Fox In The Henhouse

Unmasking unscrupulous attorneys

Makhanda High Court, established in 1864, is one of the oldest superior courts in South Africa. So why do some attorneys avoid it? A seemingly straightforward claim to the Road Accident Fund by Wendy Tetani (57) could offer some clues.

In Brief

  • Unsolicited phone calls - whether from telemarketers, scammers or ambulance chasers - are annoying. But for one widow in the Eastern Cape who wanted to make a claim against the Road Accident Fund (RAF), the man behind the unfamiliar number seemed like divine help
  • Award-winning investigative legal journalist Tony Beamish exposes how some personal injury attorneys collude to cheat the poor out of much-needed claim pay outs
  • In the Pretoria High Court, John B. Scott Attorneys and Van Zyl Le Roux Inc., challenged the Taxing Master's ruling on contingency fees
  • A Judge President last year castigated personal injury attorneys for abusing fee agreements in RAF claims

In August 2012, Wendy Tetani, a 57-year-old resident of Makhanda in the Eastern Cape, received an unsolicited telephone call from a man who gave his name as John B. Scott.

Wendy got the impression from the way Scott interacted with her and presented himself as an attorney at John B. Scott Attorneys that he was a person who could help her to pursue a loss of support claim against the Road Accident Fund (RAF). Her husband, Thembisile Patrick Tetani (54), a hospital porter who worked and lived with his family in Makhanda, had died from injuries sustained in a road accident just the previous month. So, Wendy signed a mandate and fee agreement with Scott.

Logically, the claim to the RAF should have been filed in the Eastern Cape high court, sitting in Makhanda. But in 2017, (five years after the initial phone call) Scott, strangely, issued summons out of the Pretoria High Court, over one thousand kilometres from the scene of the accident and Wendy’s home. Meaning witnesses would have needed to travel to Pretoria, and Wendy, who had by then taken domestic work duties, would have needed to take leave from her job to attend the court hearings.

Such claims from RAF are relatively straightforward, and Wendy’s lawsuit got settled out of court on 7 November 2019. The mother of two daughters was overjoyed: After such a long wait, she would finally get her share of the much-needed payout. But things took a dramatic turn for her. She became embroiled in an ugly fee dispute over the adjudication of the costs owing to the attorneys.

Without the knowledge, skills and resources needed to fight the travesty of justice, Wendy knew she faced an insurmountable problem. So, she turned to her employer, who connected her with Helen Kruuse, an old schoolmate and an Associate Professor at Rhodes University’s Department of Law.

Who are these attorneys?

The mandate and fee agreements signed by Wendy with John B. Scott Attorneys in August 2012 and October 2017 were void. According to The Cape Law Society, fee agreements must comply with the Contingency Fees Act.

Still, without a valid fee agreement, Scott roped in a Pretoria-based law firm, Van Zyl Le Roux Inc. (VZLR), who went on record as the plaintiff’s attorney.

Ironically, VZLR’s motto is “Honest. Open. Simple. Law”. Did these correspondent attorneys find it odd that Scott filed Wendy’s claim in a different province and one of the busiest courts in the country? In the Pretoria Division of North Gauteng High Court, litigants often wait for years to get trial dates. In contrast, the waiting period at Makhanda High Court is relatively shorter.

The role of a correspondent attorney is to receive and file records on behalf of the mandated attorney. But this seemingly simple matters got twisted.

Readers' call

Invalid fee agreements

On 13 August 2012, Scott got Wendy to sign the two agreements, which are mutually destructive because only one agreement is patently lawful. Unscrupulous firms do this to choose the most lucrative agreement afterwards. In 2017, Wendy signed another invalid fee agreement after Scott issued the summons.

In a scathing judgment last year, Frans Legodi, Judge President of Mpumalanga, castigated attorneys like Scott for abusing fee agreements in RAF claims:

“This way of litigating on behalf of a client amounts to an abuse intended to side-step the prohibition at common law and also to side-step the imperative in the Contingency Fees Act.”

Wendy experienced just what Judge President Legodi described: two law firms with their snouts in the proverbial feeding trough of road accident misery. The "as dit pap reen moet jy skep" (you should set a plate when it's raining porridge) attitude of certain lawyers towards victims is deplorable. And this type of extortion scam happens frequently.

Take the Bobroffs, the father and son duo. The personal injury attorneys were caught with their hands in their clients’ cookie jars. The Bobroffs packed their bags and moved to Australia.

Similar scams have been seen around the world. In the US, Alex Murdaugh of South Carolina is on trial for allegedly pocketing millions of dollars in insurance settlement funds.

The deception continued

VZLR, counsel aware of the cost of lying to the court, admitted that there was no agreement, invalid or otherwise. According to court records, the counsel appearing for Wendy told Judge Sulet Potterill: “There is no contingency fee agreement between the plaintiff and the plaintiff’s attorneys.”

But VZLR did not disclose the invalid fee agreements signed in 2012 and 2017.

There is a significant difference between 'no agreement' and 'no valid agreement'. If an agreement is void, an attorney cannot subsequently make one. If there is no contingency agreement, there may well be another valid and lawful ordinary fee arrangement in place. No valid contingency fee agreement means that there simply isn't one. In such a case, the High Court scale should apply.

This journalist knows the advocate who appeared for Wendy as an experienced, competent and respected counsel who can distinguish between "no contingency agreement" and "no valid contingency fee agreement". Did he mislead the court?

How are attorneys' fees calculated?

The Eastern Cape Division of the High Court of South Africa, sitting at Makhanda

In personal injury claims, the plaintiff’s attorney prepares an account known as a ‘bill of costs’.

The bill of costs is prepared based on the mandate signed by the client. If there is no valid fee agreement, an attorney may only charge the client a fee based on the courts’ tariff. The Taxing Master assesses (called a 'taxation') the reasonableness of the charged fees.

Unfortunately for VZLR Inc., Wendy never signed any mandates with the firm, and for some reason, the Taxing Master did not request a copy from the attorneys. During the taxation proceedings, Anneli van Niekerk of VZLR said that her law firm would rely on one of the agreements signed on 13 August 2012.

Van Niekerk attempted to cherry-pick the agreement, but Taxing Master, Comfort Shilowa was having none of it. The court had been told that the agreement did not exist. Shilowa had the discretion to determine the amount of the ordinary fee. Any contingency fee increase is a contractual matter between the attorney and the client. However, this only applies if a legal agreement is signed before the start of the ligation.

The attorneys weren't happy with the Taxing Master's decision and recently asked a judge to review it. In essence, they want the judge to endorse and validate an invalid agreement and ignore the submissions of their counsel before Judge Potterill.

The real intention of the review is to wear Wendy down to accept an excessive fee. While Scott and VZLR might know many laws, there is one law that even they cannot evade - the law of unintended consequences. We can only speculate what a judge in their review application might make of all this.

When uSpiked reached out to Scott and VZLR to exercise their respective rights to reply, the former evoked sub judice defence before undertaking to settle the client’s outstanding balance by Tuesday January 24, 2023 while the latter fell back to the default of ‘we were just correspondent attorneys and this had nothing to do with us.