South African Legal Practice Council v Majola (2260/2019) [2021] ZAECGHC 82 (7 September 2021)

IN THE HIGH COURT OF SOUTH AFRICA

(EASTERN CAPE DIVISION, GRAHAMSTOWN)

Case No: 2260/2019

In the matter between:

THE SOUTH AFRICAN LEGAL PRACTICE COUNCIL Applicant

And

MZWABANTU CROMWELL MAJOLA Respondent

JUDGMENT

BESHE J:

[1] This matter concerns an application by the South African Legal Practice Council (the Council) to strike the respondent’s name from the roll of attorneys. The applicant also seeks an order directing the applicant to cancel the enrolment of the respondent as an attorney as envisaged in Section 31 (1) (a) of Legal Practice Act[1] (henceforth referred to as the LPA). Ancillary orders flowing from striking of respondent’s name from the roll of attorneys, should same be granted, are also sought.

[2] In terms of Section 4 of the LPA, the applicant is a body corporate with full legal capacity, and exercises jurisdiction over all legal practitioners and candidate legal practitioners. The following are some of the Council’s objectives:[2]

promote the public interest;

enhance and maintain the integrity and status of the legal profession;

determine, enhance and maintain appropriate standards of professionalism and ethical conduct of all legal practitioners and all candidate practitioners;

give effect to the provisions of this Act in order to achieve the purpose of the Act.

[3] The LPA was preceded by the Attorneys Act,[3] which has now been repealed. In terms of the Attorneys Act, the Council of the Cape Law Society had the authority to discipline amongst others, attorneys practising in the area formerly known as the Cape of Good Hope – being the Northern Cape, Western Cape and Eastern Cape. In terms of the LPA, the Cape Law Society became the Western Cape Provincial Office of the South African Legal Practice Council. These proceedings were initiated by the Cape Law Society before its dissolution. Section 116 (2) of the LPA provides that any proceedings in respect of the suspension of any person from practice as an advocate, attorney, conveyancer or notary or in respect of the removal of the name of any person from the roll of advocates, attorneys, conveyancers or notaries which was instituted in terms of law repealed by the LPA and which had not been concluded must be continued and concluded as if that law has not been repealed.

[4] The respondent is Mr Mzwabantu Cromwell Majola (Majola), a duly admitted attorney who practised for his own account as MAJOLA ATTORNEYS INCORPORATED at 17 Prince Alfred Street, Queenstown. He was admitted as an attorney of this court on 5 September 2013. The respondent was interdicted from practising as an attorney of this court on 30 January 2018, pending this application. Namely to remove his name from the roll of attorneys[4].

[5] I have already alluded to some of the objectives of the Council which include the promotion of high standards of professional practice and ethical conduct of all legal practitioners. The Council is empowered to do all things necessary for the proper and effective performance of its functions or the exercise of its power.[5]

[6] Section 31 (1) (a) of the LPA provides that:

“The Council must cancel or suspend the enrolment of a legal practitioner if the High Court orders that his/her name be struck off the roll or that he/she be suspended from practice.”

It is in line with this prescript that the Council launched this application.

[7] Ms Janine Kim Myburgh (Myburgh), a member of Legal Practice Council deposed to an affidavit in support of this application. The following emerge from Myburgh’s affidavit:

Two complaints regarding respondent’s conduct were received by the Cape Law Society from Mr T Dani and Ms N. P. Maphelana. In respect of the Dani matter, the respondent acted for the sellers in respect of an immovable property Dani sought to purchase. An amount of R1 350 000.00 was paid to the respondent as part of the purchase price for the property on 27 October 2014. The sale was however cancelled. Despite repeated demands, respondent failed to pay Dani’s money. Legal action relating to the matter was still pending at the time of institution of these proceedings.

In the Maphelana matter, the respondent assisted Maphelana with the sale and transfer of her residential property. An amount of R250 000.00 being the purchase price in respect of the property, was paid into the respondent’s trust account on 8 December 2014. The respondent only tendered payment of part of the amount being R80 000.00.

[8] Having received these complaints, applicant made enquiries with the respondent’s banker, First National Bank, only to learn that the balance in respondent’s trust account was R9.87.

[9] On 10 April 2017, a further complaint was received from an attorney who was acting on behalf of Crankshaw Brothers Trust (Crankshaws). The complaint was supported by a number of documents. In respect of this matter, Crankshaws, who owned an immovable property in Queenstown entered into a Deed of Sale with the South African Bible International Church (the Church) to purchase the said property for R2 100 000.00. An associate of the respondent, Mr Jaco van Jaarsveld was appointed as the conveyancer for the transfer according to the Deed of Sale. On the 15 March 2017 the respondent rendered a statement of account to Crankshaws reflecting two payments of R400 000.00 and R1 624 223.34 respectively, having been made in respect of the property. The Crankshaws only received the R400 000.00 and not the R1 624 223.34. On the 24 March 2017 Van Jaarsveld in an email addressed to Crankshaws stated that a sum of R1 700 000.00 that was paid by the Church was erroneously paid into a fixed account and the funds would be available by 27 March 2017. This is also the date on which the transfer of the property was registered. On 31 March 2017 four cheques, three for R500 000.00 and one for R124 223.34 were deposited into Crankshaws’ account by the respondent. All the cheques were rejected by the bank and marked “refer to drawer”. No payment was made by the respondent be it on the date he undertook to make payment, the 14 April 2017, which undertaking was rejected by Crankshaws or the 9 April 2017 being the date on which the Crankshaws demanded that the payment should be made.

[10] As a consequence of the failure by the respondent to pay the outstanding amount from the purchase price of the property, the Crankshaws instituted action against the respondent and van Jaarsveld out of this court. Both filed a notice of intention to defend the action. The Crankshaws launched an application for summary judgment. It was only van Jaarsveld who filed an opposing affidavit resisting the summary judgment application. This resulted in a summary judgment being granted against the respondent in favour of the Crankshaws in the sum of R1 624 223.34. In the course of subsequent sequestration proceedings against the respondent, the trustees of respondent’s estate established that respondent, as sole director of Majola Attorneys (Pty) Ltd, had a business account held by Nedbank Queenstown. The account had a balance in excess of R1 700 000.00. The money owed to the Crankshaws was paid from monies held in this Nedbank account after it was attached by those acting for the Crankshaws.

[11] It is asserted on behalf of the applicant that based on the abovementioned complaints, the respondent has abused his position as an attorney to enrich himself. That by so doing he made himself guilty of dishonourable and disgraceful conduct. And that he is not a fit and proper person to practice as an attorney of this court.[6]

[12] Respondent admits that his firm handled the transactions involving the immovable properties which gave rise to the three complaints concerned. He however denies that he is not a fit and proper person to practice as an attorney.

[13] Regarding the Maphelana matter, it is not altogether clear whether monies due to Ms Maphelana were ultimately paid to her. Respondent denies that Maphelana’s complaint concerned failure on his part to pay her the money that was due to her and asserts that it concerned the delay in the registration of the transfer of the property. According to Ms Maphelana, her residential property was sold for R250 000.00. That amount was paid by the purchaser into the respondent’s trust account. However, respondent only tendered payment of the sum of R80 000.00 to her and not the full purchase price. This also appears from Ms Maphelana’s letter to the Council’s predecessor, the Cape Law Society dated the 25 October 2015. Whilst it is clear that Ms Maphelana is complaining about the delay by the respondent to pay her, she also complains about the balance that is still owing to her. According to her, after the registration of the transfer of the property, instead of the respondent paying the purchase price of the property to her, he told her they could lend her R50 000.00 which they paid to her on the 28 December 2014. She further states that she only got the next payment of R30 000.00 on the 20 October 2015. And that she would like the balance of the purchase price paid to her. So, it is not accurate to say she is complaining about the delay in paying the monies over to her, but also the non-payment of the balance of the purchase price due to her. It is also not clear, and the respondent does not explain why the amounts were paid in small sporadic payments.

[14] The Dani matter: Respondent states that the matter “is under dispute and lies before the High Court”. He goes on to state that Mr Dani as the purchaser failed to comply with the sale agreement resulting in the agreement being cancelled. That the seller declined to pay Mr Dani’s deposit, claiming it served as damages for breach of the sale agreement. However, in the same breath, respondent states that the deposit paid by Mr Dani (the purchaser) is held in the firm’s trust account with Nedbank pending the decision of the High Court. Indeed, it could not have been deposited in respondent’s trust account held with the First National Bank. This is so because, according to Ms Myburgh, following the complaints against the respondent, the First National Bank account only held a balance of R9.87.

[15] Respondent’s response to the Crankshaws complaint is briefly the following:

An amount of R1 624 000.00 was deposited by the Church into his trust account. Mr van Jaarsveld, whom he had employed to assist him with conveyancing, suggested that the money be transferred to an interest bearing account for the benefit of the Crankshaws. To this end, van Jaarsveld sought and obtained the Crankshaws’ permission to do so. Instead of the amount being deposited into an identified Nedbank Corporate Saver account, respondent states that he instructed his firm’s auditors to attend to the investment and caused the amount of R1 624 223.34 that had been deposited to his trust account by the Church, to be deposited into his auditors, S & L Consultants’ account. He was advised that the auditors had deposited the money into Nedbank Corporate Saver account. Later though, one Lindelwa Ndabeni from the auditor’s firm informed them that the amount had erroneously been deposited into a fixed account managed by S & L Consultants.

After the transfer of the property was registered, Ndabeni provided him with four cheques totalling R1 624 223.34 which he in turn deposited first into the firm’s trust account and then issued them to the Crankshaws.

We now know that the cheques were dishonoured by the bank. According to the respondent, attempts to obtain the money from S & L Consultants came to naught as it turned out that the proof of payment provided by the said consultants was fraudulent. Respondent does not explain why it was necessary to deposit the money paid by the Church into an interest bearing account and not keep it in the respondent’s trust account. This in view of the short timeline of Crankshaws’ transaction which is the following:

The Deed of Sale and Addendum thereto was signed on the 7 September 2016 and 7 November 2016 respectively. On 15 March 2017 the respondent rendered a statement of account to the Crankshaws reflecting two payments viz R400 000.00 and R1 624 223.34. Only the payment of R400 000.00 was received by the Crankshaws. On 27 March 2017 the transfer of the property was registered. On 31 March 2017 the valueless cheques were deposited into Crankshaws’ account. It would seem the money would have been in the interest bearing account for less than a month. In any event, it is denied that purchaser gave authorisation for the monies to be deposited into an interest bearing account.[7]

[16] According to the respondent, he has instituted action against S & L Consultants to recover monies stolen from him. No details about this action were provided by the respondent though.

[17] Regarding the account he held with Nedbank which had a balance in excess of R1 700 000.00 which amount was subsequently used to pay monies owed to Crankshaws in full, respondent proffers to following explanation:

The balance comprised of amounts paid to him by Messrs A C De Souza Inc. for work he carried out in respect of a number of motor vehicle accident matters on behalf of the said firm of attorneys. It was also made up of an overdraft facility the bank provided to him. He further states that this enabled him to pay monies due to the Crankshaws. But, we do know that the payment to the Crankshaws was only possible because:

(i) The Nedbank account was discovered / unearthed by the trustees of the respondent’s estate.

(ii) The amount owing to the Crankshaws was then attached from the account.

The payment was not, as respondent seems to suggest, made by him voluntarily or on his own.

[18] In reply, applicant retorts that S & L Consultants are not on record as having been respondent’s auditors at any stage. The amount paid by the A C De Sousa was in respect of Road Accident Files respondent sold to the A C De Sousa.[8] According to Mr De Sousa, the respondent offered to sell his RAF files as he urgently needed R1 700 000.00 in order to settle a debt he incurred as a result of monies having been misappropriated from his trust account by his conveyancing attorney. Respondent made this proposal to him during July 2017. It is also noteworthy that after receipt of payment from A C De Sousa on the 10 July 2017, the following payments were made from the account in question on the same day payment was received:

Mr Jaco van Jaarsveld’s salary in the sum of R50 000.00.

Electricity R800.00.

Airtime R200.00.

On the following day, the 11 July 2017 a payment in the sum of R1 635.00 was made to Take-a-lot.

No payment was made to Crankshaws.

[19] The respondent does not seem to have been completely frank as to how it came about that he was owed by A C De Sousa Inc. / Attorneys. His version in this regard is disputed by Mr De Sousa.

[20] The matter was initially set down for hearing on the 26 November 2020. It was however postponed to the 3 February 2021 at the instance of the respondent. Once again on the 3 February 2021, respondent sought a postponement to the 24 March 2021 for the availability of his counsel. On the 24 March 2021 there was no appearance by either the respondent or his counsel. We however had the benefit of heads of argument filed on his behalf.

[21] Even though not pertinently raised as a point in limine in his opposing papers, respondent complains that Ms Myburgh’s affidavit is defective in that the full names of the Commissioner of Oaths do not appear therein, and whilst it is stated that it was signed and sworn to at Bellville, the Commissioner’s stamp reflects the Commissioner’s address as being Somerset West. Subsequent to the filing of respondent’s heads Ms Myburgh deposed to an affidavit explaining that she appeared before Mr Martin Jones in his offices in Bellville for purposes of having the founding affidavit commissioned. That, due to the fact that their offices were under lockdown due to Covid-19, she could not obtain a confirmatory affidavit from him. I am satisfied that there has been sufficient compliance with the requirements for the commissioning and attestation of affidavits in this regard.[9] The same applies to respondent’s complaint that in the founding affidavit Ms Myburgh makes averments based on what she heard from a Mr Jaco van Jaarsveld, yet the person who deposed to a confirmatory affidavit in this regard in Mr Willem Jacobus van Jaarsveld. I have no difficulty, judging from the facts of the case and the content of the affidavits in question that Jaco van Jaarsveld and Willem Jacobus van Jaarsveld refers to the same person.

[22] In argument, respondent also complains that these proceedings are not properly before court in view of the fact that the procedure laid down in Section 38 of the Legal Practice Act for dealing with complaints against legal practitioners has not been followed.

[23] The answer to this complaint can be found in Section 116 (2) of the Legal Practice Act. I have referred to this provision earlier in this judgment.[10]

[24] Regarding the merits, respondent suggests that he had adequately explained what happened in respect of all three complaints against him. That the explanations he gave have not been gainsaid by the applicant. Once again, he takes the issue as he did regarding Mr Jaco van Jaarsveld that Mr Tony de Sousa who is mentioned in Ms Myburgh’s affidavit and yet the confirmatory in respect of Mr de Sousa is deposed to by Mr Antonio Christine de Sousa. There is no merit in these objections, that have only been raised in argument. In any event, in my view, even if the affidavits in question can be disregarded, there is enough evidence regarding the three complaints in question. Respondent argues that there is no evidence that he is not a fit and proper person to practice as a legal practitioner. Further that there is no evidence that he is guilty of dishonesty. In the alternative, it was argued that if the court was not so satisfied, an appropriate sanction would be a suspension and not the striking off his name from the roll of attorneys.

[25] In Jasat v Natal Law Society[11]. It was stated that applications of this nature involve a three-stage enquiry:

“First the court must decide whether the alleged conduct has been established on a preponderance of probabilities, which is a factual enquiry.

Second, it must consider whether the person concerned “in the discretion of the court is not a fit and proper person” to continue to practice. This involves the 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 and order of suspension from practice would suffice.”

[26] Has the conduct complained of been established on a preponderance of probabilities? There are three complaints against the respondent. The first two complaints date back to 2014. The Crankshaw complaint was received during 2017. All three relate to property transfer transactions. The respondent did not pay the complainants therein monies due to them. Ms Maphelana only received part-payment. The Crankshaws were paid as a result of a Nedbank account held by the respondent being discovered by the liquidators during the sequestration process. In respect of Ms Maphelana, it was a year after the transfer of the property she was selling was registered that she was partly paid. The common thread in all three matters is that the respondent did not pay the complainants monies due to them. Monies that had been paid to him. He in turn was to pay those monies to those they were meant for. In respect of all three complaints, the amounts could not have been in his trust account where they were supposed to be. Following the Dani and Maphelana complaints, respondent’s Nedbank Account only had a balance of R9.87. We know by his own admission the amounts paid by the Church for onward transmission to the Crankshaws were transferred to a Nedbank Corporate Saver interest bearing account not his trust account. The explanation proffered by the respondent about what happened to the money leaves much to be desired. It leaves more questions than provide answers. It is not clear why respondent considered it prudent or necessary to deposit the money in an interest bearing account given the short time within which he would have been required to pay it over to the Crankshaws. There is evidence the S & L Consultants were never respondent’s auditors on record during the years 2014 – 2017. It is also noteworthy that there are no details provided regarding the summons allegedly issued against S & L Consultants by the respondent. There is also not a shred of evidence regarding the movement of the money between his firm and S & L Consultants. The business account held with Nedbank by the respondent was only discovered by the trustees of his estate. The amount paid by De Sousa Inc. was also paid into that account. I am satisfied that the respondent failed to deal properly and legitimately with monies entrusted to him, and he has sought to enrich himself therewith.

[27] In the circumstances, can it be said that the respondent is a fit and proper person to practice as a legal practitioner if he deals with moneys entrusted to him by members of the public in this manner? Can it be said that he has been open and has made a full disclosure about what came of monies he held on behalf of the complainants? In my view, he did not. Unfortunately his conduct or the manner in which he dealt with his clients’ monies has been found wanting on more than one occasion. The respondent has not accepted responsibility in respect of all three complaints. He has sought to blame S & L Consultants in respect of the Crankshaws matter, to some extent even Mr van Jaarsveld. He also sought to impugn affidavits filed by Ms Myburgh, relating to the commissioning therefore, her reference to Mr van Jaarsveld as Jaco instead of using his full names as well as referring to Mr de Sousa as Tony instead of Antonio. This, he only raised in argument. He sought to have confirmatory affidavit by Messrs van Jaarsveld and de Sousa regarded as pro non scripto. Yet he knows fully well that Jaco and Jacobus van Jaarsveld is the same person given that van Jaarsveld was his employee. He also complained about the Council’s failure to hold a disciplinary hearing concerning the complaints in terms of Section 38 of the LPA. He mounted all these challenges, raising technical issues instead of dealing with the complaints against him. I am not persuaded that respondent is a fit and proper person to practice as legal practitioner.

[28] Much as it is unfortunate to cut short a person’s chosen vocation, in respect of which it took many years of study and resources to achieve, it is in the interest of the public that the erosion of professional ethics or unethical, unbecoming conduct be nipped in the bud. In my view, the only sanction that is appropriate is that of striking the respondent’s name from the roll of attorneys.

[29] Accordingly, there will be an order in terms of the draft marked ‘A’.

N G BESHE

JUDGE OF THE HIGH COURT

ROBERSON J

I agree.

J M ROBERSON

JUDGE OF THE HIGH COURT

APPEARANCES

For the Applicant : Adv: K Watt

Instructed by : N N DULLABH & CO.

5 Bertram Street

GRAHAMSTOWN

Ref: Mr N Dullabh

Tel.: 046 – 622 6611

For the Respondent : NO APPEARANCES

Date Heard : 24 March 2021

Date Reserved : 24 March 2021

Date Delivered

: 7 September 2021

[1] Act 28 of 2014.

[2] The objectives of the Council are listed under Section 5 of the LPA.

[3] Act number 53 of 1979.

[4] Court Order marked FA I page 20 of indexed papers.

[5] Section 6 (1) (b) (iii) of the LPA.

[6] Section 24 (2) (c) provides that: 24 Admission and enrolment (1) … … … (2) The High Court must admit to practice and authorise to be enrolled as a legal practitioner, conveyancer or notary or any person who, upon application, satisfies the court that he or she ̶ (a) ... ... ... (b) … … … (c) is a fit and proper person to be admitted.

[6] Section 24 (2) (c) provides that: 24 Admission and enrolment

(1) … … …

(2) The High Court must admit to practice and authorise to be enrolled as a legal practitioner, conveyancer or notary or any person who, upon application, satisfies the court that he or she ̶

(a) ... ... ...

(b) … … …

(c) is a fit and proper person to be admitted.

[7] Paragraph 7.3 of the replying affidavit page 93 of the indexed papers.

[8] See affidavit by Mr Antonio Christine De Sousa page 101 of the indexed papers.

[9] The Regulations issued in terms of Justice of the Peace and Commissioners of Oaths Act 16 of 1963.

[10] Paragraph [3] above.

[11] 2000 (3) SA 44 (SCA) at 5. See also General Council of the Bar v Geach 2013 (2) SA 52, Law Society, Northern Province v Mogami 2010 (1) SA 186.