- Oosthuizen Du Plooy Attorneys found liable for professional negligence after allowing a client’s debt claim to prescribe.
- Judge A Reddy emphasised that attorneys must act with skill, care, and diligence or face personal and financial consequences.
- The ruling highlights the critical duty of attorneys to protect client interests and avoid preventable losses.
Stratton Oakmont advanced R1.93 million to JM Tshabalala Trading for a contract with the South African National Defence Force.
The North West High Court in Mahikeng found that Oosthuizen Du Plooy Attorneys, representing Stratton, failed to institute proceedings and allowed the claim to prescribe. Judge A Reddy was unequivocal: “No amount of legal acrobatics or sophistries can exonerate the negligent conduct of Oosthuizen Du Plooy Attorneys.”
Jacobus Johannes Strydom, director of Stratton Oakmont, described the impact as devastating. “The prescribed claim represented both capital and potential profit that would now be lost,” he said.
Stratton’s claim rested on acknowledgements of debt signed by JMT’s directors George Kgampe and Refilwe Mpolokeng in July 2015, confirming the R1.93 million debt. Strydom countersigned both documents.
Judge Reddy noted that the acknowledgements were never intended to fall under the National Credit Act, and that the signatories “were not coerced to sign the acknowledgements.” The agreements required repayment in three instalments, with an acceleration clause for immediate payment on default.
Attorneys fail to act on client mandate
Oosthuizen Du Plooy Attorneys were retained in January 2016, but failed to issue a summons. Judge Reddy explained, “Where a client’s claim prescribes under his or her watch, he or she is guilty of a breach of his or her mandate and duty to his or her client.” He added: “An attorney should not attempt to determine the merits themselves and must leave such findings to the court.” Strydom argued that the attorneys had a contractual duty to exercise care and diligence in pursuing the claim.
Oosthuizen Du Plooy Attorneys argued the agreements were unlawful under the National Credit Act. Judge Reddy dismissed this: “An attorney must be meticulous, accountable, serve his client faithfully and diligently, and must not be guilty of any unnecessary delay.”
He added that the NCA did not apply to these acknowledgements and, even if it did, Stratton Oakmont could have claimed unjustified enrichment. The court noted Oosthuizen Du Plooy Attorneys offered no evidence and relied solely on technical defences.
Judge Reddy explained the responsibilities of attorneys: “An attorney is liable for the consequences of gross negligence if he or she displays a lack of reasonable skill and diligence in the performance of his or her duties in matters within his or her field of practice, expertise, or knowledge.” He also stated, “Abandoning a client’s mandate without lawful reason is unacceptable and allowing a claim to prescribe is a clear breach of duty.”
Judgment and consequences
The court ordered Oosthuizen Du Plooy Attorneys to pay R1,928,771.50 plus interest at the prescribed rate from the date of service of summons to the date of payment, with costs awarded on a party and party Scale C.
Judge Reddy concluded: “No defence can stand against clear negligence and Stratton Oakmont has proven its damages were caused by the attorneys’ failure to act and that the breach of duty was reasonably foreseeable.”
He warned: “The litigating posture of Oosthuizen Du Plooy Attorneys must be frowned upon and attorneys who neglect professional responsibilities risk personal liability and reputational damage.”
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