Home South African Law firms told to pay back the money to Road Accident Fund

Law firms told to pay back the money to Road Accident Fund

221
SHARE

Cash-strapped entity has, somehow, in addition to administrative error, double-paid some firms over years for claims

Road Accident Fund chief executive Collins Letsoalo. Picture: African News Agency (ANA)

Pretoria – The Road Accident Fund (RAF) will ask the court for permission to stay hundreds of millions of rand due to several law firms until they have repaid the money.

It will ask the Gauteng High Court, Pretoria, later this month to suspend the debt due for claims settled or where court orders have been granted.

The court action is a desperate attempt to recover hundreds of millions in duplicate payments to various law firms.

If granted, the order will be ending a later application in which it will ask that the Legal Practice Council appoint a curator to administer the trust accounts of those firms who had received double payments, but refused to pay the money back.

The RAF has lodged a formal complaint against more than 100 law firms with the Legal Practice Council – the watchdog over the legal fraternity – in its bid to recover the duplicate payments.

The cash-strapped entity has, somehow, in addition to administrative error, double-paid some firms over the years for claims.

However, some firms refuse to pay the money back.

In a letter earlier sent to the Legal Practice Council, the RAF called on the body to investigate the conduct of 102 law firms, which owed in total more than R340 million.

The RAF named 102 law firms countrywide in its complaint, saying they received the money into their trust accounts and they were well aware that the payments were duplicated.

In an affidavit regarding the coming urgent application, RAF chief executive Collins Letsoalo said some of the firms who had not paid the money back and in turn had not been paid for other claims by the entity were now threatening to immediately execute orders it obtained against its assets.

He said the RAF on occasion erroneously made a double payment for a particular claim to a law firm.

Instead of paying the money back, the attorney used the money to pay another claimant who was due.

But Letsoalo said this caused havoc with their ability to reconcile payments against claimants.

This application is a sequel to another brought by the RAF against various law firms and sheriffs who were executing on a daily basis against its assets in a bid to recover their claims. While a full bench had ordered the RAF to make payments before April 30 on claims of 180 days or more outstanding, the RAF has suspended payments to those who refuse to repay the duplicate payments.

Letsoalo made it clear the RAF had the money to pay these claims, but it would not do so until the duplicate payments were repaid.

He said once these sums was paid back and coincided with the RAF records, the suspension on paying claims to these firms would be lifted and outstanding claims paid – starting from the oldest to the newest.

He said while he was aware of the plight of claimants waiting for claims to be paid out, the RAF owed them and the public a duty to ensure that lawyers did not utilise funds for unauthorised purposes.

None of the law firms cited as respondents have yet filed their answers to the application.

Pretoria News