Belinda Beresford and Mungo Soggot
The flurry of litigation surrounding Magnus Heystek’s controversial handling of a family trust has intensified with a summons issued by the guardian of the trust’s beneficiaries against Heystek and his fellow trustees.
Clive Berman, the guardian of the two children who are beneficiaries to the multimillion rand trust, is asking the Johannesburg High Court to oust Heystek and his two fellow trustees from the trust. Berman is also asking the court to order the three trustees to hand over proper accounts for the trust.
Berman is being sued for defamation by Heystek who, together with the other trustees, successfully obtained a temporary interdict preventing Berman from spreading defamatory comments about them.
The trustees have launched a parallel set of summonses against Lionel Reichenberg, the controversial professional litigator initially recruited by Berman to help him prepare his action against the trustees.
However, the trustees have struggled to serve summons on Reichenberg, who keeps a low profile to avoid the stream of summons regularly fired at him. Reichenberg has been declared a vexatious litigant – which means he cannot appear in court himself – and he has been declared insolvent. The trustee of his insolvent estate wants to have his mental state probed, but also cannot find him.
Since doing some of Berman’s initial legwork, the two men have now fallen out badly, and Reichenberg has launched a fresh batch of legal attacks against Berman, claiming that he has not paid him for his services.
Reichenberg has even threatened to serve summons on Berman’s two under-age children, the beneficiaries of the trust, on the grounds that they are ultimately responsible for footing his bill.
Reichenberg is also apparently preparing a clutch of R2-million lawsuits against several employees of Primedia, on the grounds that Heystek defamed him on Radio 702 while batting off allegations about his handling of the trust.
And, Heystek is suing the Mail & Guardian for R2-million for defamation.
At the centre of all this litigation is the Berman Family Trust, set up in 1994 by the late Monica Berman and her husband Clive. Monica Berman was heir to a multimillion rand fortune, which was due to be distributed to her in several tranches from another trust. She died last December, three years after receiving R21-million on her 40th birthday.
Monica Berman and her then husband had asked Heystek and the other trustees, lawyer Leonard Singer and psychologist Ann- Marie Wentzel, to preside over a trust for her children. In addition, she gave Heystek extensive signing powers on the portion of her fortune which she did not put into the trust.
Heystek has said in court papers that Monica Berman was a spendthrift, which was why she had sought his help. Nine months before she died Monica Berman made the three trustees the executors of her will, giving them extensive powers over her estate.
In Clive Berman’s summons against the trustees, his lawyers argue that aspects of the trust and the will are unlawful because of how much power they bestow on the trustees. The summons says the clauses in question violate provisions of several Acts regulating South African trusts and “offend against the principles of the common law and in particular against the fiduciary nature of trusts and the fiduciary duties of trustees”.
Berman alleges that the trustees mishandled some of the trust money, and that Heystek had been “in a position whereby his interests and those of the beneficiaries were in conflict with one another”.
The summons also notes the failure of the trustees to supply regular accounts. It says the trustees have “persisted in their refusal and have failed to maintain a proper set of books … and to cause annual financial statements of the trust to be prepared”.
The summons also demands damages from the trustees for their alleged breach of duties.