| 46. | Procedure for election of legal practitioners to the Board |
[section 95(1)(zJ) read with section 62(1)(a)]
The amendment is to enable Council to run the elections for the Legal Practitioners Fidelity Fund Board online, due to the current lockdown regulations brought about by the Covid-19 pandemic.
Council amends this Rule in line with the provisions of section 95(5), which provides that a rule may be amended without prior publication of a draft as provided in section 95(4) of the Act.
The amendment to the rule without prior publication is necessitated by the fact that the election must take place but cannot under the lockdown regulations. The amendment will allow legal practitioners to [nominate candidates and] cast their votes online and through email thereby avoiding the need for them to travel for voting stations and minimizing the risk of contracting the Covid-19 virus.
[Part XI Rule 46 substituted in its entirety by the South African Legal Practice Council, Notice No. 391, GG43542, dated 24 July 2020]
| 47. | Application for Fidelity Fund certificates |
[section 95(1)(zK) read with section 85(1)(a)]
| 47.1 | The Council shall, not later than the last day of September in every year, send to every legal practitioner who is obliged in terms of section 84(1) of the Act to be in possession of a Fidelity Fund certificate, by electronic on-line submission to that legal practitioner's electronic mail address (or by pre-paid post to the postal address of that legal practitioner, or by delivery to that legal practitioner's business address, where the legal practitioner has not provided the Council with an email address) an application form or a notice to apply for a Fidelity Fund certificate in respect of the year following. The application form shall also be published on the Council's website. The Council shall enclose with such application form or notice a statement setting out the liability, if any, of the legal practitioner concerned in respect of his or her subscription or other amounts due to the Council, including, but not limited to, the contribution to the Fund in respect of the cost of group professional indemnity insurance arranged by the Board pursuant to the provisions of section 77(2) of the Act and any other nonrefundable amount as may be fixed by the Board from time to time in terms of section 74(1)(a) of the Act. |
| 47.2 | The application form, or electronic on-line submission format for a Fidelity Fund certificate shall, as nearly as circumstances will permit, be in the form set out in rule 49. |
| 47.3 | Every legal practitioner who is obliged in terms of section 84(1) of the Act to be in possession of a Fidelity Fund certificate shall sign, or confirm through the electronic on-line submission, the application form relevant to him or her and shall truly, accurately and completely set out the information and particulars provided for in the form, and shall submit the duly completed application form by electronic on-line submission (or where the legal practitioner does not have an email facility, by hand delivery or by other means acceptable to the Council) to the Council not later than the first day of December of the same year in which it was sent. |
| 47.4 | The failure on the part of a legal practitioner to receive an application form, or notice to apply for a Fidelity Fund certificate, and the statement of liability, or the failure of the Council to make publication on the Council's website, as required in terms of rule 47.1, shall not relieve the legal practitioner of his or her obligation to make an application as required by section 85(1) of the Act. |
| 47.5 | The Council may from time to time require an applicant to furnish it with further and additional information and particulars in respect of any application before it issues a Fidelity Fund certificate, and neither the Council nor the Board shall incur any liability in respect of any penalty incurred or loss sustained by the applicant due to any delay in issuing such a certificate if such delay was caused by the applicant's failure to furnish such information or particulars. |
| 47.6 | A Fidelity Fund certificate shall be in the form of Schedule 6A (in the case of attorneys) and Schedule 6B (in the case of advocates referred to in section 34(2)(b) of the Act) to this rule and shall be signed by an authorised official on behalf of the Council, and the production of such a certificate purporting to be so signed shall be prima facie evidence of its contents. |
| 47.7 | Every such application shall be accompanied by— |
| 47.7.1 | in the case of an applicant who, for the first time, is required to be in possession of a Fidelity Fund certificate, a statement indicating that the applicant shall within a period of one year after the date on which the applicant was required for the first time to be in possession of a Fidelity Fund certificate, or within such further period as the Council may approve in any specific case, complete to the satisfaction of the Council a legal practice management course approved by the Council, failing which a Fidelity Fund certificate will not be issued to him or her until he or she has completed the course; |
[Part XI Rule 47.7.1 substituted by the South African Legal Practice Council, Notice No. 673, GG45500, dated 19 November 2021]
| 47.7.2 | in the case of a legal practitioner other than one referred to in rule 47.7.1, the certificate of an auditor in respect of an audit of his or her trust accounts that had been performed for the year ended immediately prior to the application. |
| 48. | Contributions payable by applicants for Fidelity Fund certificates |
[section 95(1)(zM) read with section 85(2)]
The contribution payable by the applicant for a Fidelity Fund certificate shall be in the amount determined by the Council from time to time, in consultation with the Board, in accordance with sections 85(3) and 85(4) of the Act, and as notified by the Council in the Gazette and on the Council's website.
| 49. | Form of application for Fidelity Fund certificate |
[section 95(1)(zN)]
The application form for a Fidelity Fund certificate, referred to in rule 47.2 shall, in the case of attorneys, be as nearly as circumstances will permit in the form set out in Schedule 7A to these rules, and in the case of advocates referred to in section 34(2)(b) of the Act, be as nearly as circumstances will permit in the form set out in Schedule 7B to these rules.
| 50. | Inspections of accounting records |
| 50.1 | Authority to conduct inspections |
| 50.1.1 | The Board may at any time, itself or through its nominee, or through a nominee of the Council acting on behalf of the Board, and at its own cost and on its own initiative, inspect the accounting records of any trust account practice in order to satisfy itself that the provisions of sections 86 and 87 of the Act, and the accounting rules issued by the Council, are being complied with. |
| 50.1.2 | If on an inspection it is found that any of the provisions of sections 86 or 87, or the accounting rules, have not been complied with, the Board may write up the accounting records of the trust account practice and recover the costs of the inspection and the writing up of the accounting records from the trust account practice concerned. |
| 50.2.1 | The Board may appoint any person in the service of the Board, or any other suitably qualified person, as an inspector to carry out inspections in terms of these rules. |
| 50.2.2 | The Board may determine the remuneration to be paid to a person who is appointed in terms of rule 50.2.1 and who is not in the full time service of the Board. |
| 50.3 | Certificate of appointment |
| 50.3.1 | The Board must issue an inspector contemplated in rule 54.2 (whether a person in the full time service of the Board or any other suitably qualified person) with a certificate of appointment signed by the chief executive officer of the Board, which certificate of appointment must specify— |
| 50.3.1.1 | the full name of the person so appointed; |
| 50.3.1.2 | his or her identity number; |
| 50.3.1.3 | his or her signature; |
| 50.3.1.4 | a description of the capacity in which he or she is appointed; and |
| 50.3.1.5 | the extent of his or her powers to inspect. |
| 50.3.2 | When an inspector undertakes an inspection in terms of these rules the inspector must— |
| 50.3.2.1 | be in possession of a certificate of appointment issued in terms of rule 50.3.1; and |
| 50.3.2.2 | on request, show that certificate to any person who is affected by the performance of the functions of the inspector, or is in charge of any premises or firm to be inspected. |
| 50.4 | Conduct of inspections |
| 50.4.1 | In carrying out the Board's functions in terms of these rules an inspector may at any reasonable time, and on reasonable notice where appropriate, enter and inspect any premises at which the Board reasonably believes that a trust account practice is being conducted. |
| 50.4.2 | In conducting such an inspection an inspector may— |
| 50.4.2.1 | in writing direct a person to appear for questioning before the inspector at a time and place determined by the inspector; |
| 50.4.2.2 | order any person who has or had any document in his, her or its possession or under his, her or its control relating to the accounting records of the firm to produce that document or to furnish the inspector, at the place and in a manner determined by the inspector, with information in respect of that document; |
| 50.4.2.3 | require reasonable assistance from any person on the premises to use any computer system on the premises, to access any data contained in or available to that computer system, and to reproduce any document from that data; |
| 50.4.2.4 | examine or make extracts from, or copy, any document in the possession of the firm or any other person which is relevant to the inspection or, against the issue of a receipt, remove that document temporarily for that purpose; and |
| 50.4.2.5 | against the issue of a receipt, seize any document obtained in terms of 50.4.2.3 to 50.4.2.5 which, in the opinion of the inspector, may constitute evidence of non-compliance with the provisions of sections 86 and 87 of the Act or of the rules. |
| 50.4.3 | A firm to whom this Act applies must, without delay, provide reasonable assistance to an inspector acting in terms of rule 50.4. |
| 50.4.4 | No warrant is required for the purposes of an inspection in terms of these rules. |
| 50.4.5 | An inspector may at any time request the firm to provide to the Board such additional information or documentation relating to the subject matter of the inspection. |
| 50.5 | The inspection procedure |
| 50.5.1 | The procedure for an inspection will be determined on a case-by-case basis by the inspector. |
| 50.5.2 | An inspection may be conducted by one or more inspectors. Where more than one inspector is engaged in an inspection, one of the inspectors will be designated as the lead inspector who will take overall responsibility for the conduct of the inspection. |
| 50.5.3 | Any request for the firm to produce documentation for purposes of inspection must be in writing, unless the purpose of the inspection, in the reasonable opinion of the inspector, would be frustrated by the giving of notice. |
| 50.5.4 | All inspections must be conducted so as to cause as little inconvenience and disruption to the firm and its staff as possible. |
| 50.5.5 | The inspection should be conducted only during normal business hours, unless the inspector reasonably considers that the conducting of an inspection at any other time is necessary on the grounds of urgency or expediency. |
| 50.5.6 | Not less than seven days' notice in writing shall be given to the firm of any inspection; provided that where the inspector has a reasonable suspicion that there has been a contravention of the Act or of the Council rules, or that the purpose of the inspection may be frustrated by the giving of notice, the inspection may be conducted without notice. |
| 50.5.7 | Only the inspector, and such other officials of the Board as may be reasonably necessary to carry out the inspection, should enter the premises of the firm during the course of the inspection. The person in charge of the firm, or a person nominated by him or her, shall be entitled to be present and to observe all aspects of the inspection, but the failure of that person to be present at the inspection shall not prevent the inspector from proceeding with the inspection. |
| 50.5.8 | If an inspector, after having identified himself or herself and declared his or her official capacity and the purpose for requiring admission to the premises of the firm and having complied with any other reasonable requirements, is not immediately given admission to the premises or access to documentation relating to the firm's accounting records, the Board may apply to court for an order that the inspector be admitted to the premises to enable the inspection to be carried out. |
| 50.5.9 | The firm which is the subject of the inspection shall make such facilities available to the inspector as may reasonably be required for the purpose of conducting the inspection. |
| 50.5.10 | Any request for information or documentation which is not immediately available for inspection must be in writing and must allow the firm a reasonable time to comply with the request. Any such request— |
| 50.5.10.1 | must describe with reasonable particularity each item or category of items to be inspected; |
| 50.5.10.2 | must specify a reasonable time, place and manner for inspection and for performing any related acts; and |
| 50.5.10.3 | in the case of electronically stored information, must specify the form in which that information is to be produced. |
| 50.5.11 | If the firm which is the subject of an inspection objects to making disclosure of documentation or information which is called for by the inspector, the firm must set out its objection in writing, with detailed grounds of the objection, and the matter shall be determined by the executive officer of the Board. |
| 50.5.12 | Unless otherwise stipulated or ordered by a court, the following procedures shall apply to producing documents or electronically stored information: |
| 50.5.12.1 | the firm must produce documents as they are kept in the normal and ordinary course of business, or must otherwise organise and label the documents to correspond to the categories in the request; |
| 50.5.12.2 | if the request for information does not specify a form for producing electronically stored information, the firm must produce the information in a form or forms in which it is ordinarily maintained or in a reasonably usable form; and |
| 50.5.12.3 | the firm may not be required to produce the same electronically stored information in more than one form. |
| 50.5.13 | The Board may request the firm which is subject to the inspection to complete a pre-inspection questionnaire to allow for more efficient planning and conducting of the inspection. |
| 50.5.14 | At the conclusion of the inspection the inspector must prepare a report to the Board on the findings of the inspection, a copy of which report must be made available to the firm which was subject to the inspection. If the firm objects to any of the findings in the report it must do so in writing to the Board, outlining the basis of the objection. The Board shall consider the objections and shall take such further action in relation thereto as the Board considers appropriate. |
| 50.5.15 | The Board may in its discretion refer the inspection report to the Council for consideration. The firm which is the subject of the report shall be notified of such referral. |
| 50.5.16 | Any report of an inspection may, if appropriate, be used in disciplinary or criminal proceedings which may be brought against members of the firm. |
| 50.6.1 | Every firm, and every partner or director of the firm, and every trust account advocate, must cooperate with the Board in the performance of any inspection in terms of these rules. Without limiting the generality of this provision, cooperation shall include cooperating with and complying with any lawful request, made in pursuance of the Board's authority and responsibilities under the Act— |
| 50.6.1.1 | to provide access to, and the ability to copy, any accounting record in the possession, custody or control of the firm or of that person; and |
| 50.6.1.2 | provide information by oral interviews, written responses or otherwise. |
| 50.6.1.3 | any person who refuses or fails to produce a book, document or any article for purposes of an inspection, or obstructs or hinders any person in the performance of his or her functions in conducting the investigation, shall be guilty of an offence. |
| 50.6.2 | The Board will not be liable for any costs incurred by the firm arising out of an inspection in terms of these rules, otherwise than in exceptional circumstances. |
Subject to any other law, any person who performs any function under these rules may not disclose any information which he or she obtained in the performance of that function except—
| 50.7.1 | for the purposes of an inspection or hearing by a disciplinary body of the Council; |
| 50.7.2 | to any person authorised thereto by the Board or the Council who of necessity requires it for the performance of his or her functions under the Act or these rules; |
| 50.7.3 | if he or she is a person who of necessity supplies it in the performance of his or her functions under the Act or under these rules; |
| 50.7.4 | when required to do so by order of a court of law; |
| 50.7.5 | at the written request of the Legal Services Ombud for the Republic; or |
| 50.7.6 | at the written request of the National Prosecuting Authority or any competent authority which requires it for the institution of an investigation with a view to the institution of any criminal prosecution. |
| 50.8 | Obligations to provide information and documentation not affected by confidentiality rules |
Subject to the provisions of any other law relating to legal professional privilege a firm, or the person in charge of the firm, or any person nominated by him or her, may not refuse to produce any book, document or article required for purposes of an inspection under these rules, even though he or she is of the opinion that it contains confidential information belonging to or concerning his or her client.
| 51. | Contributions to the fund: insurance premiums |
| 51.1 | Every attorney who is required to be in possession of a Fidelity Fund certificate, and every advocate contemplated in section 34(2)(b) of the Act, shall pay annually to the Council, on behalf of the Fund, such amount as the Board shall determine as a contribution to the Fund towards the cost of the premiums payable by the Fund in respect of contracts of insurance entered into in terms of section 77 of the Act. |
| 51.2 | The annual contributions payable in terms of rule 51.1 shall be payable by not later than 30 November in every year commencing in the year to be determined by the Board; provided that any practitioner enrolled after 30 June in any year shall pay only one-half of the annual fee for the year then current, payable within thirty days of enrolment. |
| 51.3 | The Board shall, not later than the last day of September in every year, cause to be sent to every legal practitioner who is obliged in terms of section 84(1) of the Act to be in possession of a Fidelity Fund certificate, by electronic on-line transmission to that legal practitioner's electronic mail address (or by pre-paid post to the postal address of that legal practitioner, or by delivery to that legal practitioner's business address, where the legal practitioner has not provided the Council with an email address) an invoice in respect of the contribution to be made by the legal practitioner in respect of the year following. |
| 51.4 | The failure on the part of a legal practitioner to receive an invoice in respect of the contribution shall not relieve the legal practitioner of his or her obligation to make payment of the contribution as required by rule 51.1. |
| 52. | Issuing and costs of Fidelity Fund certificate |
| 52.1 | Subject to the payment of all contributions payable by a legal practitioner for the issue of a Fidelity Fund certificate, as required by rule 51.1, and upon receipt of the costs payable to the Council for the issue of the Fidelity Fund certificate, as determined from time to time by the Council in consultation with the Board, and as notified by the Council in the Gazette, and subject to the Council's being satisfied as to the matters dealt with in the application for the Fidelity Fund certificate, the Council shall issue a Fidelity Fund certificate to the applicant. |
| 52.2 | A Fidelity Fund certificate shall be in the form of Schedule 6A to these rules (in the case of attorneys) and Schedule 6B to these rules (in the case of advocates referred to in section 34(2)(b) of the Act), and shall be signed by an authorised official on behalf of the Council, and the production of such a certificate purporting to be so signed shall be prima facie evidence of its contents. |
| 53. | Procedure for the appointment of the executive officer and other employees |
| 53.1 | The Board must appoint an executive officer to carry out the functions referred to in section 63(2) of the Act, and such other employees as it deems necessary to assist the executive officer. |
| 53.2 | The procedure for the appointment of the executive officer shall be as follows: |
| 53.2.1 | the Board shall advertise the vacancy for an executive officer in an open and transparent manner; |
| 53.2.2 | the advertisement shall state the criteria to be considered by the Board in appointing the executive officer; |
| 53.2.3 | the advertisement calling for applications shall state the date by which applications should be received, and shall include a statement that applications received after that date will not be considered; |
| 53.2.4 | after the closing date the Board, or a committee of the Board established for that purpose, shall review the applications and arrange to interview those of the applicants which the Board or the committee, as the case may be, considers to be suitable for the position of executive officer; provided that if the Board or the committee, as the case may be, considers that none of the applicants is suitable for the position the Board shall again advertise for the vacancy, and the provisions of rules 53.2.1 to 53.2.4 shall again apply. |
| 53.2.5 | If, after following the procedure referred to in this rule 53.2, the Board appoints a candidate to fill the office of executive officer it shall enter into a written agreement with the individual setting out the terms and conditions of the appointment. |
| 53.3 | Notwithstanding the provisions of rule 53.2, the Board may, if it considers that it would be appropriate to do so in the circumstances, adopt generally accepted human resources processes and policies for the appointment of the executive officer, including, but not limited to, the engagement of executive placement entities to approach individuals who might be suitable for the position. |
| 53.4 | The procedure for the appointment of other employees of the Board shall be determined by the Board. |
| 53.5 | The need for the staff of the Board to reflect— |
| 53.5.1 | the racial and gender composition of South Africa; and |
| 53.5.2 | representation of persons with disabilities must as far as practicable be considered when the executive officer and other employees of the Board are appointed. |
| 53.6 | The Board must determine the conditions of service of the executive officer and other employees of the Board. |
