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[2010] ZAGPPHC 166
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Law Society of the Northern Provinces v Baloyi (77836/09) [2010] ZAGPPHC 166 (13 October 2010)
NOT
REPORTABLE
I
N
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT,
PR
ETORIA)
Case
No: 77836/09
DATE:
13/10/2010
In
the matter between:
THE
LAW SOCIETY OF THE NORTHERN
PROVINCES
...........................
Applicant
(Incorporated
as the Law Society of the Transvaal)
and
JOHN
ADVANCE
BALOYI
..............................................................................
Respondent
CORAM
SPIRE
et
EBERSOHN
AJJ
DATE
HEARD 12
th
OCTOBER 2010-10-11
DATE
JUDGMENT HANDED DOWN 13
th
OCTOBER 2010
JUDGMENT
EBERSOHN
AJ.
[1]
This is an application to the Court in terms of Section 22(1 )(d) of
the Attorneys Act 53 of 1979 (the Act) for the suspension
of the
respondent's name from the roll of attorneys together with the
ancillary relief which is normally granted in applications
of this
nature, on the grounds that the respondent is no longer a fit and
proper person to practice as an attorney.
[2]
The respondent was admitted and enrolled as an attorney on 08 August
2002. He practised as a professional assistant at Lux Khambule
Attorneys from 08 August 2002 until 6 January 2003. He practised as a
partner at Baloyi & Setsoalo Attorneys from 1 January
2003 until
the firm closed down. He then practised as a professional assistant
at Shai & Mgomezuiu Attorneys as from 7 June
2004 until 31 July
2007. The respondent commenced practising as a single practitioner
for his own account under the name and style
of J A Baioyi Attorneys
on 01 August 2007.
[3]The
application was served on the respondent's mother at the respondent's
business address on the 20th January 2010. He did not
file a notice
of opposition in the matter and he also did not appear when the
matter was heard although the set-down notice was
similarly wersed.
[4]
The purpose of the application is to submit to this court facts which
the Law Society contends would justify this court in ordering
that
the respondent be suspended and the application is based on the Law
Society's contention that the respondent's conduct constituted
such a
deviation from the standards of professional conduct that he is not a
fit and proper person to practise as an attorney.
[5]
It is trite law that applications of this nature are
sui
generis
and
of a disciplinary nature. There is no
Its
between
the Law Society and the respondent. The Law Society, as
custos
morum
of
the profession merely places facts before the court for
consideration.
Hassim
vs
Incorporated Law Society of NataL 1977(2) SA 757(A) at 767
C-G
Law
Society Transvaal vs Matthews, 1989(4) SA 3fiQ(
T)
at 393 F
Cirota
& Another vs
Law
Society
Transvaal. 1979(1) SA 172(A) on
187H
Prokureursorde
van Tran
svaal
vs Keynhans, 1995(1) SA 839(T) on
851E-F
[6]
The question whether an attorney is a fit and proper person in terms
of Section 22(1 )(d) of the Act is not dependent upon factual
findings, but lies in the discretion of the court.
Law
Society
of
the Cape of Good Hope? vs C, 19fi6(1) SA 616(A) at
637
C-F
A
vs Law Societ
y
of the Cape of Good Hope, 19B9(1)SA 849(A) at
B51
A-F
Law
Society Transvaal vs Mathews,
supra
at
393 I-J
[7]
According to the authorities the nature of the enquiry which the
court must conduct is threefold, namely:
7.1
The
court must first decide as a matter of fact whether the alleged
offending conduct by the attorney has been established.
7.2
if
the Court is satisfied that the offending conduct has been
established, a valued judgment is required to decide whether the
person concerned is not a fit and proper person to practise as an
attorney.
Kapian
vs Incorporated La
w
Society, Transvaal, 1981 (2) SA
page
762 at page
7S2A-C
Reyneke
vs Wetsgenootskap van die Kaap die Goeie Hoop 1994 (1) SA page 359 at
page 369
-
370
7.3
if
the court decides that the attorney concerned is not a fit and
proper
person to practise as an attorney, it must decide in the exercise of
its discretion whether in ail the circumstances of the
case the
attorney in question is to be removed from the roll or merely
suspended from practice.
Law
Society of the
Cape of Good Hope vs Buddricks
2003
(2)
SA Page 11 at Pages 13 I and 14 A to B
Malar
v
The
Law Society of the Northern Provinces
(568/2007)
[2008] ZASCA 90
(12/09/2008) at [4 - 9]
7.4
The court's discretion must be based upon the facts before it and
facts in question must be proven upon a balance of probabilities.
Law
Society Transvaal vs Mathews,
supra
at
393 l-J
Olivier
vs Die Kaapse Balie-Raari 1972(3) SA 485(A) at 496 F-G
Summerley
vs Law Society Northern
Provinces
2006(5) SA 613(SCA) at615B-F
Malan
v The Law Society of the Northern Provinces (568/2007)
[2008]
ZASCA 90
(12/9/2008) at [9]
[8]
The standard of conduct which is expected from an attorney of this
court against which the conduct of the respondent as set
out
hereunder must be measured, is set out in paragraph 8.1 of the
founding affidavit. This conduct can, insofar as it relates
to the
Respondent, be summarised as follows:
8.1
An attorney is a member of a learned, respected and
honourable profession and, by entering it. he pledges himself with
total and unquestionable integrity to society at large, to the courts
and to the profession.
8.2
Only
the very highest standard of conduct and repute and good faith are
consistent with membership of the profession which can indeed
only
function effectively if it inspires the unconditional confidence and
trust of the public.
8.3
The
image and standing of the profession are judged by the conduct and
reputation of all its members.
8.4The
attorneys' profession can only fulfil its obligations to the
community and comply with its role in the administration of
justice
in the land if it inspires and maintains the unconditional confidence
of the community and if its members devote their
absolute integrity
to the conduct of their profession and to the fulfilment of all the
requirements demanded of the profession
and its members.
[9]
RULE
70 AUDIT RFPORT:
The
requirements concerning an attorney's financial obligations to the
applicant can briefly be summarised as follows:
9.1
Section 70 of the Attorneys Act empowers the applicant to direct an
attorney to provide it with any document which is in the
possession
of such attorney and which relates to his practice to enable the
council to decide whether or not a disciplinary enquiry
into the
conduct of such attorney should be conducted.
9.2
Rule
68 obliges every firm of attorneys (which includes a sole
practitioner for his own account) to keep complete and accurate
accounting records which must explain the transactions and financial
position of the firm and which must distinguish in readily
discernable form between business account transactions and trust
account transactions.
9.3
Section
78(5) of the Attorneys Act gives the Applicant the power to inspect
the accounting records of any attorney in order to satisfy
itself
that the provisions relating to keeping of trust banking accounts and
maintaining of proper accounting records relating
to trust monies
have been observed.
9.4
Rule
70.4 read with Rule 70.3 requires every attorney who practises for
his own account to cause his auditor to lodge a report with
the
Applicant within 6 (Six) months of the annual closing of his
accounting records to the effect that the attorney has kept such
records as required by the Attorneys Act and the Applicant's Rules
and further to the effect that there were at all relevant times
sufficient monies in his trust bank account to cover his liability to
trust creditors.
9.5
Lodging
of an auditor's report is a prerequisite for an attorney to be issued
with a Fidelity Fund Certificate for the commencement
of a new year.
9.6Failure
to submit a Rule 70 report and to practise without a Fidelity Fund
Certificate is a criminal ito Section 81(10).
[10]
MFRITS
OF THF APPI NATION-
The
facts and circumstances which prompted the Law Society to bring this
application
include, among others, the following:
10.1
The
respondent failed to cause his auditor to lodge an opening audit
report as required by the applicant's Rule 70.4 read with Rule
70.3
for the period ending 31 October 2007 (from the commencement of the
respondent's practice to the end of the third calendar
month
following the commencement of his practice which opened on 01 August
2007).
10.2
The
respondent also failed to cause his auditor to lodge an unqualified
audit report for the period ending 29 February 2008.
10.3
In
a letter dated 11 February 2008 the applicant reminded the respondent
that his firm's opening audit report for the period ending
31 October
2007 was still outstanding.
10.4
In
a letter dated 27 March 2008 the respondent was again reminded of his
firm's outstanding opening audit report.
10.5
The
respondent was called upon to appear before a Disciplinary Committee
of the applicant on 06 November 2008 to answer to charges
arising
from his failure and/or neglect to cause the required audit reports
to be lodged. The respondent failed to attend the disciplinary
hearing.
10.6
In
a letter dated 17 February 2009 the respondent was again advised of
the fact that he failed to submit his audit reports. The
respondent
was cautioned about the provisions of sections 41(1) and 41(2) of the
Attorneys Act which prohibits a practitioner from
practising for his
own account without being in possession of a Fidelity Fund
Certificate and while practising or acting as such,
to receive and
accept fees, rewards and disbursements from clients. The respondent
was also cautioned about the provisions of Section
83(10) of the
Attorneys Act. The respondent was at that stage also advised that, in
the event that he persisted in his failure
to obtain a Fidelity Fund
Certificate, application would be made to this court relief against
him.
10.7
On
2 June 2009 the applicant received a letter from Baloyi Attorneys
regarding the respondent's outstanding audit reports. Mrs Gerne
Patterson who is employed by the applicant phoned on the mobile
number as reflected on the letterhead and spoke to a certain Mr
Moses
Masinga who advised her that the respondent was no longer practising
as an attorney as he suffers from a mental iliness.
According to Mr
Msinga, he was requested by the respondent to draft the letter and to
forward same to the applicant.
10.8
The
respondent also failed to pay his outstanding annual subscription
fees totalling an amount of R4 571.50.
[11]
RFPORT
RY SWART DATFD 17 AUGUST 200Q
Mr
De Leeuw Swart who has expertise in conducting investigations into
attorneys' practices, the manner in which they maintain their
accounting records and the manner in which they operate on their
trust banking accounts was instructed by the applicant to conduct
an
investigation into the respondent's firm. Swart provided the
applicant with a report wherein he indicated that he initially
experienced difficulty in contacting the respondent. Swart visited
the respondent's firm on 13 February 2009. According to Swart,
the
signboard outside the respondent's offices indicated that the offices
were occupied by Baloyi Masinga Attorneys. Swart's investigation
was
directed at establishing why no opening audit report for the period
ending 31 October 2007 and no audit report for the year
ending 29
February 2008 were submitted to the applicant by the respondent. A Mr
Masinga was found at the said offices and he informed
Swart that the
respondent had not been practising for the last six months or more at
the firm and that he never attended at the
offices during that
period. Swart indicated that Mr Masinga appeared not to be practising
as an attorney and reckoned that the
name as appeared on the
signboard outside the offices might be misleading to the public.
Swart confirmed that, according to the
records of the applicant,
there is no attorney Masinga practising in the Thulamahashe area. The
last Fidelity Fund Certificate
issued to the respondent was for the
year 2008. If the respondent was therefore still practising, he would
be practising without
being in possession of a Fidelity Fund
Certificate from 1 January 2009.
[12]
Attempts by Swart to acquire the trust account details and the trust
bank statements of the respondent's firm proved fruitless.
[13]
The respondent accordingly has contravened the following provisions
of the Attorneys Act and the Applicant's Rules:
i.
Rule
3.1 in that he did not, within 30 days after the change of his
address and the closure of his offices, inform the secretary
of the
Applicant in writing of same;
ii.
Rule
89.17 in that he abandoned his practice without prior notice to
clients and without arranging with them for the dispatch of
their
files and/or any other business and/or property in his possession or
under his control;
iii.
Rule
70.3 in that he did not ensure that his firm's outstanding Rule 70
accountant's report to be furnished by an accountant in
terms of Rule
70.4 is so furnished within or at the required time; and
iv.
Sections
41(1) and 41(2) of the Attorneys Act in that he practised without
being in possession of a Fidelity Fund Certificate and
while
practising or acting as such, received and accepted fees, rewards and
disbursements from clients. In terms of Section 83(10)
of the Act,
any practitioner who does not comply with the provisions of Section
41 of the Act shall be guilty of an offence and
on conviction liable
to a fine not exceeding R 2 000,00 or imprisonment not exceeding six
months or both.
[14]
It is clear that it has been established by the applicant that the
respondent has indeed contravened numerous of the provisions
of the
Attorney's act and the Applicant's Rules. If all the respondent's
misconduct is taken cumulatively, it has been established
that the
respondents conduct does not meet the standard which is required from
an attorney and that his misconduct reveal character
defects which
cannot be tolerated in an Officer of this Honourable Court and that
the respondent is no longer a fit and proper
person to practice as an
attorney and should be suspended pending the return day of a rule
nisi.
[15]
In the notice of motion the applicant seeks an order that the
respondent should pay the costs of this application on the scale
as
between attorney and client. Justification for this prayer is found
in paragraph 19 of the Founding Affidavit.
Prokureursorde
van Transvaal vs Kieynhans 1995(1) SA, fi39 at page
865
[16]
The following order is accordingly made:
1.1
The
respondent is is called upon to show cause, if any, at 10:00 on
Friday the 26
th
November 2010 why his name shall not be removed from the roll of
attorneys.
1.2
As
per the draft order marked "X" which shall operate as an
interim order pending the return date.
P.Z.
EBERSOHN
ACTING
JUDGE OF THE HIGH COURT
I
AGREE AND IT IS SO ORDERED:
S.SAPIRE
ACTING
JUDGE OF THE HIGH COURT
Applicant's
counsel
Me.
S.
L
.
Magardie
Applicant's
attorneys
Damons,
Magardie,
Richardson
Attorneys
Tel.
012-342 9281
Ref.
LAW1/0030/SLM/rz
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT, PRETORIA)
Case
no: 77836/09
In
the matter between:
THE
LAW SOCIETY OF THE NORTHERN
PROVINCES
..................................
Applicant
(Incorporated
as the Law Society of the Transvaal)
and
JOHN
ADVANCE
BALOYI
.....................................................................................
Respondent
COURT
ORDER
Having
read the papers filed of record and having heard the attorney for the
Applicant,
IT
IS ORDERED
1.
That
JOHN
ADVANCE BALOYI
(hereinafter
referred to as the respondent) be suspended in his practice as an
attorney of this Honourable Court, pending the finalisation
of a
striking application.
2.
That
respondent immediately surrenders and delivers to the registrar of
this Honourable Court his certificate of enrolment as an
attorney of
this Honourable Court.
3.
That
in the event of the respondent failing to comply with the terms of
this order detailed in the previous paragraph within two
(2) weeks
from the date of this order, the sheriff of the district in which the
certificate is, be authorised and directed to take
possession of the
certificate and to hand it to the Registrar of this Honourable Court.
4.
That
respondent be prohibited from handling or operating on his trust
accounts as detailed in paragraph 5 hereof.
5.
That
Johan van Staden, the head : members affairs of applicant or any
person nominated by him, be appointed as
curator
bonis
(curator)
to administer and control the trust accounts of respondent, including
accounts relating to insolvent and deceased estates
and any deceased
estate and any estate under curatorship connected with respondent's
practice as an attorney and including, also,
the separate banking
accounts opened and kept by respondent at a bank in the Republic of
South Africa in terms of section 78(1)
of Act No 53 of 1979 and/or
any separate savings or interest-bearing accounts as contemplated by
section 78(2) and/or section 78
(2A) of Act No. 53 of 1979, in which
monies from such trust banking accounts have been invested by virtue
of the provisions of
the said sub-sections or in which monies in any
manner have been deposited or credited (the said accounts being
hereafter referred
to as the trust accounts), with the following
powers and duties:
5.1
immediately to take possession of respondent's accounting records,
records, files and documents as referred to in paragraph
6 and
subject to the approval
of
the board of control of the attorneys fidelity fund (hereinafter
referred to as the fund) to sign all forms and generally to
operate
upon the trust account(s), but only to such extent and for such
purpose as may be necessary to bring to completion current
transactions in which respondent was acting at the date of this
order;
5.2
subject
to the approval and control of the board of control of the fund and
where monies had been paid incorrectly and unlawfully
from the
undermentioned trust accounts, to recover and receive and, if
necessary in the interests of persons having lawful claims
upon the
trust account(s) and/or against respondent in respect of monies held,
received and/or invested by respondent in terms
of section 78(1)
and/or section 78(2) and/or section 78 (2A) of Act No 53 of 1979
(hereinafter referred to as trust monies), to
take any legal
proceedings which may be necessary for the recovery of money which
may be due to such persons in respect of incomplete
transactions, if
any, in which respondent was and may still have been concerned and to
receive such monies and to pay the same
to the credit of the trust
account(s);
5.3
to
ascertain from respondent's accounting records the names of all
persons on whose account respondent appears to hold or to have
received trust monies (hereinafter referred to as trust creditors)
and to call upon respondent to furnish him, within 30 (thirty)
days
of the date of service of this order or such further period as he may
agree to in writing, with the names, addresses and amounts
due to all
trust creditors;
5.4
to
call upon such trust creditors to furnish such proof, information
and/or affidavits as he may require to enable him, acting in
consultation with, and subject to the requirements of, the board of
control of the fund, to determine whether any such trust creditor
has
a claim in respect of monies in the trust account(s) of respondent
and, if so, the amount of such claim;
5.5
to
admit or reject, in whole or in part, subject to the approval of the
board of control of the fund, the claims of any such trust
creditor
or creditors, without prejudice to such trust creditor's or
creditors' right of access to the civil courts;
5.6
having
determined the amounts which he considers are lawfully due to trust
creditors, to pay such claims in full but subject always
to the
approval of the board of control of the fund;
5.7
in
the event of there being any surplus in the trust account(s) of
respondent after payment of the admitted claims of all trust
creditors in full, to utilise such surplus to settle or reduce (as
the case may be), firstly, any claim of the fund in terms of
section
78(3) of Act No 53 of 1979 in respect of any interest therein
referred to and, secondly, without prejudice to the rights
of the
creditors of respondent, the costs, fees and expenses referred to in
paragraph 10 of this order, or such portion thereof
as has not
already been separately paid by respondent to applicant, and, if
there is any balance left after payment in full of
all such claims,
costs, fees and expenses, to pay such balance, subject to the
approval of the board of control of the fund, to
respondent, if he is
solvent, or, if respondent is insolvent, to the trustee(s) of
respondent's insolvent estate;
5.8
in
the event of there being insufficient trust monies in the trust
banking account(s) of respondent, in accordance with the available
documentation and information, to pay in full the claims of trust
creditors who have lodged claims for repayment and whose claims
have
been approved, to distribute the credit baiance(s) which may be
available in the trust banking account(s) amongst the trust
creditors
alternatively to pay the balance to the Attorneys Fidelity Fund;
5.9
subject
to the approval of the chairman of the board of control of the fund,
to appoint nominees or representatives and/or consult
with and/or
engage the services of attorneys, counsel, accountants and/or any
other persons, where considered necessary, to assist
him in carrying
out his duties as curator; and
5.10
to
render from time to time, as curator, returns to the board of control
of the fund showing how the trust account(s) of respondent
has/have
been dealt with, until such time as the board notifies him that he
may regard his duties as curator as terminated.
6.
That respondent immediately delivers his accounting records, records,
files and documents containing particulars and information
relating
to:
6.1
any
monies received, held or paid by respondent for or on account of any
person while practising as an attorney;
6.2
any
monies invested by respondent in terms of section 78(2) and/or
section 78 (2A) of Act No 53 of 1979;
6.3
any
interest on monies so invested which was paid over or credited to
respondent;
6.4
any
estate of a deceased person or an insolvent estate or an estate under
curatorship administered by respondent, whether as executor
or
trustee or curator or on behalf of the executor, trustee or curator;
6.5
any
insolvent estate administered by respondent as trustee or on behalf
of the trustee in terms of the
Insolvency Act, No 24 of 1936
;
6.6
any
trust administered by respondent as trustee or on behalf of the
trustee in terms of the Trust Properties Control Act, No 57
of 1988;
6.7
any
company liquidated in terms of the Companies Act, No 61 of 1973,
administered by respondent as or on behalf of the liquidator;
6.8
any
close corporation liquidated in terms of the
Close Corporations Act,
69 of 1984
, administered by respondent as or on behalf of the
liquidator; and
6.9
respondent's practice as an attorney of this Honourable Court,
to the curato/ appointed in terms of paragraph 5 hereof,
provided
that, as far as sucnJ accounting records, records, files and
documents are concerned, respondent shall be entitled to
have
reasonable access to them but always subject to the supervision of
such curator or his nominee.
7.
That
should respondent fail to comply with the provisions of the preceding
paragraph of this order on service thereof upon him or
after a return
by the person entrusted with the service thereof that he has been
unable to effect service thereof on respondent
(as the case may be),
the sheriff for the district in which such accounting records,
records, files and documents are, be empowered
and directed to search
for and to take possession thereof wherever they may be and to
deliver them to such curator.
8.
That
the curator shall be entitled to:
8.1
hand
over to the persons entitled thereto all such records, files and
documents provided that a satisfactory written undertaking
has been
received from such persons to pay any amount, either determined on
taxation or by agreement, in respect of fees and disbursements
due to
the firm;
8.2
require
from the persons referred to in paragraph 8.1 to provide any such
documentation or information which he may consider relevant
in
respect of a claim or possible or anticipated claim, against him
and/or respondent and/or respondent's clients and/or fund in
respect
of money and/or other property entrusted to respondent provided that
any person entitled thereto shall be granted reasonable
access
thereto and shall be permitted to make copies thereof.
9.
That respondent be and is hereby removed from office as -
9.1
executor
of any estate of which respondent has been appointed in terms of
section 54(1)(a)(v)
of the
Administration of Estates Act, No 66 of
1965
or the estate of any other person referred to in
section 72(1)
;
9.2
curator
or guardian of any minor or other person's property in terms of
section 72(1)
read with
section 54(1)(a)(v)
and
section 85
of the
Administration of Estates Act, No 66 of 1965
;
9.3
trustee
of any insolvent estate in terms of
section 59
of the
Insolvency Act,
No 24 of 1936
;
9.4
liquidator
of any company in terms of
section 379(2)
read with 379(e) of the
Companies Act, No 61 of 1973;
9.5
trustee
of any trust in terms of section 20(1) of the Trust Property Control
Act, No 57 of 1988;
9.6
liquidator of any close corporation appointed in terms of section 74
of the Close Corporation Act, No 69 of 1984.
10.
That
respondent be and is hereby directed:
10.1
to
pay, in terms of section 78(5) of Act No. 53 of 1979, the reasonable
costs of the inspection of the accounting records of respondent;
10.2
to
pay the reasonable fees of the auditor engaged by applicant;
10.3
to
pay the reasonable fees and expenses of the curator, including
travelling time;
10.4
to
pay the reasonable fees and expenses of any person(s) consulted
and/or engaged by the curator as aforesaid; and
10.5
to
pay the costs of this application on an attorney-and-client scale.
11.
That
if there are any trust funds available the respondent shall within 6
(six) months after having been requested to do so by the
curator, or
within such longer period as the curator may agree to in writing,
shall satisfy the curator, by means of the submission
of taxed bills
of costs or otherwise, of the amount of the fees and disbursements
due to him (respondent) in respect of his former
practice, and should
he fail to do so, he shall not be entitled to recover such fees and
disbursements from the curator without
prejudice, however, to such
rights (if any) as he may have against the trust creditor(s)
concerned for payment or recovery thereof;
12.
That a certificate issued by a director of the Attorneys Fidelity
Fund shall constitute
prima
facie
proof
of the curator's costs and that the Registrar be authorised to issue
a writ of execution on the strength of such certificate
in
order
to collect the curator's costs.
BY
ORDER OF THE COURT
REGISTRAR