The matter dates back to June 2000 following the liquidation of Monrand Investments, the owners of the Piazza shopping centre.

Nedcor Investment Bank was the major secured creditor and holder of mortgage bonds amounting to R63,1m over the property when it was placed in provisional liquidation. The property was sold for R36m on auction shortly after the liquidation order was granted.

Leon Lategan, at the time the acting deputy master of the Pretoria High Court, appointed four joint liquidators, allowed them to claim a 10% commission on the basis that the property should be considered movable property since it was sold as a going concern.

Nedbank argued against this ruling, saying 3% was the applicable tarriff, and that it should in fact only be obliged to pay a token percentage. It did most of the work required, it argued.

Prior to Nedbank instituting an action and with the exception of liquidator Philip Torre, the other three liquidators Maryna Symes, Mathlodi Legana and Solly Manamela argued that when a commercial building was sold as a "going concern", it could not be regarded as immovable property, but as a movable asset.

Shortly before the dispute was to be decided by the Pretoria High Court on Thursday last week, the liquidators decided the master of the high court had erred and conceded that they were only entitled to 3% on the auction proceeds, a maximum fee of R1,08m.

This represented a R2,5m reduction in liquidators' fees.

The remaining issue in the action was whether the liquidators' fees should be reduced below the 3% tariff.

Counsel for Nedbank, advocate Jeremy Gauntlett SC, argued that evidence would be lead to show that the liquidators did very little work in a period of less than two months prior to the sale of the building.

It was argued that Nedbank oversaw the day to day administration and took most of the steps in the sale of the property.

It was also argued on behalf of Nedbank that the appropriate forum to determine these factual issues would be the High Court, which should then further reduce the liquidators fees to 1%. The liquidators contested a further reduction in their fees, and that the matter should be heard by the high court. They argued that the matter had to be remitted to the Master for a decision on whether the fee should be reduced below the 3% tariff.

The matter was argued before Judge Ben du Plessis who reserved judgment until yesterday. The judge handed down a written judgment and ordered that the decision of the master in allowing the fee of 10% on the sale of proceeds be set aside.

The judge further ordered that the high court would determine the issue as to whether the liquidators' fees should be reduced to below 3% of the sale proceeds.

Liquidator Torre said yesterday although he had agreed from the outset that the tariff should be 3%, he dismissed Nedbank's claims that the liquidators' fees be further reduced to 1%.

He said that this was too low and argued the liquidators had done most of the work.

Torre said he had been entrusted with the day to day administration during the liquidation process.

Leon Lategan on behalf of the master of the high court handed in papers to the high court at the time saying he would abide by the court's decision.

Business Day