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IN THE NORTH GAUTENG HIGH COURT, PRETORIA

[REPUBLIC OF SOUTH AFRICA]

CASE NUMBER: 51250 / 2011

Not reportable

Not of interest to other judges

Revised.

18/7/2017

In the matter between:

THE NATIONAL DIRECTOR OF PUBLIC PROSECUTIONS                             APPLICANT

And

TIMOTHY MOYANE                                                                                 1^st RESPONDENT

ALBERT MATHEWS SITHOLE                                                               2^nd RESPONDENT

 

JUDGMENT

 

MAVUNDLA,J.

[1] This is an opposed application for an order in terms of which it is sought by applicant that a Volkswagen 365 Scirocco motor vehicle with registration number F[…] MP be declared forfeited to the State in terms of section 48(1) of Prevention of Organized Crime Act 121 of 1998 ("POCA").

[2] The aforesaid vehicle, Scirocco is registered in the name of the second respondent. A preservation order was obtained by the applicant in relation to the said vehicle on the 9 September 2011 on allegation that it was an instrumentality of an offence and or proceed of unlawful activities in that :

2.1. The Scirocco is the proceed of unlawful activities, amongst others, money laundering in terms of section 4,5 and or 6 of POCA;

2.2. The Scirocco is an instrumentality of criminal activities of the respondents and or other persons. The criminal activities include, in all probability, gold smuggling and or money laundering.

 

THE FACTUAL BACKGROUND

[3] According to the applicant, on 12 November 2008, a disruptive operation was held in Barberton area to curb and arrest gold smelters and dealers. During the operation, several items were seized by members of the South African police Service (SAPS) at the first respondent's house. During November 2010, Penual Sithembiso Mathanda Ngwenyama (Ngwenyama), a sergeant in the SAPS, noted on the E-natis system that the Scirocco was registered in the name of the first respondent on the 17 March 2010, but that the ownership was subsequently changed to that of the second respondent on 2 June 2010.

[4] One Juanita Anne Brinkman (Brinkman) the Sales Manager at Palm Motors (Palm Motors) deposed to an affidavit regarding the history of the sale of the Scirocco. Brinkman stated that the first respondent accompanied an unknown man to the dealership and that the unknown man wanted to purchase the Scirocco. The first respondent identified this man as Gideon Casey Mchirawondu (Mchirawondu). On 22 September 2009 an amount of R20 000. 00 was deposited into the bank account of Palm Motors. This amount was a holding deposit in order to secure the Scirocco. When the Scirocco became available, Brinkman phoned Mchirawondu, but was informed that he had passed away. Brinkman was informed to contact the first respondent or Charmaine. The latter is the first respondent's girlfriend. Charmaine informed Brinkman that the first respondent will continue with the deal as a tribute to Mchirawondu.

[5] On 2 March 2010, the final offer to purchase was accepted. The first respondent wanted an additional Sportech Kit fitted to the Scirocco. This brought the purchase price of the Scirocco to R538 320. 00. From 1February 2010 to 23 March 2010, 7 payments totalling R518 400 were made into the account of Palm Motors. All these payments were made in respect of the Scirocco. Of these payments, 6 were made from different sources in Witbank and Johannesburg, whilst one cheque payment of R70 000 was made from the first respondent's personal account.

[6] On 17 March 2010, the Scirocco was registered in the name of the first respondent. On 2 June 2010 the Scirocco was registered in the name of the second respondent. The circumstances regarding the registration of the Scirocco in the name of the second respondent's name is dealt with in the affidavit of Sifiso Zulu (Zulu), a sales executive at Palm Motors. Further investigations into the second respondent revealed that he is unemployed and receives a monthly disability grant from South African Social Security Agency (SASSA). In the second respondent's medical assessment it is stated that he is 70% permanently disabled, needing assistance in self-care and physical activity.

[7] Theunis van Der Merwe (Van Der Merwe), a control officer in the employ of the Department of Home Affairs (the DHA) further determined that between 25 February and 21 June 2011, the first respondent used the Scirocco on 6 occasions to travel through the Lebombo and Beitbrigde Border Posts. On 17 March 2011, the first respondent and Charmaine used the Scirocco to go through the Beitbridge Border Post. Although the second respondent also travelled through the Lebombo Border Post on six occasions, he crossed the border post on foot. During June 2011, a search was conducted at the first respondent's home after information was received that the first respondent was dealing in drugs. During the search of the premises, the Scirocco was found parked in the garage. When the first respondent's wife, Phumlile Pretty Gama (Gama) was questioned, she informed Ngwenya that the Scirocco belonged to the first respondent. Gama also stated that she knows the second respondent and that the latter apparently has a share in the Scirocco. Gama also informed Ngwenya that the first respondent was unemployed. This was confirmed by the Department of Labour.

[8] On 9 September 2011, the Preservation order was published in respect of the Scirocco. On 16 September 2011, the preservation order was published in the Government Gazette. On 30 September 2011, the preservation order and preservation application were served on Gama. On 13 October 2011, the first respondent served his Notice of intention to oppose accompanied by an affidavit. On the 26 October 2011the second respondent served his notice of intention to oppose together with his affidavit.

 

THE RESPONDENTS' VERSION

[9] The respondents alleged in their opposing papers that the Scirocco was purchase with money lawfully earned by the first respondent in the course of conducting lawful business. The purchase price was not paid in order to disguise the origin of the funds. If the first respondent wanted to hide the ownership of the Scirocco, he would not have bought it in his own name to start with, so it is averred. Further, the second respondent has an interest in the Scirocco as he contributed to the purchase thereof. They deny that the shield was acquired with the proceeds of crime and or acquired by way of an affected gift as defined in POCA, nor is the Scirocco an instrumentality of an offence; neither is the first respondent linked to the commission of any offences, so contend the respondents.

[10] The applicant brought the application in terms of Chapter 6 of the POCA. Under chapter 6, forfeiture would be preceded by a preservation order in terms of s38 and followed by the forfeiture order, irrespective whether there is a prosecution or not[1]; The State need only place before the Court facts which on a balance of probability show that the property sought to be forfeited as a proceed of unlawful activity and should be declared forfeited to the State in terms of s50 of the Act[2]. In the Mohamed 1 matter the Constitutional Court held the primary objective of the provisions of POCA is to remove the incentive for crime, not to punish criminals.

[11] The applicant has to show, on a balance of probabilities that, the property i n issue is an instrumentality of an offence listed in Schedule 1 of POCA, or the proceeds of crime.

[12] For the respondent to successfully oppose the grant of forfeiture order, they attract an onus to show that they are innocent owners whose interest i n the property ought to be excluded from forfeiture order. They attract the onus to apply for exclusion by way of an application in terms of S48(4)(1)(b) read with s52 of POCA. In the matter of National Director of public Prosecutions v Hilton Plaatjies and Another[3] Jacobs AJ held that:

"The court must grant a forfeiture order if it finds on a balance of probabilities that the property is an instrumentality of an offence or the proceeds of unlawful activities as defined in the Act. The only discretion that the court has is to exclude the interest of parties that have shown on a balance of probabilities that they acquired interest in the property legally."

[13] In casu, various large sums of payment were made through third parties to Palm Motors for the purchase of the Scirocco. I n POCA, "proceeds of crime" is referred to as the "proceeds of unlawful activities", that is, "any property or any service advantage, benefit, or reward which was derived, received or retained , directly or indirectly... in connection with or as a result of any unlawful activity carried on by any person, and includes any property representing property so derived". An "unlawful' means "conduct which constitutes a crime or which contravenes any law..." s1(1) "unlawful activity." Property as defined in POCA means "money or any other moveable, immovable, corporeal or incorporeal thing and includes any right, privileges, claims and securities and any interest therein and all proceeds thereof."

[14] It is common cause that, the following payments were effected towards the purchase of the Scirocco vehicle :

14.1 An amount of R20 000. 00 paid on 22 July 2009 by Ronell Scholtz who signed and entered her telephone particulars on the slip;

14.2 An amount of R100 000. 00 was made on the 1February 2010 by means of electronic fund transfer from a registered close corporation; Richbar CC allegedly leant to the respondent by a friend who owns the corporation;

14.3 An amount of R60 000. 00 was made on 2 February 2010 by means of an electronic fund transfer by John Thembe in terms of alleged money due to the first respondent in terms of sub-contract work he did for Thembe;

14.4 Fourth payment of R150 000. 00 was made on 19 March 2010 by Edson Ngwenya as payment for alleged rental of a truck;

14.5 Fifth payment of R94 000. 00 was made on 19 March 2010 by John Thembe in terms of alleged money due to the first respondent in terms of work he did for Thembe;

14.6 The sixth payment of R35 000. 00 was made on 20 March 2010 by John Thembe in terms of same liability mentioned herein above;

14.7 The seventh payment of R9, 400. 00 was made on 23 March 2010 by John Thembe in terms of the same liability mentioned herein above.

14.8 The eight payment of R70 000. 00 was made on 23 March 2010 by the first respondent allegedly from his own funds in his cheque account Chihudho Trading CC of which the first applicant is the owner;

These entire payments total an amount of R538 400. 00.

[15] The following is also common cause:

15.1 Mchirawondu wanted to purchase the Scirocco vehicle which was initially registered in the names of Chihudho Trading on the26 -08-2009 .

15.2 After the death of Chihudho, the first respondent concluded the deal relating to the purchase of the vehicle from Palm Motors;

15.3 On 17 March 2010, the vehicle was registered in the name of the first respondent;

15.4 On 2 June 2010, the vehicle was registered in the name of the second respondent;

15.5 The second respondent is unemployed and receives a permanent disability grant from SASSA in the amount of R1596. 45 per month;

15.6 The second respondent does not have a drivers licence;

15.7 The first respondent uses the vehicle.

[16] The version of the respondents is that the first respondent paid for the Scirocco with money which was lawfully earned by him in the course of conducting a lawful business. The second respondent has an interest in the Scirocco as he contributed to the purchase of the vehicle. The Scirocco was not acquired with proceeds of crime and or acquired by way of an affected gift as defined in POCA. Further the Scirocco is not an instrumentality of an offence and the first respondent cannot be linked to the commission of any crime.

[17] Various payments made towards the purchase of the Scirocco, do not originate from the account of the first respondent. Some of the payments are allegedly from Thembe in respect of work done by the first applicant for Thembe. In this regard there is no supporting document or confirmatory affidavit of Thembe to bolster this alleged work relationship between the first respondent and Thembe

[18] According to the first respondent, the deposit of R20 000. 00 paid to Palm Motors, was from his own bank account. He however fails to attach supporting documentation such as his work relationship with national Panel Beaters Trading CC, and or statement of account of the said CC from which the amount originated, and proof of payment to the first respondent. Neither does the first respondent attach any of his bank statement from which he withdrew the said amount.

[19] In respect of the amount of R100 000. 00 the first respondent alleged that he borrowed the amount from his friend Aaron Mlambo of Richbar CC. Again he has not attached a supporting documentation in the form of statement from Mlambo disclosing where he would have obtained the money from, regarding being had to the significant large amount; nor a confirmatory affidavit from Mlambo.

[20] In respect of the amount of R 150 000. 00 which is a significant large amount, according to the first respondent this amount originated from Edson Ngwenya who has since passed on. This amount was in respect of the business contract for hiring a truck belonging to the deceased Edson and his brother. A copy of the alleged agreement was not attached.. Neither is the confirmatory affidavit of the brother to Edson or the executor of Edson's deceased estate attached.

[21] the amount of R70 000. 00 is allegedly drawn from the account of Chihudho. From the copy of the statement of Chihudho as from 30 November 2009 to 19 March 2010, it is noteworthy that no activity takes place during this period. However, on 19 March 2010 two deposits of R ll200. 00 and R60 000. 00 were made. However, there are no financial statements of the said Chihudho business attached or any source documentation justifying the payment of these two amounts. The amount of R60 000.00 is in my view, a large amount and warrants a supporting billing statement to show why such amount was paid.

[22] In so far as it is alleged that the second respondent has an interest in the Scirrocco because he has made a contribution towards the purchase of the vehicle, it suffice to point out that there is no supporting or confirmatory affidavit of Sithole. It is also not clear how Sithole contributed towards the purchase of this vehicle, regard being had to his social grant monthly amount he receives. His further personal circumstances, such as the fact that he does not have a driver's licence and is handicapped, leaves one to conclude that it is highly unlikely that he could have made any contribution towards the o purchase of this vehicle. The inference is that the registration in his name was nothing but an attempt to disguise and distance the vehicle from the first respondent. Besides, it is the first respondent's version that this vehicle was purchased by him through his funds lawfully obtained. On the first respondent's version, there is no way that the second respondent can have an interest in the vehicle.

[23] Bearing in mind that it is for the respondents to persuade the Court on a balance of probabilities that the aforesaid mentioned payments were lawfully acquired. In this regard, for the fact that there are no supporting documents, as pointed herein above, the inference to be drawn is that these amounts are either proceeds of unlawful a activity or derived from money laundering.

[24] In my view, the applicant has mustered sufficient warranting to have the vehicle declared forfeited to the State as being an instrumentality of unlawful activity or derived from unlawful activity or money laundering, and I therefore conclude as such.

[25] In the premises the following order is made:

1. That an order in terms of the provisions of section 50 of the Prevention of Organized Crime Act 121of 1998 (POCA) declaring forfeited to the State certain property, which is presently subject to a preservation of property order granted by this Court under the above case number on 10 February 2004,namely a 2010 Volkswagen 364 Scirocco motor vehicle with registration number F[…] MP (the vehicle);

2. That the property shall vest in the State upon the granting of this order;

3. That the appointment of a curator bonis is dispensed with;

4. That a duly authorized employee of the Asset Forfeiture Unit, is authorized to:

4.1 Assume control of the property and take it ito his/ her custody;

4.2 Pay the proceeds of the property, once realized, into the Criminal Asset Recovery Account established under section 63 of POCA, number 8-3030356 held at the South African Reserve Bank, Vermuelen Street, Pretoria.

5. Any person whose interest in the property concerned is affected by the forfeiture order, may within 20 days after he or she has acquired knowledge of such order, set the matter down for variation or rescission by the Court.

6. That the Costs of the application are awarded to the applicant.

 

 

_______________________

N.M.MAVUNDLA

JUDGE OF THE HIGH COURT

 

DATE OF JUDGMENT : 18/07/2017

APPELLANT'S ADV : ADV S de VILLIERS

INSTRUCTED BY : STATE ATTORNEY PRETORIA

1^st RESPONDENT'S ADV  : S.J. COETZEE

INSTRUCTED BY : BDK ATTORNEYS

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