Readers may recall Noseweek’s story about Michael Fenner-Solomon, aka Mr Constantia, who was putting up a luxury development in Constantia called Warbler’s Grove (nose125).
Fenner-Solomon was struggling to unload the eight R20-million-plus units he had built and as creditors began to hound him, he would warn them off with the message: “I am Mr Constantia; cross me and I’ll make sure you never work in the area again.”
There are some creditors you can’t threaten, however, and Standard Bank is one of them. On 6 December, the bank brought a High Court application to place Fenner-Solomon’s close corporation, Morgan Creek Properties 144, into provisional liquidation.
The affidavit, filed by a senior Standard Bank employee, claimed that the cc owed the bank a cool R155m. Although the loan was secured by various bonds and suretyships from Fenner-Solomon and his family, the bank employee said there had been defaults in payments, and “a material adverse change” in the cc’s financial position.
She also told the court that Fenner-Solomon had admitted in an email that Warbler’s Way wasn’t viable: “Despite many attempts at restructuring the debt on this project, the market that this development was aimed at has been virtually non-existent for many years.”
The bank employee said that on top of the R155m, Fenner-Solomon’s cc owed R22m to Standard’s Personal and Business Banking division. It also owed Absa R20m; Penny Pinchers R2.5m; and a James Clinch R8.5m (Fenner-Solomon sold Clinch a property for R9.5m, took the money before transfer, then sold it on to a Mrs Searle. When Clinch objected, Fenner-Solomon was only able to refund him R1m). In total, Fenner-Solomon’s cc had properties worth R196m, owed R240m, and was therefore commercially insolvent.
Other nuggets in the affidavit were that Fenner-Solomon’s other cc, Michael Grant Developments cc, owed SARS R5.5m; and that he was involved in a development of 15 villas in Croatia – where, Standard Bank had reason to believe, funds may have been diverted from South Africa.
Noseweek asked Standard Bank’s attorney, Adam Harris of Bowman Gilfillan, whether the order had been granted, but all we got was a sniffy “I don’t talk to the press”. But another source said it had been granted – and that Fenner-Solomon was enjoying a holiday in Mauritius while all this unpleasantness was going on.
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