SCA dismisses ruling that denied attorneys their legal fees in claim against RAF

The Supreme Court of Appeal has dismissed as “procedurally flawed and irregular” a high court’s decision to prevent a legal firm from charging a client for services rendered in a claim against the Road Accident Fund (RAF) due to concerns about the calculation of the bill.

The SCA ruled there was no basis for the lower court to have made such a decision and the firm can now proceed to determine the exact amount to charge.

In 2014, Danny Sibiya was in an car accident in Mpumalanga and appointed Du Toit-Smuts Attorneys to obtain a claim from the RAF. Sibiya signed an agreement with the attorneys to pay them from the proceeds of a successful claim or from his own pocket if the court ruled against him.

In 2021, the RAF conceded its responsibility to pay Sibiya’s claim — the amount was not disclosed — as well as the legal costs.

The costs were set down for taxation — a process in which a taxing master, cost specialists and lawyers determine the costs, including the preparation of court papers and other charges based on various court rates and tariffs. Remaining charges could then be charged to Sibiya himself.

The taxing master raised concerns with the attorneys about the fee arrangements with Sibiya and sent the matter to Mpumalanga high court judge president Frans Legodi.

In 2022, Legodi found the agreement with Sibiya was unlawful and ruled that he withhold payment. The judge president also referred Du Toit-Smuts Attorneys to the Legal Practice Council, prompting their appealed to the SCA.

Writing for a unanimous court on Monday, appeal judge Yvonne Mbatha overturned Legodi’s ruling noting that “nothing required the intervention of the judge president at that stage” and that handling of the matter was “irregular”.

Mbatha noted the basis of the taxing master sending referring the matter to the judge president was based on a concern that the attorneys had “misbehave[d]” during the taxation. However, Mbatha said “there was ... no evidence of any misbehaviour”.

Even assuming there had been misbehaviour, the judge president was only empowered to “deal with misbehaviour of a party or [lawyer] ... and nothing else.” That would have had nothing to do with the agreement, the amounts and so on discussed in the taxation proceedings, Mbatha said, adding that Legodi’s ruling was “procedurally flawed and irregular”.

Mbatha also noted that despite the attorneys pointing out the purpose of the referral, Legodi “astoundingly ... proceeded with the irregular process”. Furthermore, Legodi “did not inform nor invite the parties, including the RAF, to make representations regarding the fee agreement and its legality”.

Again, the purpose of the referral was misbehaviour, not the legality of any fee agreement. “The handling of the matter by the court in chambers,” Mbatha ruled, “was irregular, a hearing by ambush and a breach of one of the fundamental principles of our law, the right to be heard”.

She also noted the court “cast aspersions” on Du Toit-Smuts Attorneys’ professionalism by seeking the Legal Practice Council’s involvement. That in itself warranted the appeal succeeding, she said.

Lawyers’ fees in claims against the RAF has been a contentious issue recently. In November, the Special Investigating Unit (SIU) recovered more than R317m erroneously paid to lawyers by the RAF. According to the SIU, several lawyers signed acknowledgments of debt totalling about R70m and others had refunded duplicate payments directly to the SIU.

moosat@businesslive.co.za