LSB roasted, harshly punished for plethora of charges

Parks Tafa
Parks Tafa

The Law Society of Botswana (LSB) has been accused of being unfair, naive, or reckless in the manner it frustrated prominent attorney, Parks Tafa and Collins Newman and Company (CNC) in dealing with the outfit’s application for a practicing licence early this year.

In view of the transgression, the High Court hit the legal practitioner’s oversight entity with punitive costs at attorney-client scale.

Tafa and his law firm in June this year found themselves in the list of non-compliant firms and attorneys as it was publicised that its trust account was non-compliant.

However, it has now emerged in the High Court ruling that Tafa and his legal firm of more than 28 years should not have been in the list of non-compliant attorneys and law firms as the accused do not fall within that category.

According to Justice Reuben Lekorwe, the LSB breached its own regulations when it refused Tafa and his company with a certificate to operate a trust account for the year 2019.

That resulted in the attorney and his law firm going for months, since June fighting to have the practicing licence and the trust account licence (also known as the fidelity fund certificate) normalised.

The High Court recently ruled that LSB did not follow the rules for the preconditions of the issuance of the fidelity fund certificate to the letter, and instead conjured up imaginary laws it used to delay or refuse Tafa and his firm the certificates.

The Court further lectured to the LSB on which section of its Legal Practitioners Act it should have confined itself to, as regards the handling of the application for fidelity fund certificate.

It found that the reasons advanced in denying Tafa and CNC the certificate were out of order and based on legally incorrect conclusions.

The Society claimed that Tafa was denied the fidelity fund certificate because he had been struck off the roll, which was not the case. Justice Lekorwe said the conclusion that Tafa had been struck off was “legally incorrect and “misconceived”, as Tafa had not been struck off the roll of legal practitioners.

“Mr Moipolai, in his answering affidavit states that Tafa has been removed from the roll of legal practitioners by the Registrar. The position propounded by Mr Moipolai is legally incorrect if not misconceived. Mr Tafa, and is common cause between the parties, has not been removed nor suspended from the roll of legal practitioners...

“It is clear to me that the jurisdictional facts upon which the secretary of Fidelity Guarantee Board could validly refuse to issue a Fidelity Fund certificate to Mr Tafa and CNC not having been established or shown to exist, there was no other basis of law upon which the decision to issue the Fidelity Fund Certificate could be withheld,” Justice Lekorwe ruled.

Moipolai was further reminded the Society that its powers of functionaries are as circumscribed by the Legal Practitioners Act, and that he, as the Secretary of the Fidelity Guarantee Fund, could not conjure up other reasons nor conditions for issuing nor non-issuing of a Fidelity Fund Certification.

“In refusing to issue the Fidelity Fund Certificate, not only did the Secretary act unreasonably, but he also acted in violation of the Legal Practitioners Act and thus acted ultra vires the Legal Practitioners Act. His decision ought to be set aside. I don’t think even the reasoning of Mr Moipolai that the issuance of a Fidelity Fund Certificate will not lead to eligibility for the grant of a practising certificate by the Registrar, is a matter that should concern him. That is a matter for the Registrar to deal with.”

Moipolai was also blasted by the Judge in the ruling for shifting goal posts “by claiming that the LSB had not refused Tafa and his company the certificate” but were only waiting for him to furnish them with well-kept books of accounts of the trust fund account.

“Mr Moipolai’s averment that LSB has not taken a decision to either issue or reject a Fidelity Fund Certificate to CNC is to be rejected outright.

The LSB has refused and gave reasons for refusing. In my judgement, the LSB or Mr Moipolai are not entitled to move the goalposts, in any case the LSB’s non-issuance of the Fidelity Fund Certificate that has been applied for, for an inordinate length of time, under the circumstances of this case constitutes a refusal.”

Justice Lekorwe also took issues with Moipolai and the LSB for rushing to conclusions that Tafa and his law firm were non-compliant, while the audit report which they had based their conclusions on, was itself inconclusive and had clearly stated that it could not pronounce non-compliance nor compliance of the client in the original report.

However, the audit report was accompanied by a second report clearly pronouncing Tafa and his firm as compliant, after a reconstruction of their books that had been messed up by migration into a new accounting and management system in 2018, and not out of any recklessness by the firm or its founder.

The High Court ruling also criticised Moipolai and LSB yet again for failure to read the audit report properly as he would have found that the second audit report offered the conclusion he needed to make a decision about the compliance of the firm.

According to the judgement, the two reports should have been read as one by the LSB and Moipolai since that’s what they are, rather than making the mistake of treating them as two separate reports. 

The judge said he agreed with Tafa’s averment that after 28 years of compliance the law firm last year changed their management and accounting system and that the migration into a new system created unexpected mess of their accounting records, something the judge said had been confirmed by the audit report.

It has also surfaced that Price Waterhouse, the audit firm that handles Tafa’s books had produced an affidavit confirming that his books were well kept, particularly the trust account.

According to the auditors’ affidavit, subsequent to the date of the original report, CNC rebuilt its accounting records for the period January 1, 2018 to December 31, 2018 which formed the starting point of the trust account prepared by the firm for the period January 1, 2019 to April 2019.

The auditors said the reconstructed records were subjected to appropriate verification procedures required to support the opinion expressed in the second report.

According to the auditors, the reconstructed records reflected a difference in balances between the trust account creditors and bank balance at January 1, 2019, with trust creditors exceeding the bank balance by P3, 185, 187.

This difference was made good through contributions of cash into the trust account’s bank by both Tafa and the firm in the amounts of P951, 130 on March 5, 2019, and P4 000, 000 on April 4, 2019, according to the auditors.

The High Court has found that the recent placing of Tafa and his firm under curatorship was illegal, as it was not based on any laws.

Lekorwe asserted that a law firm can only be put under curatorship upon death of legal practitioner, insolvency, in the event of a legal practitioner being removed from the roll or being suspended from practice, being declared by a court of a competent jurisdiction to be incapable of managing his own affairs, or abandoning his practice.

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