Follow up: Unethical Lawyers and the Dangers of Working with them

We previously posted an article titled “Unethical lawyers and the dangers of working with them”. To recap it should be noted that our client received “an order equal to 4 months’ salary” which amounted to R 120 000.00 at the CCMA, based on an unfair dismissal dispute. Our client then approached us to enforce the arbitration award. While the Sheriff was attaching the goods, a security bond was handed to him. We could therefore no longer remove the goods and had to oppose the employer’s application to review the arbitration award. The security bond claimed that an amount of R 120 000.00 was held in trust by the Employer’s attorneys; we therefore could not proceed to sell the goods. After receiving a copy of the security bond from the sheriff, and upon further inspection of the security bond, we noticed that the document contained a few irregularities. After numerous attempts to contact the “lawyer” listed on the security bond, we realised that we had no other option but to contact the Law Society.

We have since received proof from the Law Society that the abovementioned “attorney” was indeed suspended in February 2016 and struck off the roll in August 2016, in terms of a court order granted by the High Court of South Africa (Gauteng Division, Pretoria).

The attorney was suspended in February 2016. During this hearing a rule nisi order was granted and the attorney was ordered to return to court in August 2016 to show cause why he should not be removed from the Roll of Attorneys. He was further ordered to deliver his Certificate of Enrolment as an Attorney to the Registrar of the Honourable Court. The court then also appointed a curator bonis to administer and control all trust accounts of the Respondent. This curator bonis was ordered to immediately take possession of the Respondent’s accounting records, files and documents. The court also ordered that the Respondent/Attorney be removed as executor of any estate, curator or guardian of any minor or other person’s property, trustee of any insolvent estate, liquidator of any company, trustee of any trust, liquidator of any close corporation, and administrator appointed in terms of section 74 of the Magistrates Court Act, No 32 of 1944. The Respondent was also ordered to pay the reasonable costs of the inspection of the accounting records of the Respondent, the reasonable fees of the auditor engaged by the Applicant, the reasonable fees and expenses of the curator, the reasonable fees and expenses of any person consulted and/or engaged by the curator, the expenses relating to the publication of the order as well as to pay the costs of the application.

The attorney was struck off the roll in August 2016.He was again ordered to deliver his Certificate of Enrolment as an attorney to the Registrar of the Honourable Court. He was prohibited from handling or operating his trust accounts.

Our office has since sent a letter to the former employer of our client to inform it that their attorney has been struck off the roll since 2016. We informed the employer that this attorney represented them at the arbitration hearing in 2017, but that this was contra to the court order. We further informed the employer that the attorney also signed its security bond in January 2018, which stated that the money was to be held in trust until the review application was finalised. This was also contra to the court order. We advised the employer that their attorney thus had no capacity to act on their behalf and if he indeed did accept the arbitration award money of R 120 000 into his trust account, this would constitute fraud and possibly money laundering.

We went on to state that it was highly unlikely that the employer did not know that their attorney was struck off the roll – and that if it did know it would be an unlawful act from their side to not have disclosed this to us. We informed the employer that our client also has the right to lay fraud and/or money laundering claims against the Director of the Company.

We gave the employer three business days to pay, not only the arbitration award, but also our client’s legal costs.

It is therefore clear that the courts do not take mercy on unethical lawyers. It should however be noted that the Attorneys Fidelity Fund only insures trust monies up until the date on which an Attorney gets struck off the roll. The portion of the matter affecting our client happened in 2017/2018 and the attorney was struck off the roll in 2016. Therefore, we cannot retrieve our client’s money from the Fidelity Fund if the R 120 000.00 was indeed was paid into trust and we will have to obtain payment directly from the employer, either by it offering to pay us directly or by our firm again issuing a writ to attach its movable property to satisfy our client’s claim. Should it come to that, we may be able to claim from the attorney in his personal capacity through a civil matter and institute criminal proceedings against him.

Let this be a lesson to all: Do not use unethical lawyers, it may have unintended consequences. This is not only applicable to the lawyer but also to his clients!