By Kathryn Parkes

Two East London property magnates fighting over a R1 million bill in court have settled their squabble with a novel out-of-court agreement.

Riegers Contractors lodged civil claims against developer Grant Furstenburg after he failed to comply with an arbitration ruling to pay the construction company for a contract carried out in 2006.

Now, instead of cash swapping hands, Riegers has taken ownership of two luxury units at the new Furstenburg Grand in Nahoon in a special deal between the two parties.

This comes after an arbitrator ordered developer Grant Furstenburg to pay Riegers R690 000 owing to them and cover all arbitration costs which amounted to nearly R1 million.

The outstanding sum was for work done on Furstenburg Terrace, another earlier up-market townhouse complex in Stirling, which Riegers was contracted to do for R2.5m.

Garry Rieger approached the arbitration committee last year when Furstenburg failed to pay Riegers for work done in the last leg of the development. Furstenburg was given 14 days to pay the money. However, when he failed to do so, he was slapped with a civil suit.

In court yesterday, lawyers said the case had been postponed “indefinitely”. However, Rieger told the Daily Dispatch that the parties had come to an agreement out of court.

Rieger said Furstenburg had “given” him two of his Furstenburg Grand units and that he was “relieved” the matter had been settled.

Asked if he felt this was a good deal considering the current property market, Rieger said he was “not worried” and would rent out the luxury Nahoon units for about R10 000 a month. Unit prices range between R1.3m and R1.7m.

But Furstenburg said Riegers had paid “a fair amount” for the properties, and that “it would be unfair to disclose how much”.

“It is complicated in the business world just like it is in love – things don’t always run smoothly,” he said.

“I think our settlement was more attractive than simply writing out a cheque. But I can assure you the properties weren’t given to Garry at a lucky packet price.”

He said it had been a “sticky situation” and that “it is never pleasant when business deals become complicated.” His attorney Hannes Schoeman said an application had been taken to the deeds office to transfer the units into Rieger’s name.

Earlier this year the Dispatch reported that Furstenburg had turned to overseas investors after failing to sell the pricey flats.

Recessionary blues were blamed for the slow uptake of apartments after Furstenburg had spent R60m building the units on the site of the old Dolphin Hotel.

Source: Daily Dispatch