Cowan’s estate faces sequestration

2011-01-27 00:00

IN a highly unusual move the high court in Pietermaritzburg has been approached to provisionally sequestrate the deceased estate of the late Durban attorney, Colin Cowan, who is alleged to have stolen hundreds of millions of rands through a fraudulent investment scheme.

Cowan, a former executive director of top Durban law firm Garlicke & Bousfield Inc, committed suicide in Durban on November 24 last year.

However, Judge Chiman Patel, who considered the application by Topspec Investments Pty Ltd in chambers yesterday, declined to grant the provisional sequestration order immediately.

Instead the court granted an order compelling the Master of the High Court to appoint an executor in Cowan’s estate within 15 days and to report back to the court.

The court further ordered that the application papers be served on the Master of the High Court in Durban, which had not been done.

One of the concerns raised on behalf of Topspec Investments in the court papers is that one of the executors nominated in Cowan’s will — Neil McHardy of PKF accountants — has repudiated his appointment, while the other, Cowan’s widow, Norma, allegedly appeared “reluctant” to accept the appointment.

Topspec Investments asked the court to appoint a curator (advocate C.J. Snyman) to the estate with powers to inquire into the allegations made against Cowan in the papers.

A report must also be prepared to ascertain the desirability of a final order for sequestration of the estate.

It is alleged in court papers that Topspec Investments has a liquidated claim of R30,5 million against Cowan’s estate arising from the theft of money by Cowan.

Cowan’s estate is said to be insolvent as Topspec’s claim alone is for R30,5 million, while Cowan’s estate has assets of “very modest value” comprising R59 000 in a bank account, a motor vehicle and the proceeds of some insurance policies.

It was submitted further that Cowan had dealt with large amounts of money “probably running into hundreds of millions of rands”, which appear to be unaccounted for.

Under the circumstances it was submitted that his estate urgently needs to be sequestrated so that the rights of creditors can be protected.

It was submitted that a provisional sequestration would not be prejudicial and that it would serve to preserve his assets and protect creditors rights against third parties to whom Cowan may have disposed of some of the funds he dealt with.

The application was moved on an urgent basis on behalf of Topspec Investments by advocate Con Hartzenberg SC.

Last week it emerged in another application in the high court for the winding up of an allegedly fraudulent investment company run by Cowan, Rodlane Trading and Investments CC, that investor funds totalling more than R70 million flowed “in and out” of the company’s account between December 14, 2005 and October 28 last year.

This was according to KPMG director Camilla Singh, who was contracted by Garlicke & Bousfield Inc to investigate Cowan’s dealings prior to his death.

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