Fraud and corruption accused Schabir Shaik described a court ruling that a much discussed encrypted fax was admissible evidence in his trial as the "worst case scenario" on Thursday.

Shaik said he now had to "answer a lot more questions about information and [about] a fax I have no knowledge of" after Judge Hillary Squires' ruling in the Durban High Court.

Shaik's lawyers will start the defence case on Monday, after prosecutor Billy Downer, SC, closed the State's case. About 40 witnesses were called in of four months of exhaustive evidence.

The encrypted fax is central to count three of corruption against Shaik. It allegedly records a bribe agreement of R500,000 per annum for Deputy President Jacob Zuma. Shaik and Zuma were friends during the anti-apartheid struggle, and Shaik is now Zuma's financial adviser. The encrypted fax began as a handwritten note by Alain Thetard, former head of South African operations of French arms company Thomson CSF.

In his written judgment, Squires concluded the fax was "on the face of it" an agreement to pay Zuma in exchange for a counterperformance. The State alleges that "counterperformance" was protection during investigations into alleged irregularities in South Africa's multi-billion rand arms deal. "That no sign of the received messages was found in Paris or Mauritius seems to me to be hardly surprising.

Anyone at a head office being advised of achievement of this sort of thing if it was, in truth, the arrangement to pay a bribe, would normally... leave no sign of it lying about" said Squires. However, he said Telkom billing records reflected such transmissions.

Two other documents the State said was crucial in its case -- affidavits by Malaysia-based businessman David Wilson, and an extract from Thetard's diary showing meetings in March 2000 between Thetard, Zuma and Shaik --were also admissible.

The defence has admitted that such a meeting happened in Durban. However, they insist the meeting was to arrange funds for the Jacob Zuma Education Trust. Defence counsel Francois Van Zyl had opposed admitting Wilson's affidavits because they contained opinions and "character assessments" as well as facts.

However Squires ruled that just because a document contained some statements that were not facts did not mean the whole document had to be excluded. Wilson was a former director of Renong, a company initially involved in the Durban Point Waterfront development project.

His evidence relates to his company's search for a black economic empowerment partner and how Shaik tried to get that contract by using his connections with Zuma. This evidence relates to count two of "general corruption" against him.

In one of his affidavits Wilson said that in the last quarter of 1996 he met Shaik and Zuma at Shaik's flat in Durban. At that time Zuma was the MEC for Economic Affairs and Tourism in KwaZulu-Natal and the meeting came after a letter from Zuma to the chairman of Renong saying he was "extremely concerned" about the project and keen to assist Renong.

Wilson said Zuma was "clearly uncomfortable" at the meeting, and Wilson had the impression "from his demeanour, the substance of the meeting and the manner in which it proceeded that he was there under sufferance".

Wilson said Zuma was unhappy with the people nominated to present the empowerment interest and "stressed repeatedly" that Shaik would be a good partner for the job. In his affidavit Wilson said it became "increasing clear" that Shaik had some hold over Zuma. Zuma also mentioned that Shaik had helped him.

Wilson's "strong impression" was that the help was financial. After court adjourned on Thursday Downer said: "We've been on track all the way through, and things are still going according to plan." He said the prosecution looked forward to hearing from the defence.

With acknowledgement to Sapa.