{"id":486,"date":"2015-05-19T10:20:27","date_gmt":"2015-05-19T08:20:27","guid":{"rendered":"http:\/\/hsaction.previews6.matogen.com\/?p=486"},"modified":"2015-05-19T10:20:27","modified_gmt":"2015-05-19T08:20:27","slug":"orthotouch-matter-heats-up","status":"publish","type":"post","link":"https:\/\/hsaction.co.za\/?p=486","title":{"rendered":"Orthotouch matter heats up"},"content":{"rendered":"

Hanna Barry | 14 May 2015<\/strong><\/p>\n

JOHANNESBURG \u2013 Further fuel has been added to the fire between Orthotouch \u2013 a property company controlling eight of the Pickvest-promoted property syndication companies, Highveld Syndications \u2013 and a Stellenbosch-based law firm, Theron & Partners, which is bringing a class action application against Orthotouch and its directors.<\/p>\n

In a development unrelated to the class action application, Orthotouch alleges that Theron & Partners misled High Court judges and broke court rules in trying to have the recently sanctioned Orthotouch scheme of arrangement set aside.<\/p>\n

The law firm, however, claims that Orthotouch\u2019s claims are factually incorrect and \u201cclearly aimed at shifting the debate away from the merits of the pending applications by investors in the Highveld schemes\u201d.<\/p>\n

Investor payments reduced again<\/strong><\/p>\n

Sanctioned by the South Gauteng High Court in November last year, the Orthotouch scheme of arrangement restructured and reduced monthly interest payments to 18 300 investors who are invested in Highveld Syndications (HS) 15 to 22.<\/p>\n

These companies have been under business rescue since 2011, in terms of which Orthotouch (a public company founded and managed by Nic Georgiou) was meant to take transfer of properties paid for by investors and in turn pay investors a reduced monthly income for five years.<\/p>\n

At the end of the five-year period (December 2016), Orthotouch promised to repay investors the R4.6 billion they had collectively invested.<\/p>\n

But last year Orthotouch fell behind on its monthly interest payments to investors and so came up with a new scheme of arrangement, which gave investors a choice between three alternatives in full and final settlement of all their claims against Orthotouch.<\/p>\n

Investors who did not vote (more than 15 000) were defaulted to Alternative 1, which involves a monthly interest payment of 4% a year on R2.6 billion (the perceived rather than syndicated value of properties, according to Orthotouch) for ten years, until they become entitled to be paid their pro rata shares of the full amount of their historical investments.<\/p>\n

In terms of the business rescue arrangement of 2011, investors were to be paid a monthly return of 6%, increasing by 25 basis points each year.<\/p>\n

Theron & Partners recently applied to the High Court to have the scheme of arrangement set aside on a number of grounds, including that it believed insufficient investors were present at the November 12 meeting where voting on the new scheme took place.<\/p>\n

According to HS business rescue practitioner, Hans Klopper, \u201cjust short of 3 000 investors\u201d attended the meeting and voted, with 95% voting in favour of the scheme of arrangement. \u201cIn terms of the Companies Act, those who are present and vote determine the matter,\u201d Klopper told Moneyweb.<\/p>\n

\u2018Class action lawyers broke the law\u2019 \u2013 Orthotouch<\/strong><\/p>\n

In attempting to have this scheme of arrangement set aside Orthotouch claim that Theron & Partners \u201cdeliberately flouted the High Court rules\u201d and \u201cactively misled both Deputy Judge President Mojapelo and Judge Moshidi\u201d, the judge who sanctioned the scheme.<\/p>\n

According to Orthotouch, Theron & Partners wrote a letter to deputy Judge President Mojapelo, claiming that Judge Moshidi had agreed to hear their case on May 19 but was now unavailable, and requested the case be referred to another judge.<\/p>\n

In an open court meeting on May 7, Judge Moshidi denied having agreed to the May 19 hearing date as he was on long leave. He said that Theron & Partners were advised to approach the High Court Registrar to secure a hearing date, rather than approach his office directly.<\/p>\n

According to a statement from Orthotouch, Judge Moshidi said he \u201cintended to take steps to deal with Theron & Partners\u201d.<\/p>\n

Theron & Partners, however, counter that its junior counsel had liaised with Moshidi\u2019s clerk in February requesting the May 19 date be \u201cprovisionally diarised to enable the applicants\u2019 lawyers to liaise with the office\u2026 about the date in due course\u201d.<\/p>\n

\u201cIt appears that Moshidi has not yet seen the emails exchanged between the said junior counsel and his own clerk,\u201d Theron & Partners note in written responses to Moneyweb.<\/p>\n

The firm strongly denies flouting court rules and misleading judges.<\/p>\n

Diaan Ellis, an attorney and director of Faber Goertz Ellis Austen Inc, claims Theron & Partners attempted to usurp proper court process, behaviour that could prejudice certain litigants.<\/p>\n

\u201cOther HS investors, such as those who voted in favour of the scheme and who would be adversely affected if it were set aside, are also entitled to have due process followed and to intervene in the litigation if they wish,\u201d Ellis said.<\/p>\n

Theron & Partners argues that Orthotouch\u2019s statement is aimed at \u201cdeflecting the real issues to be addressed in future\u201d. It plans to request that Deputy Judge President Mojapelo appoint a judge to hear its applications as soon as possible in order to have the Orthotouch arrangement set aside.<\/p>\n

Publisher: Moneyweb | Hanna Barry | 14 May 2015<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Hanna Barry | 14 May 2015 JOHANNESBURG \u2013 Further fuel has been added to the fire between Orthotouch \u2013 a property company controlling eight of the Pickvest-promoted property syndication companies, Highveld Syndications \u2013 and a Stellenbosch-based law firm, Theron & Partners, which is bringing a class action application against Orthotouch and its directors. In a… <\/p>\n

<\/div>\n

Read More<\/a><\/p>\n","protected":false},"author":2,"featured_media":488,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/posts\/486"}],"collection":[{"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=486"}],"version-history":[{"count":2,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/posts\/486\/revisions"}],"predecessor-version":[{"id":489,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/posts\/486\/revisions\/489"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=\/wp\/v2\/media\/488"}],"wp:attachment":[{"href":"https:\/\/hsaction.co.za\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=486"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=486"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hsaction.co.za\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=486"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}