Goodricke & Son v Auto Protection Insurance Co Ltd (In Liquidation)

• Jurisdiction: South Africa
• Judge: Steyn CJ, Van Blerk JA, Botha JA, Williamson JA and Potgieter JA
• Judgment Date: 07 November 1967
• Citation: 1968 (1) SA 717 (A)
• Hearing Date: 29 September 1967
• Court: Appellate Division

Potgieter, J.A.:

In the Court a quo appellant, a firm of attorneys, practising as such in Durban, sought an order declaring respondent - '. . . to be obliged to pay to the applicant, as part of the administration expenses included in the costs of the respondent's A liquidation, the full amounts of the applicant's bills of costs for its fees earned and disbursements made in the course of or in connection with the performance by the applicant, in its capacity as the respondent's attorneys, of professional services:

(a)

which were entrusted to the applicant by the respondent before the respondent was provisionally placed under judicial management; and

(b)

the performance of which was commenced by the applicant before B the respondent was provisionally placed under judicial management; and

(c)

the performance of which was completed by the applicant, in compliance with the instructions of the respondent's provisional judicial manager, or of its judicial manager, or of its liquidator, after the respondent was provisionally placed under judicial management, or after it was finally placed under judicial management, or after it was liquidated

C irrespective of whether any particular work or any particular disbursement included in the said services was executed or made before or after the respondent was provisionally placed under judicial management; provided that, notwithstanding the aforegoing provisions, the respondent shall not be obliged to pay to the applicant the amount of any of the said bills of costs, until after such amount shall have been determined by agreement between the applicant and the respondent's D liquidator, or until after such bill of costs shall have been taxed as between attorney and client'.

The application was dismissed and, pursuant to sec. 20 (3) of the Supreme Court Act, an appeal is, by consent, made to this Court.

Before its liquidation respondent company was a 'registered company' as E defined in sec. 1 (1) of the Motor Vehicle Insurance Act, 29 of 1942, and as such was a third-party insurer of motor vehicles. In terms of the Act a considerable number of claims for compensation for injuries caused by motor collisions were lodged and in many cases resulted in litigation.

F During August, 1963 the respondent company instructed appellant to act as its attorneys and to render professional services in connection with the claims and litigation arising therefrom.

On 13th February, 1964, on the application of the Registrar of Insurance to the Witwatersrand Local Division of the Supreme Court of South Africa, in terms of the Insurance Act, the company was placed under G judicial management. This order was subsequently made absolute but on 31st March, 1964, at the instance of the judicial manager, one Wells, a rule nisi was issued calling upon interested persons to show cause why the judicial management order should not be set aside and the company liquidated. This rule was confirmed on 30th April, 1964, and the said H Wells was appointed liquidator. It is clear from both the judicial management and the liquidation orders that all fees and disbursements in connection with professional services rendered by the appellants as attorneys for the judicial manager and liquidator form part of the administration costs and that they are entitled to be paid in full for those services. The question that falls for decision is whether appellants, who had been the company's attorneys prior to 13th February, 1964, are entitled to be paid in full for professional services rendered in respect of matters not disposed of before that date.

Potgieter JA

At the date of the provisional judicial management order appellants had commenced but had not completed their professional services in connection with many of the claims handled by them. On 28th February, A 1964...