Law Society of the Northern Provinces v Adekeye and Another (21758/2018) [2018] ZAGPPHC 371 (17 May 2018)

IN THE HIGH COURT OF SOUTH AFRICA

GAUTENG DIVISION, PRETORIA

(1) NOT REPORTABLE

(2) NOT OF INTEREST TO OTHER JUDGES

(3) REVISED.

CASE NO: 21758/2018

17/5/2018

In the matter between:

THE LAW SOCIETY OF THE NORTHERN PROVINCES Applicant

and

BABATUNDE BAMIOELE ADEKEYE

First Respondent

MKHABELA HUNTLEY ATTORNEYS INCORPORATED

Second Respondent

JUDGMENT

RAULINGA J,

1. This is an application in terms of section 22 of the Attorneys' Act, 53 of 1979, for the name of the first respondent to be struck from the roll of attorneys of this Court on an urgent basis, alternatively that the first respondent be suspended from practice on an urgent basis pending the finalisation of the application for the removal of his name from the roll of attorneys (Part B), with concomitant relief.

2. The first respondent was admitted as an attorney of this Court on 20 August 1998 and his name still appears on the roll of attorneys.

3. According to the applicant's records, the first respondent practised as a director of the second respondent at Block C, No 7 Eton Road, Sandhurst, Johannesburg, Gauteng during the period 1 September 2006 to 30 August 2014. He commenced practising for his own account as a single practitioner under the name and style Adekeye Attorneys on 17 January 2017.

4. No relief is sought against the second respondent or its directors at this stage.

5. The application was served on the first respondent on 20 April 2018.

6. The applicant submits that the inherent urgency of applications of this nature is acknowledged in practice direction no 15.3(2) of the practice directives of this Court which provides:

"...these applications usually involve a degree of urgency which depends upon misconduct, its seriousness and other relevant circumstances. Where the matter is urgent and must be heard urgently it will be heard by one or both judges sitting in the urgent motion court or, as directed by the Deputy Judge President."

7. The urgency of this application, so the applicant contends, is prompted by the risk that the first respondent poses to his clients, the public at large and the Attorneys Fidelity Fund. He has inter alia misappropriated a substantial sum of trust funds resulting in a trust deficit in the second respondent's bookkeeping amounting to R11, 683, 404.00. The Law Society has also received a complaint against the first respondent to the effect that he misappropriated trust funds in excess of R83, 000, 000.00 and he is currently practising without being in possession of a Fidelity Fund Certificate.

8. Further, that the respondent has been afforded 12 days' notice of the application. This therefore is commensurate with the exigency

demanded by the application in terms of the degree of relaxation of the Rules of this Court.

9. The first respondent avers that the matter lacks urgency in that the applicant has failed to set out how the matter has become urgent,

suddenly, as the first respondent resigned from Mkhabela Huntley Adekeye Inc almost four years ago, and thus has neither access nor control of the trust fund of the second respondent. Further, the funds misappropriated are the subject of a criminal case as well as a civil claim respectively. Both cases have not been determined and the liability of the first respondent or erstwhile partners has not been established.

10. In essence, the first respondent argues that the application breaches the right to the audi alteram partem rule; erstwhile partners have not been joined in terms of the law, prompting stay of inquiry pending finalisation of criminal proceedings and civil claim. The first respondent also submits that there is a dispute of fact.

11. I deal first with urgency in this application. As indicated above in this judgment, the applicant makes submissions for the urgency of this application. There is no need to belabour this matter; the reasons advanced by the applicant for urgency are more convincing

than the objections raised by the first respondent.

12. The fact of the matter is that, there are serious allegations that the first respondent misappropriated trust funds (a contravention of section 78 of the Attorneys' Act and the provisions of Rule 35.13.14 of the Law Society Rules). Not only is this a contravention of Section 78, an offence in terms of section 83(9) and unprofessional conduct in terms of section 83(13); it also constitutes theft, a criminal offence.

13. The first respondent is currently practising without being in possession of a Fidelity Fund Certificate and he has done so since 1 January 2018. The first respondent's misappropriation of trust funds has resulted in a substantial trust deficit.

14. Flowing from this misappropriation, the second respondent's auditor's report for the period ending 28 February 2017 was qualified. The Law Society has received a serious complaint against the first respondent to the effect that he has misappropriated in excess of R83 000, 000.00 in trust funds. The first respondent placed the second respondent's trust creditors and the Attorneys Fidelity Fund at risk.

15. Following the receipt of the qualified audit report and statement by Mkhabela, Anica Mpete ("Mpete"), a legal official in the employ of the Law Society, visited the offices of the second respondent on 18 November 2017. Mpete reported to the Law Society on12 January 2018.

16. Mpete unearthed a plethora of irregular transactions from Kwezi, an entity headed by Mahamba who had developed a close relationship with the first respondent. Payments were made to several of the first respondent's companies and his personal account. These transactions

amounted to millions of rands. Of these amounts, the first respondent confessed for having misappropriated a lot of it and had to make a payment of R6000 000.00 back to the trust account.

17. In my view, the submission by the first respondent that the applicant has suddenly enrolled the matter in the urgent roll after the first respondent resigned from Mkhabela Huntley Adekeye Inc some four years ago, is misplaced. It is clear that the report of Mpete was submitted to the Law Society on 12 January 2018. This prompted the applicant to start the process of this urgent application .

18. In my view, it was not feasible for the applicant to immediately launch this application after it received the report from Mpete. The report had to be submitted to the council for deliberations and decision. These processes took some time before the launch of the application. My conclusion is that the matter is urgent as it complies with the judgment in Luna Meubels Vervaardigers (Edms) Bpk v Makin (t/a Makin's Furniture Manufacturers)[1].

19. The first respondent contends that the application is premature in that the applicant was obliged to hold a preliminary enquiry in terms of section 71 of the Act. It is also contended by the first respondent that the applicant took a decision to conduct an enquiry which amounts to an administrative action in terms of PAJA and section 33 of the Constitution. The first respondent also argues that in terms of section 73 of the Act, a person who has been found guilty may within a period of thirty days of the date of the council's decision appeal to a competent court.

20. It is important to remember that this is an enquiry in terms of section 22(1) (d) of the Act, to suspend or strike the first respondent from the roll of Attorneys. The applicant has made an election to proceed in terms of section 22 instead of section 71.

21. The decision taken by the applicant is not an administrative decision. Equally, the decision to hold an enquiry did not adversely affect the rights of the first respondent, because this Court is still going to hold an enquiry. The enquiry cannot be said to be pre-mature because the same issues will still be placed before the Court.[2] That is a process in terms of section 22 of the Act. PAJA does not apply in this instance.

22. Section 73 of the Act provides for an instance where a respondent may appeal the decision of the council. PAJA applies to the review of administrative decisions. The first respondent seems to conflate appeals and review. The submissions of the first respondent cannot be sustained.

23. I am mindful of the fact that an enquiry into an attorney's conduct is sui generis. These are disciplinary proceedings. Fit and proper is not an averment to be made jointly and severally. Liability cannot be apportioned. There is no need to joint Mkhabela, Huntley and Adekeye Inc. It suffices to have the second respondent as a party.

24. The first respondent submits that referral to an enquiry in terms of section 71 is a better option under the circumstances, because the first respondent disputes how it received funds, and instead submits that, the funds were disbursed by instruction of the client. He is of the view that the matter be resolved through oral evidence.

25. In essence, the first respondent does not raise a real, genuine and bonafide dispute which can fit the guidelines in Plascon Evans. He makes bare denials without making an explanation of the facts in dispute.

26. It is the view of the first respondent that if the council proposes to exercise its internal disciplinary powers, it must adhere to the audi alteram partem rule.

27. In the first place, the proceedings before the Court are not internal processes. Secondly, the first respondent has been summonsed to appear before this Court where he will be given an opportunity to defend himself, by putting his version forward. This cannot be regarded as anything else but the invocation of the audi alteram partem rule.

28. The parallel processes of the criminal, civil and enquiry proceedings will not hamper or hamstring the enquiry itself. If the Court decides to suspend or remove the first respondent from the roll of Attorneys, the other processes can still proceed independently of each other . The first respondent will suffer no prejudice at all because consideration will be taken of the outcome of any proceedings already finalised, whichever comes first.

29. I have already dealt with the aspect pertaining to the first respondent's practise without a Fidelity Fund Certificate above. For

as long as the first respondent has not been removed from the roll of Attorneys, he is regarded as being still in practice. The fact that the first respondent might have voluntarily stopped practising is of no moment and effect. The fact is that he has been practising without a Fidelity Fund Certificate.

30. In the circumstances, all the points in limine raised by the first respondent are dismissed with costs.

TJ RAULINGA

JUDGE OF THE GAUTENG HIGH COURT

DIVISION

APPEARANCES

For the Applicant:

Mr L. Groome

Instructed by:

RW Attorneys

For the First Respondent : Adv. N. Kumalo

Instructed by:

Nkome Inc

[1] 1977 (4) SA 135 (W) at 137

[2] Registrar of Banks v Regal Treasury Private Bank Ltd 2004 (3) SA 560 (WLD).