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[2024] ZAFSHC 131
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South Africa Legal Practice Council v Green (5205/2023) [2024] ZAFSHC 131 (9 May 2024)
IN
THE HIGH COURT OF SOUTH AFRICA,
FREE
STATE DIVISION, BLOEMFONTEIN
Reportable: NO
Of
Interest to other Judges: NO
Circulate
to Magistrates: NO
Case
No: 5205/2023
In
the matter between:
SOUTH
AFRICAN LEGAL PRACTICE COUNCIL
Applicant
and
RYAN
GILBERT GREEN
Respondent
HEARD
ON:
28 MARCH 2024
CORAM:
MHLAMBI ADJP
et
CHESIWE, J
JUDGMENT
BY:
MHLAMBI, J
DELIVERED
ON:
09 May 2024
[1]
On
16
November 2023,
the applicant approached this court
seeking
an order
as
follows:
"1,
That
RYAN
GILBERT GREEN
(hereafter
referred
to as
"the
Respondent")
be
suspended
from
the roll
and
practice
of
legal
practitioner
of
the
High
Court of South Africa until such
a
time
that
a
valid
Fidelity
Fund Certificate
has
been
issued
to him,
alternatively
for
such
period
and on such conditions as
the
Honourable
Court
may
deem
fit,
2.
That
the Respondent shall immediately surrender and deliver his
certificate of enrolment
as
a
legal
practitioner
of
this
Honourable
Court to the Registrar of this Honourable Court;
3.
That in
the event that the Respondent fails to comply with the terms of the
order in the preceding paragraph 2, within 2 (two) days
from the date
of service of this order on him, the sheriff be authorised
and
directed to take possession of the certificate,
and to
hand it over to the Registrar of this Honourable Court;
4.
That
the Respondent and any other employee of the Respondent be
prohibited, with immediate effect, from handling or operating and
dealing with any of the trust banking accounts of his practice(s),
the banking accounts of any deceased estates in respect of which
he
has been appointed as executor or Master's representative and any
banking accounts of any insolvent estates in respect of which
he has
been appointed as
a
liquidator;
5.
That the
Director of the Free State office of the Applicant,
Margarette
Kwakye
and
her successor(s) in title be and is appointed as curator bonis
("the
Curator")
of
the legal practice of the Respondent and to administer and control
the trust accounts of the Respondent, including accounts relating
to
insolvent and deceased estates and any estate under curatorship
connected with Respondent's practice as an attorney including
the
separate banking accounts opened and kept by the Respondent
at
a
bank in the
Republic of South Africa in terms of Section 86(1) and (2) of the
Legal Practice Act 28 of 2014
("the
Act")
and/or
any separate or interest bearing accounts as contemplated
by
section 86(3) or section 86(4) of the Act, 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").
5.1
Subject to
the approval of the Board of Control of the Fidelity Fund
("the
Board"}
to
sign and endorse cheques and/or withdraw forms and generally to
operate upon and the trust account(s), but only to such extent
and/or
for such purpose
as
may be
necessary to bring to completion current instructions in which the
Respondent was acting at the date of this order,
5.2.
Subject to
the approval of the Board to recover and receive and, if necessary
in
the
interest of persons having lawful claims against the trust account(s)
and/or against the Respondent in respect of moneys held,
receive
and/or invested by the Respondent in terms of sections 86(2) and
86(3) of the Act (hereinafter referred to
as
"trust
monies' , to take legal proceedings which may be necessary in respect
of incomplete transactions in which the Respondent
may
have been
involved and which may have been wrongfully and unlawfully paid from
the trust account(s) and to receive such monies and
to pay same to
the creditor(s) of the trust account(s);
5.3.
To
ascertain from the Respondent's books of account the names of all
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
Respondent to furnish her within 30 (thirty) days from
the date of
this order,
with the names, addressed
of the amounts
due to all trust creditors,
5.4.
To
call
upon such trust creditors
to
furnish
such proof. information and affidavits as she may require
to
enable her,
acting in consultation
with
and subject to the requirements
of
the Board,
to determine whether any such trust creditor has
a
claim in
respect of moneys in the trust account(s) 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, the claims
of
any such
creditors, without prejudice to such trust creditors' right of access
to the civil courts;
5.6
Having determined
the
amounts
which,
she
considers
are due
to trust creditors,
to
pay such claims in
full, but subject always to the approval
of
the Board;
5.7
In the
event
of
there being
any
surplus in the said trust account(s) 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
86(5)(a)
of the Act in respect of any interest therein referred to and
secondly, without prejudice to the right of the creditors
of
the
Respondent, the
costs,
fees, and
expenses referred to in this order, or such portion thereof
as
has not
already been separately paid by the Respondent to the Applicant and,
if there is any balance left after payment in full
of such claims,
costs, fees and expenses,
to
pay
such balance,
subject
to
the
approval of the Board, to the Respondent,
if he
is solvent, or if the Respondent
is
insolvent, to the Trustee of his insolvent estate;
5.8
In
the event of there being insufficient trust monies in the trust
account(s) of the Respondent in accordance with the available
documentation and information, to pay the trust creditors on
a
pro rata
basis-
58.1
subject to the
approval of the Board to close the trust account(s) and pay the
credit balances to the Fund and
to
require
the credit balances to be placed to the credit of
a
special
trust suspense
account
in the name of
the Respondent in the Fund's books;
5
.
8
.
2
to refer the
claims of all trust creditors to the Board to be dealt with in terms
of the provisions of the Act;
58.3
to refer the
claims of all trust creditors to the Board to be dealt with in
terms
of the
provisions of the Act, and to authorise the Board to credit the
credit balances
referred
to
in
sub-paragraph
"5.
8.1"
above
to
its
"Paid
Claims
Account" when the Fund
has paid, in terms of section 55 of the Act admitted claims of the
trust creditors in
excess
of such
credit balances, provided that, notwithstanding the aforegoing, the
said
Board
shall be entitled in its discretion, to transfer to its "Paid
Claims Account' the amount or amounts of any claim or claims
as and
when admitted and paid by it;
5.9
Subject
to the
.
approval
of the Chairperson of the Board to appoint nominees or
representatives and/or consult with and/or engage the
services
of
attorneys and/or counsel and/or accountants and/or other persons,
where considered necessary, to assist such Curator in the execution
of the duties of the Curator; and
5.10
To
render from time to time,
as
Curator,
returns to the Board, showing how the trust account(s) have been
dealt with, until such time as the said Board notifies
her that she
may regard her duties as discharged.
6.
That
the Respondent be and is directed to immediately deliver all records
relating to the legal practice of the Respondent, which
for the
purpose of this order, but without limitations, will include all
accompanying records, files, correspondence
and
documents which are directly or indirectly concerned with, or which
contain particulars of information to:
6.1
any
monies received, held or paid by the Respondent for or on account of
any person while practicing
as
an
attorney;
6.2.
any
monies invested by the Respondent in terms of section 86(3) and/or
section 86(4) of the Act;
6.3.
any
interest on monies so invested and which was paid over or credited to
the Respondent;
6.4.
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 Estate Act, Act 66 of 1965;
6.5.
any
insolvent estate administered
by the
Respondent
as
a
trustee or
on behalf of
a
trustee in
a
trust in
terms of the
Insolvency
Act, 24
of 1936
7.
That should
the Respondent fail to comply with the provisions of the preceding
paragraph "6" 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 the Respondent
(as the
case
may be),
the sheriff for the district in which such accounting
records,
records, files and documents are, is empowered and directed to search
for and to take possession thereof wherever they
may be and to
deliver them to such Curator.
8.
That
Respondent
be
and is hereby removed from office as
-
8.1.
Executor
of any estate of which Respondent has been appointed in terms of
section 14(1)
read with
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)
thereof,·
8.2.
Curator
or guardian of any minor or other person's property in terms of
section 72(1)
read with
section 54(1
and
section 85
of the
Administration of Estates Act, No 66 of 1965
;
8.4.
Trustee
of any insolvent estate in terms of section
59
of the
Insolvency
Act, No
24 of 1936
;
8.5.
Liquidator
of any company in terms of
section 379(2)
read with 379(e) of the
Companies Act, No 71 of 2008
;
8.6.
Trustee
of any trust in terms of section 20(1) of the Trust Property Control
Act,
57
of 1988;
8.7.
Liquidator
of any close corporation appointed in terms of section
7
1
51515">
4
of the
Close Corporations
Act, 69
of 1984
;
8.8.
Administrator
appointed in terms of section
7
4
of the Magistrates' Court Act, 32 of 1944.
9.
The Curator
is entitled to:
9.1
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;
9.2
require
claimants to provide any documentation or information which the
Curator may consider relevant in respect of a claim or possible
or
anticipated claim, against the Curator and/or Respondent and/or
Respondent's clients and/or Fund in respect of money and/or
other
property entrusted to the Respondent provided that any person
entitled thereto shall be granted reasonable access thereto
and shall
be permitted to make copies thereof,·
9.3
publish
this order or an abridged version thereof in any newspaper he
considers appropriate;
9.4
close
the Respondent's practice insofar as it relates to the client files,
records and trust accounts.
10.
That
the Curatorship will terminate when the Curator receives
a
final
written discharge from such duties from the Applicant consequent upon
the Curator filling with the Applicant
a
final
report and account, together with supporting vouchers, in respect of
the execution of the Curator's duties in terms of this
Order.
11.
That
the Applicant is exempted from furnishing security for the
performance of their obligations as Curator.
12.
That
the Respondent be and is hereby directed.
12.1
to pay,
in terms of section
87(2)
of the LPA, the reasonable costs of the inspection of the accounting
records of the Respondent;
12.2
to pay
the Curatorship fees and disbursements;
12.2
to pay the expenses relating to the publication of this order or an
abbreviated version thereof,·
12.2
within 1 (One) year of her being requested to do so by the Curator or
within such longer period as the Curator may agree to
in writing, to
satisfy the Curator by means of the submission of taxed bills of cost
or otherwise, of the amount of fees and disbursements
due to the
Respondent 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 Creditors
concerned for payment or
recovery thereof and;
13.
That
the Respondent is ordered to pay the costs of this application on an
attorney and own client scale, including the costs occasioned
by the
employment
of
Counsel
.
[2]
On
29
February
2024,
the
application
was
postponed
at
the
instance
of
the respondent
when the court granted the following order:
"2.1
The application to postpone is granted and the matter is postponed to
28 March 2024, and it is a final postponement.
2.2
The
respondent
shall
update
the
applicant
on
weekly
basis
on
the
progress
of the
audit
reports.
2.3
The
audit reports shall be complied with and submitted on or before 20
March 2024.
2.4
The
respondent shall pay the wasted costs accessioned by the
postponement."
[3]
On 28 March
2024, Mr Lubbe, counsel for the respondent, admitted that the
respondent had not complied with the court order and submitted
that
during the previous hearing, he had requested a longer period within
which to comply. He then handed up two letters from the
accountants,
CS Smit Admin dated 27 March 2024 and cine from Kotie Kruger Auditors
dated 28 March 2024. The accountants advised
that they were the
consulting bookkeepers to the firm, Green Attorneys, since July 2023
and confirmed that the books for the financial
year ending 28
February 2022 were written up to the date of 28 February 2022, and
were currently with the auditors to be filed
with the LPC
.
They had
prepared all the data for the financial year ending 28 February 2023
up to 28 February 2024. The processing was complete
on the accounting
software up to 30 November 2022. The auditors had received the first
two quarters of the current year for their
review, being the reports
of the respective financial periods of May 2022 and August 2022.
[4]
They had also
prepared all the data up to April 2023 concerning the financial year
ending 28 February 2024.
[5]
The
auditors
confirmed
that
the
28
February
2022
audit
had
been
finalised
and were awaiting the
original
"attorneys
statement
on trust accounts"
and the
"fidelity
fund"
certificates
signed by the respondent. Receiving those signed documents, they
could submit them to the applicant. They were informed
on 22 March
2024 by the accountants that the reprocessing of the accounting data
into the AJS Accounting System was in progress
and completed up to 31
August 2022 (second quarter).
[6]
Mr Lubbe
requested the court to grant an extension of a week or two for the
submission of the relevant documents and if the court
were not so
inclined, the order sought should be granted but suspended for a
period of two (2) to four (4) weeks to enable the
respondent to
comply with the order granted on 29 February 2024. He submitted that
the audit report for the year ending February
2022 was finalised
and
was
awaiting
the
signature
which
could
be furnished
on the very
same day. The audit report for the year ending February 2023 was on
the verge of completion.
[7]
Mr
Motselebane, the applicant's counsel, persisted with the application
and submitted that as an attorney in practice, the respondent
was
required to submit an unqualified audit report for the financial
period 01 March 2021 to 28 February 2022. This report had
to be
submitted before 31 August 2022. Should the respondent
submit the
said unqualified
audit report
timeously,
he
was required to apply for a fidelity fund certificate on/or before
the 1 December 2022. If the respondent complied with the requirements
and successfully completed the application, the respondent would have
been issued with a valid fidelity fund certificate for the
year
ending December 2023. The respondent failed and/or neglected to
submit an audit and apply for a fidelity fund certificate
for the
year ending December 2023.
[8]
In replication, Mr Lubbe requested that the court grant an order in
terms of which the audits
should be finalised and handed in by 12
April 2024 which would grant the respondent suffic
i
ent
time to comply.
[9]
As at the time
of the preparation of this judgment, there was no indication
whatsoever from the respondent that he had complied
with the order of
29 February 2024; and that he updated the applicant every week on the
progress of the audit reports or indicated
to the court that he had
complied with his request that the audit reports were finalised and
submitted on 12 April 2024. The respondent
continues to disregard the
court order granted previously as well as his undertakings. There
is
therefore no
reason whatsoever why the application should not be granted as per
the notice of motion.
[10]
I therefore make the following order.
Order:
1.
The respondent
is suspended from the roll and practice of a legal practitioner
of the High
Court of South Africa until such a time that a valid Fidelity Fund
Certificate has been issued to him
.
2.
Prayers 2 to
13 of the Notice of Motion are granted
.
MHLAMBI, J
I
concur,
CHESIWE, J
On
behalf of the Plaintiff:
Adv.
Motselebaile
Instructed
by:
Rampai
Attorneys
82
Kellner Street
Westdene
Bloemfontein
On
behalf of the Defendant:
Adv
.
E Lubbe
Instructed
by:
Green
Attorneys
Unit
Park Building
082
Vodacom Lane
Nobel
Street
Bloemfontein