BY MELODY CHIKONO
DAVID Whitehead (DW) shareholders have filed an application at the High Court, challenging the decision by the firm’s judicial manager Knowledge Hofisi to remove it from judicial management on the basis that its fortunes have successfully turned.
Hofisi, recently, announced that the textile manufacturing company was out of financial distress and was ready to resume operations.
However, David Whitehead shareholders, in their court application, contend that the judicial manager misappropriated funds from the company during his tenure.
The shareholders, according to the application, contend that Hofisi should first answer to the charges levelled against him which include unprocedurally selling company stock to workers.
DW major shareholder Edwin Chimanye two weeks ago wrote to Hofisi through his lawyers, Tamuka Moyo Attorneys, indicating that he should first clear his name regarding questions raised about his conduct during his tenure which were first raised two years ago.
The lawyers also state in the letter that they had made a High Court application challenging his decision. The case was filed under case number HC2245/21.
“Our client objects to your termination of DW’s judicial management because of the application which was filed with the High Court under case number HC2245/21 in which he invites the high court to look into your conduct for the time you have been a judicial manager/corporate rescuer practitioner for DW,” the letter, dated May 14, 2021, reads.
The lawyers further indicated to Hofisi that he must not rush to terminate the corporate rescue process before the finalisation of the lawsuit as this would influence the case.
In June 2019, Hofisi made an application to be recused as the DW judicial manager.
This again was challenged by the shareholder who pointed to Hofisi’s misconduct which included levying a US$200 000 fee against an annual turnover of US$180 000 and deliberately exceeding fees which should have been determined by the Master of the High Court.
In other instances, the letter cited that fees charged by Hofisi exceeded the total turnover of the company. DW owes current workers about US$2,4 million, while reinstated workers are owed US$700 000. Retrenched workers are owed US$116 000.
During this tenure, Hofisi allegedly failed to account for the proceeds of the disposal of the DW non-productive assets he sold to raise capital for the company. It is these unresolved issues and many others that are now standing in the way for his exit from DW judicial management.