FILTERS:

Fraudulent transfer

16 March 2010

It was found that he was not.

Proceedings then commenced in the High Court for the arbitrator's award to be enforced. They are still going on.

Apart from fraudulently preparing and backdating a deed of sale, B purporting to represent the company whose shares he had sold 1 6 years earlier and in contravention of an interdict by the High Court preventing him from doing so, had, on behalf of the company, applied for a copy of the title deed of the property, alleging that the original had been lost while he knew that this was not true. Thereafter B, again purporting to represent the company and despite the interdict signed a fraudulently back-dated sale agreement arid thereafter a currently dated power of attorney authorising the transfer of the property to T who then, with the help of his father, D, fraudulently procured the registration of the property into his name.

In February 2006 the new directors of the company learned for the first time that the property was no longer registered in its name and that it had been transferred to T.

To transfer ownership of any asset the transferor must have the intention to transfer and the transferee the intention to acquire it. Because the directors did not have the intention to transfer ownership, it had not passed.

So, because T and B had acted fraudulently T was not the true owner of the property. The arbitration award was that the registration of the property should be restored into the name of company which was still the owner.

The scriptwriter, producer and director of the fraud was D who several years ago served a prison term for several convictions relating to fraud and, amusingly, bearing in mind his girth, escaped from custody. D was recently again found guilty of fraud in regard to property transactions and he, T, his daughter and son-in-law are now facing more fraud charges again relating to property transactions. The prosecution has been postponed because the daughter and son-in-law have asked for legal aid. The current litigation in the High Court is not yet over. T, who does not have one cent and may even be slightly retarded mentally, financed by a lady from Natal, is challenging the arbitrator's award in the High Court. The arbitration was, and the litigation is still conducted by D in T's name.

The arbitration and litigation has been going on for about four years and the costs run into the millions. The editor of Law News who has been in practice for almost 50 years has never come across such dishonest litigants as B and T who treat all, including the courts, with contempt and almost never follow rules of court but manage to eke out concessions from judges. That does not encourage confidence in the judiciary.

How does one protect oneself against fraudulent conduct of this nature? It is very difficult, but the registration of a mortgage bond or some other restrictive provision over the property may assist.

Several years ago an application for a certified copy (to replace the original) of a lost or destroyed title deed had to be preceded by advertisements. That requirement was removed but Law News has heard that it will be reintroduced. Yes, it will increase the cost of getting a copy but it may prevent fraud like or similar to that of B, D and T.

Republished with permission from Eversheds Law News

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