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[2015] ZAFSHC 53
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Law Society of the Free State v Du Toit (5206/2014) [2015] ZAFSHC 53 (12 March 2015)
FREE STATE
HIGH COURT, BLOEMFONTEIN
REPUBLIC
OF SOUTH AFRICA
Case
no: 5206/2014
In
the matter between:
THE
LAW SOCIETY OF THE FREE STATE
…...............................................................
Applicant
and
JACOBUS
PETRUS ANDRIES DU TOIT
…....................................................................
Respondent
CORAM
:
RAMPAI, J
et
HINXA, AJ
HEARD
ON
: 5 FEBRUARY 2015
JUDGMENT
BY
: HINXA, AJ
DELIVERED
ON
: 12 MARCH 2015
INTRODUCTION
[1]
The respondent was admitted as an attorney on 14 April 1994 and has
been practising as such in Bloemfontein for approximately
20 years.
[2]
The applicant instituted motion proceedings on 25 November 2014
praying that the respondent’s name be removed from the
roll of
attorneys. The alternative relief sought by the applicant was that
the respondent be suspended from practising as an attorney
until he
satisfies this court that he is a fit and proper person to resume
practise as an attorney and has acquired the necessary
fidelity fund
certificate. The applicant furthermore sought numerous reliefs
ancillary to the aforementioned prayer.
[3]
The respondent served a notice of intention to oppose this
application on the applicant’s attorneys of record on 2
December
2014. The aforementioned notice was later withdrawn and a
notice of withdrawal was served on 24 December 2014. On 24 December
2014
the respondent delivered an explanatory affidavit wherein he was
declaring that he was no longer opposing this application. He
furthermore stated that he was abiding by the order that this Court
might grant.
[4]
The application was consequently heard unopposed on 5 February 2015.
[5]
There were six professional transgressions levelled by the applicant
against the respondent. I deem it apt to hereunder list
them before
analysing same. They are:
5.1
Practising without a fidelity fund certificate
5.2
Submission of an improper trust audit report
5.3
Failure to submit a trust audit report at all
5.4 Serious
complaint by Mr. Sunel Van der Berg on behalf of the Diwald Trust
5.6 Serious
complaint by Mr. Christo Fourie
ANALYSIS
OF THE TRANSGRESSIONS
[6]
The respondent has practised without a fidelity fund certificate for
the calendar year 1 January 2013 to 31 December 2013, and
has been
practising likewise from 1 January 2014 to the date of filing of this
application.
[7]
The respondent submitted a trust audit report for the financial year
ending 28 February 2013 in line with the rules of the applicant.
The
applicant’s business development manager examined the afore
mentioned report and his qualifications were of such a serious
nature
that he concluded as follows:
“
to my
mind the enclosed document cannot be regarded as proper compliance by
the practitioner. It will serve no purpose to write
to the
practitioner as he ignored all my correspondence …”
Until
such time as the qualifications as per the findings on the trust
audit report were attended to, the applicant was not in a
position to
issue a fidelity fund certificate to the respondent.
[8]
The respondent failed to submit an audit report for the period
between 1 March 2013 to 28 February 2014 contrary to the rules
of the
applicant.
[9]
On 4 June 2014 the respondent appeared before a disciplinary
committee of the applicant. Subsequently, he was given notice by
the
aforesaid committee to submit an unqualified audit report for the
period alluded to in paragraph 8 above before 26 June 2014.
[10]
Despite his undertaking, the respondent failed to comply and he had
not applied for a fidelity fund certificate for the period
1 January
2014 to 31 December 2014. This failure was perceived as not only
serious, but as an intentional and wilful disregard
of the statutory
provisions and rules of the applicant.
As
a direct consequence thereof, the disciplinary committee resolved to
advise the respondent about the contemplated application
to have his
name struck off the roll.
[11]
Three separate and serious complaints against the respondent also
unfolded, soliciting the applicant’s urgent attention
and
necessary action. I deem it apposite to hereunder deal with them in
turns.
[12]
First, on 17 May 2012, Dr. Roger Brittain attested to an affidavit in
which the applicant was requested to investigate the
respondent’s
failure to account to him (Dr. Brittain) over a period of five years
in respect of instructions to collect monies.
[13]
The respondent replied on 19 December 2012 and stated that the files
were handed over to an attorney (Mr. Hutchinson), and
that he had no
records to enable him to account to Dr. Brittain. The respondent
furthermore disputed that there had been various
payments effected by
creditors of Dr. Brittain.
[14]
Dr. Brittain responded to the respondent’s reply, providing
details of payments made by the creditors to him (the respondent),
and furthermore, annexing proof thereof.
[15]
On 7 October 2013, the respondent replied to Dr. Brittain’s
last mentioned reply, merely, reiterating that he was unable
to
account to him (Dr. Brittain) as all the files had been handed over
to an attorney (Mr. Hutchinson) and all the information
was therein
contained. He added that Dr. Brittain was in possession of the
documentation necessary for accounting to him.
[16]
Thereafter, on 25 June 2014 the respondent filed a further
supplementary affidavit in terms whereof he stated that he had
located the particular files of Dr. Brittain as well as his ledger
records. It is as well to bear in mind that the respondent had
previously stated that he was not in possession of such records.
[17]
The applicant contended that the documents attached to the
respondent’s further supplementary affidavit of 25 June 2014
were not a true and proper reconciliation of all amounts received,
nor of the disbursements in respect of the monies received.
The
applicant pointed out per annexure “DT4” that an amount
of R250.00 was received and an amount of R225.00 debited
against the
account immediately.
[18]
The Respondent explained the aforementioned discrepancy by stating
in his explanatory affidavit that the agreement between
himself and
Dr. Brittain was that he (respondent) would deduct his fees and
disbursements from whatever amounts that might be recovered
from
debtors. He further stated that in the example given by the
applicant, he (respondent) deducted the amount of R25.00 being
the
collection commission, and the amount of R225.00 was set-off against
the instruction fee. The respondent maintained that the
instruction
fee and disbursements totalled R1 129.00.
[19]
The respondent however conceded that he might not have given a full
exposition to Dr. Brittain for each transaction.
[20]
Second, on 18 June 2013, Sunel van der Berg (“Sunel”)
lodged a complaint against the respondent on behalf of the
Dewald
Trust (“
the Trust
”),
in respect of R500 000.00 the respondent deducted for his fees.
Sunel further averred that the client had not seen
the judgment given
in the matter; no receipt was issued for the aforesaid R500 000.00;
and no accounting was done to the client.
On the contrary, a request
was forwarded by the respondent to the client to pay an additional
amount of R60 000.00.
[21]
The respondent filed his reply, and numerous statements were
exchanged between the complainant and him.
[22]
The applicant served summons on the respondent to appear before the
disciplinary committee on 4 June 2014. He (respondent)
was instructed
to lodge a claim against the attorneys fidelity fund for the monies
misappropriated by the trust’s previous
attorney. The
respondent advised that it would be necessary for him to be appointed
as a trustee of the trust to enable him to
act on its behalf.
[23]
After notification of the intention to institute a claim against the
fidelity fund, the appointed committee held that the trust
had not
complied with the requirements of section 48(1) of the Act and that
the requirements for condonation for such non-compliance
were not
satisfied. The aforementioned ruling was brought on review, and the
High Court upheld it.
[24]
I pause to stress that the respondent did not have fidelity fund
certificate when he acted on behalf of the trust. It warrants
no
over- emphasis that this was yet another gross violation of the
applicant’s fast and hard rules. The applicant argued
persuasively that the respondent had a clear conflict of interest
after the review application was successful, and he was compelled
to
apprise the client of the findings of the court. Furthermore, he was
duly bound to advise the client to seek a legal advice
of an
independent attorney regarding the continuation of the application
against the fidelity fund. Once more, I can find no fault
with this
argument.
[25]
Payment of a sum of R3 100 000.00 was received by the trust from
the estate of Le Roux. The respondent withheld
an amount of
R500 000.00 for services allegedly rendered by him. On being called
upon to account, he replied in a cryptic note
in which he claimed
that a contingency fee agreement had been entered into between him
and Ms. Van der Berg.
The
note reads as follows:
“
18% fooi
betaalbaar aan Du Toit prokureurs by uitbetaling van die
Getrouheidsfonds se eis…”
[26]
Despite numerous requests, the respondent did not account for the
fees withheld by him. The applicant convincingly argued that
the
respondent furthermore intended to mislead it (the applicant) in
that, by agreement, his fees were recovered from the trust,
whilst he
also recovered same fees for the same services from the estate of the
late attorney Le Roux.
[27]
The respondent admitted that he did not obtain any proper contingency
fee agreement prior to accepting mandate on behalf of
Ms. Van der
Berg for the Dewald trust.
At
the risk of stating the obvious, the aforesaid admission is in
harmony with Ms. Van der Berg denial that there was any such
agreement.
[28]
The respondent remained silent on his failure to account to the trust
or Ms. Van der Berg with regard to the fee withheld.
[29]
Third, on 27 June 2013, Christo Fourie lodged a complaint on behalf
of Centuria 0194 (Pty) Ltd (“the company”)
against the
respondent alleging,
inter alia
,
that the respondent had acted dishonestly, fraudulently, and failed
to account for monies paid to him by Mr. Fourie and failed
to respond
to the communication on behalf of his client.
[30]
The company purchased 4 black impalas from the Mariaan Boerdery Trust
(“the trust”) for an amount of R798 000.00.
The
aforementioned amount was paid into the respondent’s trust
account on behalf of the company. The impalas were not delivered
to
the company by the trust.
Despite
various requests from the attorneys acting on behalf of the company,
the respondent failed to account for the purchase price.
[31]
The company applied for the sequestration of the trust, and the final
order for the afore stated sequestration was granted
on 23 May 2013.
Despite a confirmatory affidavit filed in opposing the application
for the sequestration, the respondent failed
to account for the
funds.
[32]
The respondent appeared before the applicant’s disciplinary
committee on 4 June 2014 where he stated that the full purchase
price
was paid to the trust on the instruction of his client, i.e. the
trust, which trust was liquidated shortly thereafter. From
the
account records he provided, cheque number T00003476 for R250 000.00
was cashed on 6 March 2012, and thus rendering his
version that the
full purchase price was paid to the client false.
[33]
The respondent in his explanatory affidavit averred that the monies
paid into his trust account were paid in the settlement
of a debt
owed to the trust, and that it was the aforementioned trust that was
his trust creditor, not the company. He merely replied
that the
cheque for R250 000.00 was cashed and dealt with in accordance with
the instructions of “Rhoode”.
[34]
It bears mentioning that the respondent drafted his explanatory
affidavit after the insolvency enquiry held on 8 December 2014.
From
the record of the insolvency enquiry, the following unfolded:
34.1 When asked by
Adv. Tsangarakis whether or not he complied with the instruction to
pay an amount of R300 000.00 to Mr.
Vester, he replied that he
paid R2 000.00 less than what he was instructed.
34.2 Although he
admitted that his client was the Mariaan Boerdery Trust, he further
admitted that he transferred an amount of R298 000.00
from his
business account at the request of Mr. Verster.
34.3 The respondent
admitted that he took an amount of R48 000.00 from R298 000.00,
being the Mariaan Boerdery Trust’s
money, for professional fees
owed to him by Mr. Verster from his trust account at the request of
Mr. Verster.
34.4
The respondent conceded when it was put to him by Adv. Tsangarakis
that he acted contrary to the mandate given to him by the
Mariaan
Boedery Trust in taking the R48 000.00 for Mr. Verster’s
indebtedness to him.
[35]
In concluding on the offending conduct of the respondent, it is worth
highlighting that it is common cause that he did not
account to Dr.
Brittain. The same holds true of his failure to obtain a proper
contingency fee agreement prior to accepting mandate
on behalf of Ms.
Van den Berg for the Dewald Trust.
[36]
That is a synopsis of the facts presented to us. They were all
undisputed. If anything, the respondent, as indicated at paragraph
35
supra, expressly admitted some of the adverse allegations on one hand
whilst implicitly abiding on the other.
LEGAL
POSITION
[37]
Section 58
of the Attorneys Act 53 of 1979(“the
act”) deals with the main objectives of the law society, and,
inter alia, provides
as follows.
37.1 To maintain and
enhance the prestige, status and dignity of the profession;
37.2 To regulate the
exercise of the profession;
37.3 To encourage
and promote efficiency and responsibility in relation to the
profession;
37.4 To deal with
all matters relating to the interests of the profession and to
protect those interests;
37.5 To uphold the
integrity of practitioners;
37.6 To uphold and
improve the standards of professional conduct and qualifications of
practitioners;
37.7
To promote uniform practice and discipline among practitioners;
[38]
Section 41(1)
and
(2)
of the Act
stipulates that a practitioner shall not practise or act as a
practitioner unless he is in possession of a fidelity
fund
certificate, and furthermore that any practitioner who practises or
acts in contravention of subsection (1), shall not be
entitled to any
fee, reward or disbursement in respect of anything done by him while
so practising or acting.
[39]
Section 83(10)
of the act provides that any person who directly or indirectly
purports to act as a practitioner in his own account or in
partnership
without being in possession of a fidelity fund
certificate shall be guilty of an offence. It is not only a serious
criminal offence
but also a serious breach of an attorney’s
duty.
(
See
Law Society of the Northern Provinces
v Mmabatho
2003
(6) SA 467
(SCA), and
Law Society of
Cape of Good Hope v Adams
(
2013)
ZAWCHC 87).
[40]
In terms of Section 78 of the act any practising practitioner shall
open and keep a separate trust banking account at a banking
institution in the Republic of South Africa and shall deposit therein
the money held or received by him on account of any person
and he
shall keep proper accounting records containing particulars and
information of any money received, held or paid by him for
or on
account of any person.
[41]
Rule 16B.4.1 of the Rules of the Law Society of the Free State
provides:
“
Every
accountant who has accepted an appointment in terms of Rule 16B.1
shall within six months after the annual closing of the
accounting
records of the firm concerned, or at such other times as the Council
may require, furnish the Council with a report
which shall be in the
form of schedule C to these rules”
[42]
Rule 16B.3 provides:
“
A
firm shall ensure that the report to be furnished by an accountant in
terms of Rule 16B.4 is so furnished within the required
time or on
the required date; provided that the Council may in its discretion
and on such conditions as it may stipulate, on written
application by
a firm relating to a particular report, condone a failure by that
firm to comply with requirements.”
[43]
Section 22(1)(b) of the act requires a three stage enquiry:
43.1
First, the Court must decide whether the alleged offending conduct
has been established on a preponderance of probabilities;
43.2
Second, it must consider whether the person concerned “in the
discretion of the court” is not a fit and proper
person to
continue to practise;
43.3And
third, the court must enquire whether in all the circumstances the
person in question is to be removed from the roll of
attorneys or
whether an order of suspension from practise would suffice.
(See
Jasat v Natal Law Society
2000 (3) SA 44
(SCA).
[44]
In terms of Section 78(8) of the act the court may, on application
lodged by the law society of the province concerned and
on good cause
shown, prohibit any practitioner from operating in any way on his
trust account, and may appoint a
curator bonis
to control and
administer such trust account, with such rights, duties and powers in
relation thereto as the court may deem fit.
[45]
In deciding whichever course to follow the major consideration is the
protection of the public. Logic also dictates that if
a court finds
that someone is not a fit and proper person to continue to practise
as an attorney, then such a person has to be
removed from the roll.
(See
Malan & Another v Law
Society, Northern Provinces
[2008] ZASCA 90
;
2009
(1) SA 216
(SCA)).
[46]
It is unlikely, if ever, that a mere suspension from practice for a
given period in itself will transform one who is unfit
to practise
into one who is fit to practise. (See
Malan & Another v Law
Society, Northern Provinces
supra
.)
[47]
These proceedings are of a disciplinary nature and
sui
generis
. The Law Society brings the
application as the guardian of morals of attorneys’ profession.
It merely places facts for consideration
by the court in the exercise
of its disciplinary function over attorneys as officers of the court;
to enable it to exercise its
discretion as to the appropriateness of
a sanction to be imposed in the event the allegation were found
to be true. (See:
H
assim v
Incorporated Law Society of Natal
1977 (2) SA 757
(A) at 767C-G 1989 and
Prokureursorde van Transvaal v
Kleynhans
1995
(1) SA 839
(T) at 851G-H).
[48]
As regards transgressions 4.1-4.3, it may serve a useful purpose if I
quote what was said by Rampai AJP (Lekale J concurring)
in the matter
of
The Law Society of the Free State
v Mahlomola Goodwin Molapo
[Case
No 1030/2013 Unreported]. In considering remarkably similar
misdemeanours, he held,
“
a)
It was the respondent’s responsibility to see to it that the
accounting records of his law practice were annually audited
by his
accountant. It was also incumbent upon him to ensure that his
accountant furnished the annual audit report to the applicant’s
law council – rule 16B.3.
b) When the
applicant’s law council receives a favourable or satisfactory
annual audit report from an attorney’s appointed
accountant it
forwards such report to the Attorney’s Fidelity Fund (“AFF”).
The AFF would then issue the requisite
annual fidelity certificate to
the attorney concerned. By virtue of the fidelity certificate the
attorney is annually licenced
to practise law. The accounting records
of the attorney are thereby publicly confirmed or certified to be in
order. By means of
annual fidelity certificate the applicant holds
therefor out to the applicant as its honourable and trustworthy
member to whom
the members of the public can entrust their affairs.
c) From the comments
I have made in the preceding paragraphs two things emerge. The first
is the significance of the annual auditing
report of the accounting
records of an attorney. The second is the danger posed to public
interest by an attorney’s neglect
to cause the required annual
audit report to be furnished to the applicant. The essence of rule
16B is the protection of the public
from untrustworthy individuals
who infiltrate the noble vocation and masquerade as honourable
lawyers only to exploit humble, unsuspecting,
unwary and trusting
members of the public.
d) The respondent
was accused of practising as an attorney without the annual fidelity
certificate. An attorney cannot obtain an
annual certificate unless,
he, first and foremost obtains an unqualified annual audit report. I
pause to stress that such an annual
audit report has to be
compiled by an accountant appointed and paid by an attorney and not
the law society. This was the
first charge. The particulars of the
charge were contained in a letter – annexure “A7”.”
[49]
In my judgment, these remarks are directly in point on the facts of
this case. Consequently, I need say no more pertaining
to their
pertinence hereto.
[50]
In the context aforesaid, I am therefore driven to the finding that
the applicant’s case is cogent that:
50.1
The respondent practised without a fidelity fund certificate for the
calendar period 1 January – 31 December 2013 and
again from 1
January – November 2014, the latter being the date on which
these proceedings were launched.
50.2
The respondent submitted an improper trust audit report for the
financial year ending 28 February 2013.
50.3
The respondent failed to submit an audit report at all for the period
1 March 2013 to 20 February 2014.
[51]
At this juncture I consider it apt to turn my attention to other
serious complaints lodged by three (3) separate individuals.
I
proceed hereunder to deal with them one by one.
[52]
I start with Dr. Roger Brittain. It is common cause that the
respondent did not account to him for a protracted period of five
years. His conduct flouted the provisions of section 78 of the
Attorneys Act 53 of 1979 as amended and calls for censure.
In
the circumstances, I am of the persuasion that the applicant has
proved that the respondent has failed to account to his client.
I
accordingly so find.
[53]
I come next to Ms Sunel van den Bergh. The respondent’s
offending conduct was three-fold herein:
53.1 He did not heed
the imperatives of accounting to his client for an enormous amount of
R500 000.00 withheld by him.
53.2 He doubled his
claim from both the trust and the estate of the late Le Roux for the
same services
53.3
By his own admission, he did not obtain a proper contingency fee
agreement before accepting a mandate on behalf of Ms. Van
der Berg
for the trust.
[54]
It is thus my finding that the respondent did not only omitt to
account to his client for a huge sum of money, but also contravened
the provisions of the
Contingency Fees Act 66 of 1997
. Furthermore,
his conduct of double claiming for single services rendered has to be
viewed in a very serious light. I am, consequently,
of the conviction
that the applicant has also proved this transgression.
[55]
I deal last with Mr. Christo Fourie. As regards this complaint the
respondent conceded to no less than three grave misdemeanours,
to
wit:
55.1
Although he was instructed by his client to pay R300 000.00 to
Mr. Vorster, he paid R298 000.00 i.e. R2000.00 less.
55.2
He improperly transferred the aforesaid R298 000.00 into his
business account although his client was the trust.
55.3
He acted contrary to the trust’s mandate by taking R48 000.00
from the trust’s money for the professional
fees owed not by
the trust but by Mr. Vorster.
In
the circumstances, I am persuaded to find that the applicant has made
a formidable case on this transgression as well.
[56]
I have considered whether each professional transgression has been
proved on a preponderance of probabilities.
I
have found that each alleged transgression has been duly proved. This
concludes the first leg of the three stage enquiry envisaged
by
section 22(i)
(b) of the act (See
Jasat
v Natal Law Society
2000
(3) SA 44
(SCA).)
[57]
At this stage it is timely to proceed to the second leg. In terms of
section 22
(1)(b), this leg dictates a consideration whether the
respondent is no longer a fit and proper person to continue practice
as an
attorney as the applicant vehemently argues. Whilst on this
point, it is apt to, once more, make reference to
Molapo
case (
supra
),
in which Rampai AJP had the following to say,
a)
“None of the misconducts committed by the respondent can be
reconciled with the noble objectives, norms and standards the
applicant tries to cultivate and uphold. An attorney who practises
without the annual fidelity certificate poses a very serious
risk to
members of the public. An appointed accountant can only prepare the
required audit reports, an essential prelude to the
issue of an
annual fidelity certificate, provided an attorney places him or
her in actual possession of the auditable accounting
records.
Implicit in this is the understanding that an accountant’s
failure to furnish the applicant with an attorney’s
annual
audit report can almost invariably be attributed to an attorney’s
failure to keep proper accounting records.
b)
In
Chetty v The Law Society,
Transvaal
1985 (2) 756 AD at 768E-H
Miller AJA said the following:
“
The
allegations and findings of misappropriation stemmed from inferences
drawn from the state of the appellant’s books account.
It was
clear that the appellant has failed to keep proper books of account
as he was required to do and that there appeared to
be deficiencies
in his trust account which at times was overdrawn. The trust account,
moreover, was not used solely for trust monies,
which were often
mixed with funds other than trust funds.
It
now appears, however, that despite irregularities and impropriety in
the keeping and administration of the accounts, there was
in the
final result no misappropriation of trust funds by the appellant. It
may be that even if this had been shown on the return
date of the
rule
nisi
,
the Court would have ordered the removal of the appellant’s
name from the roll, for it has frequently been held that failure
by
an attorney to keep proper books of account in compliance with the
provisions of Act 23 of 1934 is a “serious contravention”
which exposes the offender to the real risk
of suspension or removal from the roll. (
Cirota
and Another v Law Society, Transvaal
1979
(1) SA 172
(A) at 193E-F) And, of course, the Court would have
considered the other four complaints in conjunction with
contraventions relating
to the books of account.”
c)
In my view an attorney whose conduct was so glaringly inimical to the
prestige, status and dignity of the profession cannot be
any more
regarded as fit and proper person to continue practising as a trusted
provider of legal services. As was stated in
Jasat
case
supra
,
in deciding whether a person is still a fit and proper person to
continue practice as an attorney involves a weighing up of the
conduct complained of against the conduct one would ordinarily come
to expect of a diligent, trustworthy and ethical attorney.
When I
comparatively weighed up the respondent’s conduct as against
that of an average attorney with those attributes, I
found that the
scales weighed heavily against the respondent. In my view his conduct
was disturbingly far below the acceptable
ethical benchmark. The
gradient negatively widened every time he committed each of the three
misconducts. The comparative balancing
exercise resoundingly
disqualified him.
d)
The conduct complained of in general and misappropriation of funds in
particular were ethically deplorable. Certainly it was
not expected
of an attorney worth his salt to behave in such an unethical fashion.
The conduct is one which is highly deplorable
and frowned upon by
upright members of the profession.
[58]
I find the aforegoing dicta not only apposite but also instructive in
the situation obtaining in
casu
.
[59]
I now turn my attention to the third and last leg of the enquiry
contemplated by section 28(1)(b) of the act, to wit, a proper
form of
sanction or punishment. I should perhaps interpose to mention that
the correct approach herein is whether, taking into
account all the
particular facts of the individual case, removal from the attorneys
roll or suspension from the practise would
be apt.
[60]
Adv Le Roux for the applicant vigorously argued that the only
appropriate sanction is removal from the roll of the attorney
in view
of the gravity of the respondent’s offending conduct. It was
persuasively contended that the respondent did not only
completely
fail to account to his clients for the monies received but also
showed no remorse at all. I find merit in this contention.
That the
profession of attorney is a calling of absolute honesty admits of no
exception. Put differently, the dishonesty which
preceded this
application went to the very root of his calling. The validity of the
counsels’ contention can hardly be discredited.
[61]
It was held in
Malan
case above that if the court finds dishonestly in the complaint
levelled, there must exist exceptional circumstances for the court
to
sanction a suspension in
lieu
of a removal. In
casu
there was not even a slightest attempt to advance existence of such
circumstances.
[62]
Whilst on this point, it is as well to bear in mind the following
dictum
of
Rampai AJP in
Molapo
case
supra
,
at paragraph 56,
“
The
protection of the public is always of paramount importance in matters
such as this. In my view the public has to be protected
against the
respondent. The most effective and meaningful way of protecting the
public against this danger posed by the respondent
as an attorney is
to have the respondent’s name removed from the roll.
Such
a sanction would prevent him from endangering public interests…”.
[63]
Taking into account all the peculiar circumstances of this case, it
is my view that nothing short of permanent striking off
would be a
proper punishment herein. A suspension of the respondent will not
resonate well with the judicious exercise of discretion
vesting in us
(See
Melani v Sanlam insurance Ltd
1962 (4) SA 531
(A).)
ORDER
[64]
In the premises I make the following order:
64.1
THAT the respondent’s name be removed from the roll of
attorneys;
64.2
THAT the respondent surrenders and delivers to the Registrar of this
Court his Certificate of Enrolment as an attorney
of
this court;
64.3 THAT should the
respondent fail to comply with paragraph 64.2 within FOURTEEN (14)
DAYS of this order, the sheriff of the High
Court for the relevant
district, be empowered and directed to take possession of such
certificate and deliver it to the said Registrar;
64.4 THAT the Chief
Executive Officer of the applicant for the time being be appointed as
Curator Bonis to exercise the powers
and to discharge the
duties described in paragraph 64.7 hereof;
64.5 THAT the
respondent is directed to surrender and deliver to the Curator Bonis
all the respondent’s records relating to
his practice which,
for the purposes of this order, but without limitation, shall include
all accounting records, files, correspondence,
documents and the like
which are directly or indirectly relevant to or which contain
particulars and information relating to:
a) Any monies
received, held or paid by the respondent for or on account of any
person;
b) Any monies
invested by the respondent in terms of any provision of Section78 of
the Attorneys Act, No 53 of 1979 (hereinafter
referred to as “the
Act”);
c) Any interest on
monies so invested in terms of Section 78 (2) or 78 (2A) of the Act;
d) Any estate of a
deceased person administered by the respondent, whether as executor
or on behalf of the executor, in terms of
the provisions of the
Administration of Estates Act, Act 66 of 1965;
e) Any estate in
which the respondent acted as or on behalf of the Curator to
administer the property of a minor child or any other
person in terms
of section 72 of the Administration of Estates Act, Act 1966 of
1965;
f) Any insolvent
estate administered by the respondent as a trustee or on behalf of
the trustee in terms of the Insolvency Act,
Act 66 of 1936;
g) Any trust
administered by the respondent as a trustee or on behalf of the
trustee in terms of the Trust Properties Act, Act 57
of 1968;
h) Any company
liquidated in terms of the Companies Act, Act 61 of 1973,
administered by the respondent as a liquidator or on behalf
of the
liquidator;
i) Any close
corporation liquidated in terms of the Close Corporation Act, Act 69
of 1964, administered by the respondent as a liquidator
or on behalf
of the liquidator;
j) The respondent’s
practice as an attorney of this court.
64.6 THAT should the
respondent fail to immediately surrender or deliver the items
referred to in paragraph 64.5 after service of
this order upon the
respondent by the Curator Bonis, or after a return by the person
entrusted with such service that such person
has been unable to
effect service of this order on the respondent, as the case may be,
the sheriff of the High Court for the district
in which such records
are, be empowered and directed to take possession and deliver them to
the said Curator Bonis.
64.7 THAT the said
Curator Bonis shall have the following rights and powers:
a) to hand over any
of the said records to any person entitled thereto, as soon as he or
she has satisfied himself or herself that
the fees and disbursements
in connection therewith have been paid or satisfactorily secured, or
that same are no longer required;
b) to accept a
written undertaking by a trust creditor to pay such amount as may be
due to the respondent, either on taxation, assessment
or by
agreement, as satisfactory security for the purpose of paragraph
7(a), provided that such written undertaking incorporates
a
domicilium executandi
of such creditor;
c) to require that
any records, so handed over, be delivered back to him or her if, in
his or her sole and absolute opinion, he
or she considers them to be
relevant to any, (including any possible anticipated or threatened)
claim against him or her as Curator
Bonis and/or the respondent’s
clients and/or the attorneys Attorneys Fidelity Fund (hereinafter
referred to as “the
Fund”);
d) to administer and
control all the respondent’s trust accounts which for the
purpose of this order shall include:
i) the accounts
relating to any estate, curatorship, trust or company, referred to in
paragraph 64.5 thereof;
ii) any and all
banking accounts opened and/or kept by the respondent (or on the
respondent’s behalf) in terms of any provision
contained in the
Act or any of the Acts referred to in paragraph 64.5.
e) Subject to the
approval of the Board of Control; of the Fund (hereinafter referred
to as (“the Board”), to sign and
endorse cheques and/or
withdrawal forms and generally to operate upon the said trust
accounts, but only to such an extent and for
such purposes as may be
necessary to bring to completion current transactions in which the
respondent was acting as at the date
if this order;
f) Subject to the
approval of the Board, to recover and receive and, if necessary in
the interest of persons having lawful claims
upon the said trust
accounts and/or against the respondent in respect of monies held,
received and/or invested by the respondent
in terms of Section 78 (1)
and/or 78 (2) and/or 78 (2A) of the Act (hereinafter referred to as
“the 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 in which the respondent
may have been concerned and which may have been wrongfully and
unlawfully paid from the said
trust accounts and to receive such
monies and to pay the same to the credit of the said trust accounts.
g) To ascertain from
the respondent’s records the names of all the persons on whose
account the respondent appears to hold
or to have received trust
monies (hereinafter referred to as “trust creditors”) and
to call upon the respondents to
furnish him or her within 30 (THIRTY)
days of the date of this order, or within such further period as he
may agree to in writing
with the names and addresses of, and amounts
due to, all trust creditors.
h) To call upon such
trust creditors to furnish such proof, information and/or affidavits
as he or she may require to enable him,
acting in consultation with
and subject to requirements of the Board, to determine whether any
such trust creditors has a claim
in respect of money in the said
accounts and, if so, the amount of such claim;
i) Subject to the
approval of the Board, to admit or reject in the whole or in part,
the claims of any such trust creditor without
prejudice to such trust
creditor’s right of access to the Civil Courts;
j) Subject to the
approval of the Board, to pay such claims as he or she may consider
lawfully due;
k) In the event of
there being any surplus in the said trust accounts after payment of
any such claims, 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 the Act in respect of any
interest therein referred to and,
secondly without prejudice to the rights of the respondent’s
creditors, the costs, fees
and expenses referred to in paragraph
64.11 hereof, or such portion thereof as has already been separately
paid by the respondent
to the applicant and, if there is any balance
left after payment in full of all such claims, costs, fees and
expenses, to pay such
balance to the fund;
l) In the event of
there being insufficient trust monies in the said accounts to pay in
full the claims of trust creditors as reflected
in the records of the
respondents:
i) subject to the
approval of the Board, to close the said accounts and to pay the
credit balances therein to the Fund and require
such credit balances
therein to be placed to the credit of a special trust suspense
account in the name of the respondents in the
Fund’s books;
ii) To refer the
claims of all the trust creditors to the Board to be
dealt with in terms of the provisions of the act;
iii) To authorise
the Board to credit the credit balances referred to above to its
“paid claims account” when the Fund
has paid, in terms of
Section 26 of the Act, admitted claims of the trust creditors of the
respondents in excess of such credit
balances, provided that,
notwithstanding the aforegoing, the Board in its discretion shall be
entitled to transfer to its “paid
claims account” the
amounts of any claim as and when admitted and paid by it.
m)
Subject to the approval of the Chairman of the Fund, to appoint
nominees or representatives and/or consult with and/or engage
the
services of attorneys, counsel, accountants and/or any such other
persons where considered necessary, to assist him in the
carrying out
of his duties as Curator Bonis.
n)
To render from time to time returns to the Board showing how the said
accounts have been dealt with until such time as the Board
notifies
him that he may regard his duties as Curator Bonis as terminated.
64.8 THAT the
respondent be interdicted and prohibited from operating the accounts
referred to in paragraph 64.7 (d)
64.9 The respondent
is hereby removed from the office as:
a) Executor of any
estate in respect of which he has been appointed in terms of Section
51(1)(a)(v) of the Administration of Estates
Act, Act 66 of 1965 or
the estate of any other person referred to in section 72 (1); and
b) Curator or
guardian of any minor or other person’s property in terms of
Section 72 (1), read with Sections 54(1)(a)(v)
and 85 of the
Administration of Estates Act, Act 66 of 1965, or the estate of any
person other referred to in Section 72 (1); and
c) Trustee of any
insolvent estate in terms of Section 59 of the Insolvency Act, Act 24
of 1934; and
d) Liquidator of any
company in terms of Section 379 (2), read with Section 379 (e) of the
Companies Act, Act 61 of 1973; and
e) Trustee of any
trust in terms of Section 20 (1) of the Trust Property Control Act,
Act 57 of 1988; and
f) Liquidator of any
Close Corporation appointed in terms of Section 74 of the Close
Corporation Act, Act 69 of 1984.
64.10 THAT the
applicant be and is hereby authorised, should it consider it
necessary, to engage the services of accountants of
its choice, who
are registered in terms of the
Auditing Profession Act 26 of 2005
, to
conduct an examination and audit of the respondent’s accounting
records and to report to the applicant in respect of
such an
examination and audit insofar as such accountants, and/or applicant,
may consider it necessary.
64.11 THAT the
respondent be and is hereby directed to pay:
a) Applicant’s
costs of the inspections which may have been carried out of the
respondent’s records in terms of Section
70 (1) and 78 (5) of
the Act at the rate of R600.00 per hour;
b) The costs of the
said accountants in respect of any examination audit or report made
by them in terms of this order;
c) The costs of the
sheriff employed in terms of paragraphs 64.3 and 64.6 above;
d) The fees and
expenses of the Curator Bonis, such fees to be assessed at the rate
of R600.00 per hour (including travelling time)
and
prima facie
proof whereof shall be sufficiently constituted by way of a
certificate purporting to be signed by the Curator Bonis and
specifying
the expenses and the length of time during which he was
engaged in the performance of his duties as Curator Bonis;
e) The fees and
expenses of any person consulted and/or engaged by the Curator Bonis
in terms of paragraph 64.7 (m) above, at such
person’s
prescribed tariff rate save where such person is an attorney, at the
rate as between attorney and own client;
f) The costs of, and
incidental to, this application on an attorney and own client scale.
64.12 THAT the
respondent be and is hereby directed to satisfy the Curator Bonis,
within one year of the respondent having been
requested to do so by
the Curator, or within such shorter period as the Curator Bonis may
agree to in writing, by means of the
submission of the taxed bills of
costs or otherwise, of the amount of fees and disbursements due to
the respondent in respect of
the respondent’s said practice
and, should the respondent fail to do so, the respondent shall not be
entitled to recover
such fees and disbursements from the Curator
Bonis, but without prejudice to any such rights, if any, as the
respondent may have
against the trust creditors concerned for the
payment or recovery thereof.
64.13 THAT the
applicant be and is hereby directed to cause a copy of this order to
be served upon the Master of this court.
a) Notify
applicant’s attorney in writing within five (5) days of his
intention to oppose;
b) And within
fifteen (15) days after he has given notice of his intention to
oppose this application, to file his answering affidavit,
if any, and
further that he is required to appoint in such notification an
address referred to in rule 6 (5) (b) at which he will
accept notice
and service of all documents in these proceedings.
64.14 The proposed
Curator Bonis, Attorney Vuyo Morobane, the Chief Executive Officer of
the Free State Law Society, is in terms
of Section
5, Act 19
of 1941
exempted from furnishing security to the Master of the Free State
High Court.
64.15 The provisions
of the Section 78 and 88 of Act 66 of 1965 shall not apply to the
Curator Bonis but he or she shall be obliged
to report to the Board
of Control of the Attorneys’ Fidelity Fund in terms of
paragraph 64.7 (n) hereof
M.D.
HINXA, AJ
I
concur.
M.H.
RAMPAI, J
On
behalf of applicant: Adv L. Le Roux
Instructed
by:
HN
Botha
BLOEMFONTEIN
On
behalf of the respondent: No appearance