JOHANNESBURG – The South Gauteng High Court confirmed the appointment of attorney Tony Mostert as curator of the Cadac Pension Fund (CPF), and saddled Cadac CEO Simon Nash, his co-trustees, and sequestrated British businessman, Matthew Machin, with a number of punitive costs orders.
The strongly worded judgment, handed down by Justice Caroline Heaton Nicholls, was the culmination of a number of intertwined cases relating to the CPF. These were heard simultaneously in August of this year.
This litigation was part of the Financial Services Board’s (FSB) efforts to recover pension fund surpluses that were unlawfully stripped from a number of pension funds in which Nash was involved, using the so-called “Ghalavas Option”.
The FSB had sought the court’s imprimatur that Mostert be confirmed as final curator of the CPF. In addition to this, there were a number of other applications on which Justice Heaton Nicholls was required to adjudicate.
Nash and his fellow trustees challenged Mostert’s final appointment.
Heaton Nicholls observed, “The need for the curatorship [of the CPF] had been conceded and the real issue in dispute is the suitability of Mostert as curator. He is rendered entirely suitable to be appointed as curator.”
Heaton Nicholls analysed a string of emails between Nash and his legal advisors: “These emails are indicative that Nash over a period of years fraudulently devised a strategy whereby the business of the CPF could be transferred with a nil surplus valuation. Any claim that existed was fictitious and concocted for this purpose. Nash obviously feared that the submission of a surplus distribution scheme would have exposed his involvement in the affairs of various pension funds in which he acted as a trustee.”
Heaton Nicholls also added: “Mention must be made of the callous disregard that Simon Nash displayed towards the Cadac pensioners. He viewed them as an impediment to his plans.”
The CPF Trustees were wholly unsuccessful and the court dismissed their case, saying, “Mostert should not be out of pocket as a result thereof and I intend to award costs on an attorney and client scale.”
Machin had intervened in the FSB and Cadac litigation before Heaton Nicholls at a very late stage. She noted: “Machin’s conduct was nothing short of extraordinary. He withdrew his application on the eve of the hearing without tendering costs. This amounts to nothing more than an abuse of the court and he should be obliged to pay costs on an attorney and client scale.”