An aircraft in Dubai tied to Gupta-linked business Islandsite is among assets raised in the Free State High Court (Bloemfontein) case in which its business rescue practitioners (BRPs) are demanding legal fees related to its frozen assets.

A Business Day report says Islandsite’s business-rescue practitioners, Kurt Knoop and Louis Klopper, brought the case against the court-appointed curator and the NDPP.

They want the court to compel the curator, Dhanesvarin Appavoo, to pay their legal fees linked to Islandsite assets which have been frozen.

They also want Appavoo to file a record including income and expenses so they can submit tax returns. The BRPs launched an urgent application on 9 September and it was heard on Tuesday.

The BRPs told the court they incurred fees in the course of implementing Islandsite’s business rescue plan in early 2018.

In June 2021, the NPA secured a provisional freezing order for tens of millions of rands in Islandsite assets.

However, NDPP Shamila Batohi opposed the BRPs’ case in the High Court, and accused them of acting on the Guptas’ behalf, notes the Business Day report.

Knoop and Klopper raised transactions and actions by another BRP, who briefly acted as Islandsite’s BRP from December 2019 to November 2020. A dispute between Knoop, Klopper and the interim BRP was finalised in August 2021. Knoop and Klopper want to investigate the interim BRPs’ transactions and returns submitted to SARS. They also want payment regarding pending legal action on the sale of an Islandsite property in Midrand, Gauteng, in 2018.

In late 2021, the duo negotiated the sale of a Cessna plane, which Batohi said is ‘currently in storage in Dubai’.

They insist they need funds to close the deal and tackle an earlier sale the other BRP arranged. They say they are embroiled in a legal dispute over the aircraft in the UAE.

‘In short, the BRPs want the curator to pay for their lawyers and their lawyers’ disbursements in their continuing dealing with Islandsite’s property. The curator says he is unable to pay for such legal expenses without the NDPP’s consent,’ Batohi wrote.

According to her heads of argument, curator Appavoo ‘is not empowered by the restraint order’ to pay for legal fees already incurred and the BRPs failed to make out a case.

‘They appear to regard the curator as no more than a paymaster and are dissatisfied with his performance,’ she asserted.

Pushing back, Batohi insisted that any urgency in the case was ‘self-created’.

She said Knoop and Klopper knew they were prohibited from administering Islandsite assets since the restraint order was issued in mid-2021.

Batohi raised a court order from September 2021, which dealt with legal expenses through which they claimed R917 269. 

‘They have not explained how they have disbursed such monies,’ she said. ‘They now come to court as a matter of urgency, 16 months after the restraint order was granted, 13 months after they were made aware of ... the NDPP’s position,’ she added.

According to the Business Day report, Batohi said the BRPs could still argue for the payment of legal fees in terms of sections of the Prevention of Organised Crime Act if their urgent bid is struck from the roll.

An annexure to the Islandsite restraint order provides Appavoo ‘shall only pay legal costs for any person subject to curatorship if ordered to do so by a court or with (her) prior written consent’.

‘The BRPs are bound by the restraint order. They may not deal with Islandsite’s property in any way other than permitted or required by the order,’ Batohi said.

‘No part of the restraint order provides for the administration of the assets under restraint by any person other than the curator.’

Batohi discouraged the court from allowing the BRPs to resume implementing their business rescue plan ‘including incurring very significant legal costs’ such as in Dubai.

Full Business Day report