Johannesburg Society of Advocates v Edeling

• Jurisdiction: South Africa
• Citation: 2019 (5) SA 79 (SCA)

Johannesburg Society of Advocates v Edeling
2019 (5) SA 79 (SCA)

2019 (5) SA p79

Citation	2019 (5) SA 79 (SCA)
Case No	326/2018; [2019] ZASCA 40
Court	Supreme Court of Appeal
Judge	Ponnan JA, Wallis JA, Saldulker JA, Schippers JA and Eksteen AJA
Heard	March 29, 2019
Judgment	March 29, 2019
Counsel	J Suttner SC (with P Cirone) for the appellant.; K Foulkes-Jones SC (with P Louw SC, D Goodenough and S Kanyangarara) for the respondent.

Flynote : Sleutelwoorde

Advocate — Reinstatement — Application for — Correct approach by court — Court not having discretion to readmit or re-enrol advocate struck from roll — If applicant for reinstatement discharged onus of showing he/she fit C and proper person, court obligated to reinstate — Whether onus discharged, question of fact — Where applicant struck from roll for serious dishonesty, genuine, complete and permanent reformation to be shown.

Headnote : Kopnota

Mr Edeling was struck from the roll of advocates in December 1997 by order of D the High Court, which had made findings of serious dishonesty against him (see [4] – [8]). This case concerned the Johannesburg Society of Advocates' appeal to the Supreme Court of Appeal (with that court's leave) against a High Court decision granting Mr Edeling's 2015 application for his readmission and re-enrolment as an advocate. The High Court, in readmitting Mr Edeling, had held that it could do so 'if in its discretion, it finds that he has once again become a fit and proper person to be readmitted and re-enrolled as an advocate'. E

Held

The High Court had proceeded on the misconception that its decision was discretionary. In applications for the readmission of an attorney, the statute expressly vested the court with a discretion in regard to the applicant being F a fit and proper person to be readmitted — but there was no equivalent provision in the Admission of Advocates Act. Whether a person who had previously been struck from the roll of advocates was a fit and proper person to be readmitted, was a question of fact, and the onus of proving it rested on the applicant. In such an application the only issue before the court was whether that onus had been discharged. If so, the court had no discretion to refuse readmission. Conversely, if not, the court had no discretion to G overlook that failure and admit the applicant. (See [34].)

Where an applicant is struck from the roll for serious dishonesty, genuine, complete and permanent reformation must be shown. Mr Edeling did not discharge this onus, and in the result the appeal would be upheld (see [11] and [35] – [37]). H

Cases cited

Ex parte Aarons (Law Society, Transvaal, Intervening) 1985 (3) SA 286 (T): referred to

Ex parte Knox 1962 (1) SA 778 (N): dictum at 784 applied I

Ex parte Wilcocks 1920 TPD 243: dictum at 245 applied

Fourie NO and Others v Edeling and Others [2005] 4 All SA 393 (SCA): dictum in para [11] considered

General Council of the Bar of South Africa v Geach and Others 2013 (2) SA 52 (SCA) ([2013] 1 All SA 393; [2012] ZASCA 175): referred to

Kingdom of Lesotho v Swissbourgh Diamond Mines (Pty) Ltd and Others [2017] SGHC 195: referred to J

2019 (5) SA p80

Kudo v Cape Law Society A 1972 (4) SA 342 (C): dictum at 345H – 346A applied

Kudo v Cape Law Society 1977 (4) SA 659 (A): referred to

Law Society, Transvaal v Behrman 1981 (4) SA 538 (A): referred to

Miller and Others v Government of the Kingdom of Swaziland [2014] SZC03 (2014): referred to

Ndleve v Pretoria Society of Advocates B 2016 (12) BCLR 1523 (CC) ([2016] ZACC 29): referred to

Society of Advocates of South Africa (Witwatersrand Division) v Edeling 1998 (2) SA 852 (W): referred to

Swain v Society of Advocates, Natal 1973 (4) SA 784 (A): referred to

Swartzberg v Law Society, Northern Provinces C 2008 (5) SA 322 (SCA) ([2008] ZASCA 36): dictum in para [22] applied

Swissborough Diamond Mines (Pty) Ltd and Others v Government of the Republic of South Africa and Others 1999 (2) SA 279 (T): referred to

Swissbourgh Diamond Mines (Pty) Ltd and Others v Kingdom of Lesotho [2018] SGCA 81: referred to

Swissbourgh Diamond Mines (Pty) Ltd v LHDA D 2000 Lesotho LR 432 (CA): referred to.

Case Information

J Suttner SC (with P Cirone) for the appellant.

K Foulkes-Jones SC (with P Louw SC, D Goodenough and S Kanyangarara) E for the respondent.

An appeal from the Gauteng Division of the High Court, Johannesburg (Modiba J and Molahlehi J).

Order

1.

F The appeal is upheld with costs, including the costs of two counsel.

2.

The order of the court a quo is set aside and replaced by the following order:

'The application is dismissed with costs, such costs to include the costs of two counsel.'

Judgment

Wallis JA and Saldulker JA (Ponnan JA, Schippers JA and Eksteen AJA concurring): G

[1] Mr Christiaan Serfontein Edeling, the respondent in this matter, presently 64 years old, was admitted as an advocate of the then Supreme Court of South Africa H on 27 March 1979. He initially practised at the Johannesburg Bar and then joined the Free State Bar in 1984, where he practised until 1993. While there he was admitted as an advocate in Lesotho. He then reapplied to and was granted membership of the Johannesburg Bar and resumed his practice there.

[2] I During March 1996 the Society of Advocates of South Africa, Witwatersrand Division (as the present appellant, the Johannesburg Society of Advocates (the Society), was then known), applied, in terms of s 7 of the Admission of Advocates Act 74 of 1964, for Mr Edeling's striking-off. On 11 December 1997 he was struck from the roll of J advocates by order of the Witwatersrand Local Division (Van der

2019 (5) SA p81

Wallis JA and Saldulker JA (Ponnan JA, Schippers JA and Eksteen AJA concurring)

Merwe J and Du Plessis J). [1] Aggrieved, Mr Edeling applied for leave to A appeal against the judgment of the High Court, but it was refused. His applications for leave to appeal to the Supreme Court of Appeal and the Constitutional Court were also dismissed.

[3] In 2009, and again in 2015, Mr Edeling brought ex parte applications B before the Gauteng Division of the High Court of South Africa for his readmission and re-enrolment as an advocate. The Society intervened and opposed both applications, the first of which was withdrawn at the Society's instance after the second application was launched. The court a quo (Modiba J and Molahlehi J concurring) granted Mr Edeling's application and made no order as to costs. The appellant C applied for leave to appeal the order, which was refused by the court a quo with an adverse costs order. This appeal is with the leave of this court.

The reasons for Mr Edeling's striking-off D

[4] Mr Edeling was struck off the roll largely in consequence of his dealings with Mr Glyn Rudolph. Mr Rudolph had devised a scheme under which properties were sold at vastly inflated prices, with payment being effected in terms of two promissory notes given by the purchaser to the seller. The first of these would be for the approximate value of the property. The second would be a wildly inflated figure payable many E years in the future. The purpose of these arrangements was to secure a refund of VAT from the revenue authorities. In terms of one of these schemes Mr Edeling sold his own home in Bloemfontein, worth between R850 000 and R1 million, to Special Aircraft Utilisation (Pty) Ltd (SAU), a company effectively controlled by Mr Rudolph, for some R73 million. F He also attempted to purchase a commercial property in Johannesburg, referred to as the St Margaret's property, valued at R2,5 million, for R120 million under a similar scheme but this fell through. Instead SAU purchased the property for R158 million, to be discharged by way of two promissory notes.

[5] When Rudolph told him that there were problems in regard to the G purchase of the St Margaret's property, Mr Edeling drafted an agreement, the Condor agreement, with a view to circumventing those problems. This involved a trust that he had formed in Lesotho, controlled by him and an attorney, Mr Redelinghuys. The purpose of the agreement was to acquire the interests of the seller of the St Margaret's H property in a manner that would ensure that it would never be necessary to satisfy the second inflated promissory note. This was to be concealed from the revenue authorities. When the purchases by SAU of Mr Edeling's home and the St Margaret's property were considered in the Special Income Tax Court, Mr Edeling gave evidence in support of their legality. Melamet J held that both schemes were fraudulent and that Mr Edeling I perjured himself in giving his evidence.

2019 (5) SA p82

Wallis JA and Saldulker JA (Ponnan JA, Schippers JA and Eksteen AJA concurring)

[6] A On 11 December 1997 the High Court concluded with regard to the first transaction that the sale by the respondent of his house in Bloemfontein was not a true sale, but a simulated transaction entered into solely to obtain a tax advantage to which the parties were not entitled. This finding implied that Mr Edeling had not been truthful in B his evidence to either the Special Court or the court hearing the striking-off application. With regard to the second intended transaction the High Court concluded that the offer to purchase the St Margaret's property was a simulated transaction employed solely to obtain an unconscionable tax benefit to which the parties were not entitled. It was not genuine and was intended as a fraud on the fiscus. The High Court analysed the C Condor transaction in some detail and concluded that it showed that Mr Edeling had been untruthful in regard to his relationship with Mr Rudolph; that he was aware that the two transactions were simulated; and that his evidence at a number of points was untruthful. That was also...