A judge has described as ‘unconscionable’ a contract that the firm of Leonie Dempers, a business associate of former magistrate and fraudster Johan Fouche, entered into with Dirk and Nadia Burger, reports the Mail & Guardian.

The Burgers entered into a contract with Edenglo to save their home from foreclosure, but it led to their house being sold – twice – to strangers. 

FNB is appealing the High Court judgment that ruled the first deal was ‘void’ and that the property be transferred back into the Burgers’ names.

The respondents in the matter are Edenglo Holdings, Dempers, Minerva Baugaard, Ian Baugaard, FNB, Registrar of Deeds Cape Town, Wonderful Choice Investments, Gert de Wet N.O., and Gladys Ngobeni. 

Dempers appeared before Western Cape High Court Judge Robert Henny last week for the FNB appeal. 

She told the court that she was not registered as a VAT vendor – although she had allegedly charged the Burgers VAT – nor with Financial Sector Conduct Authority and the Property Practitioners Regulatory Authority, which are requirements for the provision of financial and property services.

The matter is expected to be back in court on 18 January next year.

In her judgment in 2021, Judge Tandazwa Ndita said the Burgers had asked the court to set aside the transfer of their Brackenfell home in the Western Cape. 

The couple stated in court papers that they had fallen on difficult financial times when they spotted an Edenglo Holdings advert. It stated that the firm assists people experiencing financial hardship, and who could not afford their bond repayments, to save their property from execution.

The Burgers responded to the advert and Dempers advised them that Edenglo would facilitate the sale of the property to an investor, Wonderful Choice Investments, for R1.4m.

Dempers is part of the alleged scam a M&G investigation uncovered in September involving former KZN Magistrate Johan Fouche, dubbed the Casanova fraudster. He was jailed for 70 counts of fraud and is allegedly on the prowl again.

The M&G says he seems to have found up to 30 new victims, whom he has cheated out of hundreds of thousands of rand.

Fouche is the COO of Asiphakame Financial Services, which he runs with Dempers, the CEO. The firm describes itself as ‘a complete financial wellness partner to our clients’ and promises to help over-indebted consumers with services that include ‘loan sourcing’, ‘credit record rehabilitation’, ‘bond originating’ and ‘bond rescue’.

According to court papers, the terms of the Edenglo scheme, as explained to the Burgers back in 2017 by Dempers, were that ‘for all practical purposes’ they would remain the owners of the property and in possession or occupation of the property. How this worked is set out in detail in the report online.

In the initial ruling, Ndita found the facts of the matter were in favour of the Burgers.

‘It is undisputed that the applicants do not know what happened to the balance of the purchase price paid by Wonderful Choice, as well as the once off rental payment in the sum of R400 000. All they know is that the scheme was fraudulent, in that it resulted in them losing their home without receiving any real benefit or payment. Furthermore, had they known that that would be the case, they would not have agreed to the transfer of the property to Wonderful Choice,’ Ndita said.

‘The facts of the matter at hand exhibit features which, when cumulatively considered, show a probability that unconscionable, immoral or illegal conduct will result from the implementation of the provisions of the contract according to their tenor.’ 

Ndita said that although the contracts did not appear to be fraudulent ‘their intrinsic unconscionableness shows that they are against public policy’.

She added that it was telling that the first respondent, Edenglo, and the second respondent, Dempers, have not opposed the application, notes the M&G report.

‘In my view, based on what I have alluded to above, the applicants could not have intended to transfer the property in these circumstances. I therefore declare the terms of the scheme and the pursuant agreements between the applicants and the first and second respondents as being contrary to public policy, and the contracts void ab initio,’ she said.

Full Mail & Guardian report