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[2010] ZAGPPHC 124
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Adlam and Another v Blacke Swart & Associate (17303) [2010] ZAGPPHC 124 (28 September 2010)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT, PRETORIA)
CASE
NO: 17303
DATE:
28/09/2010
In
the matter between:
DEREK
ADLAM
...................................................................................................................
1
st
Plaintiff
DEON
DE
BEER
….............................................................................................................
2
nd
Plaintiff
And
BLACKE
SWART &
ASSOCIATE
.....................................................................................
Defendant
JUDGMENT
LEDWABA.
J
[1]
The plaintiffs issued summons against the defendant seeking an order
directing the defendant to render an account to the plaintiff,
debatement of such account and an order that the defendant pay the
balance to the plaintiff if any, after the debatement. The defendant
is defending the action.
[2]
Both plaintiffs testified and called Mr. Morgan James Evans (Mr.
Evans) as their witness before closing their case. Defendant's
application for absolution from instance after the plaintiffs closed
their case was dismissed. Mr Blackie Swart, Mrs Swart and
Mr. Allan
Wallace testified on behalf of the defendant before defendant's case
was closed.
[3]
The plaintiffs are chemists. In the year 2000 were criminally
charged, together with 2 other accused for wrongfully and unlawfully
dealing with prescription medicine.
[4]
Defendant is an incorporated firm of attorneys which was known as
Blakie Swart and Evans Inc when the first plaintiff consulted
with it
in 2000 regarding the aforesaid criminal matter.
[5]
The accounts that the plaintiffs wanted the defendant to render and
in respect of which a debatement was to be held are, according
to the
plaintiffs, concerning:
(i)
two
cheques paid to the defendant by the first plaintiff amounting to R21
000
(ii)
A
Toyota Land Cruizer vehicle (the Land Cruizer) valued at about R330
000, and
(iii
) A Formula 323 water boat (the boat) 260 000
[6]
I will first summarise the evidence of the witnesses which I regard
relevant for the understanding of the conclusion to be reached
when I
adjudicate on the relief sought by the plaintiffs.
[7]
The first plaintiff (Mr. Adlam) testified that his mother and himself
had previously instructed Mr Blackie Swart (Mr. Swart),
an attorney
at the defendant's firm of attorneys in respect of their private
matters before. On 10 April 2000 he went to defendant's
firm of
attorneys and consulted with Mr Swart to instruct him to represent
them in their criminal case and to further make representation
to the
Office of the Director of Public Prosecutions because the officer to
whom representations were to be made was Mr. Swart's
friend and could
probably decide in their favour.
[8]
He further said he signed a fee agreement which Mr Swart presented to
him, see Bundle A page 9-12. Despite the fee agreement
only
mentioning him only as a person liable for the fees, he specifically
said he instructed Mr Swart to act for Mr. De Beer and
himself.
[9]
He said Mr Swart asked him how much money they could raise for the
case. His response was that R500 000 could be raised. Mr
Swart said
the R500 000 would be enough as fees for criminal case and it should
be paid at his offices. Mr Swart wanted a deposit
of R50 000 but he
only paid him with two cheques in the amounts of R16 500 and R4 500
respectively. He further said Mr. Swart told
him that he would debit
his fees after rendering professional services. He said he later
discussed the R500 000 fee with Mr. de
Beer and both agreed to pay
the said fee.
[10]
As far as the fee agreement is concerned, it should be noted that in
the last page of the fee agreement (page 12) there is
a hand written
note which reads as follows
"Fooie
ooreengekon kan onmidel gedebiteer en as fooie beskou word en dan so
gebank word"
[11]
Mr. Adlam said he paid a further R100 000 cash as fees to Mr. Swart
on 12 or 13 April 2000 which had been stored at Mr de Beer's
fathers
house at Centurion. He said the R100 000 consisted of five R100
packets, the value of each packet was R20 000. He further
said he put
the money on Mr Swart's desk who quickly counted the packs, not the
contents, and placed them below his desk and did
not issue a receipt
nor did he ask for same.
[12]
Regarding payment of the balance of the fee they agreed upon he told
Mr. Swart that Mr. de Beer and himself were in the process
of selling
the Land Cruizer and the boat for R260 000 and R330 000, respectively
and the balance would be paid thereafter. Mr Swart
told him that he
will also look for people interested in buying the said items.
[13]
He further said the same night after the R100 000 was paid, at about
22h00 Mr Swart phoned and told him that there was a person
interested
in buying both items and he should arrange for the items to be
delivered to him, Mr. Swart.
[14]
After a few days he arranged with Mr. Swart that he should collect
the Land Cruizer at Centurion from Mr de Beer. It is common
cause
that Mr Swart did collect the Land Cruizer from Mr De Beer at
Centurion.
[15]
He further said Mr Swart was involved in an accident in February 2001
and sustained a back injury and could represent them
at court. He
phoned Mr. Swart several times requesting a refund and he collected
the copies of charge sheet from Mr. Swart's offices
in June 2001.
[16]
He instructed another attorney Mr. Jan Ellis, to represent him. The
trial was finalised on 20 April 2002. His co-accused and
himself were
convicted and fined R300 000 and an imprisonment sentence was
suspended. He then instructed Mr. Jan Ellis to write
to the
defendant. On 22 November 2002 Mr. Ellis addressed a letter to the
defendant wherein he requested the defendant to deposit
an amount of
R190 000 urgently into his trust account so that counsel's fees could
be paid, see Bundle A page 53.
[17]
In September 2000 Sarlie and Ismail Inc. attorneys acting on behalf
of Messrs Adlam and De Beer wrote to defendant, see Bundle
A page
54-55. Paragraph 2,3 and 5 of their letter reads as follows:
'We
are
instructed that in and during April 2000 our client Adlam paid to you
on behalf of our clients' representation for an anticipated
trial the
sums of R20 000-00 and R100 OOO-oo respectively, the former being
paid in the form of two cheques drawn by third parties,
and the
latter in cash.
Subsequently,
and in anticipation of a costly legal process our clients entrusted
to you a Toyota Land Cruizer motor vehicle registration
number SD
158LG, and a formula 2327.4 litre mercury cabin cruiser boat. Your
instructions were to urgently raise monies by way
of the disposal of
such items. Our clients expressly reserved ownership in respet of the
said items until full payment had been
made, and a few days pursuant
to being entrusted with the said items, you informed our client that
the vehicle bad been sold at
a price of R330 000-00, and the boat at
the price of R260 000-00. Consequently, you were to retain the sum of
R710 OOO-oo in cash
in anticipation of our clients' pending trial.
Our
instructions are to urgently demand payment of the sum of R710 000-00
less your fee, properly substantiated, for any legal services
rendered. We also require full and precise particulars as to the
parties to whom our clients' assets as aforementioned were disposed
in order that our clients may exercise their rights of ownership,
duly reserved as aforementioned."
[18]
Mr. de Beer testified and to a great extent confirmed the evidence of
Mr Adlam.
[19]
Mr. M. J. Evans testified that in 2000 he was a director at Swart and
Evans Inc. attorneys, the defendant. He said he once
saw the
plaintiffs at a function at Mr Swart's house. They had a discussion
about the Land Cruizer and the boat. He had an interest
in the said
items.
[20]
The following day he, together with his friend Carla Botha, went to
Water World to view the boat. They arranged that the said
boat be
exchanged for another 2 boats at the showroom.
[21]
He offered Mr Swart R200 000 for the boat of Mr. Adlam and De Beer
which offer was accepted and he paid Mr. Swart R125 000
with a cheque
that did not go through and he later paid Mr. Swart R150 000 cash.
[22]
Mr Swart did give him the keys of the Land Cruizer he drove it and
took it for valuation. He was not interested in it and he
returned it
the following day to Mr Swart.
[23]
He denied hat he gave Mr Botha the keys of the Land Cruizer and that
there was a deal on the Land Cruizer between Mr Swart
and Mr Botha.
The plaintiff closed his case.
[24]
Thereafter Mr. Swart testified. Through his secretary MS. Adri
Fourie, after she duly took an oath to repeat what Mr Swart
said, for
proper recording, since Mr. Swart could not enunciate his evidence
for recording because of injury he sustained when
he was involved in
an accident.
[25]
Mr. Swart confirmed that he knew Mr. Adlam well and that he did some
legal work for him and his mother.
[26]
He consulted with Mr. Adlam for the first time at his office in
Roodepoort in April 2000 concerning his criminal case. Mr.
Adlam
signed the fee agreement. He denied that he also acted for the second
plaintiff and said if he also acted for the second
plaintiff he would
have opened a file for him and would have made him to sign a fee
agreement.
[27]
He said in the first consultation with Mr. Adlam in April 2000 he
estimated the total fees for his criminal case in the amount
of R50
000. He confirmed that Mr. Adlam paid an amount of R21 000 with two
cheques and that they agreed that the attorney who represents
Mr.
Adlam in Potchefsroom would arrange for the postponements request
copies of a charge-sheet and he, (Mr. Swart) would attend
court when
the trial commences.
[28]
He received copies of the charge-sheet in consisting of 1880 pages.
He read the charge-sheet and his nominal fee for perusal
was R20 per
page. He further said he debited fee of R21 000 immediately there
after it was paid because the contents of the fee
agreement catered
for that.
[29]
He vehemently denied Mr. Adlam paid him R100 000 cash for the case.
The version presented by Mr. Swart regarding cash is that
Mr. Adlam
had made an appointment and came to his office in about May 2000. Mr.
Adlam first plaintiff brought some cash and gave
it to Carla Botha,
the person who purchased the Land Cruizer. When he asked Mr. Adlam as
to why did he give Mr Botha the money,
his response was that he (Mr
Swart) should not worry because the docket was going to disappear. He
(Mr. Swart) told plaintiff that
he was playing with fire, and he does
not want to be part of the shenanigans. During cross examination, Mr.
Swart further said
when Adlam gave Botha money he went out.
[30]
Regarding the Land Cruizer, Mr. Swart said Mr. Adlam said he was
selling the vehicle and he told him that he had an interest
in it
because he was about to buy a car. Since he would be visiting his
family in Nabomspruit he wanted to test drive the Land
Cruizer. Mr.
Adlam told him that the vehicle was in Bronkhorspruit and he would
make arrangements for him to have the vehicle on
the Friday they
agreed upon.
[31]
Mr. Swart said his son-in-law Mr. Allan Wallace accompanied him to
Centurion to collect the Land Cruizer from Mr. De Beer at
a bridge.
He drove back with the Land Cruizer. After test driving it during the
weekend he was not interested in buying it because
it did not have a
turbo-charge and further because Mr. Adlam did not have registration
papers of the vehicle since the vehicle
was from Swaziland, it was
so-called 'greys model'. He arranged that Mr. Adlam was to collect
the vehicle on Monday afternoon.
[32]
He further said Mr. Evens saw the vehicle parked at the office. When
he enquired about it, he told him that the first plaintiff
was
selling it and he gave him the keys since he showed some interest in
it. However, in the afternoon Mr. Evans returned with
his friend viz,
Barnard who is also known as Carla Botha who was interested in
purchasing the Land Cruizer.
[33]
He said Mr. Adlam gave him permission to give Botha the keys of the
vehicle. He saw the vehicle again when the first plaintiff
gave Botha
money in the office, in about May 2000 that was the last time when he
saw the Land Cruizer.
[34]
Regarding the boat, Mr. Swart testified that two weeks after the Mr.
Adlam and Mr. Botha were at his office Adlam phoned to
say he was
selling a boat. Mr. Swart told Mr. Evans about it. Messrs Evans and
Mr. Botha communicated with Mr. Adlam directly about
the boat and he
further received information that they bought it and latter exchanged
it for two boats. Mr. Swart further disputed
Mr. Evans's evidence
that he received R150 000 cash for the boat and further that he
received a letter in page 25 of bundle A that
Mr. Adlam said it was
faxed to him.
[35]
Mr. Swart further said after receiving a letter from Mr. Adlam's
attorneys, Sarlie-lshmael Inc., dated 12 September 2002 (page
54 of
the bundle) he phoned Mr. Adlam to enquire what nonsense was in the
letter. Mr. Adlam apologised and told him to ignore the
letter. He
further testified that summons was served on the defendant three
years after the alleged incident concerning R100 000
the cash the
Land Cruizer and the boat. However, he decided not to file a special
plea of prescription to the plaintiff's claim.
He wanted the merits
of the matter can be adjudicated by the court.
[36]
In evaluating the evidence and probabilities Mr. Swart stuck to his
evidence even if he was cross-examined in detail about
his version.
He did deviate from his evidence in chief however, in my view, his
digressions were not material nor did they weaken
his version.
[37]
On the contrary, the evidence of the plaintiffs' considered together
with the evidence of Mr. Evans, in my view, reflects some
improbable
characteristics, which make the plaintiffs' to be unsatisfactory.
[38]
The version put forward by Mr. Adlam the plaintiff is that Mr. Swart
wanted a deposit of R500 000 and they paid a deposit of
R121 000 and
the value of the Land Cruizer and the boat being R330 000 and R260
000, respectively, would form part of the monies
to be paid into the
defendant's trust account to cover the fees charged by the defendant.
[39]
If it is accepted that the Land Cruizer was sold for R330 000 the
total amount received by the defendant would have been R451
000 made
up of the R21 000 cheques and the alleged R100 000 cash.
[40]
Since Mr. Evans confirmed that he held discussion with the plaintiffs
he would have informed them that he gave Mr. Swart R150
000 cash for
the boat. The plaintiffs on the aforesaid figures only would have
been immediately entitled to a refund of about R100
000 but there is
no evidence that the plaintiffs claimed the said refund then.
[41]
Having regard to the contents of the letter addressed to the
defendant by Sarlie-lshmael Inc. dated 12 September 2007 and the
contents of the pleadings, I fail to understand why he plaintiffs'
failed to claim the vehicle from the person in whose name the
Land
Cruizer was registered. Furthermore, the plaintiffs' version does not
tally with the contents of the pleadings and the letter
from
Sarlie-lshmael Inc. dated 12 September 2007.
[42]
Keeping in mind the relief sought by the plaintiff and on careful and
proper analysis of the evidence, I will deal with the
aforesaid
accounts that the plaintiffs want an account to be rendered
separately.
[43]
Regarding the deposits of two cheques of R21 000, it is common cause
that Mr. Adlam paid to the defendant on 10 April 2000
the said
monies. The monies were put in trust and debited as fees on 14 April
2000.
[44]
Mr. Swart who testified on behalf of the defendant explained that he
immediately debited the fee of R21 000 as it was agreed
in the fee
agreement.
[45]
It is clear that by then, the professional services rendered were
just one consultation with Mr. Adlam and some telephone calls
were
made. In terms of the
Attorneys
Act,
the
attorney should only transfer fees and render services and must
account to client accordingly, see
sections
78 and 79 of the Attorneys Act 53 of 1979
[46]
Mr. Swart further explained that the value of the professional
services that he rendered by reading 1180 pages of the charge
sheet,
exceed an amount that was in trust and he did account to Mr. Adlam.
It should be noted that in some of the correspondence
from the
plaintiffs' attorneys the fee of R21 000 is not an issue.
[47]
The ledger book of the defendant further reflected the defendant and
the fee debited.
[48]
I think it will not serve any purpose to make an order in respect of
the R21 000 because there is an explanation about the
said amount.
[49]
Regarding the alleged R100 000 cash deposit, Mr. Swart denies to have
received the said cash and he gave another version which
involves a
money transaction between Mr. Adlam and Mr. Botha.
[50]
The burden of proof is on the plaintiffs to prove on the balance of
probabilities that they paid the defendant the R100 000
cash.
[51]
I fail to understand as to why would Mr. Adlam risk breaching his
bail conditions by going to the defendant's office only to
pay the
R100 000 if the money could have been deposited into the bank account
of the defendant's trust account. By then, the charge
sheet had not
been drafted and there was no need for a consultation with Mr. Swart.
Mr. Swart testified that Mr. Adlam came to
his office for the second
time to meet with Mr. Carla Botha regarding the disappearance of the
docket. It is, in my view, possible
that this could have been the
reason why Mr. Adlam visited the defendant's office.
[52]
If the money was legitimately paid to the defendant as fees the
question is still why Mr. Adlam not insisted on a receipt so
that he
could even prove to Mr. de Beer and Mr. de Beer's father that he did
pay the money as part of the fees. On the contrary,
if the money was
paid for illegitimate activity it is understandable why a receipt
would not be insisted upon.
[53]
Regarding the Land Cruizer, on proper analysis of the evidence of Mr.
Adlam, Mr. Evans and Mr. Swart, there is no evidence
or sufficient
evidence to prove that the purpose of the sale of the Land Cruizer
was to use the proceeds as a deposit for the alleged
fee of R500 000.
[54]
In my view, the sale or intended sale was just a private deal and had
nothing to do with the fees to be paid to the defendant.
Advocate
Maritz for the plaintiffs', correctly, in my view, conceded that the
relief sought in respect of this item should not
succeed.
[55]
Regarding the Formula 323 boat, Mr. Swart even with the boat, denied
that he received same to be used as a deposit for the
alleged fee of
R500 000.
[56]
In my view, the issue of the boat is a private deal between Mr.
Adlam, Mr. Evans and Mr. Botha and Water World in Randburg.
[57]
Also, on the evidence of Mr. Evans who was a director at defendant's
firm of attorney even if it may be accepted that he did
give Mr.
Swart some money for the boat, there is no doubt that the transaction
was a private deal, otherwise he could have paid
the proceeds of the
alleged sale at the defendant's offices or deposited it into the
defendant's trust bank account.
[58]
Mrs. Swart denied that Evans gave Swart R150 000 cash and her
evidence was not challenged.
[59]
The relief sought by the plaintiff also in respect of this item must
fail.
COSTS
[60]
The matter was extremely important for the reputation of Mr. Swart
who had been an attorney for about twenty years.
[61]
The matter had a potential that Mr. Swart could have been struck from
the roll of attorneys for mismanaging and misappropriating
trust
money. The need of two counsel was in my view justified.
[62]
I
therefore, make the following order:
(i)
Plaintiffs'
claim is dismissed.
(ii)
The
first and second plaintiffs are jointly and severally ordered to pay
the costs which costs include the employment of a senior
and junior
counsel and also the wasted costs of the 26 October 2009.
A.
P
.LEDWABA
JUDGE
OF THE HIGH COURT