The bidder who smelt a rat
Businesswoman Wendy Appelbaum suspected she had been ‘bidding against herself’
DID not become a victim of Auction Alliance (AA) because I refused to allow that to happen,” says Wendy Appelbaum.
Appelbaum was commenting after becoming embroiled in a messy dispute over the auction of wine estate Quoin Rock by AA on December 10. She later disputed the legality of the auction process when she claimed she found out that she was the only genuine bidder.
The farm was auctioned by AA on behalf of Sars, which seized the farm from Dave King during a battle between the latter and the revenue collector over outstanding taxes. The auction took place on the 193ha farm outside Stellenbosch.
The auction was conducted by Rael Levitt, who introduced himself in jest to the 150 or so people present as “Cape Town mafia”.
Six people were registered to bid for the farm, while the remainder were registered for the sale of the furniture and other movables.
Levitt opened the bidding at R75 million. There were no takers. An opening bid of R30m was raised from the back of the
Auction Alliance responds:
IT IS no coincidence that for 20 years Auction Alliance (and its predecessors) has always enjoyed a world-class reputation for good business dealings without any negative publicity, yet in the past three weeks there has been what appears to be a systematic and well-orchestrated campaign to defame the company and its founder, Rael Levitt.
The auction industry is a highly competitive business and should our unrivalled reputation be continually questioned or the company becomes engulfed in negative sentiment, it suits many. It is thus no surprise that the “unnamed insiders who have broken ranks” to reveal highly defamatory information about us are, in fact, room, “but I could not see who it was as my husband and I were seated near the front of the room”, Appelbaum explained.
She raised the bid to R35m, and another bidder, “again out of my line of vision, bid R40m”. She went to R45m. The under-bidder went to R50.
She raised it by another R5m. The under-bidder took it to R60m.
Levitt turned to Appelbaum to raise it to R65m, but she declined.
Now caught in a bind, Levitt told her: “I’ll take it to R61m.” But she declined again. “Oh, sorry sir, was R60m not a bid?,” Levitt said to the underbidder seated at the back of the room. “Back with you madam at R55m,” he said turning to Appelbaum, and knocked down to her at that price.
Suspicious about what had just taken place, the Appelbaums decided to probe the procedure (once the bidding on the fur nishings had ended). They wanted to know who the under-bidder was, and asked to see the bidders’ roll. They were told by Ish Hendricks, an AA auctioneer, that it was a man who Appelbaum knows, “and when I phoned him, he denied it”, Appelbaum said.
Hendricks then told her it was someone else, pointing to another of the six names on the bidders’ roll, most of whom were known to Appelbaum.
She phoned the individual in question and he said it was not him either.
And on it went until Hendricks finally conceded they weren’t entirely certain who the under-bidder was.
“At this stage my suspicions were rapidly rising. I pointed out that there were only three other ‘bids’ other than my own (R40m, R50m and the withdrawn bid of R60m).
“It was hardly heated bidding, there were only six of us registered and that surely meant it was not difficult to identify the under-bidder. AA had an experienced team on hand. Hendricks, Craig Berman and Arelia Kuper were working the room.”
The auction had been recorded and also podcast, and she asked to see the footage to identify the person who was supposedly bidding against her. Forty minutes later the AA staff produced a short clip with only Appelbaum visibly present.
Eventually they identified Deon Leygonie as the underbidder, the only one of the six registered bidders who Appelbaum did not know. The AA staff claimed they had never met him before either.
By this stage Levitt had long since left the farm, but one of his staff raised him on the phone.
He told Appelbaum she “was looking for spooks” and engaging in a futile exercise. If she was unhappy with the sale, she need not sign the paperwork, he told her.
“I told him that if it was a genuine auction price, I would accept, but that we were not prepared to bid against ourselves,” she said.
A week later, the liquidators rejected Appelbaum’s R55m bid.
But Appelbaum continued to probe the events of that December day. She took it to her lawyers, who ran a credit search on Leygonie, only to find that he was a previous employee of Auction Alliance.
Levitt conceded in an interview with the Saturday Star last week that he employs Leygonie occasionally as a “vendor bidder”. Levitt also insists that Leygonie was a proxy bidder for Ariel Gerbi on December 10, and not a “vendor bidder” on his behalf.
Levitt also claims that Gerbi was registered on the day, yet his name was not given to Appelbaum that after noon, despite her repeated questions. Nor was his name on the bidders’ roll.
It subsequently appeared on that roll two days later.
Gerbi has so far declined to respond to any questions put to him.
In the weeks that followed, Appelbaum filed a complaint with the National Consumer Commission, citing the irregularities she observed on December 10.
Levitt responded by suing her for defamation.