Lordship Mr Justice Matojane with a view of seeking a postponement of the Lesotho Stay Application, the TCTA Application and the SAG (South African Government) intervention application.”
The ENSafrica law firm’s Deon Lambert/Wandile Ndabambi wrote to SA high court Judge Matojane: “We will of course make ourselves available for an urgent case management meeting as Frazer Solar has requested should His Lordship convene one.”
The lawyers continued: “However, in an effort to and perhaps even avoid the need for a case management meeting, we record for the benefit of all parties that the Kingdom of Lesotho is willing to agree to Frazer’s request to postpone the matters set down for 10-12 November 2021.”
This was subject to all concerned parties agreeing to liaise with one another to find new dates for the hearing of the applications set down or November 10-12 with such dates suiting the parties.
The South African (SA) government argued in the application that granting Frazer Solar damages from Lesotho’s revenue due to it from the Lesotho Highlands Water Project (LHWP) would irreparably harm the diplomatic relations between the two countries.
The SA government also argued that the kingdom would retaliate by cutting water supplies to it in terms of the 1986 water treaty signed by the two countries.
The treaty to supply huge volumes of water to South Africa from Lesotho’ mountain highlands was controversially signed by Lesotho military council’s Thaabe Letsie and apartheid South Africa’s foreign affairs minister Pik Botha at the Maseru Pitso Ground.
The arguments are contained in a voluminous court papers filed in the Gauteng High Court by the Trans-Caledon Transfer Tunnel.
The TCTA is the implementing agency of the LHWP that ensures supply of water to South Africa. It pays royalties to Lesotho for the supply. Frazer Solar was now seeking to have the royalties garnished as a move to recover some of the money owed to it by the Lesotho government regarding in terms of the damages arbitration award.
In its court papers, TCTA contented that the royalties should not be garnished to pay Frazer as they are to be paid to Lesotho Highlands Development Authority (LHDA) which has a legal existence from the Lesotho government with whom the German company has a contractual dispute.
“Trans-Caledon owes the cost related payments to the Highlands Authority,” said TCTA in court papers in support of Lesotho government’s application for stay of damages award.
It added: “Those claims belong to the Highlands Authority. The Highlands Authority and Lesotho are two separate persons in law. Frazer has a judgement against Lesotho. Frazer views the Highlands Authority’s assets as fair game. It cannot send the sheriff to attach the Highlands Authority’s assets.”
It further suggested: “The test is not whether Lesotho owns the Highlands Authority nor is the test about how international law treat the relationship between them. Rather, the test asks whether the Highlands Authority is a separate legal entity. If it is s separate legal entity, then its assets are its own not that of its shareholders.”
In another development, the Lesotho High Court Justice T’seliso Monaphathi issued a 14-day ultimatum to Frazer Solar to respond to Majoro’s application to scrap the award of 50 million pound sterling (about M856 million) as damages to the company for alleged breach of the solar energy deal.
The application comes in the midst of the court case lodged in South Africa;s Gauteng High Court in which Lesotho government is seeking stay of the award to Frazer Solar. That country’s government is also has also requested to intervene in the matter while the TCTA has also contested Frazer Solar’s court bid for payment of royalties to it.