The ANC says it is seeking an out-of-court settlement with Sizwe Car Rental after it was revealed the Ekurhuleni-based company is suing the party for more than R5.7m including interest.
This comes after it failed to pay for the 595 cars it had rented ahead of the party's elective conference at Nasrec in 2017.
"The African National Congress [ANC] has noted the matter in the media pertaining to a debt owed by it to Sizwe Car Rental. The ANC would like to place it on record that we received the summons last week.
"We have engaged the plaintiff to seek an out-of-court settlement. To that end, both parties have agreed, and we are currently in negotiations to settle the matter," said ANC national spokesperson Pule Mabe in a statement on Monday.
City Press reported that the car rental company had headed to the Gauteng High Court in Pretoria earlier this month seeking judgment against Luthuli House for rental fees for the period between August 2017 and July 2018.
The vehicles were rented from airports and motor depots countrywide and invoices were issued for them.
Sizwe Car Rental further told the publication it had repeatedly sent invoices to the ANC, however payment was not made, and it remained outstanding.
"In breach of the obligations toward the plaintiff [Sizwe] and the terms and conditions of the written car rental contract, the defendant [the ANC] failed to make payment on any of the invoices ... upon receipt of the said invoices, or at all," the rental agency said in court papers.
This lawsuit comes at a time when the political party is "technically insolvent" and allegedly in dire financial straits.
City Press reported former treasurer-general Zweli Mkhize had stated the political party was operating at a R215m debt and a R47m budget deficit in the previous financial year.