Cape Town - Disgruntled Tramway Road beneficiaries say they will not accept payments of R750 000 from the R51 million sale of their Sea Point land. Spear Property Trust bought the land earlier this year, after the Tramway Road Trust – represented by Leonard Lopes – revealed it owed Investec R14m for a development that went bust.
The City of Cape Town transferred the land to the Trust in 2001, on condition that it be redeveloped to benefit the beneficiaries. Given the trust’s financial predicament, the city agreed last year the land could be sold so that Investec and the beneficiaries could be paid.
But a group of eight trustees has since come forward with claims that Lopes did not have a mandate to approach the city or to sell the land.
“It’s been a shambles from the start,” said trustee Ed Collins, 76.
He said the beneficiaries were told at a meeting this weekend that ENSAfrica, the firm handling the sale of the land, had already paid Investec R19m. Another amount had been set aside to settle a quantity surveyor’s account.
Collins said financial information was bandied about in council reports and letters, without all the beneficiaries being informed.
For Collins, the turning point in the protracted land restitution saga was Lopes’s decision to turn down funding from another bank, just days after the beneficiaries had voted in favour of the loan. “Now we have paid R19m for a hole in the ground.”
Lopes declined to comment, saying all queries should be referred to his lawyers.
Collins said the eight beneficiaries had agreed they would not accept the initial payout of R750 000, as approved at the October council meeting, as this would imply they supported the sale of the land.
“We don’t know what more we can do. But we still have hope.”
The payout of R750 000 is to be made to all 34 beneficiaries, including the eight who do not agree with sale of the land.
The proceeds of the land sale have been put in trust with ENSAfrica, and it is understood that 34 non-transferable cheques will be held for each beneficiary to collect.
Meanwhile, the group’s attorney has asked the city to explain in writing why it did not consult with all the beneficiaries before it approved the payout from the proceeds of the property sale at its meeting last month.
Failure to do so could lead to a court application by the group to have the city’s decision reviewed and set aside.
In correspondence with the law firm representing the bulk of the claimants, the city’s executive director of compliance and auxiliary services Gerard Ras said ENSAfrica must “resolve the differences between the disputing beneficiaries/claimants by November 14, failing which I shall be obliged to take this matter back to council in order to reconsider its recent decision herein”.
Mayor Patricia de Lille has confirmed that the decision can only be reversed by the full council.
A recommendation to start paying out the beneficiaries an initial R750 000 from the sale of the land they were forcibly removed from by the Group Areas Act, was pushed through at the October 29 council meeting, despite objections from opposition parties.
Several opposition parties placed on record their refusal to be part of the debate, while others abstained from the vote.
But it has now emerged the city may have ignored vital information about the trust’s mandate to sell the land and decisions taken at a meeting about the proposed sale.
Mahomed Attorneys did not respond to queries about the city’s response at the time of going to press.
Cape Argus