Disbarred lawyer who raided deceased estate provisionally sequestrated

The Cape High Court has ordered that a disbarred lawyer who took funds from a deceased estate he administered be provisionally sequestrated. 

Servaas Daniel Theron was taken to court by former client Andrea Harvey.

Theron, in the process of executing his duties in winding up the estate of her late father Clarence Trefz, made unauthorised cash withdrawals adding up to R522,759.

After not receiving the promised return of the missing money, Harvey sought a court order to have Theron placed under provisional liquidation by the Master of the Court so that she could claim the funds back. She did not believe he had the money he offered to pay back in full. 

Theron is a former attorney who is now a partner and conducts business at Overberg Administrators and Planners of Estates and Sworn Appraisers and Valuations in Kleinmond. He was appointed by Harvey as her agent to assist with the administration of her late father’s deceased estate in August 2019. 

However, Theron then renounced his appointment, and Harvey remained the executrix of her father’s estate for a while. On Theron’s recommendation, she appointed Finck Attorneys as her agent. Through the attorneys Harvey, who was assured by Theron he was experienced in the administration of a deceased estate, provided him with power of attorney to administer her late father’s estate and act in her stead. This was to limit her travel between the UK and South Africa to finalise the estate. 

When Harvey appointed Theron, he failed to tell her he had been struck off the roll of attorneys by the Law Society of the Cape of Good Hope in July 2012. She later found out the reason for his disbarring was that he had paid his personal expenses from his firm’s trust account. To cover this up, he had debited his personal expense payments to various deceased estates and other clients for whom he held trust monies.

Theron opened a bank account for Harvey's late father's estate and arranged for all estate money to be paid into it. Harvey, believing it was an uncomplicated estate that could be wrapped up quickly, grew concerned when a long time passed and she received no report back from Theron. 

On investigating the matter she discovered two estate accounts had been opened, as well as a fixed deposit with transactions amounting to R1.6m. In June and July 2020 she instructed Theron to give her full feedback reports, which he failed to do. 

Harvey contacted the bank for statements of the accounts and discovered Theron had been withdrawing money from the estate over a year. She emailed him a demand for the money to be repaid, but he did not respond. 

Her attorneys sent him a letter of demand. He agreed to repay the money but did not. Harvey believed this to be because his liabilities exceeded his assets. 

Her attorneys carried out a deeds search on Theron and found he owned a 20% share in a Kleinmond property owned by his mother and long-time partner Linda Dixon. Theron owed other creditors too. Using the same method he had used to take money from her father’s deceased estate, he had allegedly defrauded others of more than R1m. Harvey told the court this meant Theron was “hopelessly insolvent” in her application to have him declared as such. 

Theron opposed the application, claiming he made a full and formal tender of his alleged indebtedness to Harvey, but she had refused to accept it on grounds she believed he owed other creditors who were also wanting to pursue claims against him.

He argued Harvey had not proved there were other creditors and having them join her application was an abuse of process. 

Theron told the court he had offered to settle Harvey’s claim in full with interest, together with her legal costs — but she had refused this offer.

He denied he was “hopelessly insolvent” and had “committed various acts of insolvency”, claiming he was worth more than he owed. 

Harvey responded with another affidavit in which she provided evidence Theron had withdrawn the estate late bank accounts of K L Taylor amounting to R182,222; E R Davis to the sum of R363,010 and S A Kotze to the sum of R4,328,348. She further claimed Theron had signed an acknowledgment of debt in respect of the winding-up of the estate late C F Thomson in the amount of R468,418; that he withdrew cash from the estate late J B Geldenhuys bank account in the sum of R53,265 and withdrew R341,000 from estate late C J du Preez's bank account. 

Because no proof of the added amounts had been given, Theron claimed these allegations were inadmissible and hearsay evidence. 

Theron told the court he owned an 80% member’s interest in a block of flats valued at R6.1m, 100% of the Kleinmond property worth R3.6m and had R50,000 cash. His assets, he claimed, totalled R8.48m. 

Harvey disputed this, claiming Theron’s properties had been valued by a friend, that the block of flats was mortgaged and he was not the 100% owner of the Kleinmond house.

The court held that Theron’s tender to pay Harvey in full did not constitute actual payment, no proof was given that this money was readily available and Harvey was justified in rejecting the offer. 

The court also agreed with Harvey that Theron had not been upfront about his asset calculations, and the valuations he provided were rejected.

The court noted that the valuation of his house at R3.6m, after it was valued at R875,000 in August 2020, “defies logic as every sector of the economy experienced a decline due to the Covid-19 pandemic”.

“It would be irresponsible and negligent of this court to allow itself to be strung along by the respondent in his unlawful suggestions,” the court held, in deciding Theron “has committed an act of insolvency or he is insolvent. His liabilities far exceed his assets.” 

The court found that Harvey had made out a case for the provisional sequestration of Theron, and his estate was ordered to be “placed under provisional sequestration in the hands of the Master of the High Court of South Africa, Cape Town”. 

A rule nisi was issued calling on all interested parties to show cause on July 31 why the estate should not be placed under final sequestration.

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