King farm Quoin Rock to be sold to settle tax debts

The auction of the Quoin Rock Winery in Stellenbosch owned by Metlika, one of the companies controlled by controversial businessman and alleged tax dodger Dave King, is to proceed this weekend. The farm and its movable assets are valued at about R150 million.

This follows the withdrawal on Tuesday of an urgent application to prevent the sale that was due to be heard in the North Gauteng High Court.

The application had been lodged by HSBC Trustee Guernsey, Metlika Trading and Rossenfeld Holdings. King represented Ben Nevis in South Africa and controlled Metlika Trading. King said he knew nothing about the application and "it certainly wasn't mine".

The joint provisional liquidators of the wine farm and the SA Revenue Service (Sars) had opposed the application.

Pieter Engelbrecht, the co-ordinator of enforcement investigations at Sars, said in an affidavit that Sars had a court order declaring the shareholding and loan accounts of Metlika executable for the tax debts of Ben Nevis Holdings.

Engelbrecht said Sars had a very real interest in the sale not being postponed and the value of the shareholding and loan account in the wine farm thereby being diminished.

He said the revenue service was the largest single proven creditor in the estate of Quoin Rock Winery with a preferent claim of about R46m.

Engelbrecht said the application had been launched to frustrate and derails Sars' attempts to legitimately recover taxes, some of which arose as long ago as the 1998 year of assessment.

Rael Levitt, the chief executive of Auction Alliance, which was instructed by the joint liquidators to sell the wine farm, said yesterday that Saturday's sale would be the most high profile auction event of the year and was the highest value liquidation auction ever held in the Western Cape.

The liquidators have verified the value of the stock and moveable assets of the farm at an estimated R30m while the property itself is estimated to be worth R120m.

The 194ha estate includes a helipad, an underground cave that housed functions for leading Stellenbosch business people and luminaries, a spectacular homestead and a state-of-the-art wine cellar imported from Italy.

The sale includes antique pieces and artwork by, among others, Irma Stern, Otto Klar and David Botha.

Ironically, Sars launched its investigation into King's affairs in May 2000 when it became aware he had bought an Irma Stern painting for R1.76m and could not reconcile this purchase with his declared gross income of R60 000.

King has been involved in a 10-year multimillion-rand tax wrangle with Sars, which in June this year was granted permission by the North Gauteng High Court to attach and sell several properties to satisfy part of a R20.9m claim.

Earlier this year Sars also launched an application in the North Gauteng High Court to execute and collect as much as possible of the assets, which had been converted to cash, for the R2.7 billion tax debt of Ben Nevis and Metlika Trading.

The Stellenbosch wine farm was placed in provisional liquidation in July.