While on a state visit to Madrid, Deputy President Jacob Zuma suggested to his legal adviser that she visit France to sort out the problem of the alleged encrypted bribe fax, the Durban High Court has been told.

Linda Makatini testified at the corruption trial of Zuma's financial adviser, Schabir Shaik, that she could not make it because her schedule "did not allow her to travel to Paris".

She explained that Zuma had sent his attorney, Julie Mohammed, to attend a meeting about the fax. They were travelling in Europe at the time and "the Deputy President wanted me to go as well".

This was after the Scorpions had discovered that there was an encrypted fax, written by French arms company Thomson's executive Alain Thetard, which set out an alleged bribe agreement between Shaik, Zuma and Thomson.

She told the court that up to yesterday Zuma had not declared his liabilities for the year 2000 to the Cabinet. This was due to an oversight on her part.

She insisted that Zuma's declarations for every subsequent year were in order, including what he owed Shaik.

Shaik has pleaded not guilty to charges of corruption and fraud.

Makatini told the court that in 1999 she had sight of a revolving credit agreement concluded between Shaik and Zuma.

She saw the document in 1999 when sorting through papers Zuma had brought from KwaZulu Natal "in briefcases".

But it was only a copy of the fax, Makatini said.

"I was asked to look for the original during the trial. I looked for it but could not find it."

Shaik said in his evidence that Zuma had asked him if he (Zuma) could keep the original as he had to file it with the appropriate people in the Cabinet.

Makatini testified that the first time she had to declare Zuma's liabilities to the Cabinet (2001), he had given her a list of his creditors. Shaik was one of them.

She had then consulted the financial director of Shaik's Nkobi group of companies, Colin Isaacs. Isaacs had told her Zuma owed Shaik R1.5 million.

Shaik has admitted that by 2001 Zuma owed him R666 000.

Makatini said she did not know that the revolving credit agreement also contained a "payment holiday" Shaik had given Zuma.

Anton Steynberg SC, for the State, told the court the prosecution would argue that because of the "payment holiday" the loan agreement should have been declared as a benefit.

Makatini said she had been involved in compiling Zuma's declarations to the secretary of the Cabinet.

The trial has been adjourned to April 4.

With acknowledgements to Estelle Ellis and the Cape Argus.