The Department of Justice and Constitutional Development (the Department) continued to take Members through the draft of 24 July of the Legal Practice Bill, from clause 56. It was emphasised that what was being presented and suggested remained suggestions only, and no final decisions had been taken.
In relation to clause 56, Members debated whether there should be reference to advocates who took out Fidelity Fund (FF) certificates and this was linked to clause 34, which stated that in general advocates would be limited to doing the type of work that they had “traditionally: done, and would not be involved in estates, insolvencies, reserved conveyancing and notarial work and RAF work. In clause 57, the definition of “family member” was extended to cover in-laws, and the reference to advocate was removed from some of the sub-clauses, depending on the type of work described. Under clause 58, it was suggested that “subject to availability of resources” should be added in, in view of the financial pressures faced by the current Attorneys Fidelity Fund, and the listing of what it “may” and “must” do was specified. Clause 63 related to the composition of the Board of the Legal Practitioners’ Fidelity Fund (the Fund) and the purpose of the Ministerial representative was confirmed to be largely for communication, which was considered acceptable. The Department would check whether other regulatory accounting bodies needed to be named. The words “where practicable” were to be inserted in relation to the considerations to be taken into account when making nominations, in line with similar provisions relating to other representative bodies. Under clause 64, Members debated the rationale behind interest needing to be paid to the Fund, and thought that perhaps it should be written into the Bill that clients must have the implications of certain investments explained to them by their attorney. Again, the words “as far as practicable” would be inserted into the option under clause 64(5).
Members had a substantial discussion on membership of the board, in clause 65, as linked also to similar wording in relation to offences, and whether “by a court of first instance” should be mentioned. The Chairperson was of the view that the membership of the Board must be completely above reproach, but other Members did not take such a stern view, and the point was made that the Constitution allowed MPs to still be eligible five years after they had been convicted of an offence and served their sentence. Members did feel, however, that there should be provision that a person convicted could be suspended and the designating body asked to designate an alternate, to cover questions of appeal, and optional wording was requested. Comparable provisions in clause 12 related to findings of misconduct, as offences were dealt with under clause 8, and it was agreed that the three should correlate as far as possible.
Provisions relating to the chair and deputy of the Board were aligned with similar ones relating to the Legal Practice Council (the Council), and there had been alignments created in clauses 66 to 69, including, for the latter, an alignment with clause 12. There was a strong motivation to remove a reference to any other misconduct, under clause 69(e) (and for the same to be done in clause 12 and 102) as this could be open to abuse and was vague. In clause 71, it had been clearly specified what the Board must, and what it may do. The chair and deputy chair of the Board would be ex officio chair and deputy, respectively, of Exco. The appointment of chairs to committees of the Board was debated, and it was agreed that one advocate must serve on Exco. Clause 74 was flagged for further discussion. Clause 84 was amended to correct references to State law advisers. It was decided that clause 84(4) would be removed, and the contents transferred to the general offences clause. Words had been added to clause 84(4) at the request of Legal Aid SA. It was confirmed that some of the submissions under this clause arose from lack of appreciation that this Bill applied only to the practising professions. It was necessary to check why the South African Human Rights Commission had been specifically mentioned. In respect of clause 87, there was discussion on whether only documents relating to accounting may be inspected, but a wider reference to other documents would probably sit better under clause 39, which related to discipline, or clause 37, which was not very specific at the moment on what an investigating committee may or may not do. Members decided that the full comparison of what the Bill provided in relation to rules by the Council and regulations by the Minister was needed, before debating Chapter 9.
Members believed that the name of the Transitional Council (TC) should be changed, as it was creating misperceptions, and discussed what the main purpose of this body should be. It was accepted that it was a compromise and was intended to thrash out the issues that the professions had been unable to settle. Questions of representation on that TC were fully debated, including what the advocates’ representation would include, and whether there should be one or two teachers of law; the Committee suggested two, if there was a body representing law teachers as opposed to law deans, and tried to avoid being too prescriptive on the representation. Members were concerned that the transitional periods must coincide so that there was no vacuum, and noted that essentially the forum had 24 months to deal with the work with the possibility of applying for a further one year’s extension. Members were not in favour of the chair being appointed by the Minister, and the proposal was made to have a judge chair the Board, with consequent discussion as to who would designate the judge. Alternatively, the TC could elect its own chair. Members felt that options needed to be drafted, also including the option that if the chair was an attorney, the deputy should be an advocate. Under clause 97, there was a request to draft an option that referred to attorneys’ and advocates’ chambers for the first council, and there was a debate on what the regional councils should look like and whether they must be the same as the Council, with the general feeling that they did not have to mirror them in every respect; this would be clarified by the drafters. It was generally agreed that academics and Ministerial representatives would not be on the regional councils. The purpose of the regional structures was debated, and Members asked for the Bar Rules, to see what might be debated by each chamber. A DA member stressed that it was necessary to split regulation from representation, and that was why separate chambers were logical. The TC would have to look at the Competition Commission’s rulings. The flagging of clause 100 was still noted. Provisions under clause 101 on termination had been brought in line with other provisions, and clause 102 was debated in relation to the serious nature of the offence.
The Committee, which had a quorum, formally confirmed the shortlist for the South African Human Rights Commission vacancy.
Legal Practice Bill: Continuation of Department of Justice and Constitutional Development Briefing
Mr Lawrence Bassett, Deputy Chief State Law Adviser, Department of Justice and Constitutional Development, noted that wherever there was a reference to the Legal Practitioners’ Fidelity Fund (the Fund), the apostrophe would be inserted.
There were no changes to clauses 54 and 55. Most of the chapter was based on existing provisions in the Attorneys Act.
Clause 56: Liability of the Fund
Mr Bassett said that there were consequential amendments to advocates accepting briefs directly from the public. This included the capping – “exceeding the amount determined by the Minister from time to time”. The figure of R5 million had been suggested, but no decision taken on this. The Fund would reimburse those if there was theft of money or property, in the circumstances set out in the three subparagraphs.
Mr Bassett explained that the advocates accepting briefs directly from the public would have to have Fidelity Fund (FF) certificates. He noted that the footnotes dealt with this. Traditionally, advocates would not act as executors or administrators, nor trustees, and asked if the reference to advocate should be removed from (b) and (c).
Ms D Schäfer (DA) pointed out that trustees in insolvent estates could not be advocates or attorneys, and the work was not reserved for them any more.
Mr Bassett added that non-lawyers could administer deceased estates and an advocate could do this work. In the Bill as drafted, the cover for that related to attorneys only.
Mr S Swart (ACDP) pointed out that other professions did not contribute to the AFF, and he agreed with the reference being taken out. There was nothing to prevent an advocate acting in his personal capacity.
Mr Bassett said that advocates taking briefs and getting FF certificates must confine themselves to litigation and court work that they would generally have done in the past. He read out clause 34, which noted that the advocate may only render legal services as rendered before the commencement of the Act, as determined by the Legal Practice Council (the Council) in the rules.
Adv L Adams (COPE) questioned what was meant by “litigation”. It was not always possible to assess what matters would end up in court. A client may only want a legal opinion prior to deciding how to proceed.
Mr Bassett said that the reference to services determined by the Council in the Rules would be covered. Opinions were not necessarily limited to court work, but were traditionally handled by advocates. The non-court work that was traditionally done would be covered.
Adv Adams requested what work it was contemplated that they could not do. Ultimately, the preparatory work may end up in court.
Mr Bassett said that other examples would become apparent as the Committee moved on. At the moment some attorneys’ firms were dealing with investment of moneys.
Mr Raj Daya, Acting Deputy Director-General: Legislative Development, Department of Justice and Constitutional Development, added that it would include notarial and conveyancing work, debt collection, liquidations, RAF claims, but it was necessary to bear in mind that advocates had the right to appear in any courts or tribunals.
Adv Adams said that essentially whatever they had been doing all along would be covered.
Members thought that the word “advocate” could be removed from (b) and (c).
Ms M Smuts (DA) said that the principle would also apply to later clauses.
Clause 57: Limitation of liability of the Fund
Mr Bassett noted that the Fund would not be liable for loss suffered in the circumstances set out in the subparagraphs (1)(a) to (e). The reference to “advocate” was necessary.
Mr Swart thought that a definition of “family member” was needed.
Mr Bassett referred to (e), saying that the question arose whether an advocate should be involved in the work of investing funds. Because that had not traditionally happened, perhaps the reference to “advocate” should be deleted.
Ms D Schäfer (DA) said that this would not refer to an investment practice. A client may brief an advocate directly and ask that the deposit be invested. That should be covered.
Mr Daya agreed, saying that it was not uncommon for advocates to be given retainers. The interest could accrue to the client.
Ms Schäfer said that it must be specified, in the clause, that it would apply only to advocates with FF certificates.
Mr Swart noted that a retainer was not a deposit as it went to the business account. A deposit had to be paid into the trust account.
Mr Daya said that this was correct; a retainer could be used immediately so there was a distinction, and he corrected his use of language.
Ms Schäfer repeated that there had to be a reference to advocates with FF certificates, and Members agreed that the necessary words be added in.
Mr Bassett said that the beginning of clause 54 already referred to the advocate as referred to in clause 34, so it was not necessary to repeat it, but it may be wiser to err on the side of caution and refer to advocates referred to in clause 34(2)(b), despite the fact that it may be cumbersome.
Members confirmed that this should be done.
Mr Bassett moved on to sub-clause (4), which referred back to (1)(e). It did not apply to money where the attorney or advocate acted in a capacity as executor, trustee or capacity.
Members asked that the reference to advocate be removed from sub-clause (4).
Mr Bassett read out sub-clause (5) and Members agreed that the reference to advocates must remain there.
He read out sub-clause (6), which related to money paid into a trust account, with interest to accrue to the benefit of the client pending conclusion of a transaction, if the attorney or advocate exercised exclusive control as trustee, agent or stakeholder.
Ms Schäfer thought the reference to advocate must be excluded.
Mr Daya said that this was a more complex situation, where the moneys were not needed immediately and would be paid to an interest-bearing trust account. The advocate with a FF certificate would have to be included. The Bill was extending cover in this specific instance, except as set out in the last couple of sentences. Deletion of “advocate” would not be correct, but it was mixed up. He suggested that it could be separated out into (a)(i) and (ii). Members agreed and asked that this be done.
Mr Bassett said that subclause (b) related to the giving of effect of a loan agreement.
Ms Schäfer thought that advocates should not be involved in lending money, and so this clause also needed to be split.
Mr Bassett thought that (b) should not refer to advocate at all.
Members agreed with that and asked that it be removed.
Mr Daya expanded that an advocate with a FF certificate could be holding money and attending to a series of transactions. In the course of that, s/he could be instructed to honour an agreement, out of the trust funds being held. Subclause (6) was giving various examples of what would be covered, such as interim payments in conveyancing transactions, lending money to give effect to a loan agreement, but this was different from an investment practice. The Committee could consider this in the broad scope of what it wanted advocates to be doing with trust money, and if this was related to litigation and opinions. The Committee may wish to exclude loan agreement payments for advocates if it wished, and draw the line where the FF certificate cover should extend.
Ms Schäfer agreed that the line should be drawn. Advocates should not be doing what they had not done before. Previously, they had not held deposits to lend money, and the only purpose for which they should be holding money would be in contemplation of litigation.
Other Members agreed, and it was decided that the reference to advocate be removed from (6)(b)(i) and (ii).
Members agreed that the wording of (7) was acceptable.
Mr Bassett said that there was nothing to consider under (8). The reference to advocate would remain in (9).
Mr Bassett noted that the definition of family member, as suggested by Mr Landman, was inserted as a new (10).
Ms Schäfer thought that in-laws should be included.
Mr Swart asked why they should be named. He asked if they were not too distant.
Ms Schäfer replied that they were no more distant than a parent.
Adv Adams questioned whether they would not automatically be included under “parent”.
Mr Bassett agreed that a reference to parents-in-law could be inserted, for the sake of certainty.
Clause 58: Purpose and application of the Fund
Mr Bassett said that there had been changes to (h), where the phrase “to be determined in consultation with the Council” had been added in. In (l), the reference to an advocate had been added in, but this was restricted to a trust account referred to in sections 86(2) and (3), not one under clause 86(4), which was a separate interest-bearing trust account. The Attorneys Fidelity Fund (as presently named, referred to as AFF) had suggested that this must be excluded. In (o) it was now specified that the Fund may be used to pay audit and inspection costs. It was also now specified that the Fund may be liable for paying bursaries and costs. He reminded Members that this was originally in clause 6, but the Members and AFF had suggested that because it was traditionally a task of the AFF, it should be placed here.
Ms Schäfer said that “subject to availability of resources” should be inserted, in view of the financial pressures that the AFF was under at the moment. Maybe that should be at the beginning of the clause.
Mr Bassett agreed, saying that refunding the bank charges was done when there was money available to do it, annually.
The Chairperson said that annual appropriations to the Council, as set out in (j) was another example.
Ms Schäfer said that there were profound funding implications for the Legal Practitioners Council (the Council), which was presumably relying on getting money from the AFF.
Mr Daya said that there would have to be discussion and an actuarial determination. He said that the beginning of the sentence referred to what the Legal Practitioners’ Fund (the Fund) “must” do, and it was possible to separate out the “must” and “may”, or it was possible to include a general caveat of “subject to available financial resources”.
Ms Schäfer agreed that some matters would have to be paid, and reiterated that she would be in favour of splitting this.
Mr Bassett took Members back to (j) and pointed out that clause 22(1)(b) referred to the finances of the Council and said that the appropriation was to be annually determined, in consultation with the Fund.
He agreed to split this clause to reflect, separately, what must and may be done.
Members agreed that “must” would refer to (a), (b), (c), (d), (f), (g), (i), (j), (k), (m) and that “may” would apply to (e), (h), (l), (n), (o), (p).
Members debated the audit costs, under (o). Mr Daya said that attorneys had to have an audit each year. He thought that this was a “may” as it was the responsibility of the attorney.
Ms Smuts asked what had happened on the discussion whether this was public money.
The Chairperson asked that this not be debated at the moment.
Clause 59: Legal Practitioners’ Fidelity Fund
Mr Bassett noted that there were only consequential changes.
Clauses 60 to 62
Mr Bassett noted no changes to these clauses.
Clause 63: Composition of the Board
Mr Bassett noted that the Fund’s Board would consist of five people. The word “nominated” had been changed to “designated”.
Mr Swart asked the purpose of the Ministerial representative. If it was purely to have communication between Board and Minister, he asked why there should be two out of nine. The Department, in its response to an objection, had said that communication was paramount to the protection of the public.
Ms Smuts said that the State did have an interest in ensuring that a Fund such as this ran properly. She was not particularly bothered about the representative.
Mr Bassett said that the Minister also had a role to play in relation to the Chapter.
Mr Daya drew attention to clause 63(1)(b), saying that there was reference to the Independent Regulatory Board of Auditors but he was worried that there were other large accounting profession bodies who should not be excluded. If they conducted auditing functions, they may need to be considered.
Members agreed, and asked that it be flagged for the Department to get further information about the other bodies, provided that this did not cause undue delay.
Ms Wilna Louw, State Law Adviser, Department of Justice and Constitutional Development, noted that the Board of Control of the AFF at the moment consisted of the serving Presidents, and three members of each statutory society. There was no State representation at the moment.
Mr Bassett noted changes to (2)(b), in relation to considerations in nominations, in the alternative option. This was similar to what had been done in relation to the Council.
Mr Swart asked that “where practicable” should also be inserted.
Clause 64: Powers and functions of the Board
Mr Bassett said that there was a reference to clause 72(3), under clause 64(1)(a). In relation to clause 64(1)(g) there was another cross reference inserted, to section 86(5). He referred to the comments in relation to the Law Society of South Africa (LSSA).
Ms Schäfer thought that there was a need to discuss further the question of interest being paid over to the Fund, in relation to investments.;
Mr Daya explained that this was because the Fund was accepting liability and covering the funds, so it was in that context, and in view of its risk, that the interest was paid over.
Ms Schäfer said that effectively this was forcing clients to pay a portion of the “insurance”, for investing their money.
Ms Louw said that currently, the attorney gave the client an explanation of what the investment entailed, this kind of investment was arranged in writing, and the attorney would have to explain the risk.
Ms Schäfer thought that people should not be compelled to have something they did not want, and thought that perhaps the requirements around notice it should be included in the Bill.
Mr Daya said that there was debate about whose interest it was in the current position. General trust funds’ interest went to the AFF.
Ms Schäfer said that she was referring to investments with interest for the benefit of the client.
Mr Daya added that the AFF was also covering the premiums for the Attorneys Insurance Indemnity Fund. The Fund was saying that where the client wanted the benefit of the cover, 5% must be paid over. Looking at what the Fund was doing to cover non-investment trust accounts, it was necessary to consider whether it was reasonable.
Mr Basset said that the LSSA had agreed to this clause.
The Chairperson said that this was in the interests of the profession and the public. However, he thought there should be a specific requirement that the attorney inform the client of the terms.
The Chairperson referred to clause 64(1)(e) and thought that “attorney” should be substituted with “legal practitioner”.
Mr Bassett agreed that “as far as practicable” would also be inserted in relation to the alternative option wording, under clause 64(5).
Clause 65: Membership of the Board
Mr Bassett noted that the heading change was merely a technical amendment.
There had been a discussion on clause 65(2), in relation to a person “convicted of an offence”, whether this should be restricted to a conviction in a court of first instance, so that the appeal should not delay the proceedings.
The Chairperson did not think that such a person could be considered.
Mr Bassett said that inserting the phrase “by a court of first instance” would clarify it. He wondered if there could be any accusations that this might hinder an appeal.
The Chairperson said that it was desirable for the Board membership to be completely “clean”.
Ms Smuts said that she understood the concerns, but it was possible to have a suspension.
Adv Adams raised the question of courts of first instance. The Constitution, sections 47 and 106, spoke to appeals. Members of Parliament were still entitled to become MPs, five years after they had been convicted and served their sentence.
Ms Schäfer said that if the appeal was upheld, it may be possible to look into something similar to the Constitutional provision. She had suggested that there should be insertion of a provision that after five years the person could be reconsidered for appointment or re-designation. She had been trying to make the point that, as it was presently worded, a person found guilty could argue that s/he should not be removed from the Board because of the pending appeal.
Ms Louw said that Board members were not holding these positions as a career, and they did have other jobs. If they were disqualified from being a Board member, they would not necessarily be barred from carrying out their profession.
The Chairperson said that the answer was perhaps that the designating authority must withdraw the designating power.
Ms Smuts thought that the person should be suspended. However, other Members said that there would be an absence on the Board.
Mr Daya asked that the Committee must also consider that the Fund acted in the public interest, and protected the public, and there was huge responsibility in acting as a Board member, as it was worth about R3 billion.
Ms Smuts said that she did not feel strongly about inserting “court of first instance”, although she would prefer to leave the wording as it was.
Ms Schäfer said that the Committee needed to make a policy decision. A valid point had been made that if the Constitution allowed MPs, whose oversaw the budget of the country, to act in a certain way, then the same should apply to attorneys.
Adv Adams, with concurrence from Ms Smuts, thought the answer might be to suspend that person from the Board once s/he had been found guilty in a court of first instance, and then to appoint an alternative.
The Chairperson said that clause 69 referred to the power of the designating authority to suspend a person “for good cause shown”. The argument would then be between the attorney and designating authority, not the Board. That did not go to whether or not there was any guilt, but it merely went to considerations of how the matter would reflect on the Board.
Mr Daya said that in reality it was very difficult for the statutory bodies to deal with the issue. There had been issues where members were convicted of offences of unprofessional conduct, and long debates whether they should be councilors on the provincial law societies. In some instances, this had also gone down racial lines. There should also be suspension of pay and benefits, and there should not be an onerous financial burden on the Fund. It would be unwise to give due preference to the Fund, and the eligibility of the Council members needed to be aligned with the eligibility of the Fund Board members. He said that he did not think they were aligned properly at the moment.
The Chairperson referred to clause 12, dealing with removal from office from the Council.
Mr Bassett said that this was where the discussions on “court of first instance” originated.
The Chairperson said that this only referred to “conviction under this Act”.
Mr Bassett said that this would be limited, in clause 12, to findings of misconduct, because convictions were dealt with in clause 8.
The Chairperson said that nobody had objected to clause 8, which was fairly standard. He agreed that whatever was agreed to under clause 65 should be included in clause 8.
Mr Bassett said that he had received instructions from the Committee to insert “court of first instance” in clause 8(2)(c).
Ms Schäfer suggested that wording be used that was in line with the Constitution, which referred to a person convicted, and where the appeal had been finalised or the time period lodging that had been expired. She also asked for reference to the Council’s powers to suspend, and the ability of the designating authority to designate an alternate, during the period of suspension. The suspension should be without benefits. They were not attending meetings, and thus did not qualify for the stipend, which was to reimburse their expenses or help them to run the practices during their absence.
Members asked the drafters to draft an option reflecting those points.
Clause 66: Chairperson and Deputy Chairperson of Board
Mr Bassett noted that these provisions had been aligned with those dealing with the Chairperson and Deputy Chairperson of the Council. The changes were seen in subclauses (2) to (7).
Clause 67: Vacancies in the Board
Mr Bassett said that similar considerations had been taken into account for this clause.
Clause 68: Term of Office of Members of the Board
Mr Bassett noted that this was aligned with clause 10.
Clause 68A: Termination of office
Mr Bassett said this was aligned with the previous provisions.
Clause 69: Removal from office
Mr Bassett noted that in clause 12, there was reference to a finding of misconduct. In clause 69(1)(a), there was reference to “a conviction for any offence”, but this would be aligned with clause 12, to read “on account of any finding of misconduct”.
In subparagraph (1)(d), there was reference to “High Court” but in clause 13, the Committee had requested a reference to “Ombud” instead of High Court so this would remained flagged for similar consideration here.
In terms of clause 69(1)(f) the sequestration of an estate had been mentioned, but on the strength of what the Committee had said, in relation to clause 12, this should be removed. It was dealt with in terms of clause 65(2), so it was unnecessary to repeat this in clause 69(1)(f).
Ms Schäfer asked if this was a final order of sequestration.
Mr Bassett said that the wording of clause 65 referred to “an unrehabilitated insolvent” which would refer to a final order.
He added that clause 69(2),(3) and (4) were similar to clause 12.
Mr Swart referred to clause (e), which he would like taken out. It was not necessary, because misconduct and criminal findings were included.
Ms Smuts said that this had been discussed under clause 12, but not removed as yet. She believed strongly that this wording should be removed from both clauses 12 and 69.
The Chairperson questioned what such an activity could be.
Ms Smuts said that it was a provision that could cover everything, was open to abuse, and that there was not even a limitation that this should apply to misconduct.
Mr Bassett noted the instruction to take the wording out, from clauses 12, 69, and clause 102.
Clause 70: Meetings and resolutions of the Board
Mr Bassett said that there was merely a technical proposal, in relation to subclause (2).
Clause 71: Committees of Board
Mr Bassett said that this clause had originally read “the Board may” but there were various things that the Board “must” do and this had now been clearly specified, as to what it must, and what it may do.
In subclause 71(2) there was a reference to the election of the chairperson, and a proviso that the chairperson of the Board was ex officio chairperson of the executive committee.
Ms Schäfer said that there should be mention of the deputy chairperson’s position also.
Mr Daya said that this would make the Exco four members, and questioned what the Council wanted to do about the odd or even numbers.
Ms Smuts said that there was mention of a casting vote. It was not necessary to align this with other provisions; this was Exco of a Fund. It was in principle good to have an odd number, but it did not have to align in every respect. For instance, she had made suggestions that if the chair was an attorney, the deputy chair must be an advocate.
Mr Daya said that the drafters needed to factor in further considerations.
Ms Schäfer said that Exco referred to “any two members” and she wondered if there should not be specific reference to attorneys and advocates.
Mr Swart said that this went back to the composition of the Board. The composition of the Board should reflect attorneys and advocates. He wondered if “at least two members, one of which should be an advocate” should be used. It was not a large Exco, but there was binding legislation.
The Chairperson said that the representatives of Exco were being appointed from members of the board, and asked if there should be one attorney and one advocate.
Mr Swart agreed but asked if Exco should refer to “members”. Nine was not so many.
Ms Schäfer thought that nine was too many. She wondered if the committees should be allowed to appoint their own chairperson, rather than the Board.
Mr Bassett noted that the chairperson of the Council was ex officio chairperson of the committee, and the deputy chairperson was the same.
Ms Schäfer said she was talking about committees of the Board. She wondered if the Board should not elect the chairperson of a committee.
The Chairperson noted that the Board, under (4) could dissolve any committee.
Mr Bassett said that this would be brought in line with what had been done with the Council.
Ms Schäfer pointed out that members of the committee did not have to be members of the Board, so she believed that someone outside the Board could chair that committee.
Mr Bassett reverted to clause 63, and asked how many should be advocates.
Ms Schäfer would be happy with one advocate, as it would be only those taking direct briefs who had an interest. There would be four attorneys.
Mr Bassett asked about the Executive committee and Members confirmed that there must be specification of one advocate on Exco as well.
Clause 72: Certificate in respect of liability of Fund and clause 73: Annual Review
There were no changes to this clause.
Clause 74: Contributions to the Fund
Mr Bassett noted the reference to advocates holding trust accounts (under section 34(2)(b) in clause 74(1)(a).
The contributions would, in terms of this subclause, be paid to the Council.
Mr Bassett noted that the submission had been to pay to the Council and not the Fund.
Ms Smuts asked if an agency fee would be charged.
Mr Bassett said that this was in section 43 of the Attorneys Act.
Ms Louw said that there had been a problem between payment mentioned in one subclause to the Fund, and one to the Council There had been a suggestion that the payments go to the Fund directly.
Ms Schäfer noted that this was a way for the Council to check on who had applied. She asked what the agency fee related to.
Mr Daya confirmed that the agency fee related to the collection of trust interest and passing that over to the Fidelity Fund. It did not relate to the relatively small amount for the Fidelity Fund certificates.
Mr Bassett said that this should be flagged; there was probably a good reason why this was included in this format.
The Chairperson noted that (ii) referred also to “non refundable amount”.
Ms Schäfer said that she wanted more details on what had to be paid at the moment.
Mr Bassett continued with the consequential amendments, which simply replaced “attorney” with “legal practitioner” and questioned whether this should be amplified with a reference to one referred to in section 34(2)(b).
Mr Bassett further noted that the reference to “a division of the High Court” had been made
Clause 75: Audit
Mr Bassett noted the consequential amendments of “attorneys” with “legal practitioners. The same applied to clauses 76 and 77.
Clause 78: Claims against the Fund
Mr Bassett noted that there had been no comments and no amendments.
Mr Swart referred to the time limit of three months. He asked if this was the same as the current wording in the Attorneys Act. He thought it was a short time frame for notifying claims.
Ms Schäfer said that this three months after the client “became aware of “ the theft and she believed it was sufficient.
Ms Louw confirmed that this was the same wording as in the Attorneys Act at the moment.
Clause 79: Actions against the Fund
Mr Bassett said that there were merely consequential amendments here.
Clauses 80 to 83
There were no changes made.
Mr Bassett said this was similar to clause 78 of the Attorneys Act. The LSSA had suggested that “and who receives or holds money or property” should be deleted.
Ms Schäfer asked if clause 84(1) meant a state legal adviser, or generally.
Mr Bassett suggested this be taken out; the correct term was “state law advisers”.
Mr Bassett said that 84(2) had consequential amendments, and he had a later version than was in front of Members. There were now references to “legal practitioners”, and the Committee had asked about the purpose of this subclause.
He explained that subclause (1) said that every person taking money from the public must have a FF certificate, in general terms. (2) was confirming that, but also referred to a person receiving or holding money or property.
Subclause 84 (4) had been briefly discussed. There were questions asked earlier whether clause 34(10) footnote was still necessary, because it was being dealt with in this provision.
Mr Swart asked if there was not going to be a general offences clause.
Ms Schäfer agreed that this would be preferable.
Mr Bassett recalled that this had been discussed and agreed that it would be possible to have everything relating to penalties moved to later in the Bill, under the general penalty clause, clause 93.
Members agreed that clause 84(4) should be moved, and clause 34(10) would fall away.
Mr Bassett noted that, to bring that in line with other penalty clauses, there was reference to “both such fine and imprisonment”.
Mr Bassett pointed out that clause 84(5) was in line with clause 30.
Under subclause (6) he questioned whether it was necessary to include “who is obliged to be in possession of a FF certificate” and Members agreed this could be removed.
The remainder of the changes in (6) and (7) were consequential.
Mr Bassett read out the provisions of clause 84(8) and said that this would not apply to those who practised in the full time employ of Legal Aid SA, who had, however, asked that the words “on a permanent basis” must be included.
Mr Jeffery had asked that the position of law clinics and entities also needed to be clarified; whether they should hold FF certificates. Mr Bassett said that the feeling in the Department was that they should, and only Legal Aid SA must be exempted.
Ms Louw said that Legal Aid SA had clarified that they sometimes appointed practising attorneys on a fixed term contract.
Ms Schäfer asked if law clinics administered estates and did anything that would require them to have FF certificates.
Mr Daya said that they did pursue damages claims, and might then receive funding into their account. They were not audited under the Attorneys Act, but the accounts were audited. The strict protection to the public should apply.
Mr J Sibanyoni (ANC) agreed.
Mr Bassett read out subclauses (9) and (10). Members noted that the reference to “legal adviser” must be removed.
Mr Swart asked if municipal lawyers were also called “state law advisers”. Secondly, he noted that the South African Human Rights Commission and Public Protector had asked for an exclusion. He thought that the prohibition should apply to all.
The Chairperson asked if the fact that they did not have a certificate would exclude them.
Ms Louw said that if a person fell under the definition of legal practitioner, s/he must hold a FF certificate and would not be allowed to practise without it.
The Chairperson said that the investigators for the Public Protector were all lawyers. The Committee had not interrogated that. Perhaps the Committee needed to go further into that.
Mr Bassett thought that the SAHRC could litigate, whereas the Gender Commission and the Public Protector did not have that power. The Auditor-General also did not.
Mr Swart said that the Electoral Commission could litigate, but not for damages.
The Chairperson asked if they used in-house lawyers, or if they contracted out.
Ms Smuts said that usually a political party would take the matter to court, and the IEC would defend its decision.
Mr Swart said that they would use private practitioners to litigate for them.
Ms Louw said that this Bill was only to regulate “practising” attorneys and advocates. Many people were under the mistaken impression that it would apply to those who were qualified but not practising. This resulted in some confusion amongst the commentators.
Mr Sibanyoni said that the FF certificates were relevant only to those practising, not those, for instance, in the employ of a university. He pointed out also that the Public Protector, if it litigated, was not doing so with the intention of holding money in trust.
Mr Swart did not think that the South African Human Rights Commission (SAHRC) was sufficiently covered, because the exemption applied to the position where money could be held, provided the person was employed by the State. He asked if there should not be a specific reference to “the State or the SAHRC” in the last part of the clause. He still did not know for sure whether this did apply to other state bodies. He asked the drafters to check up on this.
The Chairperson said that their relevant legislation did not provide for them to litigate, on behalf of their communities.
Mr Swart said that this must be checked. The Independent Electoral Commission (IEC) did hold money in trust. He wondered if their legal practitioners must hold FF certificates.
Ms Louw thought that if the IEC received money, the question must be asked if it was trust money, as defined in this Bill, or money for the purposes of the election. When the IEC went to court, advocates would have to deal with the matter as regulated by this Bill. She asked the Committee to consider not making the matter too complex; the question was what the money was held for, and by whom. She did not believe that the examples cited fell within this definition. Some commentators had read into the Bill matters that were not there. The question was whether the people concerned fell under this Bill.
Ms Christine Silkstone, Content Advisor to the Committee, said that the purpose of this was to protect the public. She said that consideration had to be given to who must cover the SAHRC.
Ms Louw said that this would again relate to the question as to whether they received “trust money” as defined in this Bill.
Ms Schäfer said that if the SAHRC received an award of damages, those would be trust moneys.
Mr Swart said that the key was that they were not required to hold two separate accounts; they would litigate under one business account.
Mr Bassett and the Chairperson said that there may be a need to engage with the SAHRC further.
Ms Smuts asked if Ms Janet Love was intending to engage with the Committee on the SAHRC Amendment Bill.
Mr Swart suggested that this could be covered by saying “or Chapter 9 institution, where applicable”. However, he still thought it necessary to check whether they were covered. It seemed strange to mention the SAHRC alone.
The drafters agreed to revert on this point.
Mr Bassett noted that the inclusion of clause 85(1)(b) was at the request of the LSSA. It prescribed a legal practice management course to be completed.
The Chairperson summarised that a law student who graduated and was admitted, and who wanted to take instructions directly, would still have to do this course.
Mr Bassett said that this provision was put into the Attorneys Act fairly recently because many new practitioners had failed because they did not have this know-how.
Ms Schäfer said that this was an added burden. She wondered if this should not be included under pupillage or under the practical training course.
Ms Smuts said that a pupillage substitute must be created.
Ms Silkstone said that her training courses as a candidate attorney had in fact included more.
Mr Bassett noted, in relation to clause 85(4), that the contribution would include consideration of whether the applicant had been he cause of any claims against the Fund in the past. This was included in the Attorneys Act and was included at the request of UNISA.
The changes to clauses (5) and (6) were consequential.
Clause 86: Trust Accounts
Mr Bassett noted that “who is obliged to be in possession of a FF certificate” could come out.
He referred to subclause (5) and said that the AFF had requested the inclusion of the words “and vests in the Fund”. The addition of a proviso in respect of the 5% interest had been added in, and had been discussed earlier.
The changes in (6) and (7) were consequential.
Clause 87: Accounting
Mr Bassett said that the first amendments were in subclause (3), where there was reference to the advocate referred to in section 34, who was the executor. This wording had been included before the Committee decided that advocates should be limited to doing work that they had done in the past. He thus thought that the words “or advocate referred to in section 34(2)(b)” should be removed. Members agreed.
The insertion of “or which is unclaimed after one year” was included at the request of the AFF and the Committee had not had any problems with this.
The changes in (5) were consequential.
Mr Swart said that this gave the Council or the Board the power only to inspect documents relating to accounting. They should be entitled also to inspect the practice for another reason, such as investigating improper conduct – which might include negligence by allowing a claim to prescribe. It was recommended that the Council should be allowed to inspect against allegations of improper conduct. It may not sit well in this clause, which dealt with accounting issues, but perhaps it could be provided for under the discipline clauses.
Ms Louw said that the Board should not investigate general negligence, even if it involved problems with money.
Mr Swart said that the clause was referring to “the Council or Board” and it was the Council who would look at that. He questioned what the present situation was.
Mr Daya said that a law society would only use the inspection rights after a complaint, and affidavits were needed.
Mr Swart said that this was slightly different from inspections.
Mr Bassett thought it could be covered under clause 39, the disciplinary section.
Ms Silkstone said that attorneys had to keep their files for a certain period, and that the purpose of this might link to queries on the files and practice.
Mr Swart said that a more general power was needed for investigating other matters that may have consequences for the client, such as prescription of claims. He asked how the Council would react to such a complaint without statutory powers.
Mr Bassett thought that something would need to be added into to clause 37, where there was reference to all complaints of “misconduct”. The clause was not very detailed as to what an investigating committee may or may not do.
Mr Daya said that the current Attorneys Act, in sections 70 and 71, referred to enquiries into alleged unprofessional or unworthy conduct, which did not appear to have been replicated. This should be flagged as needing to be included. He added that there would also need to be consideration given as to whether the Fund should also have that right.
Mr Bassett said that the Committee was tending to the argument that both should have the right of inspection, but the LSSA was not in agreement.
The Chairperson said that the Chief Executive Officer of the AFF wanted it, for very good reasons.
Mr Swart wanted to clarify the context. When it came to trust moneys, clearly both should have the power. However, he was not sure whether the Fund would be interested in negligence matters; they did also put the Board at risk.
Mr Daya noted that part of the functions and powers of the Fund was to contribute to the Attorneys Insurance Indemnity Fund, a massive premium, and this essentially dealt with negligence claims. The Fund did have an inherent interest in limiting risk.
Mr Swart agreed, saying that the Fund would not necessarily want to take disciplinary steps.
Ms Silkstone said that the Fund, the Board and the Council should be working together, and this co-responsibility might enhance that relationship.
Clause 88: Trust money and trust property of trust account practice
Mr Bassett pointed out a consequential amendment.
Clause 89: Court may prohibit operation of trust account
Mr Bassett said that the amendments followed the comments of the LSSA.
Clause 90: Appointment of curator bonis
Mr Bassett said that the Court may appoint a curator bonis to the trust account. Although there were provisions in terms of which the Master played a role, under the current Attorneys Act, there were problems.
Ms Louw said that the experience was that the Master refused to make appointments, because the regulations had never been promulgated. Therefore, the LSSA suggested that the rights and duties of the curator rather be incorporated in the court order. The Council would retain control over the appointment and carrying out of the duties, and avoid delays.
Mr Swart noted that this made sense.
Mr Daya said that currently, as soon as there were problems, the Council would ask for the appointment of a relevant party.
Mr Bassett added that there was a reference in (2) to partnerships, which should be allowed to continue under the control of the remaining partners.
The remaining provisions related to the deletion of Master and insertion of the Court. They dealt with attorneys practising in partnership, so it would not involve advocates.
Ms Schäfer asked whether advocates would be permitted to practise in partnership.
Ms Smuts thought that specialist litigation advocates remained separate, but would tend to form “bars” together, including multi-disciplinary partnerships. It was the regulator who had to deal with the change.
Mr Bassett said that this was dealt with in clause 34(5) which said that advocates may only practise for their own account and may not share fees. Attorneys were allowed to practice for own account, as commercial entities, or in partnership.
Mr Daya said that this was linked to the cab rank rule. When there was a review of the whole business structure, there would be further discussions.
Ms Smuts asked what instrument had been used to discontinue the cab rank rule in England.
Mr Bassett noted that there were no changes.
Clause 92: Recovery of costs by legal practitioners rendering free legal services.
Mr Bassett said that all these changes were consequential.
Clause 93: Offences and penalties
The Chairperson noted that this would be changed in line with earlier discussions.
Clause 94: Chapter Nine: Regulations and Rules
Members thought that the audit was needed before the Committee went through this chapter.
Chapter 10: Transitional Provisions
Mr Bassett said that the Part I dealt with the South African Legal Practice Council. He thought the name of the Transitional Council (TC) should be changed, as its name seemed to be causing confusions. It was in effect a consultative forum to get ready for and address preparatory matters for the new legislation. The existing regulatory structures would stay in place and continue to function until the new Council was elected. The purpose of the transitional arrangement was to consult and agree on outstanding issues.
The Chairperson liked the idea of calling it a consultative forum. There was a problem with referring to “Transitional”. However, there was still the composition of this to be debated.
Ms Smuts asked for the argument to be repeated as to why it was necessary to create this for the voting mechanisms
The Chairperson said that there was an argument that attorneys and advocates be equally represented.
Ms Schäfer pointed out that there was an 8: 8 split between attorneys and advocates here.
Mr Swart said that the argument under (v) was that Advocates for Transformation already represented 50% of the Bar, and the suggestion was to delete (v) and move (ii) to (vi).
The Chairperson said that there was a feeling that Advocates for Transformation were getting double representation.
Ms Smuts thought that a counter-argument had been proposed to that. There had been a suggestion that six should be designated by General Council of the Bar (GCB), under (ii).
Ms Smuts thought that of those six, a certain number should be from Advocates for Transformation. There was already 50% representation.
Mr Swart had no problem with this; it was the existing practice.
Mr Sibanyoni said that without this being specified, there could be concerns.
The Chairperson noted that the Independent Association of Advocates of South Africa was now called the “National Bar Council of South Africa”.
Ms Schäfer thought that then perhaps there needed to be a mention of “in respect of all organisations as they are currently known”. Members had noted that there was also a National Forum of advocates and other bodies.
Ms Smuts said that the new forum would have to consider the election procedure for constituting the first Council. Its composition was directly relevant to its tasks.
The Chairperson said that he would prefer to deal with that in the later clauses.
Ms Smuts maintained that form followed function.
Mr Daya said that the rationale for the interim process was to be as broadly representative of all vested interests in the profession as possible. That was why the Law Society of South Africa, National Association of Democratic Lawyers (NADEL), Black Lawyers Association (BLA) and the four statutory societies had been named, specifically so that nobody was excluded and the advocates’ listing included the National Forum of Advocates and the (newly-named) National Bar Council of South Africa as well as the GCB. There was parity in numbers at this consultative stage, so there was no accusation of one grouping having an influence on the end product, which would be determined of main groupings being attorneys and advocates.
Mr Swart asked if the Department could engage with advocates again. They had indicated that Advocates for Transformation were represented in the GCB, and two submissions were to the effect that they should not be represented again. He asked if the representation for both bodies should be changed. Just as the attorneys had reached agreement on their representation, maybe there was need to think about the bar representation again. He received confirmation that Advocates for Transformation had 50% representation, but others may be represented.
Mr Daya corrected the earlier statement, and said that the GCB currently excluded the National Forum (National Bar Council), and independent advocates. The Committee had suggested looking at six advocates, three of whom would be specifically from Advocates for Transformation.
Mr Bassett said that he believed that “designated” should be used, similar to earlier wording, for clause 96(1)(a).
The Chairperson said the GCB could choose its own process, but having gone through that, it would designate.
Mr Bassett said that it had been suggested that there be two teachers of law; one from the South African Deans Law Association and one from the Law Teachers’ Association. This would raise the Council to 22 members. Members confirmed that it was desirable to have two, because clause 97(1)(a)(v) required consideration of practical vocational training, which meant they would be reference to the academics.
Mr Bassett read out the option for subclause (2), in relation to the Ministerial representatives. Members agreed on that. He repeated that there were practical considerations as to how it would be ensured that there was representivity, during the designation stage, as well as whether “as far as practicable” should be inserted, consistent with other changes.
Mr Swart noted that (e) required one person to be designated by the Board, who may not be a legal practitioner. He wondered if this was not too inhibitive. The other nominees were not restricted.
Mr Bassett said that this person would not have to be a member of the board.
Ms Schäfer said it could be interpreted to mean that the person should not be a legal practitioner. She would prefer to state that the person should not be a member of the board.
Mr Swart said that merely “designated by the board” should be used.
Ms Schäfer said that she was concerned to ensure that the board would have the option to designate whomsoever it chose.
Mr Swart noted that the same applied to all the bodies.
The Chairperson said that, under (3), the duration was stated as three years, but the terms of reference for the also made mention of two years.
Ms Louw stated that the transitional body it would not extend beyond the date on which the permanent Council was appointed.
Ms Smuts wondered if the time period was too long. The GCB had indicated that it could do what it needed in six months.
The Chairperson remarked that the matters had not been sorted out in the last 20 years, and he thought that “not more than three years” was intended.
Mr Daya said that there was an extension period noted in clause 97(5), but he heard the concerns that this should not extend beyond three years.
The Chairperson said that effectively, the forum had been 24 months to deal with the work, and if nothing had been achieved by then, it could request one year’s extension.
Ms Schäfer and the Chairperson asked that it should be carefully worded to ensure that the “date of commencement” of Chapter 2 and duration of the body would not cause any gaps.
Ms Louw said that clause 119 clarified this.
The Chairperson noted that clause 97(5) would also apply.
Mr Daya said that the consultative forum was now 22 members, an even number, and he wanted confirmation that the chairperson should have both a casting and deliberative vote.
Mr Bassett said that this was allowed for, in clause 106(2).
Ms Smuts said that the voting rights between advocates and attorneys were equal, and she pondered if there was any lobby that could swing this either way.
Mr Swart said that there was a need to look at who appointed the chairperson.
Ms Smuts responded that the members, in consultation with the Minister, would do so, as clause 100(1) currently read. Both she and Mr Swart agreed that this was not acceptable, as it gave particular ability to the Minister.
Ms Smuts made the point that surely all the steps were proposed in the interests of self-regulation and the ideal would be to put a judge in the chair and not allow undue executive sway.
The Chairperson raised the question of who would choose the judge.
Ms Smuts thought that the Chief Justice could be asked to designate a judge; it was a temporary position and this dealt with officers of the court. It would not interfere with separation of powers. It was quite satisfactory to put judges at the head of the bodies, because at the end of the day only the Court could rule on the professional rules. All the practitioners would be officers of the court. Even before doing the 17th Amendment Bill, the Chief Justice had a long list of functions assigned under any law.
The Chairperson said that normally judges were appointed either by the Minister or President, in consultation with the Chief Justice.
Mr Swart said that the forum itself could, as an alternative, elect its own chairperson. He could not see that the Minister needed to have a role, and the use of the phrase “in consultation” would imply the Minister’s power to veto, which he did not agree with. He suggested that “in consultation with the Minister” be deleted.
The Chairperson said that, as a courtesy, “after consultation” could be used.
Ms Schäfer preferred that option. She believed it was fair and reasonable for the body to elect its own chairperson. She noted that she could not escape mentioning that judges were often former advocates, and may not be in touch with running a legal practice.
Members discussed whether if, an academic was elected as chairperson, the deputy must be the other academic representative.
Ms Schäfer said that this should be more specifically drafted, to reflect that if an attorney or advocate was chairperson, then the other branch of the profession must be represented as deputy.
Mr Daya said that the reason was that this forum was a compromise position. The Department was funding this forum’s costs, in total. There was an obligation to ensure that the process was finalised, with provision made for arbitration to resolve deadlocks, as well as the limited extension time. All groupings were allowed to be part and parcel of the process. The need to choose the appropriate chair and deputy was the reason for drafting the Bill in this way.
The Chairperson said it was still possible to choose a chair who was obstructive to the attainment of the goals of the Bill.
Ms Schäfer said that if the Minister was doing the appointment, it amounted to taking away the independence of the profession. She understood the background, but did not agree with the reasoning. Whoever the chair was would have to know the time limits and have to comply with the law and she doubted that there would be obstruction.
Mr Swart agreed that, considering the composition of the forum, with representatives from the bodies, who would commit themselves to the objectives of the Bill, it was unlikely to be a problem. As a fall-back, and if the initial proposals to have election by the forum itself of its own chair were not accepted, he would be prepared to compromise on “after consultation”, which gave sufficient say to the Minister. However, it must be remembered that there were already two Ministerial representatives, and there were also powers of dissolution. He thought that using “after consultation” would address constitutionality issues.
Ms Smuts noted that she would be opposed to that. Ms Smuts also thought that a judge should be the chair of this consultative forum; all members would be officers of the court. She could think of some with substantial leadership skills. She said that her view – which was supported by Mr Swart’s first preference – was to have the chair and deputy elected by the body. She said that it was a poor argument - although true –that because money had been paid by the Department, it wanted to ensure that it had a measure of control. The temporary body was intended to achieve self-regulation.
Clause 97: Terms of reference of the Transitional Council
Ms Smuts said that she wanted an option to be drafted for 97(1)(a)(i), to refer to the advocates and attorneys’ chambers for the first council. The question was why the consultative forum would have to look at election procedures for the first council. The answer was that each of the attorneys’ formations currently had different election procedures, and that was why the forum would have to deal with them.
In addition, in relation to regional councils in (iii), she asked that the wording should read “the composition, powers and functions” of the regional councils. That was not finalised yet. Clause 23 said that the regional councils must be constituted in such a manner as to reflect the composition of the Council.
The Chairperson did not think that this meant it must be a mirror image of the Council.
Mr Daya said that clause 97(1)(a)(i) could be changed, but the consultative forum should be coming up with something that was acceptable and should endure. The final Council could reserve the right to itself to make changes as necessary. Perhaps consideration could be given to dropping the word “first” (Council), so that by implication the transitional body would be setting matters for the future.
Mr Bassett noted, in answer to Ms Smuts’ point on composition, that the current wording meant that there should be advocates and attorneys, with proportionality the same as in the Council.
Ms Smuts said that this meant 16 and 10.
The Chairperson asked if this meant that academics would be serving.
Mr Bassett said that it would not, because there was reference to the advocates and attorneys professions.
Ms Smuts reiterated that she wanted a reference to “the composition, powers and functions”. All of this went by recommendation to the Minister. This was not a regulator, only a consultative and temporary body. The difficulty was that it would allow the Minister to regulate on matters like a fee structure, which was not correct, although it was urgent.
Mr Bassett said that the Committee had requested that references to the fee structure be removed. There was difficulty around regulation of pupillage, and there thus needed to be more discussions on practical training.
Ms Smuts could see the case for this. However, the Department assumed that the final Council would be 16 attorneys and 10 advocates, with the regional councils to mirror that. She asked why this was being done, and why the forum should not decide on the composition of not only the regional councils, but also the LP Council. If necessary, parity, at minimum, should be in the LP Council, with two chambers, but that the forum should decide. She supposed that attorneys wanted 16 members, but the Bar wanted parity.
Mr Swart said that the Committee had already been inclined to parity on the forum. No final decision had been made.
Ms Smuts said that she had attempted to persuade the Committee that there was a constitutional argument for the chambers. She did not see why this forum should not also be deciding on the future; whether there should be separate chambers, for certain purposes, and different forms of legal practice for the future.
Mr Daya said that the issue had been flagged. The costing model was also dependent on the numbers of the forum, and if no number was put in, it was possible to end up with a huge forum. The current reasonable constitution of current regulatory bodies was factored in. The numbers of attorneys and advocates had been considered next, and the attorneys’ profession had made a strong case for proportional representation, of 10: 6, making up 16 practitioners on the permanent Council. He heard Ms Smuts’ arguments on parity, but this then brought the Department back to the drawing board, and there would not be any consensus reached in reality. The concern was that, when an issue arose peculiar to the advocates’ profession, there could be a change to create parity for advocates. Attorneys did not have a similar problem.
Mr Swart thought that the discussion around parity related to the final Council, because there was already parity on the transitional arrangement. At the moment, it was 8: 8 and the proposal was to change this to 10: 6. It was necessary to have buy-in from the advocates, and he urged that the Committee needed to recognise the two professions who needed to work together. If there was also input from the progressive organisations, the same principle should go through to the final Council. He aligned himself with Ms Smuts’ option on the chambers. He supported two chambers at the national level, but also wanted, as a fall-back, an option to have this arrangement at regional council level.
Mr Bassett confirmed that this would go into clause 23.
The Chairperson said that the reason this was being discussed now was following Ms Smuts’ query on why the consultative forum should decide on the final composition of the Council.
Ms Schäfer said that there was a need also to remember that buy-in was needed from attorneys, who might be unhappy with parity when they had larger numbers. She was inclined to consider the suggestion of the regional level, and different chambers making day-to-day decisions. If there would not be two chambers, then she was not convinced on the numbers, because effectively the advocates would be over-represented.
Mr Bassett said that the Department had tried to get buy-in, and he was cautious about disturbing that on the composition of the Council. He also said that the history and sensitivities must be borne in mind.
Mr Daya asked if it was intended that the chambers would be attorneys and advocates’ chambers, within which other members (academics) should also fall, in equal numbers, and asked what they would be doing.
The Chairperson summarised that they would deal with “own affairs”. The chambers would link up to discuss general affairs.
Mr Daya said that the aim of the Bill was to create a framework to deal with admissions and discipline. The consultative forum must deal with education and other issues. He wondered what was so difficult, in this, that would make it impossible for them to work together.
Ms Smuts said that, having heard the history and sensitivities, she again raised the question “why institutionalise the tension?”. The most practical answer was to separate them out. Jointly, the branches of the profession could explore matters this Bill was not limited to admission and discipline. The most important aspect was who would make the practice rules. The Bar component must deal with Bar rules, because the regulator would take over the functions of the former bars. All the problems in the legal profession lay with those rules. The Competition Commission had ruled on fees, organisational form, regulation and advertising. Because this was a self-governing profession, advocates must do their own Bar rules. They were subject only to the supervisory jurisdiction of the courts. The rules of different bars had been different and she was sure that there were radical differences in attorneys’ rules. She believed in the value of variety. Perhaps the upper Council should discuss whether Uniform Rules were desirable, and explore liberalisation of the profession.
Mr Daya had a question of clarity; whether parity would mean that there was no need for separate chambers.
Ms Smuts said that this was not so; parity was a minimum, but it made logical sense to have separate chambers where each branch would debate its own rules.
Ms Louw asked where the other members would fall, and whether the Council could not institute committees.
Ms Smuts said that their name was not as important as what happened. It was possible to provide specifically that there would be a committee of advocates, to deal solely with regulation of the Bar, and a similar one for attorneys, but the full Council must sit jointly.
Mr Swart said that the “Option” for clause 23 set out a model for a regional council chambers. He wondered if the regional councils should mirror the final Council. The Minister would not have representatives there. If this was what the Bill was saying, it should be reconsidered. If disciplinary matters were being dealt with, at that level, it could be a good model. Statutory bodies would consider matters, at regional level, and link up with the regional bar structures. That was contained in the LSSA submission, LPB31.
The Chairperson asked Members to confirm their acceptance that the regional council did not have to mirror the Council. Members agreed that only attorneys and advocates would need to be represented; not academics or Ministerial representatives. There may be places where there were no attorneys or advocates, so it would not be necessary for the Committee to set out in clear terms how they would be constituted.
Ms Smuts and the Chairperson disagreed on whether clause 23 required regional councils to mirror the Council and what “reflect the composition” meant.
Ms Smuts said that clause 97 asked that powers and functions of the regional councils must be addressed, and she reiterated her request to include “composition”. There were fewer bars than regional structures, as they existed only generally at the seats of High Courts.
Ms Schäfer was not sure that Members were clear on what exactly they wanted. She thought there was merit in getting a copy of the Bar Rules. Ethics would not necessarily have to be dealt with by separate chambers. Until it was known what exactly the different chambers would do, Members could not give specific instructions to the Department.
The Chairperson noted that the GCB put together the Bar rules. This Bill was not requiring it to stop doing that, and he noted that the GCB would not be prevented from continuing to exist.
Mr Daya clarified that the Council would make the rules, but the constituent bodies that elected the members would be represented there. Voluntary associations still existed. The people on the Council would be included in the discussions at all levels, so that when they came to the Council, they knew exactly what their mandate was. Various rules would be debated in the lower forums.
Ms Smuts said that the GCB and bars would remain, but with a representative function. They could lobby, but the Council would regulate, through rules. This was all about rules. The requirement that there could not be a brief of a senior without also having a junior counsel, and the requirement of two thirds of the fees, were bar rules. Adv Owen Rogers’ article set out several others. In the case of attorneys, the Competition Commission refused to exempt rules relating to professional fees (in terms of which practitioners were prevented from going below a minimum), organisational forms and multi-disciplinary practices, prohibition on sharing of fees and offices with those who were not practising members, reservation of work to attorneys, rules against advertising and marketing. The matter was currently in limbo, awaiting this Bill. She believed that this Council, and the regional councils, would make the rules. In the Cape, it was possible to approach an advocate directly for an opinion. She said that it was necessary to split regulation from representation, and that was why separate chambers were logical.
Mr Swart said that the Constitution of the GCB was attached to the GCB submission, and that referred to “referral rule” as in that constitution. If the Council was to overrule that, there was already the potential for conflict. That would be the impact of the statute. At the end of the day, the regulator would determine what the rules were, and if there was conflict with the voluntary association, the statute would prevail.
Ms Schäfer still thought that it was necessary to see the GCB rules, despite the Court request and the Competition Commission ruling against them. Some of the matters would be covered by statute and the Council must have the ultimate say.
Ms Smuts said that it was necessary to bear in mind that these were self-governing professions. It was possible to look at rules, and perhaps consider how they had distorted competition. It was not for Parliament to say that it did not like the rules; and it was only considering some matters now because of the failure of the profession to act before, despite the request of the Court. Parliament had legislated on contingency fees. She did not want to ask for a set of rules because it was not Parliament’s job to consider them.
Ms Schäfer did not think Parliament needed to change the rules; she wanted to consider them only for the purpose of seeing what the Council should look at, and what regional bodies might look at.
Ms Smuts said that the position about the regulator of the Competition Commission must be considered.
The Chairperson said that this was pre-empting what the Council would look at. He was sure that the Council would have to look into the Competition Commission findings, and the contingency fee judgment. Nothing had to be done by this Committee; other regulators would be bound by the Competition Commission.
Ms Smuts wondered if the provision on the proposed fee structure was needed, when so much had been done by the Competition Commission.
The Chairperson believed that the Bill was sufficient; the Council was being asked to look into the whole question of fees and this was sufficient. He and Ms Smuts debated whether “fees” included “the structure”, and the Chairperson believed that it was covered. He instructed the drafters to draft options on having two chambers at regional level and two at Council level (whatever they were called), to deal with the rules of each respective profession.
Ms Schäfer reminded Members that the Council was only set to meet four times a year. The detail would be dealt with at regional council.
Mr Bassett recapped that the word “first” would also have to come out of the reference to regional councils, in clause 97(1)(a)(ii) and (iii).
Ms Smuts suggested that if there were options for committees or chambers in the main body of the Bill, the “composition” would not have to be included under (iii).
Mr Bassett summarised that (vi) was removed.
Mr Basset said that there might be a need to tighten up the wording in (2)(a). A new (b) had been inserted, to cover regional associations.
Mr Swart noted that there had been an objection to arbitration and there had been a suggestion that it could not be applied to this clause.
Clause 98 and 99
Mr Bassett noted no changes.
Clause 100: Chairperson and Deputy Chairperson of Transitional Council
Mr Bassett noted that this had been discussed and the flagging still remained under clause 100.
He noted that subclause 100(3) should read “must”. Other wording was to bring the wording in line with other bodies and boards. The same applied to clause 100(4). Subclauses (5) to (7) were in line with previous wording elsewhere.
Clause 101: Termination of Office
The termination of office was now also aligned with other provisions.
Clause 102: Removal from Office
Mr Swart said that a person may be convicted of an offence, but the Transitional Council might well not remove that person from office. He questioned whether “must” should not apply to 102(1)(a). The offence might be a minor issues, but could also be serious.
Ms Schäfer said that the serious nature of the nature should be considered.
Mr Bassett added that this referred to a finding of misconduct. Conviction would fall under another clause. This wording would need to be refined. He had changed the wording, and the new proposed wording could not refer to “misconduct in terms of this Act” as this referred to the transitional body. Therefore he had suggested “incapacity or …” , with (a) to fall away.
Report on developments in relation to Ombud
Mr Daya said that in the UK, there had been developments around the Ombud. There were numerous Ombuds and there was consideration being given to a single one for the Regulator. More importantly was the development relating to advocates, where there was further entrenchment that advocates would have the right to deal directly with the public, contained in the latest Gazette. He would send this on to the Committee.
Ms Smuts said she was interested in these developments because in this country the specialist Bar had expanded.
Ms Smuts asked for any information on development of the cab rank rule.
Introduction of Constitution 18th Amendment Bill
Ms Smuts drew to the Committee’s attention to the tabling of her private Member’s proposal for a Constitution 18th Amendment Bill, as listed in that morning’s ATC. The Bill would come to the Committee in due course.
South African Human Rights Commission shortlist
The Chairperson summarised that the following names had been proposed on the previous day, for short listing and interview for the South African Human Rights Commission vacancy:
Adv Kutsoane (HRC 51)
Dr W Gumede (HRC 17)
Adv MS Ameeermia Miya (HRC 18)
Prof V Jaichand (HRC 28)
Prof M Ralefatane (HRC 40)
Ms NP Thejane (HRC 66)
These names were formally adopted by the meeting, which was quorated, and the shortlisted candidates would be called for interview. The Chairperson would finalise the date for interviews on the SAHRC, and the follow-up meeting with the Public Protector.
The meeting was adjourned.
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