Veteran attorney Ronald Bobroff, head of South Africa’s largest personal injury and medical negligence practice and past president of the Law Society of the Northern Provinces, faces an unprecedented private application to have him struck off the roll.
The charges to be laid against Bobroff – whose weekly Monday night slot on the 702 and Cape Talk radio show, A Word on Legal Matters, attracts a wide audience – are supported by the findings of a forensic examination of two awards made by the Road Accident Fund (RAF) to accident victims represented by his firm.
The 17-page secret report is authored by top forensic accountant Vincent Faris, chairman of the South African Institute of Chartered Accountants’ joint attorneys accountants committee. It details alleged irregularities in the accounting of the firm’s trust account.
“There is a suggestion that the procedures followed in the two accounts are not isolated and that there are other instances of manipulation of records in other client accounts,” writes Faris. He recommends access be obtained to Ronald Bobroff & Partners’ audited financial statements and that the firm’s auditors be asked to trace the irregular payments.
Faris believes there is “sufficient evidence of contravention of the Income Tax Act, the VAT Act, the Companies Act, the Attorneys Act and the Rules of the Law Society of the Northern Provinces”. Under these circumstances, he says, “the possibility of contraventions of other legislation cannot be excluded”.
Faris’s report is only part of an arsenal of charges to be thrown at Ronald Bobroff and his 39-year-old son Darren in the pending high court battle to have them both struck off the roll of attorneys. It is believed to be the first private striking-off application in South Africa. Until now this most drastic action has been the preserve of the Law Society, which only goes to the high court for a striking-off order following a lengthy internal disciplinary process, with a final vote by its ruling council.
Noseweek has established that the ground-breaking private application, to be filed shortly in the North Gauteng High Court, is being bankrolled by Discovery Health in the name of one of its member patients, brain-damaged accident victim Matthew Graham.
|Radio Active Personal injury lawyer Ronald Bobroff|
Heading Discovery’s legal team is George van Niekerk, white-collar-crime director at leading corporate law firm ENS. In court, the application will be argued by the formidable advocate Jeremy Gauntlett SC. Van Niekerk has requested a media ban on all information relating to the application and has forbidden the name of Discovery to be linked to it.
For years Ronald Bobroff has been criticised for his firm’s no-win no-fee contingency policies. The Contingency Fees Act stipulates that attorneys may take a maximum of 25% of any settlement awarded to their client, or double their usual fees – whichever is the lower. However, Ronald Bobroff claims that a common law directive issued by his own Law Society of the Northern Provinces allows attorneys to take up to 40% of a settlement to cover their fees and the costs of experts.
Since Bobroff’s alleged excessive fees are a large part of the striking-off application, and seeing that Bobroff’s justification for them is a directive from the Law Society where – as a long-standing member of its ruling council he holds demigod status – Discovery Health chief executive Dr Jonathan Broomberg saw a private striking-off application as the only course offering a chance of success.
There is also widespread discontent with the Law Society of the Northern Provinces for its apathy, reluctance to act and failure to protect the public against delinquent lawyers.
To add to Bobroff’s problems, SARS recently sent a four-strong team into his firm’s Rosebank, Joburg offices to conduct a VAT audit. They remained there for a fortnight and, at the conclusion, one of the SARS auditors is said to have asked Darren Bobroff for an explanation about R98m of apparently unaccounted-for income. There is no suggestion the Bobroffs have appropriated this sum, rather, disapproval about the way the firm does its books.
Ronald Bobroff was 65 on August 7 and is nearing retirement. His attorney son Darren, who is a co-director at the firm his father founded in 1974, is also admitted to practice in Australia. Which could be one reason why the Asset Forfeiture Unit is keeping an eye on unfolding events, should things go against the Bobroffs and tempt them to forsake their adjoining mansions in Johannesburg’s Victory Park and head for distant climes.
Certainly, Ronald Bobroff realises the gravity of his position. He has retained two of South Africa’s top criminal lawyers, advocate Mike Hellens SC and attorney Ian Small-Smith, to represent him.
The two cases examined by Faris in his forensic report are those of accident victims Matthew Graham and Juanne de la Guerre. In Discovery Health’s private striking-off application, the focus is on its brain-damaged member Graham, who was awarded R1.9 million by the RAF. Bobroff’s firm entered into several agreements with Graham’s wife, Jennifer: that his firm would receive 30% of any award; would receive R1,500/hour for work done; and that Bobroff would guarantee the Grahams 60% of any award. Jennifer Graham accepted the 60% deal.
Juanne de la Guerre is a beautician who received a R2.8m payout from the RAF after a 2005 car accident. Ronald Bobroff & Partners deducted R868,273 for legal fees and VAT. The firm deducted a further R195,432 for legal counsel and medical experts. De la Guerre, now represented by Norman Berger & Partners, is suing Ronald Bobroff & Partners for the return of her money and an account for work actually done.
In the Graham case, Jennifer Graham complained to the Law Society about Bobroff’s “excessive fees” and of overreaching, in claiming for 394 hours when records showed fewer than 100 professional hours spent on the matter.
In February Ronald Bobroff was called before a Law Society investigating committee and asked to explain his side of the story. But he stormed out of the hearing, declaring he would answer only to a disciplinary inquiry. By the time this was held in July, Bobroff was facing 22 charges. Now he ranted that the disciplinary committee members had already read the papers in the case and were therefore biased against him. He stormed out again and won a high court interdict preventing the Law Society from proceeding against him, on the grounds of bias.
In April the Independent Newpapers’ Personal Finance supplement revealed that the Graham complaint to the Law Society was being funded by Discovery Health. The newspaper quoted Discovery Health chief executive Dr Jonathan Broomberg: “We have an obligation to assist and protect our members, particularly those that find themselves in a vulnerable position.”
Personal Finance reported that Discovery Health was also paying ENS to investigate the cases of four other of its members who had been represented by Bobroff & Partners.
Discovery Health claims its members are obliged to repay the scheme any medical expenses recovered from the RAF. In another case, Bobroff & Partners advised accident victim Mark Bellon not to pay Discovery R861,334 medical expenses he received from the RAF. Bellon followed this advice and Discovery terminated his membership.
On his website, Ronald Bobroff says he is standing by his client in taking on “the big corporate” and that Graham’s complaint to the Law Society about his fees was “a smokescreen”.
The website declares: “We always discuss and agree the fees with our clients and our 37 years of exemplary reputation is confirmation of our fair dealings with clients.” All of which may have contributed to Discovery Health’s decision now to bankroll what will be an extremely expensive high court action in an attempt to have Ronald Bobroff struck off.
What Discovery Health’s 2.4m members will feel about their medical scheme’s millions being utilised to fund a campaign to have two attorneys struck off is unpredictable.
(I would say “predictable”. – Ed).
Already the Council for Medical Schemes is unhappy about the proportion of medical scheme funds being earmarked for non-healthcare expenditure. And Discovery Health’s administration fees are the second-highest in the country, at R102 per average member per month.
► Last year Discovery Health produced an operating profit up 10% to R1.5bn. Despite this, members’ contributions keep going up. Although most schemes have kept their 2013 premiums’ increase within single figures (Momentum Health and FedHealth both 7.9%, Medshield 7.5%) Discovery Health last month announced whopping increases of between 9.8% and 11.8%.
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