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 230
|
|
Law Society of the Northern Provinces v Mashiloane (8675/2009) [2013] ZAGPPHC 230 (26 July 2013)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG, PRETORIA)
CASE
NO: 8675/2009
DATE:26/07/2013
In
the matter between:
THE
LAW SOCIETY OF THE NORTHERN
PROVINCES
....................................
Applicant
and
MAGGY
PEBETSE
MASHILOANE
.......................................................................
Respondent
JUDGMENT
SETHUSHA,
AJ:
[1]
This is an application by the Law Society of the Northern Provinces
(the Law Society) to strike the name of the respondent from
the roll
of attorneys of this court, and related ancillary relief. An order
for the suspension of the respondent from practicing
as an attorney
was granted by this court on 11 July 2012. The application is
unopposed, despite it having been personally served
on the respondent
on 1 October 2012 at her place of residence. She did not deliver a
notice of intention to oppose, nor was there
any appearance on her
behalf at the hearing.
[2]
The respondent was admitted as an attorney of this court on 17 July
2006 and practiced as a partner in the firm Stols Van Heerden
Attorneys until 31 August 2006. With effect from 8 December 2008 she
practiced for her own account under the name and style of
M.P
Mashiloane Attorneys. The complaint of the Law Society relates to the
period she practiced as a sole practitioner. The Law
Society
initiated this application after receiving a complaint from the
respondent’s client, Mr. Max Sisulu, which I shall
deal with
later.
[3]
Before I consider the merits of the application, it is prudent to set
out the applicable general principles.The applications
such as the
present are sui generis and of a disciplinary nature. There is no lis
between the Law Society and the respondent. The
Law Society, as a
custos morum of the attorneys’ profession, places before court
facts for consideration and an exercise
of a discretion. See
generally: 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)
at 393E; Cirota & Another v Law Society, Transvaal
1979 (1) SA
172
(A) at 187 H and Prokureursorde van Transvaal vKleynhans
1995 (1)
SA 839
(T) at 851E-F.
[4]
The question whether an attorney is no longer a fit and proper person
to practice as such lies, in terms of section 22 (1) (d)
of the Act,
in the discretion of the court. See Law Society of the Good Hope v
Budricks
2003 (2) SA 11
(SCA). Once a court has determined that an
attorney is not longer fit to remain on the roll of attorneys, the
court must determine
an appropriate sanction, namely a suspension
from practice or striking from the roll. This determination also lies
within the discretion
of the court. The opinion or conclusion of the
Law Society that a practitioner is no longer a fit and proper person
to practise
as an attorney carries great weight with the court,
although the court is not bound by it: Kaplan v Incorporated Law
Society, Transvaal
1981 (1) SA 762
(T) at 781H.
[5]
The application requires a three-stage enquiry. First, the court must
decide whether the alleged offending conduct has been
established on
a preponderance of probabilities, which is factual enquiry. Second,
it must consider whether the person concern
is “in the
discretion of the court” not a fit and proper person to
continue to practice. This involves a weighing-up
of the conduct
complained of against the conduct expected of an attorney and, to
this extent, is a value judgment. And 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 practice would suffice (Law Society, Northern Provinces v Mogami
and Others 2010(1) SA 186; [2010]
1 All 315 (SCA) para 14).
[6]
In Summerley v Law Society, Northern Provinces [2006] SCA 59 (RSA)
para 2, the court explained the test to be applied during
the third
stage of the enquiry as follows:
The
third enquiry again requires the Court to exercise a discretion. At
this stage the Court must decide, in the exercise of its
discretion,
whether the person who has been found not to be a fit and proper
person to practice as an attorney deserves the ultimate
penalty of
being struck from the roll or whether an order of suspension from
practice will suffice’.
An
overview of the complaints against the respondent
[7]
The Law Society alleges that the respondent has made herself guilty
of several transgressions of its rules. However, the main
complaint
relates to misappropriation of trust funds. The ancillary complaints
concern practicing without being in possession of
a fidelity fund;
failure to give proper attention to the affairs of her client;
failure to comply with various rules applicable
to administration of
estate, and failure to proper books of business.
Complaint
by Mr. Max Vuvisile Sisulu
[8]
Effectively, all the above complaints were triggered by a complaint
lodged with the Law Society by Mr. Max Vuyisile Sisulu (Sisulu).
Sisulu instructed the respondent to act as his agent in the
administration of the deceased estate of his the late son, Mr.
Mlungisi
Sisulu. An amount of R457 173.15 was received in the estate
account. Of this amount, the respondent misappropriated a total of
R310 546.81. An amount of R146 626.34 was paid in accordance with the
instruction of the deceased’s surviving spouse. A bank
statement of the firm’s trust account dated 22 December 2011
reflected a balance of R65.47.
[9]
In response to Sisulu’s complaint, the respondent admitted to
the Law Society to have misappropriated the estate money,
both in her
written response to the complaint, and during formal disciplinary
hearing. She also admitted during the hearing of
having failed to
finalise the estate of the late Sisulu within the required period and
not having distributed the account, and
having lied to Sisulu about
the progress made in finalization of the estate.
[10]
The respondent explained to the Law Society her reasons for
misappropriating the money as follows. During 2008 the firm in
which
she was a partner, experienced financially difficulties as a result
of the world-wide recession. Her salary as a partner
was reduced, and
she was ‘constructively dismissed’ at the end of August
2008. She became unemployed and without an
income. She gave birth to
a baby in September 2008. Her husband was not supportive of her. She
was threatened with foreclosure
on her mortgage bond, and the
repossession of her house became a real possibility. She commenced
her practice for her own account
on 8 December 2008.
[11]
In her own words, the respondent stated the following to the Law
Society:
‘
I
eventually thought of the money that was entrusted to me - Estate
late Sisulu’s money. I started by withdrawing R 4500.00,
which
was equal to the salary I was earning after the cut-off. I could not
survive without money, where I was staying: I could
not ask money
from my husband. He enjoyed seeing me like that. The following months
I did the same thing, also patching for the
arrears that I was
already into, with the intention that, I when my baby is older I will
find another job and repay every cent.
The money that I used from the
estate is plus/minus R300, 000.00.
This
thing is haunting me and I am not confident in everything I did, and
I am not proud about all this. I admit that I committed
a very
serious offence, and was very wrong in that I failed to act as
expected from an attorney. I am also aware that this might
lead to me
being arrested and being struck from the roll of attorneys. I have
read several articles where people got arrested and
even got struck
of for even smaller amount than the one in my case.
I
as well know that this might be the case. I also admit that I stopped
communicating with the clients, as I did not know how I
was going to
tell them about this situation. I had to create the delaying tactics,
with a hope that things will turn out good’.
[12]
Having admitted to a misappropriation of trust funds, the respondent
has exhibited conduct which is clearly inconsistent with
membership
of the attorneys’ profession. The respondent has thus rendered
herself unworthy to remain on the roll of attorneys.
What remains to
be determined is the sanction to be imposed on the respondent -
whether to strike her off the roll or simply extend
her suspension.
[13]
In my view, the complaint against the respondent is so serious that
the only sanction I deem suitable under the circumstances,
is the
striking of her name from the roll of attorneys. I come to this
conclusion very painfully, in light of the respondent’s
personal circumstances outlined in para [11] above. Obviously, those
circumstances would be considered in her favour when, and
if, the
respondent applies for re-admission.
[14]
Finally, the issue of costs. In matters such as these, policy
considerations are that the Law Society, as the custos morum
of the
attorneys’ profession, should not be burdened with legal costs
when launching applications against attorneys who have
made
themselves guilty of dishonourable, unworthy or professional conduct.
A practice has therefore developed on that basis that
costs are
granted on an attorney and client scale. The Law Society has
requested such a cost order. I see no reason why it should
not be
granted.
[15]
In the result I make the following order:
1.
The name of MAGGY PEBETSE MASHILOANE (the respondent) is struck from
the roll of attorneys of this court.
2.
Paragraphs 2-12, all inclusive, of the draft order attached hereto
and marked “A” are made part of the order of this
court.
NC SETHUSHA
ACTING
JUDGE OF THE HIGH COURT
I
agree
TM
MAKGOKA
JUDGE
OF THE HIGH COURT
DATE
HEARD 12 APRIL 2013
JUDGMENT
DELIVERED 26 JULY 2013
FOR
THE APPLICANT MS S MAGARDIE
INSTRUCTED
BY DAMONS MAGARDIE RICHARDSON
ATTORNEYS,
PRETORIA
NO
APPEARANCE FOR THE RESPONDENT
ANNEXURE
“A”
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT, PRETORIA)
Case
number: 35276/2012
DATE:26/07/2013
In
the application of:
THE
LAW SOCIETY OF THE NORTHERN PROVINCES
(Incorporated
as the Law Society of the
Transvaal)
...........................................
Applicant
and
MAGGY
PEBETSE
MASHILOANE
............................................................................
Respondent
DRAFT
ORDER OF COURT
Having
read the papers filed of record and having heard the attorney for the
Applicant,
IT
IS ORDERED
1.
That the name of MAGGY PEBETSE MASHILOANE (hereinafter referred to as
the respondent) be removed from the roll of attorneys of
this
Honourable Court.
2.
That respondent hands and delivers her certificate of enrolment as an
attorney to the Registrar 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 respondent be prohibited from handling or operating on her 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 under mentioned 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 claim;
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/she 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/her 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/her
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.
9.
That respondent be and is hereby removed from office as:
9.1
executor of any estate of which respondent has been appointed in
terms of
section 54(1)(a)(v)
of the
Administration of Estates Act, No
66 of 1965
or the estate of any other person referred to in
section
72(1)
;
0cm
; line-height: 200%">
9.2
curator or guardian of any minor or other person’s property in
terms of
section 72(1)
read with
section 54(1)(a)(v)
and
section 85
of the
Administration of Estates Act, No 66 of 1965
;
9.3
trustee of any insolvent estate in terms of
section 59
of the
Insolvency Act, No 24 of 1936
;
9.4
liquidator of any company in terms of
section 379(2)
read with 379(e)
of the Companies Act, No 61 of 1973;
9.5
trustee of any trust in terms of section 20(1) of the Trust Property
Control Act, No 57 of 1988;
9.6
liquidator of any close corporation appointed in terms of section 74
of the Close Corporation Act, No 69 of 1984.
10.
That respondent be and is hereby directed:
10.1
to pay, in terms of section 78(5) of Act No. 53 of 1979, the
reasonable costs of the inspection of the accounting records of
respondent;
10.2
to pay the reasonable fees of the auditor engaged by applicant;
10.3
to pay the reasonable fees and expenses of the curator, including
travelling time;
10.4
to pay the reasonable fees and expenses of any person(s) consulted
and/or engaged by the curator as aforesaid; and
10.5
to pay the costs of this application on an attorney-and-client scale.
11.
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/her (respondent) in respect
of his/her
former practice, and should he/she fail to do so, he/she shall not be
entitled to recover such fees and disbursements
from the curator
without prejudice, however, to such rights (if any) as he/she may
have against the trust creditor(s) concerned
for payment or recovery
thereof;
12.
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.
BY
ORDER OF THE COURT REGISTRAR