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[2012] ZAGPPHC 48
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Law Society of the Northern Provinces v Swanepoel (2188/2011) [2012] ZAGPPHC 48 (24 February 2012)
NOT
REPORTABLE
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT, PRETORIA)
CASE
NO: 2188/2011
DATE:24/02/2012
IN
THE MATTER BETWEEN:
THE
LAW SOCIETY OF THE NORTHERN
PROVINCES
......................................
APPLICANT
(Incorporated
as The Law Society of the Transvaal)
And
CORNELIUS
FREDRICUS JACOBUS
SWANEPOEL
.......................................
RESPONDENT
JUDGMENT
TOLMAY
J
[1]
On 1 February 2011 the applicant brought an urgent application in
which it sought in terms of s 22(1 )(d) of the Attorneys Act
53 of
1979 (the Act) tfef suspension from practice of the respondent. An
order to that effect was
granted.
The respondent did not oppose the application and no opposing
affidavit was filed.
[2]
The applicant now seeks in terms of s 22(1 )(d) of the Act, in
accordance with Part B of the notice of motion, an order for
the
removal of the respondent's name from the roll of attorneys together
with ancillary relief. The applicant contends that the
respondent is
no longer a fit and proper person to practise as an attorney. Once
again the respondent failed to file an opposing
affidavit.
[3]
An application in terms of s 22(1 )(d) of the Act requires a three
stage inquiry:
(a)
the Court must decide whether the alleged offending conduct has been
established on a preponderance of probabilities; if so
(b)
it must decide, in it's discretion whether the person concerned is a
fit and proper person to practise as an attorney this requires
a
value judgment; and if not
(c)
it must decide in it's discretion (this also requires a value
judgment) whether the attorney should be suspended for a period
or
whether he/she should be removed from the roll1.
[4]
As for the facts in this case, the affidavit filed by the applicant
and the report by the curator show that the respondent
misappropriated trust funds in the amount of R1 389 000-00 from three
clients. Mr Van Der Walt (R800 000-00), Dr Schrooders (R289
000-00)
and Mr J Pulen (R300 000-00). The respondent admitted this to the
applicant's investigator. Mr Van Rooyen. when Mr Van
Rooyen
investigated the accounting records. The trust account showed a
deficit of R1 389 000-00.
[5]
The respondent contravened inter alia the following provisions of the
Attorneys Act and the applicant's rules:
•
Rule
3.1 in that the Respondent's firm did not within 30 days after the
change of its address inform the Applicant in writing of
such
changes;
•
Section
78(1) of the Act in that the Respondent failed to keep sufficient
funds in his firm's trust banking account to satisfy his
obligation
to trust creditors:
•
Sec
tion 78(4) of the Attorneys Act read together with Rules 68.1 and
68.2 of the Rules in that the Respondent's firm did not retain
such
accounting records as are necessary to represent fully and
accurately
in accordance with generally accepted accounting practice the
transaction and records containing particulars and information
of all
moneys received, held and paid by it for and on account of any
person;
•
Rule
68.7 in that the Respondent failed, within a reasonable time, after
the performance or earlier termination of the mandate,
account to
clients in writing;
•
Rule
89.7 in that the Respondent, without lawful excuse, delayed the
payment of trust money after due demand was given to him; and
•
Rule
70.3 in that the Form of Assurance Report the Respondent caused to
lodge with the Applicant was incorrect.
[6]
The conduct of the respondent deviates to such an extent from what is
expected of an attorney that there is no question that
he is not a
fit and proper person to continue to practise as an attorney.
[7]
As far as the third enquiry is concerned the conduct established
justifies the conclusion that the respondent's name must be
removed
from the roll of attorneys2. It is clear that he did not keep proper
accounting records and that he has not dealt honestly
with funds
entrusted to him. The public must be protected against such a
practitioner, and there is no suggestion that he will
rehabilitate
himself. He did not place facts before this court to show that he
should not be struck off the roll.
[8]
The contraventions by the respondent are of such a nature that he
should be removed from the roll as a suspension wouid not
suffice
under the circumstances and I propose that we should exercise our
discretion to that effect.
[9]
Consequently an order is made in terms of the draft marked "X"
R
G TOLMAY JUDGE OF THE HIGH COURT
I
agree:
B
R SOUTHWOOD JUDGE OF THE HIGH COURT
IN
THE HIGH COURT OF SOUTH AFRICA
(NORTH
GAUTENG HIGH COURT, PRETORIA)
Case
No: 2188/2011
In
the matter between:
THE
LAW SOCIETY OF THE NORTHERN
PROVINCES
.......................................
APPLICANT
(Incorporated
as the Law Society of the Transvaal)
and
CORNELIUS
FREDRICUS JACOBUS
SWANEPOEL
.......................................
RESPONDENT
ORDER
Having
read the papers filed of record and hafor the Applicant,
IT
IS ORDERED
1.
That the name of CORNELIUS FREDR1CUS JACOBUS SWANEPOEL (respondent)
be struck from the roll of attorneys of this Honourable Court.
2.
That the respondent hands and delivers his 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 his trust
accounts as detailed in paragraph 5 hereof.
5.
That Johan van Staden, the head: members affairs of appiicant 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 a!!
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 ail 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 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.
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)
;
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 credttor(s) concerned
for payment or recovery
thereof;
12.
That a certificate issued by a director of the Attorneys Fidelity
Fund shali 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