Legal firm accused of excessive soliciting

Published Jul 11, 2008

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By Alex Eliseev

A storm is brewing over one of the country's top property-law firms amid allegations that it was involved in touting.

The Law Society of the Northern Provinces (LSNP) has filed a High Court application to strike the directors of Dykes Van Heerden - which has seven branches across South Africa - off the roll of practising attorneys.

With the property market in decline, touting of estate agents and bond originators by attorneys is on the rise, warned Jan van Rensburg, president of the LSNP.

Dykes Van Heerden employs almost 200 people, and has hundreds of clients, including large financial institutions, companies and individuals.

The firm, with its head office in Roodepoort, has denied the allegations, and claims the complaint - which resulted in an "aggressive court application" - was launched by a disgruntled former employee.

The conveyancing specialists have turned to legal heavyweights Webber Wentzel Bowens to defend them.

It is understood that the allegations revolve around the firm using unethical means to find new business between 1998 and 2003. Along with Peter Dykes and Johan van Heerden, two of the firm's empowerment partners now find their careers on the line.

Among the allegations against the firm are expensive breakfasts for estate agents, golf days and other "excessive entertainment".

The firm is in the process of responding to the court application, and plans to reply next month.

But it is unlikely that the matter - which was launched a month ago but, after some glitches, was reinitiated - will be heard in court before next year.

"We've done nothing wrong. We don't believe we ever touted," Johan van Heerden said on Thursday.

"It (the law society's application) was the biggest shock of my life."

Van Heerden added that the laws governing touting were currently being rewritten and "fee sharing" was being redefined.

While the LSNP refused to comment on the case, saying it was sub judice, Van Heerden claimed the woman at the centre of the storm had worked with the firm for 10 years.

In her complaint, she claims she was hired to tout new business for the firm, while Van Heerden alleges she was paid to retain existing clients.

The woman was dismissed by the firm, Van Heerden said.

"We believe there are people in the law society with an axe to grind," he added. "They want to make an example out of us. If it was any other firm it would have been done differently."

During a count in April, the LSNP was busy with around 115 applications to strike attorneys off the roll - 27 of which were awaiting trial. The membership of the LSNP is 9 811 attorneys, and Van Rensburg said he had signed no fewer than 10 new applications since April.

"It's getting harder and harder to survive," Van Rensburg said. "And (touting) is getting more and more."

He also attributed the problem to lowered standards of legal education.

The Dykes Van Heerden saga follows a similar one in KwaZulu Natal in which one of the province's biggest law firms is in court for alleged touting.

Six partners of Meumann White are at risk of being struck off the roll as the question of what advertising, marketing and promotions are permissible to law firms is tested.

The firm has admitted to spending R1,7-million on sponsorships, advertising and gifts, but denied any wrong-doing.

But the KwaZulu Natal branch of the Law Society of South Africa has argued that these methods are unethical.

The LSNP is also currently embroiled in a dispute with the Black Lawyers' Association over an appointment of a member to the council. The BLA, together with another association, has withdrawn from the LSNP.

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