SCA has limited powers to interfere with the decisions of a trial court

December 1st, 2021
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Heppell v Law Society of the Northern Provinces (SCA) (unreported case no 1096/16, 22-9-2017) (Shongwe AP (Mokgohloa, Gorven and Ploos van Amstel AJJA concurring))

In the case of Heppell, the Supreme Court of Appeal of South Africa (SCA) dismissed an appeal by attorney, Warrick Lesley Visser Heppell (the appellant), on the basis that it had found that he did not disclose critical information when he was applying for his sequestration.

Background

The appellant was admitted as an attorney on 7 May 1991 and became a member of the provincial law society. He ceased to practice as an attorney on 30 May 2007 but remained on the roll of attorneys as a non-practicing attorney. He ventured into business and formed a close corporation, traded in liquor, and became a property developer and signed several suretyships for debts of close corporations.

Due to the unstable economic climate the businesses did not do too well. The appellant eventually sold all that he had at a loss and decided to practise law again. He practised as an attorney from 1 September 2010, because he could not cope with all his financial responsibilities while in business. He decided to approach the court with an application for the voluntary surrender of his estate, which order was granted on 11 January 2012. After the appellant had been sequestrated, the then Law Society of the Northern Provinces (the respondent), instructed a legal officer of its Monitoring Unit, Magda Geringer, to investigate the circumstances that led to the appellant’s sequestration.

Ms Geringer’s finding were that the appellant did inform the provincial law society during August 2011 that he was contemplating applying for the voluntary surrender of his estate and that the appellant did not have complaints that had been lodged against him regarding the trusts funds and that there appeared to be no risks for the then Attorneys Fidelity Fund (AFF) and in her opinion the appellant was a fit and proper person to practise as an attorney. After the appellant’s successful application for the acceptance of the voluntary surrender of his estate, the respondent incorporated in terms of s 56 of the now repealed Attorneys Act 53 of 1979 (the Act), commenced an investigation into the appellant’s fitness to remain in practice.

The Investigative Committee of the Council of the Law Society of the Northern Provinces (the Council) concluded that the appellant was guilty of unprofessional or dishonourable or unworthy conduct and was no longer a fit and proper person to continue to practise as an attorney. The respondent was motivated by the provisions of s 22(1)(e) of the Act, which provides as follows:

‘22. Removal of attorneys from roll –

(1) Any person who has been admitted and enrolled as an attorney may on application by the society concerned be struck off the roll or suspended from practice by the court within the jurisdiction of which he or she practises –

(e) if his or her estate has been finally sequestrated and he or she is unable to satisfy the court that despite his or her sequestration he or she is still a fit and proper person to continue to practise as an attorney.’

After several consultations and a formal inquiry, the committee concluded that the appellant had been dishonest in his application for voluntary surrender and failed to disclose material facts, as he was obliged to do. It found among others that he misrepresented his liabilities under oath to the High Court as amounting to R 146 000, while in fact, when suretyships were included, they amounted to approximately R 20 million. The appellant had also failed to disclose that he was a practising attorney and misled the High Court concerning his monthly income and failed to disclose the type of marriage he had entered. The appellant’s explanation at the time was that his attorney had drafted the founding affidavit and that he signed it without properly checking whether the content was correct or not. The Council at the provincial law society concluded that the appellant could not be regarded as a fit and proper person to practise as an attorney and resolved to refer the matter to court, hence the application to have the appellant’s name struck off the roll of attorneys, and alternatively to have him suspended from practising as an attorney. The court a quo (Gauteng Division of the High Court in Pretoria) conclude that the appellant was not a fit and proper person to remain on the roll of practising attorneys ‘without any form of sanction’, this conclusion was based on the proven facts.

The appellant, however, contended that –

  • he did not contravene any of the sections of the Act or rules of the provincial law society;
  • there was no complaint lodged against him relating to his practice as an attorney;
  • he had no shortfall in his trust account; and
  • he did not contravene any of the provisions of the Insolvency Act 24 of 1936.

He stated that he was not an insolvency practitioner and, therefore, not acquainted with applications for voluntary surrender and that he relied on his attorney. The provincial law society argued that voluntary surrender applications required an even higher level of disclosure.

Judgment by the SCA

In essence, the SCA said that the issue before it, was whether the court was correct in finding that the appellant is not a fit and proper person to practise as an attorney and, if so, whether the sanction imposed should be interfered with on appeal. The SCA when embarking on a three-stage inquiry, said that the appellant failed to disclose that he had signed a suretyship with his creditors and instead of admitting the fact that he did not disclose suretyships he prevaricated and mounted a misconceived defence of why he failed to do so. The SCA added that in its view, it was irrelevant whether the suretyships had been called on – their disclosure would certainly have affected the benefit to creditors. That the suretyships amounted to an approximate R 20 million, and such failure to disclose is a contravention of the general principle including the failure to disclose these suretyships amounted to misrepresentation of the appellant’s liabilities.

With regard to him signing the documents without reading them, the SCA pointed out that an attorney’s duty, among others, is to advise his clients not to sign documents without reading and understanding them, but the appellant did the opposite. The SCA said that the appellant’s evidence is tantamount to perjury. The court said the gravamen of the case essentially was whether he was a fit and proper person to remain on the roll of attorneys. The SCA added that in terms of s 22(1)(e) of the Act, the appellant bears the onus of satisfying the court, despite his sequestration, he is still a fit and proper person to continue to practise as an attorney.

The SCA pointed out that counsel for the appellant concealed during the hearing of the matter that, in this case it cannot be said that the court below exercised its discretion capriciously nor that it failed to bring an unbiased judgment to bear. The SCA added that the counsel attacked the exercise of the court’s discretion on the basis that it exercised its discretion on a wrong principle or as result of a material misdirection. The SCA said that it was unclear from the submission what the wrong principle was.

The SCA pointed out that the appeal court has limited powers to interfere with the decision of the court below and referred to the following matter, Malan and Another v Law Society, Northern Provinces 2009 (1) SA 216 (SCA) at para 12. Shongwe AP said that the SCA has on numerous occasions decided that this discretion is a strict discretion, meaning that the court of appeal will not interfere if the discretion was exercised judicially (see Mabaso v Law Society, Northern Provinces, and Another 2005 (2) SA 117 (CC) at para 20 and Giddey NO v JC Barnard and Partners 2007 (5) SA 525 (CC) at para 20). Shongwe AP pointed out that he was unable to conclude that the court below exercised its discretion capriciously or that it based its judgment on a wrong principle. Shongwe AP, therefore, said that the court found, correctly so that the appellant is not a fit and proper person to practise as an attorney.

In the question of whether the sanction of suspension was appropriate in the circumstances of the case. Shongwe AP, pointed out that this too, was a matter for the discretion of the court. He added that the court exercises discretion depending on the degree and severity of the misconduct. Shongwe AP said in the present case the court found that the appellant was ‘at least grossly negligent’, however, acknowledged that there was merit in the provincial law society’s contention that the appellant was dishonest. Shongwe AP added that the court motivated the suspension on the basis that the appellant should be given the opportunity to rehabilitate himself, and to do so, it held that he needed time to reconsider his unprofessional conduct while on suspension.

Shongwe AP said that the period of suspension will indeed be an opportunity for the appellant to reconsider and change his ways and that the appellant’s absence from practise will of necessity protect the public more than punishing him, in as much as he will think twice before committing the same act of misconduct. Shongwe AP found that there was no basis to interfere with the exercise of the discretion of the court.

The appeal was dismissed with costs on the attorney and client scale.

Dissenting judgment

Majiedt JA on a separate judgment said although he agreed with judgment by Shongwe AP, it was necessary that he wrote on certain less than satisfactory aspects of the approach adopted by the High Court. Majiedt JA said that it bears repetition and special emphasis that in her detailed report, Ms Geringer, made no negative findings whatsoever against the appellant, as far as his practice as an attorney was concerned. On the contrary, she alluded to his unblemished professional record, in particular his handling of his trust account.

Majiedt JA said that the High Court rightly concluded that the offending conduct did not warrant a striking off, but some form of sanction was necessary. Majiedt JA added that it bears emphasis that, as Shongwe AP pointed out, the crux of the High Court’s finding was that the appellant had been ‘at least grossly negligent in his failure to make a full and proper disclosure to the court in his application for the surrender of his estate’.

Majiedt JA said that the court failed to enunciate and follow the correct approach, but it also neglected to consider suspending the appellant’s suspension from practice. Majiedt JA pointed out that such an order of suspension could have been made for a period of, say, three years appropriate conditions (for example, on a condition that, during the period of suspension, the appellant not be found by a court or by the provincial law society to have failed to make material disclosure (either deliberately or negligently, whether on his behalf or on behalf of his client). Majiedt JA pointed out that the sanction of that type was competent and would, in his view, arguably have served to protect the public more than a suspension from practice for six months. However, Majiedt JA said that he was mindful of the limited power of the SCA to interfere with the discretion of a trial court in matters such as these.

Majiedt JA said in his view it would have been of adequate severity to have penalised the appellant for his reprehensible conduct and would simultaneously have served to protect the public. Majiedt JA concluded the summary by saying that while the High Court’s underlying reasoning for the sanction imposed and sanction itself are rather unsatisfactory, there are not sufficient grounds on which to interfere with the exercise of its discretion.

Kgomotso Ramotsho Cert Journ (Boston) Cert Photography (Vega) is the news reporter at De Rebus.

This article was first published in De Rebus in 2021 (Dec) DR 31.

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