The developers of Cotswold Fenns Equestrian Estate in Hillcrest, KwaZulu-Natal have been ordered to repay an investor R1,3-million by the Durban High Court after it ruled that “doing nothing for four years cannot be regarded as reasonable”.
The 59-hectare estate was marketed as being part of the secure, up-market Cotswold Downs Gold Estate and was to be developed using money from investors.
Pierre du Toit of Custom Capital said he had entered into two agreements for two sites in December 2006 but after there had been a sustained period of no development at the site he turned to the Durban High Court demanding that his money be repaid.
Cotswold Fenns claimed that Du Toit’s claim was related to an agreement that had been signed more than three years ago and as such had prescribed in terms of the period in which civil proceedings can be instituted.
In his judgment handed down yesterday, Acting Judge Guido Penzhorn dismissed this technical defence. Regarding the fact that no development had taken place on site, Penzhorn said that it appeared that Du Toit believed that a town-planning application was being approved and that approval would happen within 12 months.
When challenged over this the developers had said in a letter dated November last year that the development was a large project that would take years to complete. It was for this reason that no time periods were stipulated.
Judge Penzhorn said that Du Toit was entitled to know what progress had been made and what had happened to the money invested with the company. He said that even when the response to the court action was filed in February this year, one would have expected some clarity regarding steps being taken to get the necessary approvals.
He ruled that the loan agreement had been lawfully cancelled and ordered the developer to repay Du Toit.
In a separate development investors in the Cotswold Downs development company – currently in provisional liquidation – are still waiting to hear if they will recover any of their money. The application for the final liquidation of the company has been delayed for three months.
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