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[2020] ZAGPPHC 79
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Bouwer v Attorneys Fidelity Fund and Another (88030/2018) [2020] ZAGPPHC 79 (29 January 2020)
IN THE HIGH COURT OF SOUTH AFRICA
(GAUTENG DIVISION, PRETORIA)
(1)
REPORTABLE:
NO
(2)
O INTEREST TO
OTHER JUDGES: YES
Case No: 88030/2018
29/1/2020
In the matter
between:
LOUIS
ADRIAAN BOUWER
Applicant
and
ATTORNEYS
FIDELITY
FUND
First Respondent
LEGAL PRACTICE
COUNCIL
Second Respondent
JUDGMENT
KUBUSHI
J,
INTRODUCTION
[1]
The purpose of this application is to
procure an order for the payment of the amount of R1 000 000 (one
million rand) from the first
respondent, the Attorneys Fidelity Fund,
in respect of a claim arising from the theft of money entrusted to
Gerard Jacques Du Plessis
Attorneys.
[2]
Only the first respondent is opposing
the application. No relief is sought against the second respondent,
the Legal Practice Council,
and is said to be cited in the papers for
purposes of taking notice of this application.
THE
FIRST RESPONDENT'S INTERLOCUTORY APPLICATION
[3]
The first respondent brought an
interlocutory application to file a further affidavit and for the
condonation for the lateness of
that application. The sole purpose of
the application was to bring a letter alleged to have been sent to
the applicant dated 13
December 2018, which the first respondent
omitted to attach to its answering affidavit. The interlocutory
application was not opposed
and the relief the first respondent
sought therein was granted.
FACTUAL
MATRIX
[4]
The facts of this case are mostly common
cause between the applicant and the first respondent ("the
parties"). Where,
however, the parties are not in agreement is
in regard to the events subsequent to the lodgement of the
applicant's notice of claim
to the first respondent as will more
fully appear hereunder.
[5]
The claim, as already stated, is
premised on the theft of trust money in the amount of R1 000 000 (one
million rand) by Gerard Jacques
Du Plessis Attorneys. The said amount
was in respect of the purchase price of immovable property known as
the Blancheplek, which
the applicant wanted to purchase from the
Trustees of the DEE Terblanche Trust ("the seller"). The
seller nominated Mr
Gerard Jacques; Du Plessis of the firm Jacques Du
Plessis Attorneys, as the transferring attorney.
[6]
The purchase price for the Blancheplek
property was to be derived from the proceeds of the sale of a
property which the applicant
had previously sold in Mafikeng ("the
Mafikeng property"). Steenkamp Attorneys attended to the
registration and transfer
of the Mafikeng property to the purchaser
thereof. Pursuant to the said sale, Steenkamp Attorneys transferred
the amount of R1
000 000 (one million rand), into the trust account
of Jacques Du Plessis Attorneys as security for the payment of the
purchase
price of the Blancheplek property for Jacques Du Plessis
Attorneys to proceed with registration of transfer of the Blancheplek
property to the applicant.
[7]
It later transpired that attorney Gerard
Jacques Du Plessis was implicated in an elaborate fraudulent scheme
in terms of which funds
from home owners destined to be paid to the
local authority had been misappropriated. Consequently, the estate of
attorney Gerard
Jacques Du Plessis was sequestrated on 23 May 2018.
This led to the closure of the practice of Jacques Du Plessis
Attorneys.
[8]
In terms of the information received
from the Law Society for the Northern Provinces, the applicant lodged
a claim with the first
respondent in accordance with section 26 of
the Attorneys Act 53 of 1979 for the recovery of the amount of R1 000
000 (one million
rand) misappropriated by attorney Gerard Jacques Du
Plessis.
[9]
As earlier stated, the parties differ as
to what happened after the applicant submitted his claim to the first
respondent. According
to the applicant, an official of the first
respondent, Mr Losper, who was charged with dealing with the claim,
telephoned the applicant's
attorneys of record on 12 June 2018 and
confirmed that he had approved the applicant's claim and that he (Mr
Losper) had already
given instruction for the payment to be made to
applicant's attorneys of record. However, despite repeated reminders
to the first
respondent and/or Mr Losper to make the payment as
undertaken, same was not done and this led to the applicant launching
the present
application.
[10]
The first respondent on the other hand, whilst conceding that Mr
Losper did inform the applicant
that the claim has been investigated
and found to be a valid claim and that the first respondent would pay
the amount claimed,
argues that the applicant was further informed
that the amount could only be paid if it could not be recovered from
the insolvent
estate of Gerard Jacques Du Plessis. The contention by
the first respondent's counsel is that as a fund of last resort, the
first
respondent expected the applicant to excuss the estate of
Gerard Jacques Du Plessis and other persons in law before it could
make
payment as undertaken. Thus, payment was withheld pending the
finalisation of the excussion process, which included, but was not
limited to the sequestration proceedings against the insolvent estate
of Gerard Jacques Du Plessis, in person. In support of this
argument,
the first respondent attached a letter dated 13 December 2018.
PRELIMINARY
ISSUES
[11]
In opposing the application, the first
respondent raised three preliminary issues. The first two points were
raised in its answering
affidavit, namely failure to excuss and
misjoinder. A third point
in limine
that of a dispute of fact was raised
in the heads of argument. The said points are dealt hereunder in tum.
Misjoinder
[12]
The question of misjoinder was resolved
and no longer had to be determined. The
in
limine
point on misjoinder was
raised by the first respondent against the name used by the applicant
when citing the first respondent.
The point fell away when the
applicant filed a notice of amendment of the Notice of Motion, which
was not opposed, rectifying the
name of the first respondent.
Dispute
of Fact
[13]
The key dispute of fact, according to
the first respondent, is whether or not Mr Losper informed the
applicant, and/or the applicant's
attorney of record that the first
respondent is a fund of last resort and that the claimant was
expected first to excuss Gerard
Jacques Du Plessis and all other
persons liable in law and that he (Mr Losper) would withhold payment
pending finalisation of the
final excussion process, which included,
but was not limited to the sequestration proceedings against the
insolvent estate of Gerard
Jacques Du Plessis. This is denied by the
applicant.
[14]
The submission by the first respondent's
counsel is that the dispute of fact can be resolved in favour of the
first respondent by
the application of the rule formulated in
Stellenbosch Farmers' Winery Ltd v
Stellenvale Winery (Pty) Ltd.
[1]
[15]
In terms of the said rule, where there
is a dispute as to the facts in motion proceedings, a final
interdict, as is sought in this
instance, should be granted only if
the facts as stated by the respondents, together with the admitted
facts in the applicant's
affidavit, justify such order, or where it
is clear that the facts, although not formally admitted, cannot be
denied and must be
regarded as admitted.
(16)
I do not think that there is a dispute
of fact on the papers as they stand. It ls the applicant's case, as
set out in the founding
affidavit, that on 12 June 2018 Mr Losper, on
behalf of the first respondent, telephoned Ms De Beer of the
applicant's attorneys'
office, and confirmed to her that he (Mr
Losper) had instructed for the amount to be paid out to the
applicant's attorneys of record's
office already on 30 May 2018,
thus, admitting liability on behalf of the first respondent. It is
clear from what is stated herein
that Mr Losper never informed Ms De
Beer that payment was conditional upon excussion. Ms De Beer confirms
this telephone conversation
in a confirmatory affidavit attached to
the founding affidavit.
[17] These
allegations are not pertinently disputed by the first respondent in
its answering affidavit.
Except to mention in the answering affidavit
that Mr Losper informed the applicant in a letter dated 13 December
2018, that the
first respondent admitted the applicant's claim on
condition that the insolvent estate of Gerard Jacques Du Plessis is
first excussed
and that payment was withheld pending the finalisation
of the excussion process. The first respondent says nothing about the
other
events that happened subsequent to the lodgement of the
applicant's claim before the letter of 13 December 2018, which the
first
respondent refers to in his papers.
[18]
In essence, the conversation of 12 June
2018 between Mr Losper and Ms De Beer is not denied. The letter of 13
December 2018 happened
long after the fact, when the applicant had
already issued the application. This letter, in my view, does not
create a dispute
of fact as it does not dispute the occurrence of 12
June 2018, but only introduces the first respondent's defence of
non-compliance
with the provisions of section 49 of the Attorneys
Act. There is, therefore, no dispute of fact and this preliminary
point ought
to be dismissed.
Failure
to Excuss
[19]
The first respondent raised as a point
in limine
non-compliance
with the provisions of sections 49 (1) of the Attorneys Act and 79
(1) of the
Legal Practice Act 28 of 2014
, which it maintained are
mandatory provisions in that the applicant had not first taken steps
to excuss the insolvent estate of
Gerard Jacques Du Plessis.
[20]
It is the first respondent's case that the applicant is not properly
before court in that:
20.1
In terms of section 49 (1) of the
Attorneys Act, no person shall without leave of the respondent
institute a claim against the Fund
unless the claimant has exhausted
all legal remedies against the practitioner in respect of whom the
claim arose and against all
other persons liable in respect of the
loss suffered by the claimant;
alternatively
20.2
Section 79
(1) of the
Legal Practice Act
does
not apply since the claim was lodged with the Fund before 1
November 2018. According to the first respondent, the
Legal Practice
Act has
no retrospective application and, since the facts that gave
rise to this application arose before 1 November 2018, the claim on
which it is based must be determined in accordance with the
applicable provisions of the Attorneys Act, namely section 49 (1)
thereof.
[21] In this
regard, to the argument that
section 79
(1) of the
Legal Practice Act
does
not apply in this case, counsel for the first respondent relied
on the provisions of section 12 (2)
(b)
of the Interpretation
Act 33 of 1957 ("the Interpretation Act") which provides
that a new law does not have retrospective
application. Accordingly,
so counsel argued, the repeal of section 49 (1) of the Attorneys Act
did not affect its application to
this matter after 1 November 2018.
[22] The
applicant's case, on the other hand, is that since the application in
this instance was issued
on or about 6 December 2018, and served on
the first respondent on 25 January 2019 which are dates that fell
after the repeal of
the Attorneys Act and the coming into operation
of the
Legal Practice Act, the
provisions of the
Legal Practice Act,
and
not the Attorneys Act, apply.
[23]
In support of his argument, counsel for
the applicant relied on the interpretation afforded to the provisions
of section 12 (2)
(c)
of
the Interpretation Act in the judgment in
Minister
of Public Works v Haffejee NO,
[2]
wherein that court dealing with matters of the retrospectivity or not
of legislation, interpreted section 12 (2)
(c)
of the Interpretation Act as drawing
a distinction between matters that are purely procedural in nature
and those giving rise to
vested rights on the part of parties.
Consequently, the court, in that judgment, held that statutory
retrospectively does not apply
to procedural provisions.
[24]
Counsel, on behalf of the applicant,
argued that since the provisions of sections 49 and 79 of the
respective Acts deal with the
procedure that regulate the institution
of action against the first respondent and do not affect the
substantive rights and obligations
of the applicant which arose in
terms of the Attorneys Act, the procedural aspect of the applicant's
application, being instituted
post the commencement of the
Legal
Practice Act stands
, therefore, to be regulated by the provisions of
section 79
of the Legal Practice Act.
THE
ISSUE
[25]
The question, at this stage is, which
Act, whether the Attorneys Act or the
Legal Practice Act, applies
to
the proceedings instituted by the applicant having regard that (a)
the loss of money occurred before 1 November 2018, that is,
on 30
November 2017; (b) the claim was submitted to the Fund before 1
November 2018; (c) the
Legal Practice Act came
into operation on 1
November 2018; (d) the application was launched on 6 December 2018 -
after the coming into operation of the
Legal Practice Act.
THE
LAW
[26]
The salient provisions of the
Interpretation Act read as follows:
“
12
Effect of repeal of a law
(1)
(2)
(a)
Where
a law repeals any other law, then unless the contrary intent ion
appears, the repeal shall not ... affect the previous operation
of
any law so repealed ... ;
(b)
(c)
Where
a law repeals any other law, then unless the contrary intention
appears. the repeal shall not affect any right. privilege,
obligation
or liability acquired, accrued or incurred under any law so
repealed."
[27]
Sub-section 12 (2)
(c)
of the Interpretation Act was·
given the following interpretation in
Haffejee:
"I
now turn to the question whether, on an application of common law
principles of interpretation or such provisions of the
Interpretation
Act 33 of 1957 as may be relevant, the changes brought about by the
amending Act apply to a right of compensation
which had arisen prior
to the coming into operation of that Act. but had not yet been
invoked by the lodging of an application
for compensation in a
compensation court.
In
contending that the question should be answered in the affirmative,
counsel for the appellant laid great stress on the procedural
nature
of the amendments. Now, although it has often been said that the
presumption against statutory retrospectively does not
apply to
procedural provisions, the realisation has grown that the distinction
between procedural and substantive provisions cannot
always be
decisive in the context of statutory interpretation . Thus, in
Yew
Bon Tew v Kenderaan Bas Mara
[1982] 3 All E R 833
(PC) 836b Lord
Brightman said:
"A
statute is retrospective if it takes away or impairs a vested right
acquired under existing laws, or creates a new obligation,
or imposes
a new duty, or attaches a new disability, in regard to events already
past. There is however said to be an exception
in the case of a
statute which is purely procedural, because no person has a vested
right in any particular course of procedure,
but only a right to
prosecute or defend a suit according to the rules for the conduct of
an action for the time being prescribed.
But these expressions
'retrospective' and 'procedural', though useful in a particular
context, are equivocal and therefore can
be misleading. A statute
which is retrospective in relation to one aspect of a case (e.g.
because it applies to a pre statute
cause of action) may at the
same time be prospective in relation to another aspect of the same
case (e.g. because it applies only
to the post-statute commencement
of proceedings to enforce that cause of action); and an Act which is
procedural in one sense may
in particular circumstances do far more
than regulate the course of proceedings, because it may, on one
interpretation, revive
or destroy the cause of action itself."
And at p
839 d to f:
"Whether
a statute has a retrospective effect cannot in all cases safely be
decided by classifying the statute as procedural
or substantive...
Their Lordships consider that the proper approach to the construction
of... [an Act)... is not to decide what
label to apply to it,
procedural or otherwise, but to see whether the statute, if applied
retrospectively to a particular type
of case, would impair existing
rights and obligations."
The first
passage was quoted with apparent approval in
Euromarine
International of Mauren v The Ship Berp and Others
1986 (2) SA
700
(A) 709 - 710, and was referred to in
Transnet Ltd v Ngcezula
1995 {3) S A 538 {A) 549 H. In the latter case Botha JA also
commented on the following passage in the judgment of Innes CJ in
Curlis v Johannesburg Municipality
1906 T S 308
, 312:
"Every
law regulating legal procedure must. in the absence of express
provision to the contrary, necessarily govern, so far
as it is
applicable, the procedure in every suit which comes to trial after
the date of its promulgation. Its prospective operation
would not be
complete if this were not so, and it must regulate all such procedure
even though the cause of action arose before
the date of
promulgation, and even though the suit may have been then pending. To
the extent to which it does that, but to no greater
extent, a law
dealing with procedure is said to be retrospective."
Botha
J A commented thus (at p 549 C-0):
"Of
even greater significance, for present purposes, is his statement
that, to the extent which the law must regulate the procedure
even
though the cause of action arose before the date of promulgation,
'but to no greater extent', the law is said to be retrospective.
It
is implicit in the words I have emphasised that in a situation where
more is involved than the straightforward application of
the new
procedure to a cause of action which arose before promulgation, the
convenient way of saying that the law is retrospective
is no longer
appropriate, and that other considerations must come into play."
In other
words, it does not follow that once an amending statute is
characterised as regulating procedure it will always be interpreted
as having retrospective
effect.
It will depend upon its impact
upon existing substantive rights and obligations. If those
substantive rights and obligations remain
unimpaired and capable of
enforcement by the invocation of the newly prescribed procedure,
there is no reason to conclude that
the new procedure was not
intended to apply.
Aliter
if they are not"
[28]
The argument by the first respondent's
counsel that
section 79
(1) of the
Legal Practice Act, and
his
reliance on section 12 (2)
(b)
of
the Interpretation Act, misses the point. It is not in dispute that,
as provided for in section 12 (2)
(b)
of the Interpretation Act, a law
that repeals another law, unless the contrary intention appears,
shall not in any way affect the
previous operation of the law so
repealed.
[29]
However, that is not the end of the
matter, section 12 (2)
(c)
must
also be taken into the equation, in that the presumption against
statutory retrospectively does not apply to procedural provisions.
[30] The
interpretation afforded to section 12 (2)
(c)
in
Haffejee,
is therefore, pertinent.
Haffejee
held that the new
procedure provided for in the new legislation would apply only where
the issue is procedural in nature to the
extent that it does not
affect the vested rights and interests that accrued in terms of the
repealed provision. It follows therefore
that if a new procedure
introduced in the new legislation is found ' not to affect the
substantive right and obligations which
vested and/or accrued in
terms of the repealed legislation, then in that regard the new
procedure will apply.
[31]
In this instance, it is common cause
that, the provisions of section 49 of the Attorneys Act and 79 of the
Legal Practice Act deal
, undoubtedly, with the procedure that applies
in instituting action against the fund - they are, therefore,
procedural provisions.
It is also not in dispute that in this
instance, the rights and/or interests of the applicant had become
vested and/or accrued
in terms of the repealed provision of the
Attorneys Act. It follows, therefore, that even in this instance, as
in
Haffejee,
the
substantive rights and obligations which arose for the applicant in
terms of the Attorneys Act, and the first respondent's obligation
to
make payment thereof continue to enjoy force and are clearly capable
of enforcement in terms of the procedure provided for in
the
provisions of
section 79
of the
Legal Practice Act. There
is no
reason to conclude that the new procedure was not intended to apply
to those rights and obligations. As a result, I have
to rule that
section 79
of the
Legal Practice Act applies
to the facts of these
proceedings.
[32]
However, the first respondent's counsel
contends in the heads of argument that even if the requirements of
section 49 (1) of the
Attorneys Act had fallen away on 1 November
2018, the provisions of
section 79
(1) of the
Legal Practice Act
would
still have entailed that the applicant should have stated under
oath that there is no portion of the claim which could reasonably
be
recovered from the person liable and this was not stated in the
applicant's papers.
[33]
The applicant's counsel submits that on
a proper reading of
section 79
(1) of the
Legal Practice Act, failure
to first excuss against the responsible party is no bar to the
institution of proceedings against the first respondent. The
submission
is that
section 79
(1) of the
Legal Practice Act does
not
contain any mandatory provision in this regard - unlike as was the
position under section 49 (1) of the Attorneys Act, which
determined
that no action shall be instituted without leave of the board of
control until all legal remedies have been exhausted
against the
practitioner.
[34]
In my opinion, except that it is no
longer a requirement that the applicant seek and obtain leave of the
first respondent to institute
a claim against it, the legislative bar
that applied to legal proceedings before the commencement of the
Legal Practice Act, that
is, that the applicant must first exhaust
all legal remedies against the practitioner, has been retained in the
new Act.
[35]
Section 79
(1) of the
Legal Practice Act
stipulates
that the first respondent is not obliged to pay any
portion of a claim which could reasonably be recovered from any other
person
liable.
[36]
It is my view that in order for the
complainant to prove her/his claim in terms of
section 79
(1) of the
Legal Practice Act, she/he
must allege and prove that she/he could
not reasonably recover any portion of the claim from any other person
liable. Without such
allegation and proof, the first respondent is
not obliged to pay the claim. As these are motion proceedings it was
for the applicant
to state in his founding affidavit that there is no
portion of the claim which could reasonably be recovered from the
estate of
the practitioner concerned.
[37]
It is common cause that, in this
instance, the applicant has not complied with the requirements of
section 79
(1) of the
Legal Practice Act, in
that he has not alleged
in his papers that there is no portion of the claim which could
reasonably be recovered from the estate
of Gerard Jacques Du Plessis,
or any other person liable, as such, the claim should ordinarily not
succeed.
[38]
However, the proposition for the
applicant's counsel is that Mr Losper, on behalf of the first
respondent, had already before coming
into effect of the new
legislation, made an unconditional undertaking to pay the amount
claimed by the applicant. I have already
ruled earlier in this
judgment that the unconditional undertaking by the first respondent
was not denied by the first respondent
and stands as an admission.
The undertaking by the first respondent to pay the applicant's claim
is, in my view, a right that had
accrued for the applicant, already
at the time the
Legal Practice Act came
into operation. I have ruled,
as well, that the substantive rights and obligations which arose for
the applicant in terms of the
Attorneys Act, and the first
respondent's obligation to make payment thereof continue to enjoy
force and are clearly capable of
enforcement in terms of the
procedure provided for in the provisions of
section 79
of the
Legal
Practice Act. There
was no need, in the circumstances of this case,
for the applicant to first exhaust the legal requirements of
section
79
(1) of the
Legal Practice Act before
claiming payment of the
amount misappropriated by attorney Gerard Jacques Du Plessis, because
the first respondent had already
admitted liability and undertaken to
pay the amount claimed.
[39]
The relief requested by the applicant in
the notice of motion should consequently be granted with costs.
ORDER
[40]
As a result, I make the following order:
1.
The
first respondent is ordered to make payment to the applicant in the
amount of R1 000 000 (one million rand) together with the
costs of
the application.
2.
The
first respondent is ordered to pay interest on the amount of R1 000
000 (one million rand) from the date of this order to date
of payment
at the rate of 10, 25%
per annum.
E.M
KUBUSHI
JUDGE
OF THE HIGH COURT
Appearance:
Applicant's
Counsel
: Adv Jan Moller
Applicant's
Attorneys
: Van Rensburg Attorneys
c/o Anton Rudman Attorneys
First
Respondent's Counsel
: Adv Gary Oliver
First
Respondent's Attorneys
: Brendan Muller Inc
Date of
hearing
: 22 October 2019
Date of
judgment
: 29 January 2020
[1]
1957 (4) SA 234
(C} at 235E-G.
[2]
[1996] ZASCA 17
;
1996 (3) SA 745
AD at p755