Constitutional Court dismisses Proxi Smart’s leave to appeal application with costs

September 1st, 2019

The Constitutional Court (CC) has dismissed the application for leave to appeal in the matter of Proxi Smart Services (Pty) Ltd v Law Society of South Africa and Others (CC) (unreported case no CCT114/2019, 5-8-2019) (Mogoeng CJ, Cameron J, Froneman J, Jafta J, Khampepe J, Madlanga J, Mhlantla J and Theron J). In late 2016 it came to the attention of the Law Society of South Africa (LSSA), including its constituent members, the Legal Practitioners’ Fidelity Fund (LPFF) and other interested parties that Proxi Smart sought to render certain conveyancing related services, which are currently exclusively performed by conveyancers – who are regulated by the Legal Practice Council.

Proxi Smart Services planned to perform certain ‘non-reserved’ or ‘administrative’ conveyancing-related services. The LSSA contends that Proxi Smart’s attempt at creating a distinction between ‘reserved work’ and ‘non-reserved work’ has no basis in law, and that the full conveyancing process is regarded as professional work performed by conveyancers. The view of the LSSA is that the proposal by Proxi Smart cannot be supported as the full conveyancing process is regarded as reserved work and should remain so in the interest of the public.

An application to the Gauteng Division of the High Court in Pretoria, which the LSSA opposed, was subsequently served on the LSSA for an order to the following effect: Declaring that the steps in the transfer process identified by Proxi Smart do not contravene the Attorneys Act 53 of 1979, the Legal Practice Act 28 of 2014, the Deeds Registries Act 47 of 1937 and the Regulations made under the Deeds Registries Act and that it does also not constitute the performance of conveyancing work reserved to attorneys or conveyancers.

In Proxi Smart Services (Pty) Ltd v Law Society of South Africa and Others 2018 (5) SA 644 (GP), Proxi Smart brought an application for declaratory relief concerning the lawfulness of its business model for performing the administrative and related services pertaining to property transfers that it contended was not by law reserved to conveyancers or legal practitioners. Judgment was delivered in favour of the respondents. Although the application was dismissed on technical grounds, the judges set out their views on the merits clearly. According to the court, the proposed model, was based on supporting documents that may be required to be lodged in a ‘typical transfer of immovable property’ involving the sale by private treaty of a freehold property. ‘This ignores the fundamental reality that every property transaction is unique and is not typical’ (para 17). The court held that the applicant did not make a case for the relief it sought and dismissed the application with costs.

In mid-2019 Proxi Smart approached the CC for leave to appeal the judgment by the High Court and the subsequent dismissal of its application for leave to appeal by the Supreme Court of Appeal (SCA). The SCA dismissed the application for leave to appeal in the matter of Proxi Smart Services on 7 May on the basis that there is no reasonable prospect of success in an appeal and there is no other compelling reason why an appeal should be heard.

In early August the matter was dismissed by the CC as it concluded that ‘given the procedural insufficiencies in the applicant’s case, it is not in the interests of justice for this court to adjudicate this issue on these papers’. The LSSA hopes that the order of the CC brings the matter to conclusion.

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This article was first published in De Rebus in 2019 (September) DR 3.