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Johannesburg - Mayfair Speculators, the company used by Markus Jooste to conduct his horse racing interests, has been accused by a horse selling agent of withholding a commission.
In the past month there has been a move to sell all of Mayfair Speculators' horses, just after ABSA Bank approached the High Court to liquidate the company and freeze all its assets. The bank gave the company a reprieve until the end of January and the sales have in the meantime been going ahead.
Fin24 reported in December that the application in which ABSA seeks to recuperate R266m from Mayfair Speculators was postponed for a full hearing, most likely early in February.
Judge Siraj Desai said in the Cape Town High Court at the time that "the matter is of great importance far beyond the interests of (ABSA)".
One of Mayfair’s prized horses, Legal Eagle, was allegedly sold to former Tekkie Town owner Braam van Huyssteen for R3.2m and another horse, Edict of Nantes, was allegedly sold to a buyer in Hong Kong, for just under R10m it is being speculated in media reports.
Derek Brugman, Mayfair's racing manager, had publicly revealed at the time of the ABSA application that they had made an agreement with the financiers that they will continue racing and selling horses.
Jooste had between 150 and 250 horses in training in South Africa.
According to the online horseracing publication Racing Post it was not clear if the race horses in Europe would be sold, but ABSA said that Mayfair France was in the process of selling racehorses.
They also reported that three fillies owned by Jooste would be sold at the Tattersalls February sale.
According to an agent who sells race horses, it was the sale of one of these horses in France which led to a fall-out between him and Mayfair Speculators.
The commission
Herbert Smith alleged that Mayfair Speculators has kept a commission of over R1m from him that he claims was owed to him after the sale of a €1.8m horse (about R27m) in France this December.
Smith, from the HRC Bloodstock agency, a business which sells racehorses, has also accused Brugman of allegedly swearing at and belittling him when Smith attempted to bring up the issue of his payment.
Smith told News24 he found a buyer for one of Mayfair Speculators' top racing fillies called Juliet Rose, who won the Prix de Royallieu at Chantilly, France, in 2016 and 2017.
- WATCH: Juliet Rose wins
Smith said the owners of the horse were listed as Jooste and Bernard Kantor, from Mayfair Speculators & Euifrance Holdings respectively. Kantor is also the cofounder and managing director of Investec.
Smith claims he organised for a buyer to go and look at the horse in France and received a formal offer of €1.75m for the filly, less 5% commission which Smith said is the worldwide standard commission for an agent.
Smith said he did not have a written agreement with Brugman to sell the horse, but the industry tends to work on a “gentleman’s agreement”, and he has never had to put it in writing that a racing agent’s commission is 5%, which before this incident he said has always been paid.
In the sale offer Smith added that he would be paid a 5% commission. He claims he sent this to Brugman.
Brugman allegedly responded by sending an email to Smith the next day saying he had dealt with the buyer directly and the farm manager in France, Henri Bozo, had finalised the deal, selling the horse for €1.8m (about R27m).
According to Smith, Brugman indicated Smith would be paid “as a gesture of goodwill” €5 000 for the introduction to the buyer by Mayfair Speculators, and the buyer would contribute another €5 000.
“More than this I have not agreed to and certainly didn’t give you a mandate at the commission rates that are now suddenly reflected in your latest communication,” Brugman allegedly said in an email.
Smith said he did not feel the commission offered was fair for the work done. He said that, according to the industry standard of 5% of the purchase price, he would have made a commission of €90 000.
He alleges Brugman’s response was to call and swear at him, insulting his company and telling him he would stop the whole deal if Smith continued to ask for the commission.
“He told me I should be happy with what he is offering or I could get nothing, it was my choice… if I didn’t agree to the commission he has set out then he would pull the deal. This was one of the strangest things I had heard as the world knows what problems their outfit is going through and the need for those funds and the sale was essential,” Smith claims.
Smith said he called the buyer who claimed he had no idea he would not be getting his full commission and the buyer allegedly offered him a further €5 000.
Smith alleges he waited to receive the €15 000 (R222 000) which was paid by EquiFrance, before contacting Kantor, who had owned 25% of Juliet Rose, to complain about what had happened.
He claims he said to Kantor that he felt Brugman had acted unethically and had, according to Smith, gone behind his back to cut him out of the deal.
“Mr Kantor I implore you to contact Mr Jooste and speak to him to do the right thing and pay what is due. I worked hard on this deal and was robbed at the final hurdle by my own countrymen on what any other agent in any other part of the world would expect and rightfully get,” the agent claimed he told Kantor.
He said he had sold horses all over the world and never had anyone who has not paid a commission due to him.
'Generous'
Kantor’s response, according to Smith, in an email was that since the farm manager, Bozo, had concluded the deal, it was his opinion the €15 000 payment was generous.
Kantor told News24 he had no dispute with Smith and he was not party to the negotiation on commission payable.
Smith claims it was not easy to sell horses that are in any way connected to Mayfair Speculators, and many buyers came back to him and said they wanted nothing to do with Jooste or the company.
In response to media queries about the dispute, Brugman threatened that he would hold News24 and its journalist liable if they defamed him.
“I do not comment on sensation seeking articles in either my private or professional capacity. Even less so when accusations are filled with blatant, deceitful lies in an effort to blackmail and extort money out of people,” he said.
He claims Smith did not have any signed mandate to sell the horse.
“I have no further comment on the slanderous innuendo of your questions other than to categorically state that, not a single person, other than Smith, received 1 euro on this transaction, despite them, unlike Smith, working tirelessly over the festive season to make this transaction happen,” he said.
“I will not enter into any further communication with anyone on this subject.”
