Cape Town mansion sold to settle tax bill over 'gift'

05 July 2020 - 00:00 By BOBBY JORDAN
Candice van der Merwe and her father, Gary, who have lost a tax battle over a Cape Town beachfront mansion.
Candice van der Merwe and her father, Gary, who have lost a tax battle over a Cape Town beachfront mansion.
Image: Supplied

It was the home of statesmen and nation-builders, but it will be remembered for a R140m spat involving a swimwear model and her businessman father.

This week the "battle for Zonnekus" ended in an auction after the 10-year spat had gone as far as the Constitutional Court.

The mansion, commissioned in 1929, once attracted values of up to R100m. On Thursday it attracted a highest bid of only R15.5m.

The auction marks the end of an era for businessman Gary van der Merwe and his model daughter, Candice, who were central to the tug-of-war over the property.

They and their legal representatives made hundreds of court appearances in a fight with the South African Revenue Service (Sars) over a $15.5m (about R140m in 2012) payment to Candice - allegedly a gift from her "admirer", former Lebanese prime minister Saad Hariri.

The payment was flagged as suspicious by the Financial Intelligence Centre (FIC).

This promoted a Sars investigation and a subsequent tax bill, which the Van der Merwes challenged.

The Van der Merwes began several court applications against the liquidators of Gary van der Merwe's assets, which are held by Zonnekus Mansion (Pty) Ltd.

On February 5, the Constitutional Court dismissed Van der Merwe's attempt to challenge a high court order evicting him from Zonnekus, the Milnerton, Cape Town, beach home he had occupied for almost 20 years.

This paved the way for this week's sale by WH Auctioneers, with the winning bid now under consideration by liquidators Sanek Trust Recovery Services.

Darusha Moodliar, of the liquidators, said the auction attracted local and international buyers. The auctioneer's website says the highest bid was R15.5m, much less than the R50m municipal valuation.

The Sir Herbert Baker-designed home, on Woodbridge Island, was commissioned by Sir David Pieter De Villiers Graaff, a former mayor of Cape Town and father of De Villiers Graaff, once leader of the United Party. At one stage it was occupied by the British high commissioner, according to the auctioneers.

The payment was flagged as suspicious by the Financial Intelligence Centre (FIC)

The mansion has seven bedrooms, five reception rooms, a wine cellar, a gym, an eight-car garage, a large pool overlooking the beach, private beach access, a staff canteen and a guest cottage. It has views across Table Bay to the city and the mountain.

Van der Merwe refused to concede defeat this week, insisting the auction was illegal.

"I have a claim against the property ... and it is an illegal sale with the liquidators and Sars colluding," Van der Merwe told the Sunday Times by e-mail.

Moodliar said any claim against the Zonnekus sale "is no bar to the realisation of assets, which the liquidators are, by law, obliged to do".

One of Van der Merwe's companies, Wild Olive Enterprises, has filed a post-liquidation claim of R5.3m "relating to the upkeep of the mansion", according to Moodliar.

"To the extent that [Wild Olive] may hold such a claim, it will be reflected in a liquidation and distribution account which will be lodged with the master of the high court following the sale and transfer of the mansion."

The Van der Merwes' tax saga attracted international interest last year when Candice revealed the name of her mystery benefactor, Hariri, whom she said she met at a Seychelles resort in 2012 when she was 20.

Would you like to comment on this article or view other readers' comments? Register (it’s quick and free) or sign in now.

Speech Bubbles

Please read our Comment Policy before commenting.