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[2015] ZAGPPHC 241
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Law Society of the Northern Provinces v Hunter (47205/2013) [2015] ZAGPPHC 241 (24 April 2015)
REPUBLIC
OF SOUTH AFRICA
IN THE HIGH COURT
OF SOUTH AFRICA
(GAUTENG
DIVISION, PRETORIA)
CASE NO: 47205/2013
DATE: 24 APRIL 2015
NOT REPORTABLE
NOT OF INTEREST TO
OTHER JUDGES
IN THE MATTER
BETWEEN:
THE LAW SOCIETY
OF THE NORTHERN
PROVINCES
.................................................
APPLICANT
and
JOHN GRAHAM
HUNTER
...................................................................................................
RESPONDENT
JUDGMENT
KUBUSHI, J
[1] The purpose of
this application is for the applicant to submit to this court facts
which the applicant contends constitute deviation
by the respondent
from the standards of professional conduct that makes him not a fit
and proper person to continue to practise
as an attorney; and, which,
justify an order that the respondent’s name be struck from the
roll of attorneys; alternatively,
that the respondent be suspended on
an urgent basis pending finalisation of the application for the
removal of his name from the
roll of attorneys; alternatively, that
the respondent be suspended in his practice on an urgent basis on
such terms and conditions
as the court may deem fit
[2]
The history of this matter is that the application was initially
brought on an urgent basis and was enrolled for 27 August 2013.
The
application was served on the respondent on 5 August 2013 and on 15
August 2013 the respondent delivered his notice of intention
to
oppose the application and subsequently filed his answering
affidavit. On 27 August 2013 the matter was postponed
sine
die
and
the respondent ordered to provide the applicant access to his
practice’s accounting records. Further papers were exchanged
between the parties. The matter was set down for hearing for 9 May
2014 and on that day, at the behest of the respondent the matter
was
again postponed
sine
die.
The
matter was again set down for hearing on 13 March 2015.
[3] At the beginning
of the hearing, counsel representing the respondent applied for the
postponement of the matter from the bar.
No formal and substantial
application was filed. The applicant’s counsel opposed the
application for postponement. The respondent’s
counsel informed
us that he had only been briefed and instructed on the morning of the
date of hearing, to appear and apply for
postponement. From the
questions put to counsel by the bench in trying to ascertain the
reason why the respondent would want the
matter to be postponed
without having filed a formal application, it emerged that counsel
was not properly briefed as he seemed
not to have knowledge of the
matter. In fact counsel conceded that he has not read the papers but
only appeared to apply for the
postponement.
[4] I should pause
here and mention that by the time the matter was placed before us the
respondent had not filed his heads of argument.
I actually became
aware as early as Monday 9 March 2015 that the respondent’s
heads of argument have not been filed. I instructed
my clerk to
contact the respondent and inform him to file his heads of argument.
My clerk, and Molefe J’s clerk were in constant
contact with
the respondent reminding him to file the heads of argument, but none
were filed. Of importance is that during all
the time of contact with
the respondent neither Molefe J’s clerk, nor my clerk, were
informed that an application would be
brought for the postponement of
the matter. Having deliberated on the issue, a decision was taken not
to postpone the matter. The
respondent’s counsel did not have
instruction to proceed with the matter on the merits and, as such,
the matter was proceeded
with in the absence of the respondent.
[5] Even though the
respondent was not represented at the hearing, in deciding this
matter I have to consider all the evidence that
is before us.
[6] The respondent,
John Graham Hunter, was admitted as an attorney of this court on 27
September 1983 and his name is still on
the roll of attorneys. At the
time of the transgressions he was practising as an attorney of this
court for his own account and
as a single practitioner under the
style Hunter Attorneys.
[7] It is the
applicant’s contention that the respondent has contravened
certain of the provisions of the Attorneys Act No
53 of 1979 (the
Act) and certain of its Rules promulgated in terms of s 74 of the
Act, which conduct makes the respondent not a
fit and proper person
to continue to practice as an attorney.
[8]
The question whether an attorney is no longer a fit and proper person
to continue to practice lies in terms of s 22 (1)
(d)
of
the Act, in the discretion of the court.
1
[9]
In exercising its discretion, in applications of this nature, a court
is in effect called upon to consider a three-stage enquiry
that
requires it to enquire whether
:
2
9.1 The applicant
has established the offending conduct on which it relies;
9.2 The conduct
established indicates that the attorney is not a fit and proper
person to practice; and
9.3 The attorney
should be struck from the roll of attorneys or suspended.
[10] The first issue
to be determined is whether the applicant has established the
offending conduct on which it relies, on a balance
of probabilities.
Put differently, did the respondent commit the offending conduct as
alleged by the applicant?
[11]
The facts and circumstances which prompted the applicant to launch
the application include,
inter
alia,
the
following:
11.1 that, the
respondent failed to account to a client. He delayed the payment of
trust funds. There is a deficit in the respondent’s
bookkeeping
and the respondent most probably misappropriated trust funds.
11.2 that, the
respondent failed to reply to the correspondence addressed to him by
the applicant and he failed to cooperate in
the proposed inspection
of his accounting records.
11.3 that, the
respondent misled the court in an affidavit deposed to by him. He
further failed to honour an undertaking to keep
certain funds
available in his trust banking account.
11.4 that, the
respondent failed to give proper attention to the affairs of his
client. He transferred an immovable property into
the name of a
person other than the buyer.
[12] In his
answering affidavit, the respondent submits that he will in his
evidence demonstrate that he was not guilty of any financial
impropriety, and in particular that there was no trust deficit in his
bookkeeping; he did not misappropriate trust funds or other
funds of
any nature; he did not place his trust creditors and the Attorneys
Fidelity Fund at risk - his trust account is in order
and has a
credit, so he contends.
[13] The facts and
circumstances in respect of the issues raised by the applicant and as
stated in paragraph [11] of this judgment,
emanate from complaints
lodged with the applicant by Mr D E A Farinha (Mr Farinha), Mr H
Teladia (Mr Teladia) and Ms Lisa Goosen
(Ms Goosen).
THE COMPLAINT BV
MR D E A FARINHA
[14] In April 2012
the applicant received a complaint from Mr Farinha. Mr Farinha
alleged that he approached the respondent’s
firm in 2007 and
instructed the respondent to act on his behalf and to acquire a
member’s interest in B & T Plumbing
CC He paid an
amount of R1300 000 into the respondent’s trust banking
account. There was a delay in the matter and Mr Farinha,
as a result,
approached the firm Michael Salomon & Associates for
assistance. Mr Farinha instructed Michael Salomon & Associates
to advise the respondent that he has terminated his mandate and
request the respondent to hand over ail the documentation relating
to
Mr Farinha’s matter to them.
[15] The
respondent’s response was that he will hand over the relevant
documents once he had prepared a statement of account
and received
payment from Mr Farinha. The respondent, however, failed to render
the statement of account and to file a notice of
withdrawal as
attorney of record. He, further, failed to respond to various
subsequent telephone messages left for him by Michael
Salomon
& Associates; this in contravention of rule 89.23 of the
applicant's Rules.
[16] Michael Salomon
& Associates reported the matter to the applicant alleging
that the respondent failed to pay over
an amount of Rl 200 000
belonging to Mr Farinha to them. The applicant in turn appointed Mr
Deleeuw Swart (Mr Swart), a chartered
accountant, to conduct an
inspection of the respondent’s accounting records and practice
affairs and to investigate Mr Farinha’s
complaint.
[17] After the
investigation, Mr Swart found that the respondent contravened at
least the following provisions of the Act and of
the applicant’s
Rules:
17.1 Rule 89.23 of
the applicant’s Rules due to the fact that the respondent
failed to reply to correspondence addressed to
him;
17.2 Section 70 of
the Act in that the respondent failed to comply with the direction of
the applicant to produce his accounting
records to Mr Swart for
purposes of an inspection thereof;
17.3 Rule 89.25 of
the applicant’s Rules due to the fact that the respondent
failed to comply with an order, requirement or
request of the Council
of the applicant; and
17.4 Section 78 (1)
of the Act read with rule 69.3.1 of the applicant’s Rules due
to the fact that there was a trust deficit
in the respondent’s
bookkeeping.
[18] Most
importantly, Mr Swart found that Mr Farinha’s monies were not
available on trust. Mr Swart based his findings on
the entries
contained in the respondent’s own records and the auditor’s
report that certified that Mr Farinha’s
monies were not
available on trust.
[19] The question
is, did the respondent contravene these provisions of the Act and/or
Rules of the applicant?
Contravention of
Section 78 (i) of the Act
[20] As regards the
contravention of s 78 (1) of the Act, the respondent denies having
transgressed the provisions of the said section.
His defence and/or
explanation is that he, on the instructions of Mr Farinha, invested
Mr Farinha’s monies in a money market
account with First
National Bank (FNB), for Mr Farinha’s benefit. In support of
this allegation, the respondent provided
a bank statement reflecting
the availability of the monies in the said account. There is,
however, no indication at all that the
funds were invested on behalf
of Mr Farinha. The account was not opened and held in Mr Farinha’s
name but in the name of
the respondent. The account itself does not
comply with the requirements of the provisions of the Act which
authorises the investment
of trust funds into a separate account for
the benefit of a client, namely, s 78 (2A) of the Act. In order to
circumvent this challenge,
the respondent, in his supplementary
affidavit, which I take it to be his answering affidavit to the
applicant’s supplementary
founding affidavit, attached a letter
from FNB confirming that the money market account was opened in terms
of s 78 (2a).
[21] Section 78 (2A)
of the Act provides that any separate trust savings or other interest
bearing account which is opened by a
practitioner for the purpose of
investing therein, on the instructions of any person, any money
deposited in his or her trust account
shall contain a reference to
the subsection.
[22] It is my view
that the provisions of s 78 (2A) of the Act are imperative and should
be complied with in order for an account
to fall within the ambit of
the subsection. As such, failure of an investment account to contain
a reference to the subsection
disqualifies such account from being an
investment for the benefit of a client as envisaged in the
subsection.
[23] It is common
cause that Mr Farinha was a trust creditor of the respondent’s
firm at all material times hereto. It is
also not in dispute that the
respondent had removed Mr Farinha’s monies from the firm’s
trust account and invested
them in a money market account. In terms
of the subsection, the choice of bank and the investment vehicle into
which the funds
could be invested is at the discretion of the
practitioner handling the funds. The investment vehicle can be either
a savings account
or any other interest bearing account. In this
instance, the respondent at his discretion chose to invest the money
in a money
market account held in FNB. However, in order for the
money market account to comply with s 78 (2A) of the Act it should
contain
a reference to the subsection.
[24] It is common
cause that the statement of account on which the respondent relied to
support his assertion that the money was
invested in a s 78 (2A)
investment account does not contain a reference to the subsection.
The applicant’s contention is
that the investment should not be
regarded as having been invested in terms of the subsection and urges
the court to accept Mr
Swart’s findings that there was as a
result of the removal of this money from the respondent’s trust
account a deficit
in the respondent’s bookkeeping. I agree with
the contention by the applicant.
[25] The respondent
seeks to bring the money market account into the ambit of s 78 (2A)
by relying on a letter from FNB which confirms
that the account was
opened in terms of the subsection. Unfortunately, the letter refers
to s 78 (2a) which is a different subsection
that serves a totally
different purpose. But, the respondent provides an explanation that
the reference to s 78 (2a) was an error
by the bank which he failed
to pick up at the time. According to the respondent, the intention
was for the letter to have reference
to s 78 (2A) and not s 78 (2a)
as the funds were invested on behalf of a client for the client’s
benefit; and he has since
requested the bank to rectify the error.
[26] I am prepared
to accept that a typographical error might have occurred when the
letter was typed. It is easy for such a typo
to occur and as such the
respondent’s explanation is reasonable in that regard. However,
the typo does not resolve the respondent’s
challenge, which is
that the money market account which the respondent chose as a vehicle
to invest the monies does not contain
a reference to the subsection.
As I have already stated, the provisions of the subsection are
peremptory and requires the account
to contain such reference. In my
view, whether or not it was the respondent’s intention to open
the account in terms of the
subsection is not the test. What is
required is for the account to contain reference to the subsection in
order to distinguish
it as an investment account for the benefit of
the client in terms of the Act. The money market account does not
contain the reference
and it cannot therefore, be regarded as an
investment account for the benefit of a client in terms of the Act.
[27] The
respondent’s challenge is exacerbated by the findings of the
respondent’s auditors who certified and reported
to the
applicant that Mr Farinha’s monies were not available on trust
[28] It is trite
that all accounting records and entries made in relation to a s 78
(2A) investment must form part of the attorneys
bookkeeping records
and must also be part of the audit carried out by the auditor on
whose report a Fidelity Fund certificate is
issued. The effect of s
78 (2A) should be that a client’s trust funds invested in terms
of a client’s instruction should
at all times whilst so
invested retain their trust identity.
[29] The funds lost
their trust identity when the respondent removed them from his firm’s
trust account and placed them in
an account which did not contain
reference to the subsection. When the respondent’s auditors
reported that Mr Farinha’s
monies were not on trust it meant
that there was a deficit in the respondent’s trust account.
This was so because the funds
having been moved from the trust
account and placed in an account which did not contain a reference to
the subsection were no longer
trust funds when in fact they were
supposed to be trust funds. Consequently, I am satisfied that there
was a deficit in the respondent’s
firm’s bookkeeping.
[30] Technically,
the respondent may not have misappropriated the funds which were not
on trust but, the respondent placed Mr Farinha,
his trust creditor,
and the Attorneys Fidelity Fund at risk. By removing Mr Farinha’s
monies from the trust account and placing
them in a non-trust
investment account anything detrimental could have happened to the
monies whilst they were so removed. The
very essence of a trust fund
is the absence of risk and the confidence created thereby.
[31] It is thus
evident that, by placing the client’s monies in the money
market account which is an ordinary account the
respondent
contravened the provisions of s 78 (1) of the Act.
Contravention of
Section 70 of the Act
[32] As already
stated in paragraph [16] of this judgment due to the complaint of Mr
Farinha, the applicant appointed Mr Swart to
investigate the
complaint The applicants contention in this regard is that the
respondent failed to cooperate with the applicant
in its
investigations of the complaint by Mr Farinha, when the applicant
sought to investigate the respondent’s accounting
records. The
respondent also failed to appear before the disciplinary committee of
the Council of the applicant.
[33] The respondent
does not in his answering affidavit deny that he failed to cooperate
with the applicant in its investigation,
but avers that his reasons
for delaying the inspection of his books with Mr Swart was simply
that he was suspicious and did not
know the purpose for which Mr
Swart wished to inspect his books. This is not acceptable.
[34] The respondent
is a very senior member of the profession. He has been practising for
32 years as he says. He should as such
be knowledgeable about the Act
and the Rules of the applicant In his own version, the respondent
admits having served on the disciplinary
committee of the Council of
the applicant on a number of occasions and has even chaired that
committee. He was, thus, better placed
to understand the operations
and the requirements of that committee. His explanation is in my view
unacceptable and unreasonable.
He ought to have known that when the
committee has resolved to inspect his books he should his books
available to Mr Swart immediately.
[35] His further
assertion that the inspection of his books was inappropriate as the
complaint was purely a fee dispute and that
the complaint should have
served before a fee assessment committee, is misconceived. The
respondent fails to take into account
that the complaint that was
received by the applicant was in respect of his failure to render a
statement of account to Mr Farinha
and to withdraw as attorney of
record. Mr Farinha did not complain about the fee charged by the
respondent, he could not at that
stage have done so since the
respondent had not furnished him with his statement of account, the
very issue he was complaining
about
[36] The respondent
is, therefore, guilty of contravening s 70 of the Act read with rule
89.25 of the Rules of the applicant.
Contravention of
Rule 89.23 of the Applicant's Rules
[37] There is no
contestation in regard to the respondent's contravention of rule
89.23 of the applicant’s Rules.
[38] The respondent
pleaded guilty to a contravention of rule 89.23 in that he failed to
answer to or appropriately deal within
a reasonable time with any
communication which reasonably required a reply or other response. He
asserts, however, that he responded
fully and comprehensively to the
complaint albeit not within a reasonable time.
Mr H Teladia’s
Complaint
[39] The applicant
received another complaint from Messrs Tucker Incorporated attorneys
acting on behalf of Mr H Teladia (Mr Teladia).
[40] Mr Teladia is a
member of Alpine Valley CC (Alpine Valley). Alpine Valley and Tevmor
CC (Tevmor) entered into a written agreement
in respect of the
purchase of an immovable property by Alpine Valley. The agreement was
subsequently amended and a further agreement
was concluded where the
purchase price was Rl 500 000. The respondent prepared the agreement
and was instructed to attend to the
registration of transfer of the
property. According to the applicant, Alpine Valley paid amounts
totalling approximately R300 OOO
to or on behalf of Tevmor in respect
of the purchase price. The respondent was fully aware of this
payment. The property was for
reasons unknown to Mr Teladia, never
transferred to Alpine Valley but transferred to Mr Ebrahim Hassam and
Ms Faaiza Hassam. Mr
Teladia then instructed Tuckers Incorporated to
establish what has transpired and why the property was not
transferred to Alpine
Valley.
[41] It is also
alleged that an amount of R50 000 was paid to the respondent for
purposes of a deposit in respect of costs in a
proposed High Court
application to be instituted against Mr E Hassam and Ms F Hassam.
Tuckers Incorporated was also instructed
to uplift the contents of
the files relating to the matter and to request the respondent to
account to them for his fees to date
and pay over the available
balance.
[42]
Tuckers Incorporated addressed a number of letters to the respondent
which went unanswered. A complaint was as a result made
to the
appellant The appellant also sent numerous letters to the respondent
which, were also not answered. Consequently the respondent
was
summoned to appear before a disciplinary committee of the Council of
the applicant in order to answer to various charges relating
to his
failure to respond to correspondence. The respondent pleaded guilty
to the charges and was fined R2 500
per
letter
to which he did not respond to.
[43] The
respondent’s submission is that he became aware that the
property he was to transfer to Alpine Valley had been transferred
to
a third party perchance as he was doing another transaction with the
City Council. He informed Mr Teladia that it will no longer
be
possible to transfer the property to Alpine Valley because it had
already been transferred to a third party. Mr Teladia was
in any
event already aware of the prior sale of the property and the
transfer when he informed him.
[44] The respondent
in his answering affidavit denies having received any money in
respect of the purchase price or the High Court
matter on behalf of
Mr Teladia or Alpine Valley. He, however, explained that the amount
of R50 000 he received from Mr Teladia
was on behalf of Mrs Papa.
According to the respondent he received instructions from Mrs Papa to
institute action against Mr and
Ms Hassim in respect of a cancelled
agreement which was between them. By agreement between Mr Teladia and
Mrs Papa, Mr Teladia
paid the R50 000 to him on behalf of Mrs Papa.
He contended further that he had no obligation to account to Mr
Teladia in respect
of that R50 000 as it was paid on behalf of Mrs
Papa.
[45] There is an
obvious dispute of fact in this complaint. Consequently, I will have
to decide the matter on the version of the
respondent and the common
cause facts. It is my view that the explanation by the respondent as
to why he could not transfer the
property is satisfactory. The
evidence shows that he became aware of the transfer of the property
to the third party and informed
Mr Teladia. Mr Teladia was aware of
the prior sale of the property and the transfer to the third party.
[46] As regards the
amount of R300 000 it is alleged was paid to the respondent towards
the purchase price, it is my opinion that
the money was not paid to
him. Mr Teladia in his complaint states only that ‘with the
knowledge of Messrs Hunter Attorneys,
Alpine Valley paid various
amounts totalling R300 000 to or on behalf of Tevmor CC on account of
the purchase price.’ To
me this does not indicate that the
money was paid to the respondent. There is also no documentary proof
of payment, like for instance,
a receipt or invoice, to prove that he
paid the amount to the respondent. 1 also have to accept the
respondent's evidence that
the amount of R50 000 was paid on behalf
of Mrs Papa even though it was paid by Mr Teladia as it is alleged.
[47] It is common
cause that Mr Swart had an opportunity to discuss the complaint with
the respondent and to scrutinize the firm’s
trust cash book and
was unable to identify any deposit relating to Alpine Valley. He
could not find an account for Alpine Valley
in the respondent’s
trust creditors, as well.
[48] What remains of
this complaint is the failure by the respondent to reply to the
correspondence of the applicant, which he admitted.
[49] The applicant
received a complaint from Lisa Goosen. Ms Goosen is a business woman
and the chief executive officer of Tintswalo
Property Group (Pty) Ltd
(Tintswalo), which is a property managing company of the Lonehill
shopping Centre. The legal department
of Tintswalo instructed Mr L
Norwitz of Norwitz Attorneys to proceed with an application for the
ejectment of Markella Kyrkou (Mr
Kyrkou) and Nicholas Sotheriades (Mr
Sothariades) from the premises for none payment of rent.
[45] There is an
obvious dispute of fact in this complaint. Consequently, I will have
to decide the matter on the version of the
respondent and the common
cause facts. It is my view that the explanation by the respondent as
to why he could not transfer the
property is satisfactory. The
evidence shows that he became aware of the transfer of the property
to the third party and informed
Mr Teladia. Mr Teladia was aware of
the prior sale of the property and the transfer to the third party.
[46]As regards the
amount of R300 OOO it is alleged was paid to the respondent towards
the purchase price, it is my opinion that
the money was not paid to
him. Mr Teladia in his complaint states only that 'with the knowledge
of Messrs Hunter Attorneys, Alpine
Valley paid various amounts
totalling R300 000 to or on behalf of Tevmor CC on account of the
purchase price.’ To me this
does not indicate that the money
was paid to the respondent. There is also no documentary proof of
payment, like for instance,
a receipt or invoice, to prove that he
paid the amount to the respondent. I also have to accept the
respondent’s evidence
that the amount of R50 000 was paid on
behalf of Mrs Papa even though it was paid by Mr Teladia as it is
alleged.
[47] It is common
cause that Mr Swart had an opportunity to discuss the complaint with
the respondent and to scrutinize the firm's
trust cash book and was
unable to identify any deposit relating to Alpine Valley. He could
not find an account for Alpine Valley
in the respondent’s trust
creditors, as well.
[48] What remains of
this complaint is the failure by the respondent to reply to the
correspondence of the applicant, which he admitted.
[49] The applicant
received a complaint from Lisa Goosen. Ms Goosen is a business woman
and the chief executive officer of Tintswalo
Property Group (Pty) Ltd
(Tintswalo), which is a property managing company of the Lonehill
shopping Centre. The legal department
of Tintswalo instructed Mr L
Norwitz of Norwitz Attorneys to proceed with an application for the
ejectment of Markella Kyrkou (Mr
Kyrkou) and Nicholas Sotheriades (Mr
Sothariades) from the premises for none payment of rent.
[50] Mr Kyrkou and
Mr Sothariades instructed the respondent to act on their behalf to
oppose the relief sought by Tintswalo. The
application was heard in
the South Gauteng High Court (as it then was). Pursuant to the
judgment being reserved, Tintswalo launched
another application for
the ejectment of Mr Kyrkou and Mr Sothariades from the premises. This
application was also opposed and
the respondent acted on behalf of Mr
Kyrkou and Mr Sothariades. The second application was heard before
the judgment in the first
application could be delivered. The relief
sought in the second application was granted and ordered the
ejectment of Mr Kyrkou
and Mr Sothariades from the premises.
[51] Subsequent to
the judgment in the second application, Mr Kyrkou signed an
acknowledgement of debt in favour of Tintswalo. The
respondent
deposed to a confirmatory affidavit confirming his participation in
the conclusion of this acknowledgment of debt and
later wrote a
letter denying his involvement in the acknowledgement of debt.
[52] Mr Kyrkou and
Mr Sotheriades deposed to an affidavit in the second application
wherein they stated that the rentals from May
to September 2012 stand
to the credit in the respondent’s trust account which will be
paid over immediately upon a positive
finding in the first
application. The respondent deposed to a confirmatory affidavit
confirming that he holds an amount of R206
910 to the credit of Mr
Kyrkou and Mr Sothariades which shall on their instructions paid over
to Tintswalo. The respondent later
sent a letter to Tintswalo’s
attorneys advising them that he no longer held that amount in his
trust banking account.
[53] The applicant’s
contention is that this conduct of the respondent appears to be
unprofessional, negligent, improper and
unethical.
[54] The respondent
in his answering affidavit denies that he had anything to do with the
acknowledgement of debt, his involvement
according to him was as set
out in the answering affidavit. He contended that the acknowledgment
of debt was not drafted by him
and that he did not advice his clients
in respect thereof. He submitted further that the payment of the
amount to Tintswalo was
conditional on the dismissal of the first
application and since that application was not dismissed the
precondition to his instructions
to pay over the money of R209 910
was not fulfilled.
[55] Even in this
complaint there is a clear dispute of fact which I have to resolve by
deciding the matter on the version of the
respondent. As such this
complaint should therefore be dismissed.
Conclusion
[54] I am,
therefore, satisfied that the applicant has been, on a balance of
probabilities, abie to establish the following offending
conduct:
54.1 Contravention
of s 78 (1) of the Act.
54.2 Contravention
of s 70 of the Act read with rule 89.25 of the applicant’s
Rules.
54.3 Contravention
of rule 89.23 of the applicant’s Rules.
B. The second issue
is whether the respondent is a fit and proper person, to continue to
practice as an attorney.
[55]
The conduct expected of an attorney in terms of the Act is that of a
fit and proper person. The phrase ‘fit and proper
person’
is not defined in the Act. However, courts have over the years in
numerous cases attempted to give meaning to this
phrase. Some
characterisation such as integrity, honesty, worthiness, reliability,
good faith etc. has been given by the courts.
It is against this
depiction that the conduct complained of should be weighed.
3
[56] My view is that
the conduct complained of by the applicant does not depict the
respondent as dishonest or an unworthy person
to remain in the ranks
of the profession nor can it be said that his conduct is one of the
worst. I would not say that the conduct
complained of reflects upon
his character as such, but, may be oversight on his part. The
respondent has been an attorney since
1983 that is approximately 32
years at the time this matter was heard. This is the first time any
allegations of impropriety were
brought against him.
[57] The main
transgression in this instance revolves around the contravention of
the provisions relating to the trust account and
the investment of
trust monies. It is so that a large amount of money, Rl 200 000, in
respect of Mr Farinha’s complaint was
involved in this matter.
A finding was also made that the provisions of s 78 of the Act were
contravened. What made the transgression
more serious is that Mr
Farinha and the Fidelity Fund were put at risk. But, sight should not
be lost that in the ultimate end
the funds were not misappropriated.
The whole amount due to Mr Farinha including interest accrued during
the investment of the
funds less what was due to the respondent has
been paid back to Mr Farinha who eventually withdrew his claim
against the respondent.
This contravention, including the other
transgressions in regard to the failure by the respondent to respond
to correspondence,
are merely administrative in nature, and not
material to warrant a finding that the respondent is not a fit and
proper person to
continue to practice. In any event, the applicant
has already penalised the respondent for some of these administrative
transgressions.
[58] It is
undoubtedly so that non-compliance with any of the provisions of the
Act and the Rules of the applicant is a serious
transgression. It is
also of particular importance that an attorney complies with the
provisions of the Act and the Rules in relation
to the money of a
client which is placed in his or her custody and control, as a
result, the respondent must still be sanctioned
for the
transgressions.
[59] In the
circumstances of this case, I am of the opinion that an appropriate
sanction would be for the respondent to be precluded
from practising
for his own account either as a principal or in partnership or in
association or as a member of incorporation,
for a period of two
years. Should, he in future, that is, after the expiry of the period
stated herein, choose to practise as stated
above in this paragraph,
he shall have to satisfy the court that he is a fit and proper person
to do so. Such a sanction in my
view, will serve to protect the
public and to avoid repetition of this conduct.
[60]
The evidence indicate that the respondent was, at the time of
drafting his answering affidavit to the applicant’s
supplementary
affidavit, in the process of closing down his practice,
with a few remaining files being taken over by another firm of
attorneys
where he is to be employed as a consultant for a short
while. I would as such infer that by now he has already closed down
his
practice. If not, he should be granted a period of six months
within which to wind up his office. This process must be done in
conjunction with the applicant. Therefore, I would propose that a
curator
bonis
be
appointed to assist the respondent to wind up his practice. If the
respondent has already closed down his practice, a curator
bonis
must
still be appointed to see to it that the respondent’s trust
account has been properly closed and that all the creditors
have been
accounted to.
COSTS
[61]
The applicant has prayed for an order for costs on an attorney and
client scale. The general rule in matters of this nature
is that the
respondent has to pay the costs of the applicant on an attorney and
client scale because the applicant is not an ordinary
litigant as it
performs a public duty.
4
On
the facts of the present matter, there is no reason, in my view, to
depart from the general rule. The cost order against the
respondent
must be on an attorney and client scale, indeed, as stated by the
applicant’s counsel, the applicant must not
be burdened with
legal costs when launching applications of this nature.
[62] In the premises
I would make the following order:
62.1 The Draft Order
marked with an “X” and initialled is made an order of
court.
E.M. KUBUSHI
JUDGE OF THE HIGH
COURT
I concur
D.S. MOLEFE
JUDGE OF THE HIGH
COURT
APPEARANCE
HEARD ON THE: 13
MARCH 2015
DATE OF JUDGMENT: 24
APRIL 2015
APPLICANT’S
COUNSEL: Mr. J.P. SMITH
APPLICANT’S
ATTORNEY: ROOTH&WESSELS INC
RESPONDANTS' COUNSEL
: ADV. D. VAN DEN GORGERT
RESPONDANTS'
ATTORNEY: JOH G HUNTER ATTORNEYS
1
See
Law Society of the Cape of Good Hope v Budricfes 2003 (2) SA it
(SCA).
2
See
Botha and Others u Law Society, Northern Provinces
2009 (3) SA 329
(SCA) at para 3.
3
See
Kaplan v Incorporated Law Society/ Transuaal [1981] 4 All SA15 (T)
4
See
Law Society of the Northern Provinces v Dube
[2012] JOL 29446
(SCA)
at para 33.