30 November 2005

Dear Purchasers

REVIEW OF APPROVAL

As you are aware, two days of hearing before the Development Tribunal were completed on 28 October 2005. Our team delivered an outstanding presentation and we are pleased to advise that last week the Development Tribunal reinstated the approval granted on 15 December 2004.

The written judgement of the Tribunal included these findings:

1. The allegation by the Department of Agriculture that the Development Tribunal did not have the authority to suspend the Subdivision of Agricultural Land Act, was incorrect in that the Tribunal had specific powers to suspend the Act.

2. After assessing all the evidence regarding the agricultural potential of the land, the Tribunal found that the case of the Department of Agriculture was grossly exaggerated in that the land in question was no more than of low-income potential and suitable primarily for sugar-cane or timber production. It was pointed out that the Tribunal included Professor Peter Ewang, a highly qualified agricultural scientist, whose views were persuasive.

3. The Department of Agriculture had also suggested that the Municipality's Spatial Development Framework Plan was inappropriate and not correctly prepared. The Tribunal found this allegation to be unfounded and it supported the Municipality's contention that the framework plan had been correctly prepared and was sound. The Tribunal believed that the development was in the general public interest and this was supported by the tremendous interest which has taken place, over 80% of the properties having been sold.

4. We are pleased to report that this first major hurdle preventing site development, has been cleared.

The Department of Agriculture has, however, also called for an independent report to look at the benefits of the property as a residential estate, compared with an agricultural unit. Professor Jeff MacCarthy of the University of KwaZulu-Natal has been asked to do this report, which should be tabled by 15 December. We shall then await the decision of the Minister of Agriculture for the Province of KwaZulu-Natal, before being able to proceed with work, early in the new year.

We apologise to all buyers for the delays experienced, which have been beyond our control. In the interests of all purchasers, we did not wish to commence the development prematurely. Although the delay has prejudiced us, we are pleased to be able to move forward with this exciting project, ensuring, in the new year, that Garlington becomes a reality.

We wish you all a happy festive season and a successful 2006. If any of you wish to have a copy of the judgement, please do not hesitate to contact me.

Yours sincerely

Guy SMITH
for Garlington Development Trust