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Netcare is 'seeking to silence KPMG'

23 May 2014

Netcare's plan from the outset was to bar KPMG from participating in the Competition Commission's high-stakes market inquiry into the private healthcare sector‚ according to KPMG's counsel‚ Wim Trengove SC.

Wim Trengrove SC, acting for Netcare wants to prevent KPMG from revealing confidential information to the Competition Commission about the hospital group. Image: Common Room

He made the claim in the High Court in Johannesburg on Wednesday (21 May)‚ where the groups have gone head to head in a legal battle over confidential information.

The information relates to Netcare - the private hospital group with the most beds in South Africa - and is in KPMG's possession as Netcare had used the professional services company for consulting and strategic work for several years.

Netcare is worried that the information could be used in the Competition Commission's inquiry without its consent. The inquiry was scheduled to start in January.

Netcare is asking the court to order KPMG‚ which is opposing the application‚ to identify and deliver to it any confidential information it has relating to the hospital group.

On Tuesday (20 May) Netcare accused KPMG of delaying the inquiry by not complying with an October court order compelling it to hand over the information.

Trengove said KPMG's response was that it had deleted most of Netcare's information from its servers in September and October last year‚ before the order was made.

He also said none of the contracts between KPMG and Netcare contained a restraint of trade clause. Trengove said while the contracts imposed a duty on KPMG to protect Netcare's confidential information‚ KPMG was free to contract with other parties who were in conflict with Netcare.

"KPMG may‚ for instance‚ work with customers of Netcare‚ such as medical aid schemes‚" he said. Trengove also took issue with a submission by Netcare's counsel‚ David Unterhalter SC‚ who argued that KPMG's role in the work of the inquiry made it a public functionary‚ meaning it was bound by the values in the constitution.

Unterhalter relied on the recent Constitutional Court judgment in the matter of AllPay and Cash Paymaster Services.

"That contention is flawed. The Constitutional Court did not hold that Cash Paymaster Services attracted a constitutional duty when it provided services to the South African Social Security Agency‚" Trengove argued.

The case continues on Thursday (22 May).

Source: I-Net Bridge

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