Municipal account frozen
Once your account is frozen, it goes into a holding period for about two to three weeks. During this time, the money is still in your account, but you are not able to access it.
LYDENBURG – Thaba Chweu Local Municipality (TCLM) has had its bank account frozen.
This follows after the Sheriff paid a visit to this government body on June 6. The municipality was slapped with a High Court judgement from the Gauteng division to immediately pay Magoveni Business Trust, a private trust, an amount of R9,1 million with interest at the rate of nine per cent per annum, as well as the costs of the lawsuit.
Elias Mohlahla, the local Sheriff, was instructed to act on the judgement served. He delivered the notice to TCLM and the same time, the R8 333 313 in the account of the municipality was taken by Magoveni Business Trust, until the R9,1 million is paid. In the meantime, the municipality had no access to this public purse.
The notice read; “I, Sheriff for Nelspruit, give notice that acting into Supreme Court Rule 45 (12) (a), I do hereby judicially attach sufficient funds of the respondent to cover the amount due and thus satisfy the writ.” The writ referred to the means of execution that has frozen the bank account.
The bank will report to the creditor the money that is in the account, which can be taken by the creditor. If the balance of the account is less than what is owed, the creditor can continue to levy different accounts until the judgement is satisfied.
You are not able to withdraw or transfer your money until the issue that caused the account to be frozen is cleared. Banks have to freeze the account once they get a restraining notice from a judge. The same judgement and notice was sent to Standard Bank, at which TCLM holds its account. “Take notice that in the event that you, Standard Bank, refuse or neglect to comply with this notice, the applicant may call upon you to appear in court to show cause why such funds should not be paid to the Sheriff.”
Depending on where you live, your bank may or may not notify you in advance. Once your account is frozen, it goes into a holding period for about two to three weeks. During this time, the money is still in your account, but you are not able to access it.
Steelburger/Lydenburg News contacted TCLM to find out whether the account is still on hold, why the service provider was not paid and how payments by the municipality would be affected by the suspended account.
MUNCIPAL RESPONSE
Themba Sibiya, communications manager at TCLM, said there had been media reports regarding the attachment of the municipal account. “TCLM can confirm that there was a court decision to that effect.
“Magoveni Business Trust used a court order dating back to 2015 on a case that was closed and withdrawn by the same service provider before the court. Case number 26980/15 was declared closed, and since then Magoveni instituted another case with the same merits. The municipality is currently defending the case before the court.”
Sibiya said Magoveni appointed a new attorney and, disregarding due processes, reissued the court order with the allegations of the debt totalling R9,1 million without notifying the institution, as required by law.
“TCLM urgently approached the court to interdict the writ of execution against the municipality’s account. TCLM has successfully obtained an urgent court order, directing the Sheriff to release the account and also directed Magoveni to pay the costs of the urgent application.”
