About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: High Court, Northern Cape Division, Kimberley
SAFLII
>>
Databases
>>
South Africa: High Court, Northern Cape Division, Kimberley
>>
2013
>>
[2013] ZANCHC 48
|
|
National Director of Public Prosecutions v Scholtz and Others (2027/2012) [2013] ZANCHC 48 (13 December 2013)
IN
THE HIGH COURT OF SOUTH AFRICA
(Northern
Cape High Court, Kimberley)
Case
No:2027/2012
DATE:
13 DECEMBER 2013
In
the matter between:
The
National Director of Public
Prosecutions
...................................................
APPLICANT
And
Alfeus
Christo
Scholtz
...............................................................................
1st
RESPONDENT
Alfeus
Christo Scholtz
N.O
.....................................................................
2nd
RESPONDENT
(In
his capacity as joint trustee
of
the Casee Trust)
Esmarie
Scholtz
.........................................................................................
3rd
RESPONDENT
Esmarie
Scholtz
N.O
.................................................................................
4th
RESPONDENT
(In
her capacity as joint trustee
Of
the Casee Trust)
Trifecta
Investment Holdings (Pty)
Ltd
................................................
5th
RESPONDENT
(Registration
No. 2006/011099/07)
Trifecta
Holdings (Pty)
Ltd
......................................................................
6th
RESPONDENT
(Registration
No. 2003/018438/07)
Trifecta
Trading 434 Property 5 (Pty)
Ltd
............................................
7th
RESPONDENT
(Registration
No. 2005/035873/07)
Trifecta
Trading 434 Property 5 (Pty)
Ltd
............................................
8th
RESPONDENT
(Registration
No. 2006/004455/07)
Trifecta
Trading 434 Property 7 (Pty)
Ltd.
...........................................
9th
RESPONDENT
(Registration
No. 2006/004635/07)
Trifecta
Prop 11 (Pty)
Ltd
......................................................................
10th
RESPONDENT
(Registration
No. 2006/007170/07
Lanel
Breda
N.O
.....................................................................................
11th
RESPONDENT
((In
her capacity as joint trustee
of
the Shosholoza Trust)
Hermanus
Petrus Steyn
N.O
..............................................................
12th
RESPONDENT
(In
his capacity as joint trustee
of
the Shosholoza Trust)
Richard
Scheffer
N.O
............................................................................
13th
RESPONDENT
(In
his capacity as joint trustee
of
the Shosholoza Trust)
Yolanda
Rachel
Botha
.........................................................................
14th
RESPONDENT
John
Fikile
Block
...................................................................................
15th
RESPONDENT
Noluthando
Silungile
Block
.................................................................
16th
RESPONDENT
Chisane
Investments (Pty)
Ltd
...........................................................
17th
RESPONDENT
(Registration
No. 2004/004027/07
Nicolaas
Natwala
...................................................................................
18th
RESPONDENT
Khara
Hais
Municipality
.......................................................................
19th
RESPONDENT
Alvin
Botes
..............................................................................................
20th
RESPONDENT
Itile
Supply Services (Pty)
Ltd
............................................................
21st
RESPONDENT
((Registration
No. 2005/010820/07)
Rodney
Martin
Saal
............................................................................
22ND
RESPONDENT
Kelvin
Cecil
Ryland
............................................................................
23RD
RESPONDENT
Palesa
Ruth
Lebona
..........................................................................
24TH
RESPONDENT
Trifecta
Resources and Exploration (Pty) Ltd
.............................
25TH
RESPONDENT
(Registration
No. 2006/015442/07)
Alvin
Botes
..........................................................................................
26TH
RESPONDENT
(In
his capacity as trustee
of
the Poliyane Leisure Trust)
Green
Marble Investments 3 (Pty)
Ltd
..........................................
27TH
RESPONDENT
(Registration
No. 2006/028085/07)
Ngwedi
Investments (Pty)
Ltd
.........................................................
29th
RESPONDENT
(Registration
No. 2001/017372/07)
Quantum
Leap Investments 657 (Pty)
Ltd
.....................................
30th
RESPONDENT
(Registration
No. 2002/028568/07)
Catwalk
Investments 582
Pty
.......................................................
31ST
RESPONDENT
(Registration
No. 2000/023642/07)
Sovereign
Seeker Investments 98 Pty Ltd
..............................
32ND
RESPONDENT
(Registration
No. 2005/027824/07)
Trifecta
Trading 434 Property 10 Pty Ltd
.................................
33RD
RESPONDENT
(Registration
No. 2006/004307/07)
Green
Marble Investments 2 Pty
Ltd.
........................................
34th
RESPONDENT
(Registration
No. 2006/028262/07)
Steelpoort
Inv Pty
Ltd
.................................................................
35TH
RESPONDENT
(Registration
No. 2006/033775/07)
Upington
Super SaltPty
Ltd
.....................................................
36TH
RESPONDENT
(Registration
No. 1968/013439/07)
Rochelle
Sandra
Botes
..............................................................
37TH
RESPONDENT
Heard:
25/10/2013
Delivered:
13/12/2013
JUDGMENT
MAMOSEBO
AJ
INTRODUCTION
[1]
On 30 November 2012 I issued a provisional restraining order ex parte
against the 37 respondents cited in this matter. The order
restrained
them, inter alia, from dealing in any manner with any property to
which the restraining order relates. Simultaneously
with this
order, a rule nisi was issued calling upon the respondents to show
cause on 22 March 2013 why the provisional order
should not be made
final. The rule and the interim order were extended on 10 May 2013
and subsequently to 31 May 2013. On 31
May 2013, the matter was
postponed to the opposed roll for hearing on 25 October 2013. A
Curator Bonis, Mr Shawn Williams of
KPMG, a firm of Chartered
Accountants, was appointed in terms of s28 (1) (a) of the Prevention
of Organized Crime Act, 121 of
1998 (POCA). The applicant, the
National Director of Public Prosecutions (NDPP), now applies for the
confirmation of the provisional
restraint order.
[2]
Respondents 2-10; 25; 27 and 30-33 filed notices of intention to
oppose the application but have not deposed to affidavits in
opposition thereto. The NDPP placed in issue the first respondent’s,
(Alfeus Christo Scholtz’s) authority to act on
their behalf in
opposing this application. Respondents 11 to 13 have filed notices to
oppose but did not file answering affidavits.
It was common cause
that Mr Alvin Botes has been erroneously cited twice; the 28th
respondent is therefore deleted. A breakdown
reflects that
respondents no’s 1 and 5-10 have been charged criminally and
are opposing this application. Respondents 2-4;
11-13; 25; 27 and
30-33 have not been criminally charged and are also opposing the
application. Respondents 14; 15; 17 and 20-24
have been criminally
charged and do not oppose the application. Lastly, respondents 16;
18-19; 26; 29 and 34-37 have not been
criminally charged and do not
oppose this application.
[3]
On 10 May 2013 I granted the following order:
“
In
respect of the first to tenth, eleventh, twelfth, thirteenth, twenty
fourth, twenty fifth, twenty seventh, thirty first and thirty
sixth
respondents this matter is postponed to Friday 31 May 2013 (as a
provisional date) and the rule nisi is extended accordingly;
In
respect of the remaining respondents the provisional order that was
issued on 30 November 2012 is confirmed.”
Mr
Cilliers SC, representing 16 respondents, has in his introduction
included among the respondents he is representing in this application
twenty ninth, thirtieth, thirty second, thirty third, thirty fourth
and thirty fifth. The provisional restraint order has already
been
confirmed against them on 10 May 2013.
THE
PARTIES
[4]
The applicant is the NDPP duly appointed in terms of s10 and s5(2)
(a) of the National Prosecuting Act, No 32 of 1998, read
with
s179(1) of the Constitution of the Republic of South Africa Act, No
108 of 1996.The respondents comprise the Trifecta Group
of companies,
persons and or entities alleged to have been involved or may have had
an interest in the realisable property.
THE
FACTUAL BACKGROUND
[5]
The NDPP relies on the affidavit of Mr Nkululeko Christopher Ndzengu,
a Senior Deputy Director of Public Prosecutions. It is
common cause
that the Trifecta Group of companies acquired office space in the
Northern Cape and leased it to government departments.
It is further
not in dispute that Mr Breda, a former Director in the fifth
respondent, Trifecta Investment Holdings (Pty) Ltd,
who died in a
plane crash on 03 March 2009, negotiated and entered into all lease
agreements with government departments. In the
quest to identify a
broader BEE involvement, Breda nominated the Shosholoza Trust
(eleventh to thirteenth respondents) to hold
his 10% allocated
shareholding. Mr Alfeus Christo Scholtz (first respondent and joint
trustee of Casee Trust) held his shareholding
in Casee Trust (fourth
and fifth respondents).
[6]
Breda at a later stage informed Scholtz that he has identified the
fourteenth respondent, Yolanda Rachel Botha, Head of Department,
Northern Cape Department of Social Development, as a BEE participant.
Botha in turn established JYBA Trust for that purpose. The
Trifecta
Group, through Breda, was awarded seven lease agreements which, as
deposed to by the NDPP, were secured fraudulently
and corruptly. The
averments are supported by the audit report compiled by Trevor Sean
White, a Chartered Accountant and Forensic
Auditor of
PricewaterhouseCoopers. White conducted an investigation into the
lease agreements entered into between the Northern
Cape Department of
Social Development, the South African Social Security Agency (SASSA)
and the fifth respondent, Trifecta Investment
Holdings (Pty) Ltd, and
the subsidiary companies. The NDPP intimates that the respondents
circumvented the legitimate supply chain
management processes in
order to secure the lease agreements and in doing so charged the
department grossly inflated amounts for
the office space supplied
and/or for services purportedly rendered.
[7]
The NDPP maintain further that the respondents made corrupt payments
to and for the benefit of amongst others Yolanda Rachel
Botha, John
Fikile Block and Alvin Botes.
[8]
During this period Mr Block held the following positions:
(a)
The Provincial Chairmanship of the African National Congress (ANC),
in the Northern Cape;
(b)
He was a Member of the Northern Cape Provincial Legislature (NC/MPL);
and
(c)He
was a Member of the Executive Council (MEC), in charge of the
Department of Education, and presently MEC for the Department
of
Finance.
[9]
At the relevant time Mr Alvin Botes was:
(a)A
Member and Deputy Secretary of the ANC (NC);
(b)
MPL, the Northern Cape Legislature;
(c)MEC,
Department of Social Development, (NC).
[10]
The others held the following positions:(a) Rodney Martin Saal,
Deputy Director: Physical Planning, Northern Cape Department
of
Social Development; (b) Kevin Cecil Ryland, Physical Planning; ad (c)
Palesa Ruth Lebona, administrative clerk in the Physical
Planning
Division.
[11]
Mr Van der Linde SC, for the NDPP, submitted that he is not seeking
relief from the eleventh to thirteenth respondents (the
trustees of
the Shosholoza Trust). In response Mr South, representing eleventh to
thirteenth respondents, argued that the NDPP
obtained the provisional
restraint order through the abuse of the process of Court. He argued
that the founding affidavit never
alleged that anything was
transferred to the Shosholoza Trust. Mr South accordingly applies for
the restraint order against eleventh
to thirteenth respondents to be
discharged and that all restrained or seized assets be returned to
his clients. A concession erroneously
made does not bind a Court. I
will show why I reject the concession. See Phillipus Johannes Botha v
Minister of Constitutional
Development and Another, Case No 849/2013
delivered 29/11/2013 in this division in which Kgomo JP et Lever AJ
remarked as follows
at Para 7:
“
[7]
The application to strike out was brought informally, but
nevertheless we entertained it. Advocate Barnard for the NDPP
conceded
that paragraphs 4 to 8 and 10 to 13 should be struck out and
resisted the application to strike out only in respect of paragraph
14 of Ms Byleveld’s affidavit. In our view Advocate Barnard was
wrong to make such concession and in any event a court is
not bound
by a concession erroneously made. In Matatiele Municipality and
others v President of the Republic of South Africa and
Others
2006
(5) SA 47
(CC) at 67 the Court held:
“
[67]
Here, we are concerned with a legal concession. It is trite that
this Court is not bound by a legal concession if it considers
the
concession to be wrong in law. Indeed, in Azanian’s Peoples
Organisation (AZAPO) and Others v President of the Republic
of South
Africa and Others, this Court firmly rejected the proposition that it
is bound by an incorrect legal concession, holding
that, ‘if
that concession was wrong in law [it], would have no hesitation
whatsoever in rejecting it.’ Were it to be
otherwise, this
could lead to intolerable situation where this Court would be bound
by a mistake of law on the part of a litigant.
The result would be
the certification of law or conduct as consistent with the
Constitution when the law or conduct, in fact,
is inconsistent with
the Constitution. This would be contrary to the provisions of s2 of
the Constitution which provides that the
‘constitution is the
supreme law of the Republic; law or conduct inconsistent with it is
invalid.”
See
also Government of the Republic of South Africa and Others v Von Abo
2011 (5) SA 262
(SCA) paras 18 and 19; and Paddock Motors (Pty) Ltd v
Igesund
1976 (3) SA 16
(A) at 23F.”
[12]
In an affidavit submitted by Scholtz, appearing as the second
respondent to the North Gauteng High Court in Case Number 3753/11
the following extract appears under cited paragraphs:
“
18.
The deceased passed away on 03 March 2009. Although the Shosholoza
Trust was the registered holder of 55% of the shareholding
in the
first respondent (being Trifecta Investment Holdings (Pty) Ltd), 10%
of these shares were being held as nominee on behalf
of a principal,
which means that Shosholoza Trust and the Casee Trust each
effectively held 45% shareholding in the first respondent.”
“
31.5
Although the Shosholoza Trust was registered as a shareholder of 55%
of the shares in the first respondent, the Shosholoza
Trust
represented by the deceased [Breda] had, to my personal knowledge, in
2005 undertaken to transfer a 10% shareholding in the
first
respondent to the nominee of Yolanda Botha, who was a close friend
of the deceased and influential in political circles.
She had not yet
nominated the entity to which shares should be transferred at the
time of the deceased’s death, and hence
the reference to the
YB Trust in the spreadsheet. That 10% shareholding is also reflected
in the organogram, annexure “CS3”
which I had handed to
and discussed with the first applicant at our meeting in March 2009,
and was at no time queried or disputed
by any of the applicants.”
“
67.1
I refer to what I have stated above in regard to the undertaking
given by the deceased on behalf of the Shosholoza Trust, and
accepted
by Yolanda Botha, to transfer 10% of the shares held by the
Shosholoza Trust in the first respondent to the nominee of
Yolanda
Botha. This agreement was confirmed by both of them to me in 2007,
and on numerous subsequent occasions. It was expressly
confirmed to
me that until such time as she has decided upon and nominated the
entity which was to hold the 10% shareholding, the
Shosholoza Trust
would continue to hold 10% of the shares in the first respondent for
and on behalf of the entity nominated by
Yolanda Botha.
67.2
On 19 January 2009 the deceased and I at a meeting held at Pretoria
agreed to give effect to the transfer of the 10% shareholding
in the
first respondent to a BEE company or trust which would be controlled
by Yolanda Botha. We formally agreed that 10% of the
shares in the
first respondent, and which formed part of the shares held by and
registered in the name of Shosholoza Trust, would
be sold at par to
a BEE company or BEE trust to be formed, and that Van Deventer Smith
Attorneys would be instructed to establish
the entity and effect the
transfer.
67.3
The JYBA Belleggingstrust was subsequently formed with Angelique
Botha, (the niece of Yolanda Botha) and Naude as trustees,
and the
shares were transferred to the Trust.”
The
names of the parties identified above by numbers only are the
following: 11th to 13th; 5th; 2nd; 4th and 14th respondents.
THE
LEGAL ISSUES
[13]
It is necessary to refer to the provisions of
s25
and
26
of the
Prevention of Organized Crime Act, 121 of 1998
as a point of
departure.
25
Cases in which restraint orders may be made
“
(1)
A High Court may exercise the powers conferred on it by
section
26(1)
-
(a)
When-
(i)
A prosecution for an offence has been instituted against the
defendant concerned;
(ii)Either
a confiscation order has been made against that defendant or it
appears to the court that there are reasonable grounds
for believing
that a confiscation order may be made against that defendant; and
(iii)
The proceedings against that defendant have not been concluded; or
(b)
When-
(i)
That court is satisfied that a person is to be charged with an
offence; and
(ii)
It appears to the court that there are reasonable grounds for
believing that a confiscation order may be made against such
person.
(2)Where
the High Court has made a restraint order under subsection (1)(b),
that court shall rescind the restraint order if the
relevant person
is not charged within such period as the court may consider
reasonable.
26
Restraint orders
(1)
The National Director may by way of an ex parte application apply to
a competent High Court for an order prohibiting any person,
subject
to such conditions and exceptions as may be specified in the order,
from dealing in any manner with any property to which
the order
relates.
(2)
A restraint order may be made-
(a)
In respect of such realisable property as may be specified in the
restraint order and which is held by the person against whom
the
restraint order is being made;
(b)
In respect of all realisable property held by such person, whether it
is specified in the restraint order or not;
(c)
In respect of all property which, if it is transferred to such person
after the making of the restraint order, would be realisable
property.
(3)(a)
A court to which an application is made in terms of subsection (1)
may make a provisional restraint order having immediate
effect and
may simultaneously grant a rule nisi calling upon the defendant upon
a day mentioned in the rule to appear and to show
cause why the
restraint order should not be made final.
(b)
in respect of all realisable property held by such person, whether it
is specified in the restraint order or not;
(c)
Upon application by the defendant, the court may anticipate the
return day for the purpose of discharging the provisional restraint
order if 24 hours’ notice of such application has been given to
the applicant contemplated in subsection (1).
(4)(a)
A restraint order shall provide for notice to be given to persons
affected by the order.”
[14]
Mr Cilliers, has argued two issues in limine pertaining to the ex
parte application. First, whether the NDPP was entitled to
approach
the Court on an ex parte basis in the light of the preceding
requests on behalf of the respondents and the relevant facts;
and
secondly, whether the NDPP disclosed all material facts in the
founding affidavit as they were obliged to do having regard
to an
applicant’s obligations when approaching a Court on an ex parte
basis.
APPROACHING
THE COURT ON AN EX PARTE BASIS
[15]
As quoted above
s26(1)
permits the NDPP to approach the Court on an
ex parte basis. The term ‘may’ makes it discretionary to
the NDPP to follow
the ex parte route but nowhere does it expressly
or by implication prevent the NDPP from pursuing that option; the
exigency of
the situation may dictate the choice to be made. The Act
makes provision for a rule nisi to be granted in order to afford a
respondent
an opportunity to show cause why the provisional order
should not be confirmed on the return date. A respondent is even
expressly
authorized to anticipate the return date and have the rule
nisi discharged, if so advised.
[16]
Mr Cilliers has further argued this aspect based mainly on a North
Gauteng unreported judgment of Prinsloo J in Theodore Wilhem
Van den
Heever versus National Director of Public Prosecutions and 11 Others,
Case No 22354/12 delivered 26 October 2012. In that
case two urgent
applications were considered simultaneously. In the one application,
the curator bonis, Mr Van den Heever, brought
the application. The
circumstances there are distinguishable from the facts in the present
application. The second application
in the same matter referred to as
the Groenewalt matter involved inter alia conducting the farming
business which included trading
in animals, including rhino and
buffalo as well as hosting hunting parties from overseas. The
responsibility was cumbersome to
Van den Heever who had to take
responsibility for these animals which were in dire straits and in
distress due to the drought.
It was a matter of life and death for
the animals. Undue delay or inappropriate steps taken may have
precipitated irreparable harm
or loss.
[17]
The case before me involves commercial buildings which have been
leased out. An order by my sister Williams J issued on 07
March 2013
reads:
“
1.
The first to fourteenth applicants (the applicants) will fully comply
with paragraph 18 of the order dated 30 November 2012 (the
November
order) by 13 March 2013.
2.
Subject to compliance by the applicants with paragraph 1 above, the
second respondent (curator) is authorised to provide written
authorization for the sale of the immovable properties referred to in
paragraphs 2.1, 2.2, 2.3 and 2.4 of the Notice of Motion
dated 27
February 2013 to the third respondent in terms of the following sale
of rental enterprise agreements:
2.1
The sale of enterprise agreements between the third respondent [Delta
Property Fund Limited] (purchaser) and the third applicant
[Esmarie
Scholtz] (seller) dated 20 February 2013 which includes Erf 7365,
Kimberley;
2.2
The sale of enterprise agreements between Delta Property Fund Limited
(purchaser) and the Esmarie Scholtz (seller) dated 20
February 2013
which includes Erf 29879, Kimberley;
2.3
The sale of enterprise agreements between Delta Property Fund Limited
(purchaser) and Trifecta Trading 434 Property 4 (Pty)
Ltd (seller)
dated 20 February 2013 which includes Erf 10405, Kimberley;
2.4
The sale of enterprise agreements between Delta Property Fund Limited
(purchaser) and the Trifecta Trading 434 Property 4 (Pty)
Ltd
(seller) dated 19 February 2013 which includes Erf 12180, Kimberley.
3.
The full purchase price payable in terms of each of the sale
agreements referred to in paragraphs 2.1 to 2.4 above, will be paid
directly to the second respondent [The Curator S Williams N.O.) save
for any amount payable to mortgagees under any mortgage bond(s)
presently registered over any of the properties referred to in
paragraphs 2.1 to 2.4 above payable to such mortgagees to procure
cancellation of such mortgage bond(s).
4.
The curator will deal with the purchase price received in terms of
paragraph 3 above in accordance with the powers provided for
in the
November order.
5.
The legal costs and disbursements of the curator will be paid on the
following basis unless otherwise agreed:
5.1
In respect of council fees in the amount assessed as reasonable by
the relevant Bar Council.
5.2
In respect of attorney’s fees in the amount assessed as
reasonable by the relevant Law Society.
5.3
In respect of disbursements the assessment of the reasonableness
thereof by the relevant Law Society.
6.
Payment of the curator’s disbursements in terms of paragraph 5
above will be paid in terms of section 28 (3)(c) of POCA.
7.
Save as aforesaid the November order remains of full force and
effect.
8.
Applicants do not proceed with the order sought in terms of paragraph
3 of the Notice of Motion.
9.
Costs of applicants and the NDPP is reserved for argument at the
hearing in the main application.”
It
seems to me that pursuant to this order, relief was granted to the
applicants, the Trifecta Group of companies, removing any
other form
of pressure, mainly financial, which they may have had prior to the
sale of these immovable properties.
[18]
Mr Cilliers has referred to a letter addressed to the NDPP dated 07
June 2011 written by Mr Naude of Etienne Naude Attorneys,
on behalf
of Trifecta Investment Holdings and all the companies in the group
including Mr Christo Scholtz and the Casee Trust.
He argued that
based on undertakings by the respondents to safeguard the NDPP’s
position in that letter pending the finalization
of the criminal
trial, it was unwarranted for the NDPP to have approached the Court
ex parte. He argued further that s26(1) does
not confer on the NDPP
an additional or stronger right but simply restates the ordinary
common law principle.
[19]
I did not find anything in the papers or during argument that
substantiated the argument that the applicant could not have
approached the court ex parte. See Development Bank of Southern
Africa Ltd v Van Rensburg and others NNO
2002 (5) SA 425
(SCA) at
443F-444F where Nienaber JA stated:
“
The
interim order, according to the above dicta, therefore had no more
than a mere holding effect in respect of the attachment that
took
place in terms thereof. It did not have the additional effect of
converting the possession resulting from the attachment
into a real
right that, per se, would enjoy preference over the claims of other
creditors. That this is what the Court had in
mind appears further
from what was stated at 86H:
'I
have pointed out that an order in favour of the applicant would not
merely be the enforcement of an existing right, but would
amount in
effect to the grant of rights which the applicant would otherwise not
have had. More particularly, it would bestow upon
the applicant a
right of security which would disturb the distribution of Affinity's
assets if Affinity were finally liquidated.'
[39]
This conclusion, that the rule nisi did not have finite and
definitive effect, is patently correct. An interim order is by
its
very nature both temporary and provisional; its purpose is to
preserve the status quo pending the return day. Thus it was
said by
Corbett CJ in Shoba v Officer Commanding,Temporary Police Camp,
Wagendrift Dam, and Another; Maphanga v Officer Commanding,
South
African Police Murder and Robbery Unit, Pietermaritzburg, and Others
1995 (4) SA 1
(A) at 18J - 19B:
'The
term ''rule nisi'' is derived from the English law and practice, and
the rule may be defined as an order by a Court issued
at the instance
of the applicant and calling upon another party to show cause before
the Court on a particular day why the relief
applied for should not
be granted (see Van Zyls's Judicial Practice 3rd ed 450 et seq;
Tollman v Tolmann
1963 (4) SA 44
(C) at 46H). Walker's Oxford
Companion to Law sv ''nisi'', states that a decree, rule or order is
made nisi when it is not to take
effect unless the person affected
fails within a stated time to appear and show cause why it should not
take effect. As Van Zyl
points out, our common law knew the temporary
interdict and a ''curious mixture of our practice with the practice
of England''
took place and the practice arose of asking the Court
for a rule nisi, returnable on a certain day, but in the meantime to
operate
as a temporary interdict.'(See too, Safcor Forwarding
(Johannesburg) (Pty) Ltd v National Transport Commission
1982 (3) SA
654
(A) at 674H -675C.) If the order authorising attachment is
provisional and subject to confirmation, it must follow that an
attachment
effected and any entitlement acquired on the strength
thereof must likewise be provisional and subject to confirmation.
[40]
I agree with Grosskopf J's conclusion that the interim order of
attachment had a mere holding effect. For otherwise it would
mean
that in all kindred cases a real right supposedly vesting in a
bondholder on the executionof a provisional order of attachment
would
thereafter be abrogated should the provisional order be discharged on
the return date, be it at the instance of the liquidator
or a third
party or because the Court for good reasons resolved to exercise its
discretion against the bondholder. Grosskopf J
in effect decided
that an attachment pursuant to a rule nisi that was issued ex parte
and which is in competition with a provisional
winding-up order
issued before its return day is not to be equated in law with an
attachment sanctioned by a confirmed rule nisi.”
[20]
It is common cause that the order obtained ex parte, which was
accompanied by the entire application, was served on the respondents
or was properly brought to their notice. It was accordingly up to
them to challenge the averments made therein or to abide the
final
outcome of the NDPP’s application. Obtaining an interim order
does not place a respondent at a disadvantage when the
issues are
fully ventilated and argued on the return date. No march has been
stolen.
I
find that under the circumstances, and for the stated reasons, the
applicant NDPP was justified in approaching the Court on an
ex parte
basis.
APPLICANT’S
DISCLOSURE OF MATERIAL FACTS
[21]
The following have been disclosed in para 46 of the NDPP’s
affidavit:
“
I
wish to immediately draw this Honourable Court’s attention to
the fact that there is:
46.1
Civil and application proceedings under Case Number 3735/2011 in the
North Gauteng High Court, Pretoria, which respectively
pertained to
civil recovery and restraint by the eleventh respondent and others
against the fifth respondent and others;
46.2
A docket of a criminal case of theft of the fifth respondent’s
data registered as Garsfontein CAS 545/02/2011 and opened
by the
first respondent against Magdalena Elizabeth Buizer (Buizer), the
former book keeper of the fifth respondent;
46.3
A letter dated 7 June 2011 and marked NCN 1 from the fifth
respondent’s attorneys requesting the applicant:
46.3.1 Not
to proceed in this matter by way of an ex parte application; and
46.3.2 To
serve process in this matter at Naudè’s. The applicant
advised the fifth respondent’s attorneys that
it is not
prepared to supply an undertaking not to proceed in this matter by
way of an ex parte application as set out in NCN 2.
46.4
A preservation order under Case Number 1825/2012 returnable on 14
December 2012 against fourteenth respondent in respect of
renovations to 12 Jawno Street, Kimberley, and 10% shares in JYBA
Beleggings Trust registered as 105/2012 (the JYBA Trust).”
[22]
It is accordingly evident that the NDPP was not prepared to settle
for a mere undertaking by it not to proceed ex parte. There
was
therefore no agreement that the NDPP broke which the respondents
opposing this application can now seek to hold the NDPP to.
[23]
In National Director of Public Prosecutions v Basson
2002 (1) SA 419
(SCA) at 428 para 21 Nugent AJA held:
‘
[21]
Where an order is sought ex parte it is well established that the
utmost good faith must be observed. All material facts must
be
disclosed which might influence a court in coming to its decision,
and the withholding or suppression of material facts, by
itself,
entitles a court to set aside an order, even if the non-disclosure or
suppression was not willful or mala fide (Schlesinger
v Schlesinger
1979 (4) SA 342
(W) at 348 E to 349 B).
[24]
Mlambo AJA in National Director of Public Prosecutions v Kyriacou
2004 (1) SA 379
SCA at 387 pronounced:
“
[17]
Counsel for the respondent submitted that the appellant should be
non-suited for failing to disclose in the ex parte application
that
the trial Court had granted a forfeiture order in terms of s34(1) of
the Criminal Procedure Act and the amount thereof. It
was submitted
that such disclosure was called for as it is likely to have
influenced the Court whether to grant the provisional
order or refuse
it. It is common cause that the s34 order was not referred to in the
papers.
[18]
It is correct that utmost good faith must be observed when initiating
an ex parte application, and failure to disclose and
present fully
and fairly all known material facts may constitute a ground to
dismiss an application. The duty to disclose extends
to all facts
which might influence a court in coming to its decision.
[19]
The learned Judge in the Court a quo had a discretion, on being
apprised of all the facts, to either set aside the provisional
order
or confirm it. An important consideration in the Court a quo was the
question whether the Court that granted the provisional
order might
properly have been influenced by non-disclosure of the s 34 order to
refuse relief. The learned Judge in the Court
a quo heard full
argument on this issue but elected to discharge the rule on another
ground. He did not deem it necessary to deal
with this one. I can see
no reason to have discharged the order by reason of the
non-disclosure in question. Had disclosure been
made the s34 order
would not have been the answer to a confiscation order. There was,
in addition, as already said, the matter
of related criminal activity
and the force of the presumptions.”
[25]
In addition to there being no bar against the NDPP to approach the
Court ex parte and that the NDPP broke no agreement, I am
satisfied
that the NDPP has not failed to disclose material information as
alleged by the respondents but has made a full and
frank disclosure.
I have approached and considered the information cited in para 21
above in the context of the cited jurisprudence.
I
find therefore that there was adequate disclosure of material facts
by the applicant NDPP and reject the argument advanced by
Mr
Cilliers.
[26]
The question is whether on the evidence before me there are
reasonable grounds for believing that a confiscation order may
be
made against those respondents who have been charged with any
relevant criminal activity. See s25(1)(b)(ii) of POCA. If I am
persuaded that there are reasonable grounds to believe that a
confiscation order may follow after the criminal trial I, would then
be vested with a discretion to confirm the provisional restraint
order. On the other hand, if there are no such reasonable grounds
for
so believing, I would in all fairness and in the interests of
justice, have to decline to confirm the order and discharge the
rule
nisi.
[27]
For me to arrive at an informed decision it is crucial to examine all
the evidence. It is imperative to determine if there
is evidence
which “might”, as opposed to “shall”, support
the conviction which may result in a confiscation
order. It is
essential further to be satisfied that such evidence “might”
be believed by the trial Court. Southwood
AJA in National Director of
Public Prosecutions v Kyriacou (supra) at 388 para 23 observed:
“
[23]
Section 25 of POCA provides for the jurisdictional requirements for
an order in terms of s26. The jurisdictional requirements
in issue in
the present case is contained in s25(1)(a)(ii):
‘…
when-
it
appears to the court that there are reasonable grounds for believing
that a confiscation order may be made against that defendant.’”
I
have to consider the circumstances under which a confiscation order
will be made against the backdrop of the case in casu and
whether the
established facts would induce a reasonable person to believe that a
confiscation order may be made against the respondents.
See National
Director of Public Prosecutions v Basson (supra) at para 19.
[28]The
aforementioned section confers upon me a discretion to grant a
restraint order if there are reasonable grounds for believing
that a
confiscation order may be made.. It is so that the respondents have
been deprived of the restrained realizable property.
I believe there
is a real possibility that the trial court may confiscate the assets
at the end of the trial in favour of the NDPP.
Brand JA in National
Director of Public Prosecutions v Kyriacou (supra) at 394G
pronounced:
“
All
s25 (1)(a)(ii) requires are reasonable grounds for the belief that
the trial Court may (not will) conclude that respondent benefited
from related criminal activities”(Emphasis added)
[29]
Mr Cilliers and Mr South have both argued that the NDPP should not
have joined the trustees and the individuals as well as
the companies
that have not been criminally charged. They referred to the
Shosholoza Trust in particular as well as other individuals
and
entities cited on the basis that they may be having an interest in
the realisable property. Their submissions in this matter
are
incorrect. Having perused the White Report it seems to me that
there is a correlation particularly between Scholtz, the first
respondent in this matter, who is the sole director in Trifecta
Investment Holdings (Pty) Ltd, the main company to which all these
trusts and other companies are subsidiaries. Trifecta Trading 434
Property 5 (Pty) Ltd has been criminally charged and its shareholders
are Shosholoza Trust 75% and Casee Trust 25% shares. Mr South
argued that it has not been shown in the founding affidavit that
any
of the respondents has transferred anything to the Shosholoza Trust.
Mr Ndzengu relied on the investigation of Col Luis, Col
Smit and Mr
White’s report. In White’s report, at page 310 thereof,
Shosholoza Trust leased Keur and Geur building
in Douglas from
November 2008 and has received 40 payments to the total sum of R997,
791.24, just under a million rands. The other
criminally charged
individuals and companies also have an association which is so
intertwined and diffused that it is unfortunate
for those with
interest in these realizable properties who are affected by this
order.
[30]It
is necessary to pierce the corporate veil here. See Cape Pacific Ltd
v Lubner Controlling Investments (Pty) Ltd and others1995
(4) SA 790
(A) at 803 C-G where Smalberger JA pronounced:
“
The
principle of a company's separate juristic personality was first
asserted in the House of Lords in Aron Salomon v A Salomon
and Co
Ltd
[1897] AC 22.
There already it appears to have been recognised
that proof of fraud or dishonesty might justify the separate
corporate personality
of a company being disregarded. (See, in this
regard, the speeches of Lord Halsbury at 33 and Lord Macnaghten at
52-3.) And over
the years it has come to be accepted that fraud,
dishonesty or improper conduct could provide grounds for piercing
the corporate
veil. Recently this was confirmed in The Shipping
Corporation of India Ltd v Evdomon Corporation and Another
[1993] ZASCA 167
;
1994 (1)
SA 550
(A) where Corbett CJ expressed himself as follows at 566C-F:
'It
seems to me that, generally, it is of cardinal importance to keep
distinct the property rights of a company and those of its
shareholders, even where the latter is a single entity, and that the
only permissible deviation from this rule known to our law
occurs in
those (in practice) rare cases where the circumstances justify
"piercing" or "lifting" the corporate
veil. And
in this regard it should not make any difference whether the
shares be held by a holding company or by a Government.
I do not find
it necessary to consider, or attempt to define, the circumstances
under which the Court will pierce the corporate
veil. Suffice it to
say that they would generally have to include an element of fraud or
other improper conduct in the establishment
or use of the company or
the conduct of its affairs. In this connection the words "device",
"stratagem", "cloak"
and "sham" have
been used. . . .'
[31]I
have carefully considered this matter and discovered that there were
a lot of shenanigans, misrepresentations and obfuscation
at
destroying the paper trail. I need not be satisfied that the charged
respondents are guilty of offences for which they have
been charged
or whether they probably benefited from the unlawful activities. All
that I need to be satisfied with is whether it
appears to me, on
reasonable grounds, that there might be a conviction followed by a
confiscation order. I am satisfied based
on the facts before me that
there are reasonable grounds that the respondents may be convicted of
inter alia, fraud, corruption
and money laundering. With regards to
the confiscation order it remains undisputed that Scholtz, the sole
director in the holding
company with shares in the individual Trusts
and subsidiary companies, Yolanda Botha, John Block and Alvin Botes
with shares
in the Trusts, as well as the three employees in the
Department of Social Development who received cash payments,
benefited from
the proceeds generated by the Trifecta Group of
Companies with tenders awarded to them through the influence of John
Block, Yolanda
Botha and Alvin Botes, who were in authority in the
Provincial Government.
[32]
I have noted the judgment of my sister Pakati J in John Fikile Block
and Others v The National Director of Public Prosecutions
Case No
988/2013 delivered on 29 November 2013 in this division concerning
some of the parties listed therein who are also cited
in my judgment
and note that I have not discovered anything inconsistent in the two
judgments of this division.
[33]
In the result, I make the following order
Order:
1.
The Provisional Restraint Order issued on 30 November 2012 is
confirmed.
2.
The respondents are ordered to pay the costs of the application which
includes costs of the curator bonis jointly and severally,
the one
paying the other to be absolved.
M
C MAMOSEBO
ACTING
JUDGE: NORTHERN CAPE HIGH COURT
On
behalf of the Applicant: Adv HJ van der Linde SC
Assisted
by: Adv T de Jager
Instructed
by: Johan Kotze Attorneys
Mr
OF Lategan, from the Office of the State Attorney
On
behalf of the Respondents:
1,
10, 25, 27, 30, 31, 32, 33 Adv JG Cilliers S InstruWA Du Plessis
Attorneys
On
behalf of Respondents: 11th -13th Adv South
Weavind
& Weavind Inc.
Engelsman
Magabane