Audit uncovers lawyers’ misdeeds

A Law Society investigation of a father-and-son law team specialising in helping road accident victims – many with horrific injuries – claim compensation produced clear evidence of unlawful conduct. Yet the lawyers in question have not been suspended. Lau

The Law Society of the Northern Provinces inspectors have found evidence that two prominent personal injury lawyers committed a number of unlawful practices, including overcharging accident victims for claims against the Road Accident Fund (RAF).

Details of the inspectors’ report and their conclusion – that the fatherand-son pair, Darren and Ronald Bobroff, “pose a risk” to their clients – was contained in an affidavit filed in the High Court earlier this month.

The affidavit from Sibusiso Gule, the vice-president of the Law Society of the Northern Provinces, comes more than four years after a couple first complained to the society that they were overcharged and follows a string of judgments against the Bobroffs, who are still practising.

Next month, a High Court judge will have to decide whether to give the Law Society of the Northern Provinces an extended period in which to hold a disciplinary hearing against the Bobroffs, who are both directors of Ronald Bobroff & Partners, and whether to suspend them pending the outcome of the hearing.

In addition, the court is being asked to determine whether the Law Society has a duty to find all the Bobroffs’ clients who may have been overcharged and to ensure that they are reimbursed.

Johannesburg-based Bobroff & Partners has helped large numbers of accident victims to claim compensation from the Road Accident Fund (RAF) and typically work on a no-win, no-fee (contingency) basis.

The Contingency Fees Act governs these fee arrangements and states that lawyers acting on a no-win, no-fee basis can charge up to double their normal time-based fees or 25 percent of the settlement, whichever amount is lower.

The Law Society’s report and a number of cases against Bobroff & Partners confirm that they have charged many clients a lot more than the Act allows.

The Bobroffs justified this by arguing that the fee agreements were allowed in terms of common law and that commonlaw fee agreements were sanctioned by the Law Society of the Northern Provinces. They argued that many other lawyers also charged fees beyond the limits allowed by the Contingency Fees Act.

In February 2013, the full bench of the Pretoria High Court ruled in a matter brought by a client of the Bobroffs, Jeanne de la Guerre, that lawyers who work on a no-win, no-fee basis cannot charge more than the Act allows.

GRAHAM CASE

Next month’s hearing will be a continuation of an application launched in the Gauteng North High Court in 2012.

The case concerns Jennifer and Matthew Graham, former clients of Ronald Bobroff & Partners, who were charged more than the Contingency Fees Act allows and complained to the Law Society in 2011 that they had been overcharged.

In 2012, when their complaint to the Law Society had still not been heard, they applied to the court to suspend the Bobroffs pending the Law Society’s decision on their complaint. As alternatives, the Grahams asked the court to compel the society to hear their complaint or to hold its own disciplinary hearing into whether or not the Bobroffs should be struck off the roll of attorneys.

Matthew Graham suffered brain injuries after an accident in 2006, and Bobroff & Partners obtained a settlement of R1.9 million and costs of R300 000 from the Road Accident Fund for him. The Grahams’ legal fees are being paid by Discovery Health Medical Scheme, which had sought to recover the medical bills it paid for Matthew Graham from the settlement he obtained from the RAF.

The Grahams had signed a fee agreement with Bobroff & Partners that bound them, contrary to the Contingency Fees Act, to pay 30 percent of any award the RAF paid out.

However, the couple received only R1.1 million. The Bobroffs kept the remaining 40 percent of the settlement (about R860 000) and the R300 000 in costs in lieu of legal fees and fees for doctors, advocates and other professionals they claimed were used to obtain the settlement.

The Grahams’ lawyer, George van Niekerk of Edward Nathan Sonnenberg, has also argued that the bill of legal costs drawn up by Bobroff & Partners for the Grahams reflected many more hours than the Bobroffs actually spent on the case.

In April 2014, the Gauteng High Court dismissed the Grahams’ application to suspend Ronald Bobroff and his son, but ordered an urgent inspection of the law firm’s books of account, including its trust account, and the submission of a report within 30 days. The basis of the order was a forensic report submitted during the application that suggested that Bobroff & Partners failed to put certain fees through its books and may have avoided paying tax.

The Law Society was also ordered to convene a hearing within 60 days.

The society, however, found itself unable to abide by the court’s timeline for the forensic inspection, as the Bobroffs “delayed and frustrated” its attempts, the society says in its submission to the court.

In April last year, therefore, it approached the court asking for an extension of its deadline.

The forensic report was finally completed at the end of January and, according to a supplementary affidavit filed by the Law Society in the Graham matter earlier this month, the society is now ready to proceed with another disciplinary hearing against the Bobroffs. Previous attempts were abandoned.

COUNTER-APPLICATION

But in a counter- application to the Law Society's request for more time, the Grahams and their lawyer, Van Niekerk, say the Law Society has failed to recognise the pervasiveness of the Bobroffs’ conduct, the urgency of the situation and the importance of protecting the public and the administration of justice.

Van Niekerk asks the court, therefore, to order the Law Society to extend its investigation into each and every client who has signed a contingency fee agreement with Bobroff & Partners, to determine whether those clients were overcharged, or charged for attendances and consultations that did not, in fact, take place.

He also asks for the Bobroffs to be suspended pending the completion of this investigation and that a curator be appointed to administer the firm instead.

The Law Society is opposing this application, saying that the investigation of each and every file would be impossible as there are potentially thousands of files and that many records may have been destroyed. It also says that in each case a detailed bill of costs would have to be drawn up.

The society also alleges that the Grahams’ complaint is being used “to pursue Discovery’s broader interests” and notes that Van Niekerk wrote to the Law Society after a judgment against the Bobroffs in a case brought by another client, Anthony de Pontes, stating that Discovery has 470 members who may have been charged 30 percent or more of their contingency-fee settlements by the Bobroffs.

Van Niekerk said that Discovery wanted the public notified that people who have used legal firms to help them claim from the RAF may be entitled to the repayment of certain legal fees.

Anthony de Pontes was left a quadriplegic after an accident. Bobroff & Partners helped him to claim R6.1 million from the RAF. They then claimed R2.1 million as a contingency fee, but were ordered by the Gauteng High Court to repay these illegal fees in 2014 and instead submit a reasonable, itemised fee.

MEDICAL SCHEME INVOLVEMENT

If you are injured in a motor accident, medical schemes are obliged, in terms of the Medical Schemes Act, to pay for your emergency medical treatment and a number of other conditions covered by the prescribed minimum benefits.

However, should a third party, such as the RAF, pay your medical costs, your scheme is entitled to claim from you whatever you recover.

Ronald Bobroff claims Discovery’s vendetta against his firm started when he publicised the fact that Discovery was requiring accident victims to claim from third parties such as the RAF.

Discovery Health has repeatedly denied that it puts pressure on its members to pursue claims against third parties. However, should a member successfully do so, it will claim back any medical costs recovered. The Council for Medical Schemes has stated that medical scheme members cannot be unjustly enriched by the likes of the RAF for medical expenses already paid by their schemes.