April 24, 2017

Who covers your costs when your legal representation is inadequate?

As a matter of common sense, people who approach courts for relief are entitled to legal representation. It follows that they are entitled to expect that every effort will be undertaken by their chosen legal representative to ensure that their cases are properly prepared and presented to courts. Thus, every legal representative owes the duty of diligence to their clients.

When a reasonable standard is not maintained in the drafting and presentation of pleadings or court processes, this duty is breached. If, consequently, the litigant’s case fails, the failure is attributable to the attorney’s negligence. It would be unfair to expect the unsuccessful litigant (be it a natural person or legal entity) to cover the costs of the failed action or application, whichever the case may be.

One of the questions that confronted the High Court, brought about by the Respondent, Standard Bank, against the Applicant’s legal representatives in the January v Standard Bank of South Africa decision was whether to mulct, and if so, under what circumstances legal practitioners may be held responsible for costs de bonis propriis for their conduct in the proceedings.

In this case, amongst other deplorable conduct frowned upon by the court, the Applicant’s practitioners (attorney and counsel), brought the matter before the court, failed to file a proper certificate of urgency, which sets out why the matter is urgent and why the Applicant cannot obtain relief in due course.

This certificate is required to avoid unnecessary time wasting, and to ensure that only matters that could be dealt with in the ordinary course are not treated as urgent. It therefore comes as no surprise that failure to file the certificate of urgency may result in the matter being struck off the roll, or, in appropriate circumstances, result in a cost order being made against the legal practitioners representing the litigant.

There is no exhaustive list of conduct upon which the courts may show their displeasure by imposing a punitive costs order. From case law, however, it would appear that the following would attract such punishment:

  • If legal costs are incurred by a litigant as a result of the gross negligent conduct of a practitioner;
  • Where the level of diligence in a practitioner is found woefully inadequate;
  • Flagrant disregard of the Rules of Practice;
  • Unnecessarily litigating where there is no cause;
  • Where a litigant occupying a fiduciary capacity in connection with the litigation conducts himself mala fide, negligently or unreasonably.

It may here, for completeness sake, be added that the duty of diligence applies equally and without much qualification to public officials acting in the course and within the scope of their employment when it comes to their institution of frivolous litigation, or the frivolous defence of legitimate litigation instituted against them by aggrieved parties.

This is even more so if one considers the decision made on 5 April 2017 by Judge Pillay in the Durban High Court in Westwood Insurance Brokers (Pty) Ltd v Ethekwini Local Municipality and Others where the Judge mulct public officials in their personal capacity with a 50% legal costs order for blindly approving a non-compliant water leak insurance on behalf of the municipality and then went on to frivolously defend their ineptitude in courts with resultant waste of the public purse. The following passage from the judgment is instructive:

“An irrational decision might still have an explanation albeit one that is not acceptable or is weak in logic. But a bizarre decision is manifestly inexplicable. The decision in this instance is so bizzare that unsurprisingly even those who participated in making it cannot explain it.”

The public officials’ arrogance is further frowned upon by the Judge in the following passage:

“All those involved in the decision to appoint South West persist in defending what is now manifestly indefensible by trying to justify their conduct in order to avoid having to pay costs. Their responses fortify their failure and continuing refusal to be not only accountable and transparent but also remorseful for their inexplicable decision which renders them liable for costs.”

Author: Frank Setati

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