As company fights to keep Henties’ N$54 million debt contracts
Zorena Jantze
MARGARET Malambo, the Chief Executive Officer (CEO) of Redforce Debt Management cc, has said that debt collection work, when it relates to local authorities, involves political interference and that she has noticed a trend whereby every time elections arrive, Redforce faces resistance and its contracts are terminated without any basis whatsoever.
Malambo made these remarks in an urgent application brought forth by Redforce Debt Management cc against the Council of the Municipality of Henties Bay and the Acting Chief Executive Officer of Henties Bay, in which it seeks a High Court order interdicting the Henties Bay municipal council from terminating its services.
She added that similar political interference, intended to win over votes from residents, was observed in the Walvis Bay municipality, which, after court action, had to retract its unlawful decision to terminate Redforce’s services and issue an apology.
Malambo said that, to Redforce’s utter shock, on 18 October 2024, a letter was dispatched by the Council of the Municipality of Henties Bay’s Accounting Officer and Acting CEO, confirming termination of the agreement it had with Henties Bay, effective 08 October 2024.
In a founding affidavit, Malambo explained that on 02 February 2022, the first handover of accounts took place.
“The applicant (Redforce) had to collect all debts that were aged 60 days and above. A total of 2,124 accounts were handed over for collection; these accounts were valued at N$54,828,629.87 and were aged 60 days and over. The applicant started collections and there were 2,124 accounts aged 60 days and over. That number has reduced to 1,638 accounts. I submit that the Applicant has collected the total sum of N$43,137,135.70 on behalf of the First Respondent between February 2022 and September 2024—that is roughly N$1.5 million every month in respect of debtors aged 60 days and above,” Malambo said.
She added that despite this progress, a letter dated 6 September 2024 outlined several grounds for termination of the agreement between the parties. The termination of the contract was, however, extended for one month on 15 October.
Malambo added that, however, to Redforce’s utter shock, on 18 October 2024, a letter was dispatched confirming termination of the agreement effective 08 October 2024. The Henties municipal council, citing reasons for the termination of the contract, said that debt recovery of less than 30% over two years does not meet standards. The decision to terminate the agreement was based on an internal review carried out by the First Respondent after the dismissal of its former Chief Executive Officer.
Further to this, the CEO said that Henties municipal council waived the arbitration agreement, and that the High Court has jurisdiction in the circumstances to hear the dispute.
She further added that at no point did the respondent ever raise any complaint that Redforce was not performing as required by the agreement, and that it did not provide the source of the information or the benchmarks that support the allegation that debt recovery of less than 30% over two years does not meet acceptable standards.
“I submit that if the Respondents are not interdicted from proceeding with termination, as they clearly intend to, the Applicant shall suffer irreparable harm because the Applicant has a total of 13 employees who were hired and designated specifically to implement the contract in question. I therefore submit that the only effective remedy is the grant of the interdict that the Applicant seeks,” Malambo said.