Final blow for former Old Mutual CEO in R250 million legal battle

Peter Moyo, the former CEO of Old Mutual, has lost his final bid to appeal a ruling against his R250 million damages claim against his former employer. 

The spat between the 174-year-old insurer and Moyo spilt into the open in May 2019 when he was suspended for an alleged conflict of interest.

According to Old Mutual, the situation arose because the former CEO “violated the terms of his employment contract” by allegedly placing his private financial interests ahead of the company.

“In flagrant disregard of the provisions in his employment contract designed to manage conflicts of interest between NMT Capital (a company Moyo co-founded) and Old Mutual, Moyo chaired a meeting of the NMT Capital Board on 4 July 2018, at which it was decided to pay an ordinary dividend of R105 million.

“Moyo and his partners thus shared R84 million, while omitting to pay preference share dividends, valued at R65.4 million at the time, due to Old Mutual,” it said.

The group said that its board engaged Moyo for months about the matter, but it became clear that he and the Board had a difference of opinion about his transgressions and how to resolve them.

The company fired him three weeks later – a decision Moyo successfully challenged in the High Court.

However, the battle didn’t end there. Moyo was subsequently prevented from returning to work and was ultimately fired a second time by the group.

The insurer’s board responded to CEO Peter Moyo’s application to have them declared in contempt of court for blocking him from returning to work.

Former Old Mutual CEO Peter Moyo

Old Mutual denied that it was in contempt of court, arguing that it had fully fulfilled its obligations to Moyo in terms of his reinstated contract. 

The board also argues that it was within its rights to dismiss Moyo again, as the initial court order did not prevent them from doing so.

The company said that the situation with Moyo was untenable and that no company should be expected to endure it. They say that the relationship between the board and Moyo had completely broken down.

Moyo accused the board of acting in bad faith and of trying to remove him from office. The board has denied these allegations and has said that it acted in the best interests of Old Mutual.

The Constitutional Court has refused Moyo’s leave to appeal, saying that his application does not engage its jurisdiction.

Moyo had filed several lawsuits against Old Mutual after he was fired in mid-2019. He had initially succeeded in his legal application for temporary reinstatement, but Old Mutual managed to have that overturned on appeal. 

Moyo then brought several other cases, including an attempt to secure his reinstatement and R250 million in damages, another to have the directors, including chair Trevor Manuel, be declared delinquent, and one to have the directors be declared in contempt of court. 

The courts dismissed all of these cases.

Old Mutual said in a statement that the battle with Moyo had been a “long journey”, but it had “stood by its principles throughout and always knew we had acted completely within the ambit of the law and in the best interests of our company and its stakeholders”.

The Constitutional Court’s decision is a final blow to Moyo’s legal challenges against Old Mutual. He has no further legal recourse. 

Old Mutual has said that it is “extremely pleased” with the outcome of the case.