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[2011] ZASCA 145
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Mda v Law Society of the Cape of Good Hope (534/10) [2011] ZASCA 145; 2012 (1) SA 15 (SCA) (26 September 2011)
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THE SUPREME COURT OF APPEAL OF
SOUTH AFRICA
JUDGMENT
Case No: 534/10
In
the matter between:
MATOLWANDILE BONGA MDA
….................................................................
Appellant
and
THE LAW SOCIETY OF THE CAPE OF GOOD
HOPE
…..........................
Respondent
Neutral citation:
Mda v The
Law Society of the Cape of Good Hope
(534/2010)
[2011] ZASCA 145
(26 September 2011).
Coram:
Brand, Cachalia, Malan,
Majiedt and Seriti JJA
Heard:
15 September 2011
Delivered: 26 September 2011
Summary: The authority of council
of the Law Society to inspect, under s 70(1) of the Attorneys
Act 53 of 1979, ‘any
book, document, record or thing’
pertaining to a practice, or to inspect the ‘accounting
records’ under s 78(6)
framed widely – not limited only
to documentary material pertaining to specific complaint against
practitioner.
________________________________________________________________
ORDER
________________________________________________________________
On appeal from:
Eastern Cape
High Court, Mthatha (Petse ADJP and Miller J sitting as full bench):
(1) The appeal is dismissed with
costs.
________________________________________________________________
JUDGMENT
________________________________________________________________
CACHALIA JA (Brand, Malan, Majiedt and
Seriti JJA concurring):
[1] This is an appeal against an order
of a full bench of the Eastern Cape High Court sitting at Mthatha
(Petse ADJP, Miller J concurring)
ordering the appellant, Mr
Matolwandile Bonga Mda, to make the accounting records of his
attorney’s practice available for
inspection by the Law Society
of the Cape of Good Hope. The appeal comes before us with leave of
the high court. The circumstances
under which the Law Society asserts
a right to inspect Mr Mda’s records are these.
[2] Mr Mda has not had a happy
relationship with the Law Society. He has, on fifteen occasions, been
found guilty of unprofessional
conduct pursuant to internal
disciplinary proceedings conducted in terms Rule 15 of the Rules
of the Law Society of the Cape
of Good Hope. The Law Society is
considering instituting disciplinary proceedings against him for five
other matters. One of these
relates to a complaint arising from a
claim that Mr Mda was instructed to pursue on behalf of Mr Dlokweni
against the Road
Accident Fund (the RAF) in about 1996. In 2005, Mr
Dlokweni lodged a complaint with the Law Society against Mr Mda
regarding his
claim. This was after Mr Dlokweni had learnt that the
RAF had paid his claim to Mr Mda three years earlier, in 2002, and Mr
Mda
could not account for the money. At Mr Dlokweni’s instance
the Law Society wrote to Mr Mda to establish what had happened,
but
received no satisfactory response.
[3] Early in April 2006 Mr Mda
informed the Law Society that he could not locate Mr Dlokweni’s
file. He promised to respond
by 21 April 2006, but failed to do so.
He then gave another undertaking to answer the query by 14 July 2006.
Again, no response
was forthcoming. The Law Society wrote further
letters – the last on 4 January 2007 – but elicited
no response.
When he did finally answer, on 24 August 2007, the Law
Society was still not satisfied with his explanation.
[4] On 11 July 2007 the Law Society
addressed a letter to Mr Mda to inform him that a ‘forensic
audit’ of his practice
was to be conducted as envisaged in
s 70(1), and s 78(5) of the Act, and that PDP Pretorius Dondashe
(the auditors) had been
authorised to do this. It explained that this
was required to satisfy itself that the practice was keeping proper
accounting records
in compliance with s 78(4), and to decide
whether or not disciplinary proceedings under s 70(1) were warranted.
Mr Mda requested
information on the ambit of the investigation. On 15
August 2007 the Law Society answered by letter informing him that
four other
complaints by his clients against him were being
considered, in addition to Mr Dlokweni’s. The first two
complaints concerned
an alleged failure on his part to respond to
requests for information from his clients to provide progress reports
to them about
their matters; the third was that he had allegedly not
paid arrear rates and taxes to a municipality in respect of a
property despite
having promised to do so; and the last complaint
concerned a matter involving the transfer of a property for which he
had received
an instruction ten years earlier, but had allegedly not
reported on its progress, and then resisted attempts by the
complainant
to have the file removed from him.
[5] Mr Mda avers that he attended to
all these complaints and that there is no basis for a wide-ranging
investigation into the affairs
of his practice. Despite adopting this
stance he initially appeared willing to assist the auditors with
their investigation, but
then demurred. The Law Society demanded his
co-operation, threatening to institute proceedings to compel him to
co-operate if necessary.
With no adequate response forthcoming from
him, the Law Society launched the proceedings that are the subject of
this appeal.
[6] The essential dispute before the
high court, as before us, concerns the ambit of the investigation
that the Law Society may
undertake. Mr Mda accepts that the five
complaints in issue, if proved, could amount to ‘unprofessional,
dishonourable or
unworthy conduct’ as the Act envisages. But,
he contends, the Law Society may only demand information concerning
the five
complaints mentioned above: it may not conduct a general
forensic audit of his practice for the purpose of enquiring into
allegations
of misconduct on his part. In support of his contention
he submits that ss 70(1) and 78(5), upon which the Law Society
purports
to rely to conduct a wide-ranging investigation into the
affairs of his practice, do not authorise this. Instead, so the
submission
goes, s 70(1) permits the Law Society only to inspect
material pertaining to specific complaints against him, and s 78(5),
only
to inspect accounting records concerning his trust account –
nothing else. It is therefore necessary to consider the ambit
of
these provisions.
[7] Law Societies have, among their
objects, the responsibility to uphold the integrity of practitioners
1
and ensure that the standards and
control of their professional conduct
2
are maintained. This task falls to a
council, which runs the affairs and exercises the powers of a
society.
3
Among the powers given to a council to
achieve these objects is s 71, which sanctions an enquiry into
allegations of ‘unprofessional
or dishonourable or unworthy
conduct’ on the part of a practitioner. To decide whether or
not an enquiry should be held a
council may use s 70(1)
4
to inspect ‘any book, document,
record, or thing’ pertaining to a practice. There is no limit
to the ambit of the inspection.
[8] A council may also, under s
78(5)
5
,
satisfy itself that a practitioner’s trust accounts are in
order by inspecting the ‘accounting records’ of the
practice. In this regard it must be noted that s 78(6)(d)
6
makes clear that ‘accounting
records’ is of wide import and includes ‘any record or
document’ under the
custody and control of a practitioner
relating to the practice. So whether a council is considering a
possible professional misconduct
enquiry under s 70(1), or the
supervision of a practitioner’s trust accounts under s 78(5),
both provisions expressly permit
the council to inspect all the
records and documents concerning the practice. It is on this basis
that the high court found that
the Law Society was entitled to
conduct the envisaged inspection.
[9] In my view the high court was
correct in its conclusion. Concerning Mr Mda’s submission
that s 70(1) permits
a council to inspect documentary material
pertaining only to specific allegations of misconduct, this cannot be
so. As I have indicated
above, the section does not limit a council’s
authority when it is deciding whether or not to hold a misconduct
enquiry.
However, once the council has decided to hold an enquiry, ss
71(2)(a)(i) and (ii) require any person who is summoned to testify
to
produce any documentary material that has a bearing on the subject
matter of the enquiry.
7
Section 71(2) is concerned only with
documentary material that may be relevant to an enquiry. Section
70(1), on the other hand,
has a specific purpose, which is to place a
council in a position to decide whether or not to hold an enquiry.
This is why the
legislature permitted a broader inspection under s
70(1) than it did under s 71(2).
[10] There is also no merit in Mr
Mda’s objection to the Law Society relying on s 78(5),
which he maintains may be used
only to police trust accounts, and not
to investigate misconduct. If this contention were correct it would
mean that a council
may not request documentary material regarding
any allegation of misconduct when it concerns a practitioner’s
failure to
keep proper accounting records, which is absurd. This is
why s 78(6) in terms authorises inspection of more than merely the
‘accounting
records’ of a practice.
[11] Moreover, the facts of this case
demonstrate why Mr Mda’s objection to the Law Society’s
use of the relevant provisions
is untenable. One of the allegations
against Mr Mda is that he may have misappropriated monies that were
due to Mr Dlokweni. On
the face of it this allegation, if proved,
would amount to a failure to keep proper accounts under s 78, and
also misconduct as
envisaged in s 71. It would also be a criminal
offence. In addition, as I have mentioned, Mr Mda has four other
complaints pending
against him and a dubious disciplinary record.
There are therefore clear grounds for the Law Society to invoke both
ss 78(6) and
70(1), so that a thorough inspection of his practice may
be conducted.
[12] For all these reasons the appeal
must fail. The appeal is therefore dismissed with costs.
_____________
A CACHALIA
JUDGE OF APPEAL
APPEARANCES
For Appellant: T M Ntsaluba
Instructed by:
Jolwana Mgidlana Inc, Mthatha
Nonxuba Inc, Bloemfontein
For Respondent: A A Brink (Attorney)
J F Heunis & Associates, Mthatha
Webbers Attorneys, Bloemfontein
1
Section
58(e).
2
Sections
58(f) and (g).
3
Section
60.
4
‘
Council's
power of inspection
(1) A council may for
the purposes of an enquiry under section 71 or in order to enable it
to decide whether or not such an enquiry
should be held, direct any
practitioner to produce for inspection, either by the council itself
or by any person authorized thereto
by the council, any book,
document, record or thing which is in the possession or custody or
under the control of such practitioner
and which relates to his
practice or former practice.’
5
‘
Trust
accounts
.
. .
(5)
The council of the society of the province in which a practitioner
practises may by itself or through its nominee, and at
its own cost,
inspect the accounting records of any practitioner in order to
satisfy itself that the provisions of subsections
(1), (2), (2A),
(3) and (4) are being observed, and, if on such inspection it is
found that such practitioner has not complied
with such provisions,
the council may write up the accounting records of such practitioner
and recover the costs of the inspection
or of such writing up, as
the case may be, from that practitioner.’
6
‘
(6)
For the purposes of subsections (4) and (5), 'accounting records'
includes any record or document kept by or in the custody
or under
the control of any practitioner which relates to –
(a)
.
. .
(b)
. . .
(c)
.
. .
(d)
his
practice.’
7
Section
71(2)(a)(i) reads: ‘
Enquiry by council into alleged cases
of unprofessional or dishonourable or unworthy conduct
. . .
(2)
(a)
For the
purposes of an enquiry under subsection (1), a council may –
(i) under
the hand of the president or the secretary of its society, summon
any person who in the opinion of
the council may be able to give
material information concerning the subject matter of the enquiry or
who is believed by the council
to have in his possession or custody
or under his control any book, document, record or thing which has
any bearing on the subject
matter of the enquiry, to appear before
it at a time and place specified in the summons, to be interrogated
or to produce that
book, document, record or thing, and may retain
for inspection any book, document, record or thing so produced; . .
.’