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[2010] ZAWCHC 219
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Law Society of the Cape fof Good Hope v Zietsman (6171/2010) [2010] ZAWCHC 219 (10 December 2010)
Republic
of South Africa
IN THE HIGH COURT OF
SOUTH AFRICA
(WESTERN
CAPE HIGH COURT, CAPE TOWN)
CASE NO: 6171/2010
In the matter between:
THE LAW SOCIETY OF THE CAPE OF
GOOD HOPE
Applicant
and
HANS JURIE
ZIETSMAN
Respondent
JUDGMENT DELIVERED:
10 DECEMBER 2010
DLODLO J
et
BINNS-WARD J
JUDGMENT
: DLODLO
et BINNS-WARD, JJ
FOR THE APPLICANT
:
MR
B.N. NCANISA
INSTRUCTED BY
: BISSET
BOEHMKE McBLAIN
CAPE TOWN
FOR THE
RESPONDENT
:
INSTRUCTED
BY
:
DATE OF
HEARING
: 19
NOVEMBER 2010
JUDGMENT
DELIVERED
: 10
DECEMBER 2010
Reportable
Republic of South Africa
IN THE HIGH COURT OF SOUTH AFRICA
(WESTERN CAPE HIGH COURT, CAPE TOWN)
CASE NO: 6171/2010
In the
matter between:
THE LAW
SOCIETY OF THE CAPE OF GOOD HOPE
…..............................
Applicant
and
HANS JURIE ZIETSMAN
…........................................................................
Respondent
JUDGMENT DELIVERED: 10 DECEMBER 2010
DLODLO J
et
BINNS-WARD J
It is not in dispute that the respondent, an attorney who practised
in Mossel Bay until the end of July 2009, misappropriated
an amount
of at least R1,8 million from the funds entrusted to him to be
held on behalf of clients and third parties. The
Law Society has
applied for an order that the respondent’s name be struck off
the rolls of attorneys and conveyancers,
together with the other
relief that is ordinarily granted ancillary to such orders.
The respondent does not oppose the application. Indeed, in so far as
may be determined from the papers, he appears to have been
moved,
sometime in June 2009, himself to report the occurrence of the
defalcations to the applicant. This was done through the
agency of a
fellow practitioner (‘the intermediary attorney’) who
forwarded to the Law Society an email sent to him
by the respondent
setting out a summary of the trust accounts on which there was an
identified shortfall.
The standard of professional conduct required from an attorney is an
exacting one. This has been emphasised in any number of
judgments of
the superior courts over many decades; see e.g.
Incorporated Law
Society, Transvaal v Visse (1); Incorporated Law Society, Transvaal
v Viljoen (2)
1958 (4) SA 115
(T) at 131D-G;
Law Society,
Transvaal v Matthews
1989 (4) SA 389
(T) at 395F-396H; and
Botha
and Others v Law Society, Northern Provinces
2009 (3) SA 329
(SCA). The respondent has fallen grievously short of the standard of
conduct required from him as an attorney. As Hefer AP
observed
in
Law Society of the Cape of Good Hope v Budricks
2003 (2)
SA 11
(SCA) ([2002]
4 All SA 441)
at para. 11, the
misappropriation of trust funds is ‘about the worst
professional sin that an attorney can commit’.
There can be no question in the circumstances that the respondent is
not a fit and proper person to continue in practise as an
attorney
and that the discretion of the court in terms of s 22(1)(d) of
the Attorneys Act 53 of 1979 (as amended) should
be exercised in
favour of granting the Law Society’s application.
It is unfortunately necessary, however, for us to say something
about two aspects of the manner in which the Law Society brought
the
current application. The first concerns the extent of the evidence
put before the court and the second concerns the delay
in bringing
the application.
The forwarding email, which was sent to an officer at the Law
Society on 15 June 2009, contained no narration or explanation
by the intermediary attorney. The absence of any covering
explanation in the forwarding email led us to believe that there
must have been some previous contact between the intermediary
attorney and the addressee of the email, Mr Glenn Flatwell, an
officer of the Society, to whose individual email address it had
been sent. The founding papers therefore left us wondering what
had
preceded the email. Mr Ncanisa, who represented the applicant, was
unable to enlighten us as to why the narrative of the
evidence in
the founding papers had such an abrupt and apparently incomplete
introduction. We therefore decided that the hearing,
which commenced
before us on 19 November 2010, should be postponed in order for
him to make the necessary enquiries and
to allow the applicant to
supplement its papers in this regard, if it considered it
appropriate to do so to address our concern.
As we pointed out to Mr
Ncanisa when the application was first called, in matters like this,
particulars of the manner in which
the misconduct is discovered and
the reaction of the delinquent attorney in the particular
circumstances are issues which might
become of interest later should
the attorney apply in the future for re-admission. If that should
occur, the court seized with
the re-admission application will
always look at the judgment in the striking off matter to see how
these issues were treated
there. It would, for example, be
significant for that purpose if it were to appear from the striking
off judgment that the delinquent
attorney had turned him or herself
in, rather than being reported by a client, or discovered in the
context of an audit to have
been plundering the trust funds. On the
state of the founding papers in this matter, however, we were none
the wiser because
the narration of events appeared to begin with
what read as if it should have been the second chapter.
Furthermore, as already noted, the Law Society was informed of the
respondent’s misconduct in June 2009. It took more than
nine
months from then, until 25 March 2010, before the current
proceedings were instituted. We considered this delay to
be
unsatisfactory on the face of it. An additional reason for the
postponement of the further hearing of the application was
to allow
our request that the Society provide an explanation for the delay.
Both of the aforementioned issues raised by the court were addressed
in a supplementary affidavit made by a councillor of the
Law
Society. It states that the applicant first became aware of the
shortfall in the respondent’s trust account when Mr
Flatwell
received the email forwarded by the intermediary attorney, described
earlier. Accepting that to be so, we consider it
odd that the
applicant’s officers apparently made no enquiry into the
circumstances that led to the email being forwarded
in that manner.
While it would have made no difference to the result, it would have
assisted in the production of a more enlightening
judgment at this
stage for possible reference by another court in a different context
in the future.
On the aspect of undue delay, the explanation given in the
applicant’s supplementary affidavit went as follows:
After an investigation pursuant to the receipt of the abovementioned
email from the intermediary attorney, the applicant’s
council
resolved on 22 June 2009 to institute an application urgently to
interdict the respondent from practising, pending
an application for
his removal from the roll.
The Society’s attorneys were, however, instructed only on
6 August 2009, by which stage the respondent had, of his own
accord, ceased practising on 31 July 2009.
The manner in which the respondent had dealt with his trust account
was then investigated and clients whose moneys had been
misappropriated
were advised of their entitlement to submit claims
for compensation to the Attorneys Fidelity Fund.
A draft founding affidavit in the intended striking off application
was prepared by the applicant’s attorneys and forwarded
for
consideration to the Society on 22 October 2010.
The further preparation of the application was described thus:
‘
The [draft] affidavit required
amplification and the Respondent’s dealings with his trust
funds were further investigated
with reference to the trust bank
account statements. The Respondent operated three trust banking
accounts. The bank statements
were not available and had to be
obtained from the banks in question. The process of obtaining the
bank statements from the banks
in question took some time.
This application was not immediately launched as the
Respondent had ceased practising and did not, in the Applicant’s
view,
constitute a danger to his clients or to the public.’
We regret that we have to say that we find the explanation for the
delay to be unsatisfactory.
It is apparent from the founding papers that the case against the
respondent is founded entirely on the basis of the report of
the Law
Society’s officers who attended on the respondent on 17 June
2009 to investigate matters after receipt of
the email forwarded by
the intermediary attorney two days earlier. That report was
substantiated by extensive reference to trust
ledger accounts,
insight into which had been afforded to the Society’s
investigating officers during their interview with
the respondent on
17 June. The report and copies of the trust ledger accounts in
question comprise 55 pages of the 108 page
long founding papers. The
notice of motion takes up 11 pages and the greatest part, by far, of
the 21 page founding affidavit
is no more than a narrative rehearsal
of the content of the investigators’ report and the
accompanying copies of the trust
ledger accounts.
The balance of the founding papers comprised a computer generated
trust account reconciliation, obtained from the respondent
and which
had been produced on 28 February 2009 at 1:36 pm, and also bank
statements or certificates reflecting the closing
balances on
28 February 2009 of the three trust banking accounts maintained
by the respondent. This additional documentation
added nothing of
substance to the material the applicant had obtained when its
officers had interviewed the respondent on 17 June
2009. It was
in any event evident from the investigators’ report that
material defalcations from his trust accounts had
been perpetrated
by the respondent in the period after 28 February 2009.
Why it should have been difficult to obtain information from the
banks at which the relevant trust accounts were maintained is
not
explained; nor is there any explanation of what efforts were made to
expedite the provision of this information, and at what
stage. There
is also no explanation as to why the information that the Society
was reportedly having difficulty in obtaining
from the banks was
considered sufficiently material, in the context of the evidence of
which it was already possessed, to justify
the attendant delay in
the institution of striking off proceedings.
The Law Society is not an ordinary litigant in matters of this
nature. It acts as the both the statutory
custos morum
of the
attorneys’ branch of the legal profession and as protector of
the public in their dealings with that profession;
cf.
Holmes v
Law Society of the Cape of Good Hope and Another; Law Society of the
Cape of Good Hope v Holmes
2006 (2) SA 139
(C) at para. 16.
The court is in turn heavily dependant upon the law societies to
submit to them the information concerning
facts necessary for the
courts to fulfil the function of oversight exercised originally at
common law, and currently in terms
of the Attorneys Act, in respect
of who should be admitted to, or removed from the roll of attorneys;
cf.
Solomon v Law Society of the Cape of Good Hope
1934 AD
401
at 409.
In matters in which it is appropriate for the court to determine in
its discretion whether a delinquent attorney’s name
should be
removed from the roll, it is the duty of the law societies to bring
the relevant facts to attention of the courts without
delay. The
degree of urgency with which these matters must be attended to will
obviously be affected by the extent to which the
public might be
exposed to danger by the attorney in question remaining active as a
practitioner; but in all cases in which a
striking off or suspension
order might be appropriate expedition is required. The somewhat
leisurely course that preceded the
launch of these proceedings is
therefore to be deprecated.
Even in cases in which the attorney has ceased to practise, it is
inimical to the high status and esteem in which the attorneys
profession should, in the public interest, be generally regarded if
persons whose names should not be on the roll in consequence
of
their defalcation of clients’ money remain registered as
attorneys any longer than practicably necessary. This much
is
inherent in any achievement of the object of maintaining and
enhancing the prestige, status and dignity of the profession;
the
very first of the objects of a law society listed in s 58 of
the Attorneys Act. Thus in all striking off applications,
even where
no considerations of urgency are involved, there is nevertheless a
duty on the society concerned to institute proceedings
expeditiously. That duty was not satisfactorily discharged in this
case.
In the circumstances described above we do not consider it
appropriate that the respondent should be made liable for the costs
occasioned by the postponement of the hearing of the application on
19 November 2010.
Order
:
It is directed that the respondent’s name be struck off the
roll of attorneys and conveyancers of this Honourable Court.
Pursuant to the provisions of paragraph 1 of this order, and
to the extent that may remain necessary, relief is further
granted
as prayed for in paragraphs 2 – 12 of the notice of
motion, save that there shall be no order in respect
of the costs
of appearance on behalf of the applicant at the hearing on
19 November 2010.
D.V. DLODLO
Judge of the High Court
A.G. BINNS-WARD
Judge of the High Court