The Constitutional Court has reserved judgment in a consolidated case involving a trust and a company connected to financial adviser Petrus Louw, jailed in March for defrauding his clients of millions of rands.

A Cape Argus report says during his trial, Louw confessed that he had defrauded his clients of about R110m, and the funds had been used in his company, Pholaco.

In the interim, his joint estate with his wife, Martha Louw, was declared insolvent.

Two cases were consolidated into one for the Constitutional Court to hear.

The first was brought by the trustees of a family trust known as the HNP Trust. This case concerns an application for leave to appeal against an order for the final sequestration of the trust by the Western Cape High Court.

The second application was by the trustees of the Insolvent Estate Louw. They sought leave to appeal against an order of the Western Cape High Court, which declined to grant a final order for the liquidation of a company known as Quintado 120 (Pty) Ltd.

In his submissions to the Constitutional Court on behalf of the HNP Trust, Advocate Pieter van Eeden SC argued that the trustees of the Insolvent Estate Louw lacked locus standi to apply for the sequestration order.

Appearing for the insolvent estate, Advocate Jannie van der Merwe argued that the High Court erred when it said the money channelled through Quintado’s bank account was not Louw’s money, but his clients’ stolen money.

‘The High Court applied an incorrect legal test in determining when a director’s conduct may be attributed to the company for civil or criminal liability, the so-called directing mind of the company test, and had it used the correct test, Louw’s conduct could be attributed to Quintado,’ he said.

Full Cape Argus report