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[2021] ZAGPPHC 258
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South African Legal Practice Council v Breedt (31869/2020) [2021] ZAGPPHC 258 (3 May 2021)
HIGH
COURT OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE NO: 31869/2020
REPORTABLE:NO.
OF INTEREST TO OTHER
JUDGES:NO.
REVISED.
DATE
:03
MAY 2021
In
the matter between:
SOUTH
AFRICAN LEGAL PRACTICE COUNCIL
Applicant
and
PETER
MARTINUS BREEDT
First Respondent
PETER
M BREEDT INCORPORATED
Second Respondent
JUDGMENT
This application was
heard virtually and otherwise disposed of in the terms of the
Directives of the Judge President of this Division.
The judgment and
order are accordingly published and distributed electronically.
DAVIS,J
[1]
Introduction
This is the judgment in
an application by the South African Legal Practice Council (LPC) for
an order that the name of the first
respondent, Peter Martinus Breedt
be struck from the roll of legal practitioners. The second
respondent
is
Mr Breedt’s incorporated
law
firm, Peter M Breedt Inc.
[2]
The role of the LPC
The role of the LPC is
that of custodian
of legal
practitioners
and overseer of
their conduct. It does so in terms of the Legal Practice Act, 28 of
2014
(the LPA). The LPC is
the successor of the Law Society of South Africa and its provincial
societies. The custodian role and the
LPC’s function as
amicus to the court has been set out in various
judgments and it is not necessary to expand thereon for present
purposes. See, inter
alia
Prokureursorde van
Transvaal v Kleynhans
1995 (1) SA 839
(T) and
Law Society of the Northern Provinces v Le
Roux
202 (4) SA 500
(GNP). The
current application is one in terms of section
44(1) of the LPA which affirms the power of this court to “
adjudicate
upon and make orders in respect of matters
concerning
the
conduct of a legal
practitioner”.
It
must
be read with section 31(1)(a)
of
the LPA which obliges the
LPC
“
to
cancel
the
enrolment of a legal practitioner if the High Court orders that his
or her name be struck off the Roll”.
[3]
The suspension order
On 18 August 2020, the
LPC applied to this court for an order that the first respondent be
suspended from practice and that a
curator
bonis
be appointed to take control of his
practice. The respondents gave notice to abide such an order,
which
was
granted
on the said
date
by
Raulinga,
J together with
certain ancillary relief.
[4]
The inquiry
The determination of
whether a practitioner is no longer fit and proper to
practice as such and the exercise of the
discretion regarding an appropriate sanction, involve a three-stage
inquiry:
-
The first inquiry is to determine whether the alleged offending
conduct
has been established on a preponderance of probabilities.
-
The second determination is as to whether the practitioner is still
fit
and proper to continue to practice in view of those offences
which have been determined in the first inquiry.
-
The third inquiry is, whether in all the circumstances of a
particular case,
the sanction of striking off is the
appropriate sanction or whether any other sanction should be imposed.
See:
Jasat
v Natal Law Society
2000 (3) SA 44
(SCA) and
Malan v
Law
Society of the Northern Provinces
[2008] ZASCA 90
;
2009 (1) SA
216
(SCA).
[5]
The offending conduct
5.1 In
the affidavit filed on behalf of the LPC in support of the initial
application for the suspension
of the first respondent from practice,
the following offences were identified (in similar fashion as in
Malan
(above) at [21], I shall merely list the offences as
they are not really in dispute): a trust deficit of some R20 million
was identified,
the first respondent had practiced as an attorney
without a Fidelity Fund Certificate for some time, the auditor’s
report
for the period ending 28 February 2019 was flawed and could
not be relied on, irregular transfers from the firm’s trust
banking
accounts were made, the first respondent had effectively
abdictated his control over the firm’s trust account and
generally
failed to account to the firm’s clients in respect of
trust funds or delayed payment of trust funds to clients. A number of
the provisions of the Code of Conduct for legal practitioners were
also breached.
5.2
Shortly before the aforementioned suspension order, the respondents
delivered an affidavit
styled an “explanatory affidavit”.
In it, the first respondent stated: “
I furthermore confirm
that I am aware of the trust shortage and do not contest the
correctness thereof, nor the charges as laid
against myself and the
second respondent by the various complainants as attached to the
founding affidavit”.
The trust shortage was, without the
furnishing of any particularity, ascribed to the conduct of an
employee against whom the first
respondent had laid criminal charges.
5.3
Prior to the hearing of the application for striking off, the LPC
caused a further supplementary
affidavit to be filed. This was done
in order to inform the court of several additional complaints
received against the respondents.
The first is that of a Mr Lesetedi
who was not paid the proceeds of a sale of immovable property after
the respondents had attended
to the transfer thereof. The second was
from a Ms Ntlabathi. She was the purchaser of a property and had paid
R 550 000.00 in total
to the respondents. These funds are unaccounted
for and neither did the transfer go through. The third compliant was
from a Mr
Matlala. His complaint related to transfer fees which he
had paid in respect of a property transaction which had been
cancelled
and which had not been repaid to him. The fourth complaint
was from a Mr Mngomezulu. This concerned the uncompleted
administration
of a deceased estate. A fifth complaint was lodged by
a Ms Thito. She had not received the portion of her rates and taxed
to which
she was entitled to after the sale of her property, which
refund had been paid to the respondents . A seventh complaint, of Mr
and Mrs Makhajane also related to a property transaction. After
payment of the purchase price, the sale never went through but the
funds were no longer available in the respondents’ trust
account. The eighth complaint, of a Ms Rapadi, is for a loss in
similar terms, but only for the deposit and transfer fees and not the
whole purchase price as in the case of the previous complaint.
5.4
Not only did these complaints result in a number of further
contraventions of the
Code of Conduct for legal practitioners and
various provisions of the LPA, it also increased the exposure and
liability of the
Fidelity Fund and resulted in further prejudice to
members of the public.
5.5
The respondents have neither answered nor delivered an “explanatory
affidavit”
in respect of these complaints (as they have
previously done).
5.6
The determination is consequently that the offending conduct have
been established
on a balance of probabilities.
[6]
Fit and proper
In the latest affidavit
delivered on behalf of the LPC, its chairperson submitted, in view of
the above facts, that the first respondent
has made himself guilty of
unprofessional, dishonourable and unworthy conduct and that he cannot
be considered to be a fit and
proper person to remain on the roll of
attorneys. I agree. This submission is substantiated by the
aforementioned facts.
[7]
Sanction
In exercising the value
judgment required for the imposition of an appropriate sanction, I
take into account that the transgressions
are numerous, they extend
over a period of time, they impacted negatively on
various parties, be they purchasers or sellers of
properties, bondholders or beneficiaries of a deceased estate. The
transgressions
are all related to moneys and, in particular, trust
funds. The trust placed in the first respondent as a legal
practitioner has
repeatedly been breached. The breaches involve greed
and dishonesty, and, if they were not perpetrated by the first
respondent
but by a
member
of
his staff, then
he has
displayed a reckless disregard or gross dereliction of duty in
respect of monies which the public had entrusted to him. In
those
circumstances and where no mitigating factors have been placed before
us, I am of the view that a striking off order would
be the most
appropriate sanction.
[8]
Control and costs
8.1
The suspension order makes provision for the control over the files
of the respondents
by placing it in the hands of a curator. The
provisions relating to the curator’s powers should remain in
place for the proper
administration of those files in the interest of
the public.
8.2
The provisions under which the LPC operate in matters such as this
and precedent provide
that costs, which should in this case follow
the event, be ordered on the scale as between attorney and client.
[9]
Order
The
order should be as follows:
1.
The name Peter Martinus Breedt is struck
off the roll of legal practitioners and the applicant is ordered to
adjust its records
accordingly.
2.
Paragraphs 3 to 13.5 of the order of 18 August 2020 remain in force.
3.
The respondents are, jointly and severally, ordered to pay the costs
of the application on
the scale as between attorney and client.
N DAVIS
Judge of the High Court
Gauteng Division,
Pretoria
I agree
K S MAHLANGU
Acting Judge of the High
Court
Gauteng Division,
Pretoria
Date
of Hearing: 20 April 2021
Judgment
delivered: 03 May 2021
APPEARANCES:
For the
Applicant:
Mr L Groome
Attorney for the
Applicant:
Rooth and Wessels Attorneys, Pretoria
For the
Respondents:
No appearance
Attorney for the
Respondents:
Hefferman Attorneys,
Pretoria