High court blocks Thoshan Panday’s bid to use restrained assets for legal and living costs

The Pietermaritzburg high court has overturned a lower court order that allowed controversial Durban businessman Thoshan Panday and others to access frozen assets to pay their legal and living expenses.

The court held that the legal requirements for such relief had not been properly met, and set aside the 2023 ruling that has allowed Panday and his relatives to live off funds from confiscated assets being held under a restraint order.

In a judgment delivered on Friday, a full bench of the high court upheld an appeal by the National Director of Public Prosecutions (NDPP) who argued that Panday was not entitled to the funds he was receiving because he and his family had failed to meet the required terms as laid out in the Prevention of Organised Crime Act (Poca).

The court held that Panday and his co-respondents failed to provide the court with the level of full, admissible disclosure required by the act to justify the use of restrained property for expenses.

The statutory discretion is vested in the court.

—  Judge Mokgere Masipa

It was noted that under Poca, a court may permit a person whose assets have been restrained to use some of those funds for reasonable living and legal costs — but only if it was satisfied that the person had fully disclosed all interests in the restrained property and could not meet those expenses from unrestrained assets.

Judge Mokgere Masipa found that the earlier court had relied too heavily on agreements and arrangements between the parties and the court-appointed curator, rather than on evidence properly placed before the court itself.

“The statutory discretion is vested in the court,” she stressed, adding that disclosure to a curator alone cannot substitute for disclosure to the court. The judgment noted that crucial affidavits and financial details were either not properly before the lower court or were inadequately substantiated.

As a result, the full bench upheld the NDPP’s appeal, set aside the 2023 expenses order and replaced it with an order dismissing the application with costs.

Panday is a Durban-based businessman who has been at the centre of long-running criminal and asset-forfeiture proceedings linked to alleged corruption, fraud and racketeering. The state’s case is tied to contracts and tenders, including those awarded to companies associated with him, which prosecutors allege were obtained through unlawful means.

As part of those proceedings, the NDPP previously secured a restraint order freezing certain assets pending the outcome of criminal cases and potential confiscation proceedings. The now-overturned 2023 order had allowed Panday and others to draw on those restrained funds to cover legal fees and day-to-day expenses.

The underlying criminal and forfeiture proceedings against Panday remain before the courts.