Cleared doctor guns for multimillion-rand hospital

The Mthatha high court has set aside the fraud and theft conviction of Eastern Cape doctor Chwayita Ongama Yongama Yako, who has vowed to reclaim his interest in his brainchild, the 52-bed Mthatha Private Hospital, now in business rescue.

Appeal judge Belinda Hartle and acting judge ZZ Matebese said the state had failed to even come close to proving Yako had stolen or defrauded millions of rand arising from a R75m loan granted to him to set up the Cross-Med Mthatha Private Hospital more than a decade ago.

Delivering the judgment on Friday, the court found the state had not produced evidence to support claims that Yako had been in criminal breach of his fiduciary duties towards the hospital company.

With his name now cleared, Yako says he will institute a civil claim to restore his rights in the hospital.

His arrest in 2018 was reportedly in connection with a R75m Industrial Development Corporation loan to build the private hospital that opened in September 2014 on Nelson Mandela Drive in the Mthatha CBD.

In 2021, Mthatha regional court magistrate Noluthando Conjwa convicted Yako of stealing R1.29m from the project.

He was sentenced to an effective 10 years’ imprisonment, but when he sought leave to appeal, Conjwa noted that after “anxious consideration” of his appeal papers, she was persuaded that another court could come to a different conclusion.

Judges Hartle and Matebese did just that.

They found the state’s evidence, in fact, confirmed that the supposedly suspicious payments had been transparently made by Yako and “not in breach of his fiduciary responsibilities and not unjustified at all”.

The judges found the state had “perfunctorily” resisted the appeal mainly because Yako had not testified in his own defence.

This left it open to debate “whether this had effectively sealed his fate and damned him to the two convictions”.

They found it had been clear that the state had not put up a case requiring Yako to explain himself.

The judges said in the case of the conviction for theft, the principal act of supposed misappropriation of the R1.29m was contradicted by the evidence of the state’s own witnesses.

One state witness, who had been expected to testify that Yako had diverted money to his own company rather than paying professional fees owed had, in fact, said exactly the opposite.

The witness said Yako was director and sole shareholder of Cross-Med Health Centre, the company from which he was accused of stealing funds.

The judges said: “There was nothing per se untoward about him having given effect to the transaction as he did.

“We are satisfied that Yako’s conviction on this charge, based on tenuous threads of suspicion of culpable wrongdoing on his part, was a huge stretch.

“Fundamental to the charge was whether Yako had made the misrepresentation, as contended.

“This could not have been sustained once the trial court accepted that it had become common cause at the end that Yako owned the licence and practice number issued in the name of Cross-Med Mthatha Private (Pty) Ltd, which he withdrew at the end of the lease agreement.”

It was conceded by the state that Yako ran his own practice during the period of the alleged fraud, and there was no evidence that money from the medical aid scheme to his bank account was due to Cross-Med Health.

“In conclusion, there was no obligation on Yako to prove his innocence and no adverse inference fell to be drawn by his failure to testify adjudged against the poor case proffered by the state.

“It simply failed to prove its case against him on the criminal standard in respect of either charge.”

Yako said in a statement that he would “relentlessly pursue justice and protect my entity’s rights”.

He had been out on R15,000 bail pending the outcome of the appeal, which had now exonerated him.

The hospital company is in business rescue, with Cassim Zaheer having been appointed as business rescue practitioner.

Yako said: “This is not the end but the beginning of my journey to reclaim all that belongs to me, now that the appeal court has exonerated me.

“I thank the head of my legal team, advocate Nazo Zilwa.

“I have instituted civil proceedings before the Makhanda high court to reclaim my private hospital and set aside all court orders against me and my companies instituted by Cross-Med Health during business rescue proceedings.

“I intend to recover all funds unlawfully paid to Cross-Med Health pursuant to the use of my private hospital practice.”

NPA spokesperson Luxolo Tyali said: “We are still busy studying the judgment and will take appropriate steps once we decide on the next move.”

IDC Head of Corporate Affairs Tshepo Ramodibe declined to comment, saying: “The IDC has no details on the latest development to have an opinion.”

Numerous efforts to get comment from the business rescue practitioners were not responded to by the time of publication.

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