About SAFLII
Databases
Search
Terms of Use
RSS Feeds
South Africa: North Gauteng High Court, Pretoria
SAFLII
>>
Databases
>>
South Africa: North Gauteng High Court, Pretoria
>>
2013
>>
[2013] ZAGPPHC 213
|
|
Law Society of the Northern Provinces v Moima (10881/2011) [2013] ZAGPPHC 213 (24 July 2013)
NOT
REPORTABLE
IN
THE NORTH GAUTENG HIGH COURT,
PRETORIA
(REPUBLIC OF SOUTH AFRICA)
Case
No: 10881/2011
DATE:
24/07/2013
In
the matter between:
THE
LAW SOCIETY OF THE NORTHERN
PROVINCES
......................................
APPLICANT
(Incorporated
as the Law Society of the Transvaal) and
SELLO
NKURAHMAN
MOIMA
.................................................................
FIRST
RESPONDENT
and
MOIMA
INCORPORATED
...................................................................
SECOND RESPONDENT
CORAM:
EBERSOHN ET CHETTY AJJ
DATE
HEARD 14th JUNE 2013
DATE
JUDGMENT HANDED DOWN: July 2013
JUDGMENT
EBERSOHN
AJ
[1]
The Law Society of the Northern Provinces (hereinafter referred to as
“the Law Society”) is applying for the name
of Sello
Nkurahmah Moima (hereinafter referred to as “the First
Respondent”) to be struck from the roll of practising
attorneys.
[2]
2.1 The First Respondent Sello Nkurahmak was admitted as an attorney
of this Court
on
5 May 1992 and his name is still on the roll.
2.2
The First Respondent is currently practising as an attorney of this
Court for his own account and as a single practitioner under
the name
and style of Moima Incorporated (the second Respondent) at First
Floor, Masada Building, Comer of Proes and Paul Kruger
Street,
Pretoria, Gauteng.
[3]
The Law Society presented facts to this Court which the Law Society
contends constitute such a deviation from the standards
of
professional conduct that the First Respondent is not a fit and
proper person to continue to practice as an attorney and which
will
justify the Court in ordering that the First Respondent’s name
be struck from the roll of attorneys.
[4]
4.1 It is trite law that applications such as this one, are sui
generis and of a disciplinary
nature.
There is no lis between the Law Society and the Respondents The Law
Society, as curator morum (genitive singular) of the
profession,
places facts before the Court for consideration.
Vide:
Hassim v Incorporated Law Society of Natal, 1977(2) SA 757(A) at
767
C-G.
Law
Society, Transvaal v Matthews, 1989(4) SA 389(T) as 393 E. Cirota &
Another v Law Society, Transvaal, 1979(1) SA 172(A)
on 187 H.
Prokureursorde
van Transvaal v Kleynhans, 1995(1) SA 839(T) on 851 E-F.
4.2
The question whether an attorney is a fit and proper person in terms
of Section 22(1 )(d) of the Act is not dependent upon a
factual
finding, but lies in the discretion of the Court.
Vide:
Law Society of the Cape of Good Hope v C, 1986(1) SA 616(A) at
637
C-E.
A
v Law Society of the Cape of Good Hope, 1989(1) SA 849(A) at 851 A-E.
Law
Society, Transvaal v Mathews, supra at 393 I - J.
4.3
In exercising its discretion, the Court is faced with a three stage
inquiry:
(a)
The first inquiiy is for the Court to decide whether or not the
alleged offending conduct has been established on a preponderance
of
probabilities;
(b)
The second inquiry is whether, as stated in Section 22(1 )(d) of the
Act, the practitioner concerned “in the discretion
of the
Court” is not a fit and proper person to continue to practice.
This entails a value judgment;
(c)
The third inquiry is whether in all the circumstances, the
practitioner in question is to be removed from the roll of attorneys
or whether an order suspending him from practice for a specified
period will suffice. Ultimately this is a question of degree.
Vide:
Jasat v Natal Law Society, 2000(3) SA 44 (SCA) at 51 B -1.
Law
Society of the Cape of Good Hope v Budricks, 2003(2) SA11
(SCA)
on 13E-14.
4.4
The Court’s discretion must be based upon the facts placed
before it and facts in question must be proven upon a balance
of
probabilities.
Vide:
Law Society, Transvaal v Matthews, supra at 393 I - J.
Olivier
v Die Kaapse Balie-Raad 1972(3) SA 485(A) at 496 F - G. Summerley v
Law Society, Northern Provinces, 2006(5) SA 613 (SCA)
at 615 B -F.
4.5
The facts upon which the Court’s discretion is based should be
considered in their totality. The Court must not consider
each issue
in isolation.
Vide:
Law Society, Transvaal v Matthews, supra at 420 B - D.
Law
Society, Cape of Good Hope v Segall, 1975(1) SA 95C at 99B. Beyers v
Pretoria Balie Raad, 1966(2) SA 593 (A) at 606B.
Malan
and another v The Law Society, Northern Provinces
[2008] ZASCA 90
;
[2009] 1 All SA 133
(SCA).
4.6
The following case law reflects the attitude of the Courts in respect
of attorneys not keeping proper accounting records:
Vide:
Malan and another v The Law Society, Northern Provinces
[2008] ZASCA 90
;
[2009] 1
All
SA 133
(SCA)
Law
Society of the Northern Provinces v Morkel [2003] FOL 10868 (T)
Botha
& Others v The Law Society of the Northern Province
[2009] 3 All
SA 293
(SCA)
Law
Society of the Northern Provinces v Setshogoe
[2009] JOL 2307
(T)
[5]
The facts and circumstances which prompted the Law Society to bring
this application to the Court include the following:
a)
There is and has been a substantial trust deficit in the First
Respondent’s bookkeeping;
b)
The First Respondent delayed the payment of trust funds;
c)
The First Respondent failed to account to a client in respect of
trust funds;
d)
The First Respondent failed to co-operate with the Law Society and to
hand
the firm’s accounting records to the Law Society for purposes
of an inspection thereof;
e)
The First Respondent contravened several provisions of the Attorneys’
Act and the Law Society’s Rules relating to
bookkeeping of an
attorney; and
f)
The Law Society received complaints against the First Respondent.
[6]
6.1 This application was issued during February 2011 and brought
before this Court on
an
urgent basis. It was served on the respondents on 17 February 2011
and was set- down for 08 March 2011.
6.2
The respondents served an opposing affidavit on 04 March 2011. On 8
March 2011 the application was postponed sine die.
6.3
The Law Society filed its replying affidavit on 29 September 2011
i.e. six months later and a further supplementary founding
affidavit
in April 2012 i.e. seven months later.
6.4
In the supplementary founding affidavit particulars of more
complaints against the respondents were raised. In the further papers
filed more complaints were raised. For purposes of this judgment it
is, however, only necessary to refer to and to deal with one
complaint and the flaws in the Responents’ bookkeeping and the
deficit in his trust account.
6.5
The matter was set down for hearing on the 24th August 2012 and on
that same date the respondents filed their supplementary
answering
affidavits to the Law Society’s supplementary founding
affidavits.
6.6
On that day the matter was argued and the first respondent raised
what problems he
had
and the Court made the following order:
“
1.
That the application for the suspension of the first respondent from
practice as an attorney, alternatively for the striking
off of the
first respondent’s name from the roll of attorneys of this
Honourable Court, be postponed sine die;
2.
That the first respondent is to provide the outstanding accounting
records, if any, including the business accounting records,
to the
applicant within 30 (thirty) days from the date of this order;
3.
That the applicant is to prepare a final written audit report within
30 (thirty) days from the date of this order;
4.
That the first respondent is to serve and file his accountant’s
report within 30 (thirty) days of receipt of the report
as referred
to in paragraph 3 above;
5.
That the applicant may thereafter set the matter down for hearing in
accordance with the Rules of this Court;
6
. That costs be reserved.”
6.7
The supplementary founding affidavit that was filed by the Law
Society in April 2012 was clearly necessitated by additional
complaints against the respondents which had to be brought to the
attention of this Court. Furthermore, the audit by the Law Society
which was sanctioned by this Court in its order of 24 August 2012 was
conducted after receiving the accounting records from the
First
Respondent and was placed before the Court by a supplementary
founding affidavit dated 29 January 2012. The actual report
appears
on pages 676 (a) to 691 of the paginated bundle.
6.8
The Law Society proceeded with the application for the removal of the
name of the first respondent from the roll of practising
attorneys.
The court now deals with the merits of the application.
[7]
7.1 After the Law Society had received a complaint against the First
Respondent to the effect that the first respondent delayed
the
payment of trust funds and failed to account in respect of trust
funds, the Law Society instructed an internal auditor in the
employ
of the Law Society’s Monitoring Unit, one Ms Phossina Mapfumo
(Mapfumo), to investigate the complaint and to conduct
an inspection
of the First Respondent’s accounting records. Mapfumo completed
her mandate and reported to the Law Society
in writing on 6 December
2010.
7.2
According to her report Mapfumo could not inspect the accounting
records of the First Respondent due to the First Respondent’s
failure to co-operate with Mapfumo or her principal, the Law Society.
The efforts of Mapfumo and attendances in trying to obtain
and
inspect the First Respondents’ accounting records are recorded
in Mapfumo’s report.
7.3
What is pertinent in the report is the fact that the First Respondent
had failed to co-operate, he made undertakings which he
failed to
honour, and that the Second Respondent did not retain its accounting
records at its main office. This is a contravention
of Rule 68.4.2.
7.4
Mapfumo also discussed a complaint received by the Law Society dated
29 July 2010 from Werner Prinsloo Attorneys (attorney Prinsloo)
on
behalf of Mr M.J. Maela and Mr M.P. Marema, the current trustees of
the Mirror Development Projects Trust (Mirror Trust). The
facts of
the complaint are set out in page 69 and 70 of Mapfumo’s report
and may be summarised as follows:
7.4.1
Attorney Prinsloo acted on behalf of the abovementioned trustees.
Mirror
Trust entered into a written agreement with Mr D Van Hengel for the
purchase of an immovable property located in Leeufontein.
Attorney
Prinsloo was appointed as the conveyancing attorney.
7.4.2
A deposit in the amount of R350 000.00 was paid and an undertaking
was given to deliver guarantees and/or to pay the balance
of the
purchase price at an agreed date.
7.4.3
Mirror Trust was initially represented by Mr P Botha of Weyer &
Weyer attorneys. Botha received and invested the monies
on behalf of
Mirror Trust.
7.4.4
During the period September 2009 to October 2009 a trustee of Mirror
Trust, the late Mr Frans Latekgoma, instructed Weyer
& Weyer
attorneys to transfer the available funds to the First Respondent.
The First Respondent was instructed to in future
represent Mirror
Trust.
7.4.5
Weyer & Weyer attorneys transferred an amount of R978 700.00 into
the First Respondent’s trust account (Mapfumo’s
report
incorrectly refers to R984 700.00. See page 177, paragraph 5.30 of
the record).
7.4.6
On 15 October 2009 the late Frans Latekgoma instructed the First
Respondent to transfer the amount received from Weyer &
Weyer
attorneys together with the interest earned thereon to the trust
account of attorney Prinsloo. He also instructed attorney
Prinsloo to
invest the monies in an interest bearing account pending the transfer
of the property and the registration thereof
in the name of Mirror
Trust.
7.4.7
The First Respondent on 2 November 2009 deposited a cheque in the
amount of R400 000.00 into attorney Prinsloo's trust banking
account.
7.4.8
The First Respondent’s trust cheque was, however, dishonoured
by his bank (the First Respondent explained the reason
for the
dishonoured cheque in page 106 to 107 of the answering affidavit,
paragraph 6.6., and he attached a letter from the bank
which letter
merely states that failure to pay the cheque was due to no fault of
the Second Respondent). The Respondents did not
attach a copy of the
bank statement reflecting the balance in the account during the time
in question to disprove any suspicion
of a trust shortage.
7.4.9
Thereafter, on 6 November 2009, the First Respondent transferred the
amount of R400 000.00 to attorney Prinsloo’s trust
banking
account electronically.
7.4.10
The First Respondent failed to make further payments to attorney
Prinsloo, despite several requests that he should do so.
7.4.11
On 8 January 2010 attorney Prinsloo addressed a letter to the First
Respondent and requested him to transfer the balance
of the funds in
accordance with his instructions from Mirror Trust.
7.4.12
During a telephone conversation between attorney Prinsloo and the
First Respondent, the First Respondent mentioned that an
amount
of
approximately R600 000.00 was still to be transferred.
7.4.13
The First Respondent failed to make any further payments or
transfers.
7.4.14
During a meeting held on 18 February 2010 the trustees confirmed
their instructions to the First Respondent to transfer the
balance of
the funds held in his trust banking account to attorney Prinsloo.
7.4.15
The First Respondent refused and/or neglected to effect any further
payments or transfers. Attorney Prinsloo was on 9 June
2010
instructed to address a letter to the First Respondent, demanding
payment of the total amount held by him in order to effect
the
transfer of the immovable property.
7.4.16
The First Respondent persisted in his failure to make further
payments. After having provided several verbal undertakings
in this
regard, the First Respondent eventually transferred an amount of R100
000.00 to attorney Prinsloo’s trust banking
account on 18 June
2010.
7.4.17
Since the transfer of 18 June 2010 referred to above the First
Respondent has failed and/or refused to accept telephone calls
from
attorney Prinsloo and to reply to his messages.
7.4.18
The First Respondent subsequently undertook to transfer the balance
of the funds to attorney Prinsloo on or before Wednesday,
21
July 2010. He failed to honour his undertaking.
7.4.19
On 27 July 2010 attorney Prinsloo , however, received a trust cheque
for a further amount of R100 000.00 from the First Respondent.
The
First Respondent’s trust cheque was however dishonoured by his
bank.
7.4.20
Attorney Prinsloo has to date received only an amount of R600
000.00. An amount of R378 700.00 plus interest earned on this
amount
remains outstanding.
7.5
Mapfumo discussed the complaint with the First Respondent. The First
Respondent advised Mapfumo that he had opened a separate
trust
banking account at Standard Bank for purposes of the funds in the
Mirror Trust transaction. His main trust bank account was
kept at
Nedbank. He admitted to having received the funds from Weyer &
Weyer attorneys. He was however uncertain as to the
exact amount he
received from Weyer & Weyer attorneys. He ascribed his
uncertainty to the fact that his file and bank statements
were in
possession of his auditors.
7.6
The First Respondent furthermore admitted that there were no funds
available on the account. He alleged that he had received
instructions from the trustees to pay other parties from the funds.
The First Respondent did not present Mapfumo with any proof
in
respect of this allegation. These allegations are repeated in the
answering affidavit. However, they are denied by the trustees.
7.7
Mapfumo was unable to inspect the accounting records relating to the
transaction.
She
was therefore unable to establish why the First Respondent had failed
to pay the transferring attorneys the balance of the funds
as agreed.
She was also unable to establish why the First Respondent paid
certain amounts in instalments to attorney Prinsloo,
whilst the total
of the trust funds should have been available in his trust banking
account at all times.
7.8
The First Respondent has therefore failed to account and to pay trust
funds within a reasonable time.
7.9
The First Respondent submitted his Rule 70 auditor’s report for
the period ending 28 February 2010 to the Law Society
only on the 12
August 2010.
7.10
In paragraph 7.7 of the auditor’s report the Law Society was
informed that the First Respondent held an amount of R52
893.50 in
his trust banking account and that the firm’s trust creditors
amounted to R52 893.50 whilst in actual fact this
report was
incorrect as the deficit in the trust account was considerably
higher.
7.11
The firm’s auditors therefore, for unknown reasons which the
Law Society is to follow up with the auditors, did not report
any
trust deficit to the Law Society. As at 28 February 2010 an amount of
R584 700.00 was however still owing to the complainant
referred to
above. There was therefore a trust deficit in the First Respondent’s
trust bank account and the Respondents’
auditors’
certificate was not correct and should have read that there was a
trust shortage. It is clear that wrong information
was given to the
Responents’ auditors with the intent to mislead the Law
Society. The deficit evidences a contravention by
the First
Respondent of the provisions of Section 78(1) of the Act, read with
Rule 69.3.1 of the Law Society’s Rules. In
paragraphs 7.4.5,
7.4.9 and 7.10 supra the actual
deficit
as at the date in question were set out. As at 28 February 2010 the
first respondent had only refunded an amount of R400
000.00 to the
complainant leaving a considerable balance owing which apparently had
disapearded form the First Respondent’s
trust bank account.
7.12
Mapfumo obtained a certificate regarding the balance of the trust
banking account of the Respondents held at Nedbank.
7.13
Mapfumo was, however, unable to obtain a certificate of balance in
respect of the First Respondent’s trust banking account
held at
Standard Bank.
7.14
According to the certificate of balance obtained from Nedbank the
First Respondent held an amount of R32 793.53 in his trust
banking
account as at 23 November 2010.
7.15
Based on the complaint referred to above and the first respondent’s
indications that the Standard Bank trust account
had no funds, the
First Respondent did not have sufficient funds available in his
Standard Bank trust banking account. There was
therefore a trust
deficit in the firm’s bookkeeping if the Nedbank trust account
is considered.
REPORT AUDITOR VINCENT FARIS
7.17
After Mapfumo’s investigations the Law Society instructed a
chartered accountant, Mr Vincent Faris (Faris), to investigate
the
matter and the allegations contained in the first respondent’s
answering affidavit.
7.18
Faris was unable to conduct a proper inspection of the firm’s
accounting records
due
to the fact that the records presented to him were incomplete,
unreliable and inaccurate. The accounting records presented to
Faris
were in arrears, there were no justifications for payments and there
was an improper movement of funds between the trust
account, trust
investment account and business banking account.
7.19
From the available records Faris could establish at least two trust
deficits if the following positions are accepted and there
appears to
be no reason why it should not be accepted:
7.19.1
If it is accepted that there is a trust liability in the matter of
Mirror Development Trust, the trust deficit as at 31 December
2010 is
the amount of R397 585.99.
7.19.2
If it is accepted that there is no trust liability to Mirror
Development Trust, there is in any event a trust deficit in
the
amount of R3 583.98 comprising of trust account interest due to the
Law Society.
7.20
It was the case of the Law Society that there is a trust liability to
Mirror Development Trust as the First Respondent has
failed to prove
otherwise and the trustees of Mirror Development Trust are denying
the First Respondent’s allegations and
support the complaint.
7.21
Faris has revealed further contraventions by the First Respondent
which are contained in his report and is referred to in the
Law
Society’s replying affidavit (pages 170-176 of the record) as
follows:
“
5.8
Faris contacted the first respondent on 29 March 2011 and scheduled
his
inspection
for 8 April 2011. Prior to 8 April 2011 the first respondent
contacted Faris and advised him that it would not be possible
to meet
with him on the agreed date.
5.9
After Faris made several telephone calls to the first respondent, he
subsequently undertook to make his accounting records
available to
Faris on 26 April 2011.
5.10
Faris attended at the firm on 26 April 2011. The first respondent was
not present.
5.11
Faris subsequently directed a written enquiry at the first respondent
as to the availability of his business accounting records.
The first
respondent failed to reply thereto.
Nature of investigation and Faris’
approach
5.12
Faris directed his inspection at a review of the first respondent’s
trust accounting and supporting financial records,
subsidiary source
books and documents, operating and administrative systems and
procedures and the state thereof in order to express
an opinion on
the following:
5.12.1
whether the first respondent has complied with the provisions of the
Attorneys’ Act;
5.12.2
whether the first respondent has complied with the provisions of
Rules 68, 69 and 70 of the Law Society’s Rules; and
5.12.3
the existence of any contraventions and/or irregularities and the
identification and disclosure thereof.
5.13
Only limited accounting records were made available to Faris for
purposes of his inspection. He was therefore unable to perform
the
procedures which he would normally perform during an investigation.
The scope of his investigation was accordingly limited.
5.14
Faris directed his inspection at the period June 2009 up to the last
date to which the accounting records had been written
up, being 31
December 2010.
Accounting and supporting records and
the state thereof Introduction
5.15
Faris was presented with the firm’s receipt book, two blue soft
cover files and one yellow lever arch file. The business
accounting
records were not made available to Faris.
Trust banking account and cash book
5.16
The first respondent conducted his trust banking account at Standard
Bank. On 31 December 2010 there was an amount of R315.14
available in
the account.
5.17
Bank statements covering the period from the opening of the account
on
25
June 2009 (with a deposit of R500.00) up to December 2010 were made
available to Faris. These statements were contained in one
of the
blue soft cover files referred to above. The file was described as
Standard Bank Trust Account on the outside cover. There
was also a
computer generated cash book in the file which was written up,
totalled and balanced up until 31 December 2010.
Trust Investment Account and Cash Book
5.18
The second soft cover file contained bank statement of another
Standard Bank account, described as Investment Account on the
outer
cover. The account was styled in the same manner as referred to
above, but it did not contain any indication that it was
in fact a
trust account. It did not contain a reference to Section 78 (2A) of
the Attorneys’ Act either.
5.19
The bank statements covered the period from the opening thereof on 13
August 2009 up until 31 December 2010. It was opened
with a deposit
in the amount of R500 000.00 which was made from the trust banking
account. On 31 December 2010 there was an amount
of R1 051.26
available in the account. A cash book was also included in the file.
5.20
Faris found that there was no annotation on the bank statements to
indicate that the account was opened in terms of Section
78 (2A) of
the Attorneys’ Act. The statements did not contain an
annotation to the effect that it was a trust account either.
5.21
Receipt book
5.21
Faris found that the first respondent did not issue receipts in a
chronological order.
Trust interest and bank charges
5.22
Faris examined the firm’s bank statements and found that bank
charges were debited directly against the firm’s
trust banking
account. In many instances the bank charges exceeded the trust
interest.
5.23
The accumulated interest due to the Law Society for the period June
2009 to December 2010, after the deduction of bank charges
amounted
to R3 690.16. This is reflected on the first page of annexure D to
Faris’ report. (Faris incorrectly refers to it
as annexure E)
5.24
Faris’ inspection revealed that the first respondent failed to
account to the Law Society in terms of Section 78 (3)
of the
Attorneys’ Act for interest earned on his trust banking
account.
5.25
There were insufficient funds available in the first respondent’s
trust banking account on 31 December 2010 in order
to cover the
amount due to the Law Society, being R3 690.16.
5.26
There was therefore as at 31 December 2010 a trust deficit in the
amount of R3 059.88 on this account alone.
5.27
There were also trust deficits at the month ends September 2010,
October 2010 and November 2010 in respect of this account
alone.”
7.22
The First Respondent has subsequently delivered certain accounting
records to the Law Society which records were forwarded
to Faris for
further inspection. Faris reported further in short that there was no
reason to vary or change his initial report
as the accounting records
did not assist as they remained incomplete and unreliable.
[8]
The Law Society received additional complaints against the First
Respondent which complaints are summarised in the Law Society’s
supplementary founding affidavit. In terms of the complaints the
first respondent appears to have failed to execute his instructions
properly in contravention of Rule 89.15 and 89.30 of the Law
Society’s Rules. It is, however, not necessary for purposes
of
this judgment to deal therewith herein.
COMPLAINTS HERMAN MONAGENG MOKGATLE
AND DR. H. KONIG
[9]
Mokgatle instructed the first respondent to institute a third party
claim against the Road Accident Fund in 1996. The matter
has still
not been finalised. He referred to the matter as never-ending. He
also complained that the first respondent did not reply
to his
communications and that he failed to provide Mokgatle with a progress
report.
9.1
The respondents replied that summons has been issued against the Road
Accident Fund and the reports from doctors were obtained
regarding
the injuries to Mokgatle’s eyes sustained during two separate
incidents, the present one handled by the respondents
and a previous
one and that the doctors were allegedly uncertain as to which
injuries were caused during which incident.
9.2
The respondents stated that they were attempting to settle the matter
with the Road Accident Fund.
9.3
On p. 774 etc. of the record there is a copy of the summons issued
against the Road Accident Fund already in 2001. It is now
12 years
later.
9.4
Dr. Harold Konig also complained in writing about the conduct of the
respondents in the Mokgatle matter. He examined Mr. Mokgatle
in 2007
and wrote a report. Thereafter the respondents got him to release the
report against their promise that as soon as the
case has been
settled they would settle his account which has not happened to date.
It is unacceptable that the summons was issued
in 2001 and the eye
specialist only consulted in 2007. It seems to indicate that the
summons was issued before the case was properly
and timeously
attended to so that a proper summons could be issued. Dr. Konig is
now waiting for his fees 6 years. It is improper
and unprofessional
to have a doctor wait so many years for his fees.
9.5
It is now 16 years after the First Respondent was instructed in the
matter. It must therefore be concluded that the matter did
not
receive proper attention and the respondents made themselves guilty
of improper, negligent and unprofessional conduct.
PREVIOUS DISCIPLINARY PROCEEDINGS
[10]
The Law Society has previously disciplined the First Respondent after
finding him
guilty
of offences which can be summarized as follows:
10.1
The First Respondent failed to pay his subscription fees in respect
of
the
Law Society for the years 2003, 2004 and 2005;
10.2
The First Respondent failed to submit his Rule 70 auditor’s
report for the period ending 29 February 2004 to the Law
Society. The
report had to be submitted to the Law Society on or before 21 August
2004. The First Respondent’s failure is
a contravention of the
provisions of Rule 70 and amounts to unprofessional, dishonourable
and unworthy conduct;
10.3
The First Respondent practised as an attorney without being in
possession of a fidelity fund certificate during 2003, in
contravention
of the provisions of Section 41(1) and 41(2) of the
Attorneys’ Act;
10.4
The First Respondent failed to submit his Rule 70 auditor’s
report for the period ending 28 February 2005 to the Law
Society. The
report had to be submitted to the Law Society on or before 31 August
2005;
10.5
The First Respondent failed to submit his Rule 70 auditor’s
report for the period ending 28 February 2006 to the Law
Society.
This report had to be submitted to the Law Society on or before 31
August 2006;
10.6
The First Respondent failed to honour an undertaking given to a legal
official in the employ of the Law Society’s Monitoring
Unit, Ms
M Geringer, to report back to her after having had a discussion with
his auditors;
10.7
The First Respondent failed to honour an undertaking given to Ms
Geringer of the Law Society on 23 March 2006, to report back
to her;
10.8
The First Respondent failed to reply to correspondence addressed to
him by the Law Society on 6 September 2005, 28 April 2006
and 9 June
2006;
10.9
The First Respondent failed to pay fines imposed by a disciplinary
committee of the Council of the Law Society and persisted
in his
failure.
Record:
See page 52
[11]
11.1 The approach of the court in relation to trust shortages and the
duty of an attorney with regard to trust money was stated
in Law
Society, Transvaal v Matthews (supra) on 394 as follows:
“
I
deal now with the duty of an attorney in regard to trust money.
Section 78(1) of the Attorneys Act obliges an attorney to maintain
a
separate trust account and to deposit therein money held or received
by him on account of any person. Where trust money is paid
to an
attorney it is his duty to keep it in his possession and to use it
for no other purpose than that of the trust. It is inherent
in such a
trust that the attorney should at all times have available liquid
funds in an equivalent amount. The very essence of
a trust is the
absence of risk. It is imperative that trust money in the possession
of an attorney should be available to his client
the instant it
becomes
payable. Trust money is generally payable before and not after
demand. See Incorporated Law Society, Transvaal v Visse and
Others;
Incorporated Law Society Transvaal v Vilioen, 1958(4) SA 115(T) at
118 F - H. An attorney’s duty in regard to the
preservation of
trust money is a fundamental, positive and unqualified duty. Thus
neither negligence nor wilfulness is an element
of a breach of such
duty: Incorporated Law Society, Transvaal v Behrman, 1977(1) SA
904(T) at 905 H. It is significant that in
terms of section 83(13) of
the Attorneys Act a practitioner who contravenes the provisions
relating to his trust account and investment
of trust money will be
guilty of unprofessional conduct and be liable to be struck off the
roll or suspendedfrom practice. ”
11.2
On 395 the Court said the following regarding the keeping of proper
accounting records by a practitioner:
“
Failure
to keep proper books of account is a serious contravention and
renders an attorney liable to be struck off the roll of practitioners
or liable to suspension; and the Courts have repeatedly warned
practitioners of the seriousness of such a contravention. See Cirota
and Another v Law Society, Transvaal (supra at 193 F - G). The
seriousness is again underlined in rule 89 read with rule 89(11)
of
the applicant's rules which provides that it is unprofessional or
dishonourable or unworthy conduct on the part of the practitioner
to
contravene the provisions of the Attorneys Act or the applicant’s
rules”.
See
also: Malan v The Law Society of the Northern Provinces
[2008] ZA SCA
90
(12 September 2008) at paragraphs [10] to [11],
11.3
In the absence of any acceptable explanation by the respondents and
in view of the proof furnished by the Law Society for the
allegations
in the founding and replying affidavits, which are serious, the
inevitable conclusion is that First Respondent can
no longer be
regarded as a fit and proper person to continue to practise as an
attorney.
11.4
The Law Society submitted that a proper case has been made out for
the order sought and the Law Society asked that same be
granted with
costs.
[12]
When the matter came before this Court the Respondents attempted to
have a further affidavit handed up by their counsel wherein
it is
allegedly explained that the missing funds of the Mirror Trust had
been found and was allegedly credited in the name of another
trust
creditor and the Respondents sought a postponement to have the matter
sorted out with the Law Society. This court clearly
was not prepared
to fall for this trick to delay the matter and the Court refused to
receive the additional affidavit and refused
to postpone the matter
and the matter was fully argued and judgment was reserved.
[13]
First Respondent has contravened at least the following provisions of
the Act and the Rules:
a)
Rule 68.4.2 of the Rules due to the fact that the First Respondent
failed to retain his
accounting
records at no other place than his main office;
b)
Rule 69.7 of the Rules due to the fact that the First Respondent
failed to at intervals of not more than three calendar months
extract
a list of trust creditors and compare the total of the list with the
firm’s trust bank balance;
c)
Section 70 of the Act due to the fact that the First Respondent
failed to comply with a direction of the Law Society to produce
for
inspection to a person authorised thereto, the firm’s
accounting records;
d)
Rule 89.25 of the Rules due to the fact that the First Respondent
failed to comply with an
order,
requirement or request of the Council of the Law Society;
e)
Rule 68.7 of the Rules due to the fact that the First Respondent
failed to, within a
reasonable
time after the performance or earlier termination of his mandate,
account to his client in writing in accordance with
the requirements
of Rule 68.7;
f)
Rule 69.8 of the Rules due to the fact that the First Respondent
delayed the payments of
trust
funds; and
g)
Section 78(1) of the Act read with Rule 69.3.1 of the Rules due to
the fact that there is a trust deficit in the First Respondent’s
bookkeeping
[14]
It is not necessary to deal in this judgment with the numerous other
complaints against the First Respondent received by the
Law Society.
[15]
It is clear that that the First Respondent is no longer a fit and
proper person to remain on the roll of attorneys and the
following
order is made:
“
1.
That the name of Sello Nkurumah Moima (the first respondent) be
struck from the roll of attorneys of this Honourable Court and
he is
ordered to pay the costs of the application and of the hearing on the
24th August 2012 on the attorney and client scale.
2.
That the first respondent immediately surrenders and delivers to the
Registrar of this Honourable Court his certificate of enrolment
as an
attorney of this Honourable Court.
3.
That in the event of the respondent failing to comply with the terms
of this order detailed in the previous paragraph within
two (2) weeks
from the date of this order, the sheriff of the district in which the
certificate is, be authorised and directed
to take possession of the
certificate and to hand it to the Registrar of this Honourable Court.
4.
That the respondent be prohibited from handling or operating on his
trust accounts as detailed in paragraph 5 hereof.
5.
That Johan van Staden, the head: members affairs of applicant or any
person nominated by him, be appointed as curator bonis (curator)
to
administer and control the trust accounts of respondent, including
accounts relating to insolvent and deceased estates and any
deceased
estate and any estate under curatorship connected with respondent’s
practice as an attorney and including, also,
the separate banking
accounts opened and kept by respondent at a bank in the Republic of
South Africa in terms of section 78(1)
of Act No 53 of 1979 and/or
any separate savings or interest-bearing accounts as contemplated by
section 78(2) and/or section 78(2A)
of Act No. 53 of 1979, in which
monies from such trust banking accounts have been invested by virtue
of the provisions of the said
sub-sections or in which monies in any
manner have been deposited or credited (the said accounts being
hereafter referred to as
the trust accounts), with the following
powers and duties:
5.1
immediately to take possession of respondent's accounting records,
records, files and documents as referred to in paragraph
6 and
subject to the approval of the board of control of the attorneys
fidelity fund (hereinafter referred to as the fund) to sign
all forms
and generally to operate upon the trust account(s), but only to such
extent and for such purpose as may be necessary
to bring to
completion current transactions in which respondent was acting at the
date of this order;
5.2
subject to the approval and control of the board of control of the
fund and where monies had been paid incorrectly and unlawfully
from
the undermentioned trust accounts, to recover and receive and, if
necessary in the interests of persons having lawful claims
upon the
trust account(s) and/or against respondent in respect of monies held,
received and/or invested by respondent in terms
of section 78(1)
and/or section 78(2) and/or section 78(2A) of Act No 53 of 1979
(hereinafter referred to as 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, if
any, in which respondent was and may still have been concerned and to
receive such monies and to pay the same
to the credit of the trust
account(s);
5.3
to ascertain from respondent's accounting records the names of all
persons on whose account respondent appears to hold or to
have
received trust monies (hereinafter referred to as trust creditors)
and to call upon respondent to furnish him, within 30 (thirty)
days
of the date of service of this order or such further period as he may
agree to in writing, with the names, addresses and amounts
due to all
trust creditors;
5.4
to call upon such trust creditors to furnish such proof, information
and/or affidavits as he may require to enable him, acting
in
consultation with, and subject to the requirements of, the board of
control of the fund, to determine whether any such trust
creditor has
a claim in respect of monies in the trust account(s) of respondent
and, if so, the amount of such
5.5
to admit or reject, in whole or in part, subject to the approval of
the board of control of the fund, the claims of any such
trust
creditor or creditors, without prejudice to such trust creditor's or
creditors' right of access to the civil courts;
5.6
having determined the amounts which he considers are lawfully due to
trust creditors, to pay such claims in full but subject
always to the
approval of the board of control of the fund;
5.7
in the event of there being any surplus in the trust account(s) of
respondent after payment of the admitted claims of all trust
creditors in full, 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 Act No 53 of 1979 in respect of any interest therein
referred to and, secondly, without prejudice to the rights
of the
creditors of respondent, the costs, fees and expenses referred to in
paragraph 10 of this order, or such portion thereof
as has not
already been separately paid by respondent to applicant, and, if
there is any balance left after payment in full of
all such claims,
costs, fees and expenses, to pay such balance, subject to the
approval of the board of control of the fund, to
respondent, if he is
solvent, or, if respondent is insolvent, to the trustee(s) of
respondent's insolvent estate;
5.8
in the event of there being insufficient trust monies in the trust
banking account(s) of respondent, in accordance with the
available
documentation and information, to pay in full the claims of trust
creditors who have lodged claims for repayment and
whose claims have
been approved, to distribute the credit balance(s) which may be
available in the trust banking account(s) amongst
the trust creditors
alternatively to pay the balance to the Attorneys Fidelity Fund;
5.9
subject to the approval of the chairman of the board of control of
the fund, to appoint nominees or representatives and/or consult
with
and/or engage the services of attorneys, counsel, accountants and/or
any other persons, where considered necessary, to assist
him in
carrying out his duties as curator; and
5.10
to render from time to time, as curator, returns to the board of
control of the fund showing how the trust account(s) of respondent
has/have been dealt with, until such time as the board notifies him
that he may regard his duties as curator as terminated.
6.
That respondent immediately deliver his accounting records, records,
files and documents containing particulars and information
relating
to:
6.1
any monies received, held or paid by respondent for or on account of
any person while practising as an attorney;
6.2
any monies invested by respondent in terms of section 78(2) and/or
section 78 (2A) of Act No 53 of 1979;
6.3
any interest on monies so invested which was paid over or credited to
respondent;
6.4
any estate of a deceased person or an insolvent estate or an estate
under curatorship administered by respondent, whether as
executor or
trustee or curator or on behalf of the executor, trustee or curator;
6.5
any insolvent estate administered by respondent as trustee or on
behalf of the trustee in terms of the
Insolvency Act, No 24 of 1936
;
6.6
any trust administered by respondent as trustee or on behalf of the
trustee in terms of the Trust Properties Control Act, No
57 of 1988;
6.7
any company liquidated in terms of the Companies Act, No 61 of 1973,
administered by respondent as or on behalf of the liquidator;
6.8
any close corporation liquidated in terms of the
Close Corporations
Act, 69 of 1984
, administered by respondent as or on behalf of the
liquidator;
6.9
respondent's practice as an attorney of this Honourable Court, to the
curator appointed in terms of paragraph 5 hereof, provided
that, as
far as such accounting records, records, files and documents are
concerned, respondent shall be entitled to have reasonable
access to
them but always subject to the supervision of such curator or his
nominee.
[7]
That should respondent fail to comply with the provisions of the
preceding paragraph of this order on service thereof upon him
or
after a return by the person entrusted with the service thereof that
he has been unable to effect service thereof on respondent
(as the
case may be), the sheriff for the district in which such accounting
records, records, files and documents are, be empowered
and directed
to search for and to take possession thereof wherever they may be and
to deliver them to such curator.
[8]
That the curator shall be entitled to:
8.1
hand over to the persons entitled thereto all such records, files and
documents provided that a satisfactory written undertaking
has been
received from such persons to pay any amount, either determined on
taxation or by agreement, in respect of fees and disbursements
due to
the firm;
8.2
require from the persons referred to in paragraph 8.1 to provide any
such documentation or information which he may consider
relevant in
respect of a claim or possible or anticipated claim, against him
and/or respondent and/or respondent's clients and/or
fund in respect
of money and/or other property entrusted to respondent provided that
any person entitled thereto shall be granted
reasonable access
thereto and shall be permitted to make copies thereof;
8.3
publish this order or an abridged version thereof in any newspapers
he considers appropriate.
9.
That if there are any trust funds available the respondent shall
within 6 (six) months after having been requested to do so by
the
curator, or within such longer period as the curator may agree to in
writing, shall satisfy the curator, by means of the submission
of
taxed bills of costs or otherwise, of the amount of the fees and
disbursements due to him in respect of his former practice,
and
should he fail to do so, he shall not be entitled to recover such
fees and disbursements from the curator without prejudice,
however,
to such rights (if any) as he may have against the trust creditor(s)
concerned for payment or recovery thereof;
10.
That a certificate issued by a director of the Attorneys Fidelity
fund shall constitute prima facie proof of the curator’s
costs
and that the Registrar be authorised to issue a writ of execution on
the strength of such certificate in order to collect
the curator’s
costs.
P.Z.
EBERSOHN
ACTING
JUDGE OF THE HIGH COURT
I
AGREE:
M.R.
CHETTY
ACTING
JUDGE OF THE HIGH COURT
Applicants’
attorneys Rooth & Wessels Ref.J. Leotlela/B29238