Legal Practice Bill: Draft 2: from clause 35

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Justice and Correctional Services

13 August 2013
Chairperson: Mr L Landers (ANC)
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Meeting Summary

The Committee noted that the Superior Courts Bill had just been signed into operation.

The Department of Justice and Constitutional Development (the Department) drafters took Members through Draft 2 of the Legal Practice Bill, from clause 35. The Chairperson emphasised that at this stage the Committee was still pondering options and no final decisions were being taken. Further options and subclauses were added in respect of legal fees, but Members requested further revisions, including a reference to an examination of the Contingency Fees Act. They deliberated the different arrangements for litigious and non-litigious charges, and whether it would be appropriate to specify fees for State work, in order to answer concerns about high legal costs in State departments, and the point was made here that there was a need to find a balancing mechanism. Fees were one of the most important matters affecting both the profession and the public’s right to access justice. Members generally agreed that mandatory agreements between practitioner and client would go far to addressing the problems.

Under clause 37, the Committee deliberated whether it would be central or regional bodies dealing with discipline, particularly in view of the number of complaints that were lodged, and asked for an option to be inserted for complaints to be dealt with at regional level. The DA Member reiterated that her party was not in favour of having only a single code of conduct, believing that the two branches of the profession should develop their own code. The COPE Member questioned if time periods were needed. Members would need to consider who should compile the list of lay persons to be included on committees. The changes to clauses 38 and 39,which provided that fines be paid to the Council, were noted. Members requested a change to clause 40(3)(b)(i). Under clause 43, Members debated whether all other legal processes must be exhausted before the Ombud was approached, but stated that the time period already set for finalisation of complaints within three months should ensure no undue delays, although the Rules would have to cover the point. Members debated the appointment of the Ombud in clause 48, and agreed that if the Ombud was a judge discharged from active service, the President should appoint. They also suggested that one non-renewable term of seven years may be apposite. Revised wording for clauses 50, 56, 58 was indicated. References to advocates accepting direct briefs had been made in clause 59, and other appropriate places in the Bill. Changes were also indicated to clauses 65, 66, and 69, but the Committee still needed to decide whether the Board “may” or “must” remove a member on account of a finding of serious misconduct. Members approved of the new wording for clause 71. The drafters noted that they would be proposing an amendment on the composition of the South African Judicial Education Institute Board committees, where some discrepancies had been picked up. Minor changes were noted to clauses 74, 77, 80, and 84. Members decided to ask the South African Human Rights Commission, on the following day, to explain the wording it had requested in clause 84, which did not appear to be in line with other Chapter 9 institutions. Changes were noted to clause 85, but subclause (1)(b) would remain. There were technical amendments to clauses 86, 87, 89, 90, 93. Clauses 94 and 95 remained still to be finalised.

In clause 96, the “Transitional Council” had been re-named as the “National Consultative Forum” and Members would still debate the final composition. The terms of reference were to be amended with reference to chambers. The Department suggested, in relation to Members’ requests about the costing of the Bill that the Forum (which would be funded by the fiscus) be asked to work on the future funding model for the profession, which would be linked to its final structure. This direction would be added under clause 98(1). There had been amendments to clause 99, relating to who may be a member of the Forum, with appropriately linked wording in clause 102. The Schedule was to be updated in the next draft.

Members decided to caucus within their parties on the following morning and resume deliberations on the Bill on Thursday afternoon.

Meeting report

Chairperson’s opening remarks
The Chairperson noted that the President had just signed the Superior Courts Bill into operation. The Committee expressed its appreciation.

The Chairperson asked that the good wishes of the Committee for a speedy recovery also be conveyed to Mr Lawrence Bassett, Deputy Chief State Law Adviser.

Legal Practice Bill: Draft 2: complete
Ms Wilma Louw, State Law Adviser, Department of Justice and Constitutional Development, confirmed that the whole of the new Draft 2 had been e-mailed to Members. She said that she would proceed from clause 35.

Clause 35: Fees in respect of legal services
A new sub-clause (3) had been inserted, dealing with fees in respect of legal services. A person could contract out of the determined fees. A further option was inserted as sub-clause (4) that the Council must report back to Parliament or the Minister with recommendations on several aspects relating to fees.

Ms M Smuts (DA) said that this was a very important matter. The first option set out that the Rules Board for Courts of Law deal with fees, but the Committee had not been satisfied that this was the full answer, in view of the contradiction that many smaller attorneys firms did not get sufficient work, whilst the public claimed that legal services were unaffordable. It was suggested that fees may be part of the problem. She was grateful for the option, but did not think it was yet acceptable. For instance, in (a) she said that “untenable” was not a phrase that should be used in law. She thought also that there should be reference made to the fact that the rules made by the professions themselves were sometimes anti-competitive. She suggested that (b) should be rephrased, to delete everything after “the Competition Commission”. She also suggested that this sub-paragraph should start with the question whether a mechanism must be set to deal with fees, or whether it should be left to the market to determine, after the whole situation had been considered. She also thought that, in this context, the (c) should not appear. It was appropriate under the first option, but thought it was not apposite to the second option.

The Chairperson noted that this option came as a result of discussions in the Committee. It read rather like a preamble, and he wondered if it was possible to re-phrase it in a simpler and less wordy form that still encapsulated the principles in subclause (4). He thought perhaps the Committee should bring more proposals.

Mr S Swart (ACDP) agreed that more thought was needed, and, depending on the option to be followed, his suggestions for (c) may or may not be appropriate. He thought that the Contingency Fees Act was not dealt with sufficiently; it may be appropriate to look at that Act as well as common-law agreements relating to litigious matters before finally deciding on the options. The point about the Contingency Fees Act was raised by the Competition Commission, and the Department had commented that it should perhaps be included in the Bill.

Mr Jacob Skosana, State Law Adviser, Department of Justice and Constitutional Development, commented on the sequencing. If the Committee decided upon the first option, then it must be noted that within two years, the Rules Board would be reconstituted, under the Superior Courts Act, in a process to be undertaken by the Minister. The option saying that the Council must undertake a review within two years implied that the Council would be set up by 2016 and this review would thus be done by 2018. He cautioned against creating that impression; that date was far too late for those not getting access to justice now, and the Minister had a responsibility to come up with something else, under the Superior Courts Act, by 2015. He suggested that there should be a closer link between the two concepts.

Ms Smuts sought confirmation from Mr Skosana whether he was suggesting the first option, for the Rules Board, as well as the further option.

Mr Skosana responded that if the Rules Board, in its new form, would have responsibility for fees, and that might be set out in the amendments to that relevant legislation. He was suggesting that the cross-referencing needed to be done so that its powers were not defined in this Bill, but the process for the Rules Board was recognised here.

Ms Smuts said that this was persuasive, and that the amendments would be tabled to this Committee. She agreed that it would need a re-draft, and so the Committee would end up doing the further option.

Ms C Pilane-Majake (ANC) referred to the reference to the Competition Commission. She asked if this was not included because the mechanism may be in contradiction with the views of that Commission. She agreed that there had to be consideration of the Contingency Fees Act.

Mr Swart said that (3) related to non-litigious matters. Tariffs were set for litigious matters, to protect parties. There was a strong suggestion from the Competition Commission, and many of the major law firms, who said that something would have to be set for non-litigious matters. The major firms said that their clients were prepared to pay large amounts to ensure that their non-litigious matters were properly effected – such as registration of patents, or acquisitions and mergers that were worth billions of rands. It was in the interests of the economy to have a clause to that effect. The main concern in relation to individuals was in relation to litigation and he had been trying to make that distinction. That was why it was important to cover the non-litigious matters. The Bill was going further, and was going to cover the attorney/client costs, as well as the party/party costs that were covered in the litigious matters.

Ms Pilane-Majake made the point that the ordinary man in the street may come up with a patentable concept, but may not be able to afford huge fees.

Mr Swart stressed that it was up to the client to say that he was prepared to pay a higher fee. The Bill was not saying that the attorney may charge a higher fee. He noted that (1) referred to fees for litigious and non-litigious matters. A smaller user would be asking for the tariff set out in clause 35(1). It must be borne in mind that this was a global economy context, and local legal firms should not be pricing themselves out of the market.

Ms Christine Silkstone, Content Advisor to the Committee, noted that there was nothing said about agreements to charge less than tariff, and that had to be clearer.

The Chairperson agreed, the primary concern of the Competition Commission was that no minimum should be set.

Ms Smuts agreed fully and said that it was necessary to allow the market to operate. She believed that the irregularities had arisen because of distortions in the market. If attorneys were allowed to charge less than fees set, they could get more clients, and at the same time if a wealthy client wanted to pay more, they could.

Mr Raj Daya, Acting Deputy Director General: Legislative Development, Department of Justice and Constitutional Development, said that the drafters would try to capture, more succinctly, the key principles in the Further Option, without referring specifically to Competition Commission principles.

Mr Swart noted that an attorney could negotiate, up to 25%, under the Contingency Fees Act, and he thought it was necessary to make reference to this. Perhaps “investigate the provisions of the Contingency Fees Act” needed to be inserted in both options.

Ms Smuts thought the Committee was only opting for the Further Option.

Mr Swart agreed that in that case, it would be covered.

Mr Skosana said that the Director General of the Department had asked that the drafters raised, with the Committee, a clause allowing the Minister to determine categories of fees for certain legal services. That would relate to fees paid by the State, where there was lack of uniformity, and government departments were vulnerable. If certain categories of fees were published in the Government Gazette, it may be helpful. At the moment, fees were being charged differently depending on the person who was being charged.

Mr Swart understood the point, as far as it related to government departments, but reminded the Committee that there had been a very strong sentiment against the Minister determining any fees. The broad issue was that government departments were not using the State Attorney, but rather private attorneys, and that was something that needed to be looked into. Although the client was a government department, the fee was being charged by a private practitioner, and this might run foul of the Competition Commission. The State Attorney was one body, and it was problematic when some departments were not using it, as they should. There were other issues contributing to the dilemma that Mr Skosana had outlined. His initial reaction was that he was not in favour of this. There was already a set tariff for litigation so he was not sure how attorneys or advocates were charging different fees for this.

Ms Pilane-Majake supported the view that departments should be using the State Attorney, and they should get special permission from the Minister to depart from that. She suggested that perhaps the State Attorneys Act may need to be amended.

Adv L Adams (COPE) asked why there should be any difference between a state department and ordinary citizens, since both were clients. It amounted to ultimately setting a maximum fee for all clients, then allowing the practitioners to negotiate below that.

Mr Daya reiterated that all the principles would be incorporated, but that investigation should include the possibility of capping fees, whether limited to State departments or otherwise. That would avoid being prescriptive on the outcome of the process. That would not compromise any existing law and would be a wide investigation. Legal Aid South Africa had a prescribed tariff, with a roster of attorneys, and those who did not want to be bound by those fees would not include their names on the roster. He thought that the State could have a similar tariff.

Mr Swart agreed about the sentiment to consider it, but pointed out that there was a huge difference between criminal cases, and something that involved billions of rands, where the State wanted to use the top advocates. The State was the biggest litigator and it was often in the interests of the taxpayer to get the best lawyers. National Treasury was using Jeremy Gauntlett in the SANRAL case. He did not want to pre-empt the arguments or what might come out of the inquiry. Clients who were state departments should also be entitled to have the best services. This also linked into the broader policy perspective of State departments.

Ms Pilane-Majake thought it was sensible to allow State departments to get specialised services. At the same time, it was necessary to have control mechanisms. The important point was how to strike a balance and put those in place.

The Chairperson said that whilst Mr Swart had raised some very important and persuasive points, he was pleased to hear Ms Pilane-Majake’s emphasis also on control. There was a danger that numerous senior practitioners may be hired, and although the State department might be able to justify it, in context, there was also a danger that other matters could get out of control, and in hindsight, it was recognised that lesser services would have been sufficient. It was clear from what Mr Skosana had said that there were concerns, and the Department of Justice and Constitutional Development (the Department) had noted that it was faced often with bills from state departments.

Mr Skosana said that Mr Daya’s suggestion for a possible capping might make sense. He cited the instance where Government was faced with Constitutional issues, but many of the team did not actually speak. He wondered whether an interim measure was not needed, because it was an ongoing and immediate problem.

Adv Adams thought that capping of fees would not result in getting the best lawyers, because the best would not act until the fees were to their satisfaction. Ultimately, the client, whether government department or citizen, needed the services. She agreed that at times lawyers were taking advantage of government departments, regarding them as a cash cow, but the government department was the one requesting the services.

Mr Swart gave an example of a matter that had severe consequences for the State – where a policeman off-duty had committed crimes and the State was being sued. A Junior only had been used, but that case had had huge consequences, and the Constitutional Court determined that the State was liable in that case. He was still not in favour of any interim measures, as suggested by Mr Skosana, until the full investigation had been held. He fully agreed with the points raised by Adv Adams. He pointed out that the fees could range from R45 000 or higher, per day. This, however, was part of the broader enquiry that needed to take place. If the State Attorney won a case, it would recover fees for the fiscus, but would not charge its department any fees. He did not understand why departments were not using the State Attorney.

Ms Pilane-Majake said that the fiscus must be protected, but it recognised that the State should be in a position to get the best services, subject to some controls where outside practitioners were to be used.

The Chairperson noted that this really answered the fundamental question of why this Bill was needed.

Mr Daya said that another factor to be considered was the question of mandatory fee agreements, which lay at the heart of many complaints laid before the law societies. One of the recommendations might be that mandatory agreements were necessary.

Ms Smuts suggested that perhaps that needed to be included specifically as well.

The Chairperson fully agreed; every client must be informed, up front, of what fee s/he was expected to pay.

MS Smuts pointed out that there was something useful in one of the research papers.

Clause 37: Establishment of disciplinary bodies
Ms Louw noted the new (1A) dealing with establishment of disciplinary bodies. An investigating committee may obtain “any book, document or article… which relates to the complaint in question”. The legal practitioner may not refuse to produce the information.

There were other amendments to (2)(a) and a new (b).

Ms Smuts thought that reference was needed here to the relevant regions. The complaints would be lodged with the regional councils. There was an assumption that the disciplinary matters would take place at the regions, but this clause should specify that the investigation was not investigated at central level.

Ms Louw said that the intention was that this could be delegated, but the option would be left to the Council to delegate. The matter would be lodged at the region.

Ms Smuts said that this should be clear, and that after lodgment with the region, it should either be sent to the central body (which might be better since the people did not know each other), but there were also considerations that the disciplinary actions and hearing should occur where the misconduct occurred. However, that should not be discretionary and had to be more clearly stated.

Mr Swart said that this emphasised the importance of separate sub-committees at regional level. He was concerned with the wording because the Council would only be meeting four times a year, and this raised the question of how it could “when necessary, appoint a committee”.  He also thought that one person should be appointed to investigate. He saw the option to delegate but still thought that this was a problem. It would surely have to be delegated down, even Exco may not deal with the matter, and surely, particularly in view of the volume of complaints, this would have to be dealt with at the regions. He cautioned that this Bill was water-tight on procedures to avoid the possibility of practitioners taking this on review. A delegation power would have to be incorporated, for the Council.

Ms Pilane-Majake thought that it would be easier to discuss this at regional level.

Ms Smuts said that clause 36 had not been considered today, but it formed part of the debate. The DA was not in favour of clause 36 as it stood, because it asked the Council to develop a single Code of Conduct. There were two branches of the profession, and each should develop its own Code. She reiterated her view that there should be two Chambers at top level (Council) as well. The General Council of the Bar (GCB) was happy to consult, but wanted the ability to have its own Code. The disciplinary hearings would be held because of infringement of the Codes. As the Bill was written, the disciplinary committees would consist of one advocate, one attorney and one lay person. That did not appear to be in discord with the position of either the advocates or attorneys profession. She thought that there may well be virtue in that, as there had been cases in the past where an instructing attorney refused to testify against an advocate.

Mr Daya urged the Committee to consider some issues when deliberating. The first related to the Code, as set out in clause 36. The Department was envisaging that there be a very simple Code, with some sections applicable to each branch. For instance, there would be a chapter headed “Advocates”. Essentially, the differences would relate to trust accounts and referrals. That was why the Department did not think that there was a need for a separate chamber at an entrenched level, but it did agree that there could be specialist committees at regional level.

As to how the disciplinary bodies should be constituted, and whether original powers were to be given to a regional body, he noted that the regions would no doubt develop according to need. There could be a duplication of what currently existed, with its financial challenges, but there might be regional councils in every province. Ideally, that would enhance access to justice. If there was delegated power at a national level, it enhanced accountability of the profession. Some practitioners had offices in several provinces. This Bill would emphasise that attorneys were admitted as officers of the High Court, not of divisions. If the national Council was to create other bodies, to whom it could delegate, that was a question of efficiency. The rationale was to retain this power with the national Council, and not to give original powers to regional committees, which might dilute those functions.

Mr Skosana added that the Council would have committees, who may meet more than four times a year, and focus on different aspects. He cited the example of the Judicial Service Commission (JSC) which had conduct committees, whose recommendations were referred back to the full JSC sittings. He said it was important to have an investigating committee (not an individual) who would get the necessary information. The Council would hear the recommendation of the committees who had done all the preliminary work. If the preliminary committees did not have any power to make a decision, then they did not need original powers. It would be important to consider an organogram of the structure.

In relation to the Code, he noted that something similar was being done for magistrates; there would be a uniform Code, but aspects specific to each branch would be incorporated.

The Chairperson cited the example of a person who lived in a remote rural area, asking where she would have to lodge her complaint.

Mr Skosana said it was envisaged that there would have to be a regional office, but once the complaint had been taken there, it would refer it to a central office.

Ms Pilane-Majake stressed that it was not the intention of the Committee to encourage fusion of the profession, and pointed out that clause 36(1) was apparently attempting to do this.

Mr Skosana said that this was not the intention of the Bill. However, the Department wanted to have a uniform approach to make matters simpler for the public.

Mr J Sibanyoni (ANC) said that if the example of the JSC was followed, and complaints were dealt with by a committee, it would assist if the groundwork had been done.

Ms Smuts noted that the codes were available, and the issue of self-regulation sat in their codes. As long as the two professions were recognised, it was not up to anyone to take that away. However, she noted that there were arguments for homogenizing; she respected the ideology, but did not agree with it, believing that there was a place for the two professions. In every other country where there had been fusion, there was a Bar operating in effect and that was because there was a need for it. She did not believe that the JSC structure would work. She still thought it was necessary to have a chamber or committee at the top, to write its own code. When the disciplinary matters arose, misconduct would relate to specific rules of that particular profession. The complaints would be lodged in the regions (ideally with the regional chamber). She pointed out that committees would have to look at 32 000 complaints, from all the regions. She thought rather that the complaints should go to the new regional councils, and to the relevant chambers within that. These should have some sort of recommendatory committee. If a hearing was warranted, then a disciplinary investigating committee would be constituted.

On the broad homogenisation, she said that bar councils had always done their uniform rules at a central level, and she suggested that they should be able to add extra matters governing their own conduct.

The Chairperson stated that all of these issues were still under discussion, with no agreement reached on any.

Adv Adams wanted to speak to time periods for lodging a complaint. The procedure for disciplinary action had nothing to do with lodging a complaint. Clause 95(s) spoke to the manner and form for complaints.

The Chairperson said that there were difficulties with this. He questioned who would determine once the time period kicked in.

Mr Daya said that he would find out if any time periods applied currently.

Ms Pilane-Majake thought that perhaps enabling rules could be included.

Ms Smuts said that it was not possible to start writing rules for the profession.

Ms Louw thought that perhaps something should be inserted under that, to alert the Council that it may be necessary to consider guidelines.

The Chairperson thought it might be left to the Legal Practice Council or the Rules Board.

Ms Louw asked if an option was needed.

Ms Smuts said that she could not see that the Council could deal with so many complaints, and asked that an option be included for this to be dealt with at regional levels.

Ms Louw noted the insertion in (3), that a Chair of the disciplinary committee could not be a lay person. She also noted that the footnote 212 referred to the fact that section 25 of the JSC wording was used, but the Committee needed to decide who was to compile the list, and how remuneration would be handled.

Ms Smuts said that she was tempted to suggest that the Ombud compile the list, who should have the right to oversee disciplinary proceedings. She remained of the view that the Ombud should be a retired judge, although she was not completely opposed to the option provided. A retired judge would have public confidence and she thought it could be left to this person to compile the list.

The Chairperson noted that other Committee members were not in a position to comment at this stage, and the note was to be considered.

Clause 38: Procedure for dealing with complaints
Ms Louw noted that there was an insertion into subclause (3), which noted that this was subject to new subclause (4)(a), which now contained a reference to sections of the Criminal Procedure Act.

The Committee had asked for information on how the medical profession conduct inquiries worked. These were open to the public and the media, unless the Chairperson decided otherwise.

The Chairperson referred to subclause (3)(d)(iii) and questioned why there was a provision for availability during business hours.

Ms Louw noted that the public could access the details either by visiting the offices, or accessing the website.

Mr Swart suggested that “relevant” should be inserted, before “regional council” in (iii).

Members agreed and asked for the change.

Ms Louw noted that (4)(b) was inserted to allow the complainant to be present.

Ms Smuts thought that the changes reflecting the wording of the Criminal Procedure Act (CPA) were correct, with the wording “with the necessary changes”, which she quipped was a wonderful phrase.

Ms Louw asked whether “on good cause shown” should be deleted, but the Chairperson confirmed that it should remain.

Clause 39: Disciplinary hearings
Ms Louw noted that subclause (8) had been moved to the clause dealing with disciplinary offences.

Clause 40: Proceedings after disciplinary hearings
Ms Louw noted insertions, firstly in subclause (3)(i).

Ms Smuts said that the objection in every country where there had been reform was the cost. This was one way to get revenue, provided that the Council was not in charge of discipline.

The Chairperson agreed that making the fines payable to the Council was acceptable.

Mr Daya said that the argument was that complainants were sometimes out of pocket, with compensation awards in favour of the complainant.

The Chairperson noted that this was dealt with under clause 40(b). This was a different option from (a). Similar options were included for juristic entities and practitioners.

Ms Silkstone noted that in Australia, the practitioners could be ordered to make good. She suggested that perhaps something could be included. Essentially this was rectifying any harm done; she would look into it further and report back.

Adv Adams asked if clause 40(3)(b)(i) should not be worded the same as subclause (3)(a)(i), to include the wording “on application by the Council”.

The drafters and Chairperson agreed, and these words would be inserted.

Ms Louw referred to the deletion of subclause (8) because it was unnecessary if clause 38(3) (relating to particulars of hearings that were published) was accepted.

Clause 42: Appeal against conduct or finding
Ms Louw noted that an insertion in regard to the composition of the committee was included, in subclause (2)(b).

Clause 43: Monitoring by Legal Services Ombud
Ms Smuts noted that there was no underlining or insertions, but footnote 250 suggested that the Committee needed to give guidance on review powers. She believed that if the Ombud was a retired judge this would do no harm.

Ms Louw said that the footnote related to the powers and functions of the Ombud.

Mr Daya noted that the wording was not mandatory.

Mr Swart agreed that the “may” was preferable. However, the Committee was considering the disciplinary process at regions, with an appeal structure. If the clause was worded as “may”, the attorney or complainant may be able to run to the Ombud to complain about the process, which might delay the proceedings. He thought that the review process should be available once the disciplinary process was finalised, although he was not opposed to the principle that the Ombud could be called in earlier. He asked how the Committee wanted the process to unfold and thought it would be useful to look at other structures, to see how they dealt with this.

Mr Daya said that somewhere else in the Bill there was a note that all other legal processes must be exhausted before approaching the Ombud.

Ms Smuts said that originally there was a power of review, but the Committee  had started to move towards an appeal mechanism.

The Chairperson noted that other powers were set out in clause 49.

Mr Swart asked if the Ombud could intervene at any stage.

The Chairperson noted that it was not intervention, but referral of the matter to the relevant authority, such as the National Prosecuting Authority. He suggested that the matter raised by Mr Swart should be flagged for further discussion as the Committee went through the Bill.

Ms Pilane-Majake said that the Ombud was a referee. If the complainant felt that processes were not being followed, he should be allowed to approach the Ombud, but this was not to say that the Ombud would stop the process unfolding.

Mr Daya noted that the rules of natural justice would include an appeal procedure. The Committee had ensured that the appeal committee was independent. In order to prevent a flurry of referrals to the Ombud, prior to the appeal being finalized, the intention should be to have those internal mechanisms exhausted.

The Chairperson said that he agreed; there would always be a right of appeal, which should ensure that the committee would deal with matters properly.

Mr Swart said that whilst this should apply, as the Bill was worded, the Ombud could “on receipt of a complaint” take action, and there was nothing to prevent a complainant from lodging a complaint, for instance, that the matter was taking too long.

The Chairperson asked if the Committee wanted the Ombud to be able to intervene.

Mr Swart answered that this was a debate that Members should have. Complainants may not feel that the matter was being dealt with effectively or fairly. The wording now suggested that the Ombud could look into it. It was possible that a complainant may not approach the Ombud for fear of delaying finalization.

Ms Pilane-Majake said that a complainant could feel that the matter was being dragged out and approach the Ombud.

Ms Smuts said that essentially the Public Protector was an ombud. On the same point, looking at the alternative to clause 49, subclause (1(a)(ii) referred to “undue delay”. She also said that (b) implied that if the hearing was incorrectly conducted, the Ombud could step in to mediate, conciliate or negotiate.

The Chairperson said that (c) also referred to “do anything necessary to enable the proceedings to be taken to a competent court”.

Mr Daya said that this was a worrying power. Because the Committee was looking at this, in isolation of the rules to be promulgated around time-frames, delays and so on, there was not a completely clear picture. He would have thought the rules would be specific to avoid any delay.

Ms Smuts noted that there was already something to say that the matter should be concluded within three months.

Mr Swart said that there was nothing to prevent the accused to say that he had not been dealt with effectively or fairly, and referring it to the Ombud as a delaying tactic, because the Ombud would have to call for the record of the proceedings. Mr Daya’s point was correct and perhaps this needed to be tightened up when the rules were created.

Ms Smuts was persuaded by this. Procedural impropriety could also be the subject of an appeal.

Clause 48
Mr Sibanyoni asked who was to appoint the Ombud.

Ms Pilane-Majake said that the role of the Ombud was to make recommendations. She did not think it was necessary for the President to be involved. Similarly, when other sections referred to “the President” she suggested that it could be changed.

Mr Skosana said that it would depend on the principle whether that person was a judge. The reference to the President was probably based on this. (the remainder of what he said was inaudible).

The Chairperson noted that the alternative option introduced the possibility of a judge, which the Committee had not interrogated yet.

Ms Smuts said that she had suggested that if a retired judge was to be used, the President might appoint, with the concurrence of another person.

Mr Skosana said that for appointment to a commission, it was usually the President with the concurrence of the Chief Justice. In other matters, the President and Minister would deal with appointments. Only the President could determine remuneration and conditions, with Parliament, to preserve their independence.

Ms Smuts felt strongly that a retired judge should be the Ombud as that person would be above reproach. She agreed that if this was done, the President should appoint, but thought that the Chief Justice must also be involved.

Mr Skosana said that when appointments involved a retired judge, in terms of other legislation, it was the President, on advice of the Minister, who would deal with the appointments. Once judges moved out of service, the Chief Justice was involved. He reminded Members that there was in fact no “retired judge” but one relieved from active service, who may still be called in, and finally one discharged from active service who may not be called.

Ms Smuts reiterated her desire to have a judge discharged from active service as the Ombud.

Mr Skosana noted that a renowned person with authority would be needed, as that person may be required to oversee the conduct of a senior practitioner, and that could be difficult. Perhaps the person would have to meet the requirements to be appointed as a judge. As the current list stood, there might be difficulties in practice, for a senior practitioner may object to being under the oversight of another person who, although meeting the requirements, did not have the clout or respect.

Adv Adams noted that the period of service of the Ombud was seven years, or even fourteen years, and that person could be in their eighties by then. She proposed that if the retirement proposal was included, then a specific age should be included.

Ms Smuts said that “and/or a period of service could be included”. 

Mr Sibanyoni quipped that the Constitution prohibited discrimination on the basis of age.

Ms Smuts noted that there were also some young discharged judges.

Clause 47: Objects of Ombud
Ms Louw noted the mention of “as contemplated in this Act”, which would emphasise the fact that it was only legal practitioners under this Bill being dealt with.

Ms Smuts thought that “monitor” might be better than “ensure” in subclause (b).

Clause 50
Ms Louw noted that the Committee had asked for the clause to be tightened up, and read through the new wording of “salary, allowances and benefits” in subclause (2).

Ms Smuts asked Mr Skosana to explain the remuneration situation for a judge discharged from active service.

Mr Skosana explained that the President and Minister would deal with this. It was unusual for the President to consult with the Minister of Finance.

The Chairperson said that this was not the Committee’s understanding; the meaning of “after consultation” implied that at least a letter would be written but there was no requirement for the Minister to agree. The Committee did not like the term “on the advice of” because it was not as clear as “in” or “after” consultation. This could be as simple as a phone call.

Ms Smuts said that others had well-developed views on what “consultation” meant and it came into play when the President consulted on appointments like the Chief Justice. She thought that it should not be perfunctory, in that context. There were legal opinions and the President would have to apply his mind to what the advice was, certainly in the context of judges.

The Chairperson said that “after consultation” meant that there was no requirement for agreement.

Ms Smuts asked if Mr Skosana was suggesting that “after consultation” should not be used.

Mr Skosana said that the Department was trying to align the Ombud with the office of the judge – and if that was so, then it was possible to determine that a salary equivalent to that of a judge would be paid, which would not require consultation, as it was a known fact.

The Chairperson noted that the term of office remained as seven years for the moment.

Ms Smuts suggested an option also for five, because of the difficulty as raised earlier by Adv Adams that most judges were of a certain age once discharged. She would not like to see another term of five years. In general, she thought that only one term for these kinds of positions was correct.

The Chairperson asked Members to consider one non-renewable term of seven years.

Members present agreed to that.

Clause 56: Limitation of liability of Fund
Ms Louw noted that sub-clause (1) set out that the Practitioners Fidelity Fund (the Fund) would not be liable in respect of certain instances. There were various deletions of the term “or advocate” in subclauses (4) and (6).

Clause 58: Purpose and application of the Fund
Ms Louw pointed to the deletions in (l)  and (n), because of the differentiation between the “may” and “must” functions.

There was a whole new paragraph setting out for what purposes the funds may be utilised.

Mr Daya noted that this would be renumbered as clause 58(2), if supported.

The Chairperson noted that there would be a number of administrative changes that would still need to be effected.

Clause 63: Composition of the Board
Ms Louw noted that in clause 63(1)(a) it was now noted that one of the five practitioners serving on the Board of the Legal Practitioners Fidelity Fund (the Board) must be an advocate. This would be one who received direct briefs. Similar references were included in clause 64.

Clause 65: Membership of the Board
Ms Louw noted that this now reflected the discussions earlier about the court of first instance and appeals.

The Chairperson asked Members to think about the alternatives now set out.

Clause 66: Chairperson and deputy chairperson of the Board
The Chairperson noted a grammatical error in clause 66(2) where “of” should read “or”.

Ms Louw noted that there was a technical insertion in clause 66(2) to align this with clause 9.

Clause 69: Removal from office
Ms Louw noted that clause 69(1) was amended to provide that the Board may remove a member on account of a finding by a disciplinary committee of any serious misconduct contemplated in section 36.

The Chairperson said that the Committee still needed to decide whether this should read “must” or “may” remove.

Ms Louw pointed the alternative option to (d), with the addition of the words “confirmation thereof as soon as practicably possible by the Ombud”.

There was also a reference in a new subclause (e) to becoming disqualified to remain as a member of the Board, in circumstances set out in section 65(2). The previous (e) and (f) were deleted.

Mr Swart asked, in respect of the alternative to (d), whether this meant that if the Ombud did not confirm it, this would fall away.

Mr Daya said that the intention in putting this in was to ensure that the Ombud would deal with it speedily but it must be recognised that the Bill could not dictate to the Ombud. However, it was an indication that this was what was needed.

Mr Daya also noted the need to amend the reference, in subclause (4), to the appropriate subsections of section 64.

The Chairperson said that section 64 did contemplate the rules and he thought there was no problem with this.

Mr Daya corrected himself.

Clause 70: Meetings and resolutions of the Board
Ms Louw noted that in clauses 70(4) and 17, the printed version stated “a decision of the majority of the members” constituted a decision. The previous draft had said “members present”.

Mr Daya said that the concern was that on a particular day the quorum might be very low. The Committee had said that the intention was that the quorum would be based on the membership of the board.

Mr Skosana said also that on the JSC the appointment of judges was confirmed by the majority, regardless of how many attended. A reference to “all membership” would tie members to attending meetings, and this could avoid skewed membership. Even if the meeting was quorated, a certain number of confirmations were required.

Clause 71: Committees of Board
Ms Louw said that the Board “must” appoint an executive committee, one of whom must be a (direct brief) advocate, in terms of subclause (1)(a).

In subclause (2), it was now stated that the Board must elect and appoint a chairperson of a committee.

Mr Daya noted that clause 71(2)(b) noted that the chair and deputy chair of the Board would be, ex officio, chair and deputy chair of the Exco.

Members confirmed that they were happy with this.

Mr Skosana said that this Committee had approved the South African Judicial Education Institute Act, where the Chief Justice was not actually involved in all committees. It was not workable and an amendment would be brought to the Committee.

Ms Smuts thought that the Chief Justice had a huge workload, and it made sense in some cases not to require that official to attend to all meetings.

Mr Skosana maintained that for practical purposes it could be a challenge.

Ms Pilane-Majake pointed out that often turmoil in institutions was caused by the legislative framework.

Clause 74: Contributions to the Fund
Ms Louw noted insertions in subclauses (2), (3) and (4), which were technical in nature, referring back to subclause (1)(a) to ensure that this was clearly referring to practitioners with fidelity fund certificates.

Clause 77: Insurance cover
Ms Louw pointed out that there was an insertion of a reference to a practitioner referred to in section 84(1) (practising for own account or as a director).

Clause 79: Actions against Fund
Ms Louw noted a similar cross-reference in this clause, and noted that the same also applied to clause 80, where clause 80(2) had been moved also to the clause setting out the offences.

Clause 84: Obligations relating to handling of trust money
Ms Louw noted that the offence originally set out in subclause (4) was moved to clause 93.

There had been a deletion from subclause (6), and another from (10), referring to a “legal adviser”.

Mr Swart reminded the Department that the South African Human Rights Commission (SAHRC) had asked for a special provision to apply to themselves.

Ms Louw said that in any application, there would be consideration of how the lawyers in the employ of Chapter 9 institutions would be acting. She personally believed that the SAHRC may have understood the context of the whole Bill when requesting this.

The Chairperson suggested that the SAHRC be asked to explain this when it met with the Committee on the following day.

Mr Swart noted that this insertion was done at the request of the SAHRC. However, he thought that it was strange only to refer to this body. He had suggested that a general reference to “Chapter 9” institutions be inserted. They were included because they had specifically requested it.

Ms Louw repeated that she thought they had misunderstood the ambit of the Bill. There were admitted attorneys employed by the SAHRC. However, a person remaining on the practising roll would fall under the ambit, but this was because they would be practising attorneys, not under the employment of the SAHRC.

Ms Silkstone asked what trust money they dealt with.

Ms Louw said that they fell under the Public Finance Management Act, and would not receive trust money for a client.

Mr Daya asked if the SAHRC undertook any damages claim.

Mr Swart said that they could not claim damages. The legal practitioner employed by them may act for a community, but the practitioner would not receive money.

Mr Daya said that if the institution received money, and it was misappropriated, then the question arose how it would be protected. The broad principle must be clarified.

Ms Pilane-Majake said that she thought the SAHRC submission covered trust money.

Mr Swart said that with the State Attorney, any cheque made out for a claimant would be made out by the client department directly to the claimant, so the State Attorney acted merely as a “post-box”. He thought that the cheques would be made out in the name of their client. The PFMA did not make any provision for separate accounts. There was less likelihood of stealing the money because it was a non-negotiable instrument. If the attorney intended to steal it, s\he would have to open an account in the name of the client; it was not unheard of, but unlikely. He thought the SAHRC must clarify, on the following day, under what circumstances they would receive capital money.

Ms Smuts thought it would be useful for Mr Daya and Ms Louw to be present.

Mr Swart said that he had thought the Public Protector may have given an order of damages, but he spoke under correction.

Ms Smuts noted that the Equality Act did make provision for unusual orders.

Clause 85: application for Fidelity Fund Certificate
Ms Louw noted that there had been a suggestion that clause 85(1)(b) be moved to clause 26, which related to practical vocational training and this had been done.

Mr Daya noted that this subclause had referred to a practice management course for candidate legal practitioners. However, this referred to every practitioner who, for the first time was entering practice. He wondered if clause 26(c)(ii) was attempting to insist that a person must do the course again when opening up practice for own account. He noted that a professional assistant (who was not a candidate) might decide to open up his own practice, after ten years. He thought that the intention may not be correctly reflected in (c)(ii).

Ms Louw suggested that in this case, clause 85(1)(b) be reinserted, to deal with the existing practitioners. The other clause, clause 26, dealt with candidate attorneys, and it was necessary to ensure that they did not fall through the cracks.

Mr Swart noted that he was currently on the non-practising roll. As presently worded, he would not be required to do the course.

Members pointed out that the course would have to be done by a person wanting to practice “for the first time”. Anyone who had operated a practice previously would be exempt.

Mr Skosana said that someone who had practised with the State Attorney but who wanted to open for own account would have to do the course.

Ms Silkstone asked if there was anything around continuing legal education.

Ms Louw confirmed that it was under the objects, powers and functions of the Council, clause 6(5)(e), which referred to “compulsory post-qualification professional development”.

Ms Louw noted deletions of subclauses (6), and technical amendments in (5).

Clause 86: Trust accounts
Ms Louw noted technical deletions of wording, in subclauses (1), (6) and (7).

Clause 87: Accounting
Ms Louw noted the deletion of references to “advocate”, because this did not refer to work that advocates undertook.

In sub-clause (5) there was a cross-reference to clause 37(1A), which related to the investigating committees. There was also the insertion of “advocate”.

There had been a correction of a typographical error in (6), and clause (7) had been moved to the offences clause.

Clause 89: Court may prohibit operation of trust account
Ms Louw noted a technical deletion.

The same applied to Clause 90(1)

Clause 93: Offences
Ms Louw noted that all offences had been consolidated here.

Mr Swart said that he was satisfied with the sanctions.

Clauses 94 and 95
Ms Louw noted that these clauses had not been finalised.

Clause 96: National Consultative Forum
Ms Louw noted that the name of the Transitional Council was changed to the National Consultative Forum, This would be effected throughout.

Mr Daya said that in clause 96(a)(i), the names of the law societies appeared to be antiquated.

The Chairperson noted that these were their names as stated in the Attorneys Act. This Act was repealing the Act.

Mr Skosana noted that a similar situation applied under the Superior Courts Bill. It was necessary to put their legislative titles into this Bill.

In subclause (b) there had been a deletion of the reference to the Law Teachers Association of Southern Africa. The Committee would still need to decide upon one or two academic representatives.

In (e) the wording “who may not be a legal practitioner” was deleted.

Ms Louw noted the option to clause (2)(c), which included the wording “as far as is practicable”. 

A period of three years had been inserted,  at the Committee’s request, into subclause (3).

Clause 97: Terms of reference
Ms Louw noted that the Forum must, within 24 months, make recommendations on an election procedure for the Council (not the “first Council”) to avoid repeating the process, and there was insertion about a chamber for advocates and for attorneys.

Mr Daya thought that the reference to a chamber should be put in as an alternative.

The Chairperson said that the footnote made it clear that this was an option.

Mr Daya said that he would prefer to reflect it as an option, and this was agreed to.

There was insertion of the word “composition” in relation to (iii).

There had been a question, in relation to subclause (4), why the GCB had had a problem with the referral to arbitration. The Department did not understand the problem that the GCB had with “status” and did not agree with this. She read out the new wording for (4).

Mr Skosana said that when the Department had worked on the costing, the Ombud and new Forum would be funded by the fiscus, and the calculations would be presented in due course. The Committee had repeated its query what the Bill would cost the profession, at the end of the day. There were comments that it may not be affordable and might even affect transformation. One idea might be for the transitional council itself to come up with a funding model, over the next three years, so they would have to think how to organise meetings and how to fund the profession.

Ms Smuts thought that this was a good idea.

The Chairperson said that it was difficult for the Department to assess this and it would force the profession to think creatively for the future.

Mr Skosana said that whilst the Department could do that, it would prefer the profession itself to do so. This should be included then under the terms of reference.

The drafters were asked to add this in, under clause 98(1).

Clause 99: Membership of Transitional Council
Ms Louw noted the reference to a conviction “in a court of first instance” under clause 99(2)(c).

Clause 102:
Ms Louw said that a previous clause dealt with convictions of misconduct, but the provisions would not be in effect during the time that the TC was to operate.  However, the various members of the Transitional Council may be subject to codes of conduct of the professions they represented.

There was deletion of wording for sequestration, since this was covered in clause 99(2)(a).

Ms Louw said that the Schedule would be updated in the new draft.

The Chairperson said that there seemed to be no reason, now that the Committee had gone through the full draft, whether the “hard decisions” could not be debated on the following day. He asked if Members needed the opportunity to consult their parties.

Ms Smuts thought it might be prudent.

Mr Sibanyoni wondered if it might be feasible to delay the start of the meeting.

Members thought that it might not be possible to do so. They suggested that perhaps the Committee should not meet at all in the morning, leaving that time for caucus consultations.

Ms Smuts noted that the Committee was meeting on Thursday afternoon as well, and would appreciate the drafters also being present at the SAHRC briefing. She noted that there were some other ideas “still percolating” and the drafters had work to do on several clauses. She was keen to look also at the Australian and new research unit documents.

The meeting was adjourned.


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