The High Court in Pietermaritzburg has rejected former attorney Thivendra Moodley's application for readmission to practice law, citing unresolved trust fund misappropriation of R2 million and insufficient evidence of reformation.
The court scrutinised Moodley's past conduct, particularly his disbarment due to the serious misappropriation of trust funds and underscored the importance of maintaining the integrity of the legal profession. Both the KwaZulu-Natal Legal Practice Council and the Legal Practitioners Fidelity Fund opposed his application, articulating concerns over Moodley's failure to adhere to ethical standards and the continuing uncertainty surrounding his financial obligations to defrauded clients.
During or about February 2000 to about March 2002, Moodley successfully completed his articles of clerkship and passed the requisite board examination. On 2 December 2002, he was duly admitted to practise as an attorney. Shortly thereafter, he practised for his own account until 25 February 2009, when he was struck off the roll of attorneys.
On or about 3 March 2006, Gengan Naidoo instructed Moodley to attend to a transfer of immovable property, which was sold to Johan Martinus Oosthuizen. To that end, Naidoo deposited R657 000.00 into Moodley’s trust account. However, when the monies were required to be paid over to Naidoo, he was unable to do so because he had misappropriated these monies, causing Naidoo to continue servicing the bond over the property; notwithstanding, that the property had already been transferred to Oosthuizen. Naidoo eventually reported Moodley to the Legal Practice Council.
Naidoo's report triggered an investigation that eventually found a discrepancy of R2 065 240.84 unaccounted for in the applicant’s trust account, which had been misappropriated by Moodley. He eventually repaid R460 000.00, and the balance of R1 605 240.84 was settled by the Legal Practitioners Fidelity Fund. The final account provided on 12 July 2018, after considering disbursements and recoveries, was R1 631 779.83, which Moodley owes to the fund.
Moodley asserted he had briefed counsel for a complex criminal matter, where counsel had estimated their fees to be R350 000. However, he had only taken cover of R150 000, which he paid to counsel. Counsel reduced the balance of R200 000 to R152 000, which Moodley eventually paid to counsel by misappropriating monies from the trust account. At the conclusion of the criminal trial, the accused were fined R500 000. Since the client could only provide R337 000 for the fine, Moodley contributed an additional R173 000, which he accessed from the trust account, to cover the total amount.
Regarding the R657 000.00 involved in the property transaction that initiated the investigation, the applicant acknowledges the misappropriation of these funds to the prejudice to Naidoo and Oosthuizen, but did not provide a detailed account of this misappropriation. However, based on the context of the applicant's explanation, it appears that this sum was gradually appropriated in smaller amounts as he began using the trust account to address his debts. In the circumstances, he only provides a detailed account for an amount of R325 000 of the R1 631 779.83 short fall.
Moodley further stated, without mentioning how much or when, out of desperation he resorted to taking loans from money lenders at very high interest rates, in order to repay the misappropriated monies. At the time of his removal from the roll, he had an outstanding debt of R550 000 to money lenders and was making monthly repayments of R65 000 by misappropriating monies from the trust account. The timing and amount of these loans, as well as the extent of the repayment before accessing the trust account to service the debt, remain unclear. However, the court found his explanation regarding the misappropriated funds is vague and lacking a full disclosure.
In presenting his case, Moodley had argued that he has since updated his legal knowledge and sought employment in the legal field. However, the court viewed these efforts as inadequate compared to the serious nature of his past conduct.
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