Losses Covered by the Fund
Typical losses covered by the Fund include the theft of money from deceased or insolvent estates, money held pending registration of the transfer of immovable property, or settlements in personal injury claims.
The Fund does not reimburse loss suffered as a result of negligence by a practitioner in the conduct of his/her practice. Business transactions are also not covered, or money handed to an attorney for investment purposes, nor loans to the attorney. Certain relationships such as family, business or partnership associations will preclude a person from claiming against the Fund.
Any person who believes that he/she has a claim against the Fund, should note the following:
- Notice of the claim should be given to the Council of the Law Society concerned (i.e. in the province in which the practitioner practices) and to the Fund’s Board of Control within a period of three months after the claimant became aware of the theft, or by the exercise of reasonable care should have become aware of the theft (section 48(1)(a) of the Act).
- Such proof as the Fund may reasonably require should be furnished within six months after receipt of a written demand requesting the submission of such proof (section 48(1)(b)).
- In terms of section 49(1), the Fund may require a claimant to exhaust all available legal remedies against the practitioner concerned, and against any other persons liable in respect of the loss suffered, before having recourse to the Fund. However, the Board of Control is empowered to waive compliance with this requirement and claimants are therefore requested not to take any steps for the direct recovery of what is owed by a defaulting practitioner until such time as they are advised by the Fund to do so.
Claimants are strongly advised to ensure that in the interim period (i.e. before receipt of the Fund’s directions regarding action as particularised in 3 above), any rights of action which they might have do not become prescribed. Where claimants endeavour to recover directly from a defaulting practitioner, without having been directed by the Board of Control to do so, they will run the risk of not being able to recover costs incurred in the event of the practitioner’s estate being insolvent.
4.1 The claim should be made by the way of an affidavit in which the facts giving rise to the claim are fully set out. Such an affidavit will serve a dual purpose in that it will be used, firstly, for the purpose of proving a claim against the Fund, and secondly, to assist the South African Police Service in instituting a speedy and effective criminal investigation and prosecution against the defaulting attorney. In this regard, kindly follow the guidelines set out in the section entitled ‘Framework for a sworn affidavit in support of a claim’ below.
4.2 The defaulting practitioner’s entire office file relating to the matter on which the claim is based (cover and contents) should accompany the affidavit.
- Except where the Board of Control has directed that a formal enquiry in terms of the regulations framed under the Act should be held, consideration of the claim will be confined to the affidavit submitted. For this reason, therefore, any allegations in the affidavit in connection with amounts entrusted to the practitioner should, where possible, be corroborated by other means. In this regard, it is usual for the affidavit to be accompanied by a photocopy of the claimant’s ledger account or other relevant ledger accounts in the practitioner’s accounting records, which substantiate(s) the allegations in the affidavit. In addition, other evidence such as paid cheques, receipts or relevant correspondence should be submitted, and although photocopies will be accepted, the Fund will require the original documents where available, particularly paid cheques.
- The Fund has a discretion to make a contribution towards the costs incurred by a claimant in establishing a claim against the Fund. As unnecessary correspondence and delays invariably result where a person who is not an attorney elects to attend to the submission of a claim, it is strongly recommended that a claimant should instruct an attorney to attend to the submission of a claim.
- In terms of section 45(2), the Fundâ€™s Board of Control has a discretion to pay interest on the amount of any admitted claim. In the event of such discretion being exercised, interest is normally paid from the date of first notification of a claim to the Fund’s offices. It is accordingly important for the Fund to be notified of a claim as soon as possible. Furthermore, failure to respond to any request from the Fund within a reasonable period of time may lead to such discretion being exercised less favourably.
- Correspondence with respect to claims should be addressed to:
The Claims Director
Legal Practitioners Fidelity Fund
PO Box 3062, Cape Town
8000 or Docex 154, Cape Town
Tel: 021 424 5351
Fax: 021 423 4819
and should bear the claim reference number assigned to each claim by the Fund, as will appear in the caption of every letter written by the Fund.