Update: Investec's Joburg senior advocates found to have charged eight times too much

Senior Joburg advocates found to have charged eight times too much.

Three senior advocates of the Johannesburg Bar who were hired by Investec to oppose a high court application brought by the minority shareholders of Randgold and Exploration Ltd, have suffered humiliation at the hands of the Taxing Master of the North Gauteng High Court in Pretoria.

Johnnie Blou
Shanee Stein

This is the latest development in a seemingly endless legal war of attrition which began in March 2011, when the minority shareholders launched a case claiming damages from Investec – and Randgold itself – for allegedly deliberately failing to take appropriate action to recover losses they suffered when the late Brett Kebble stole all their shares in the company and sold them for his own and associates’ benefit.  (See noses81, 85, 117, 179, 180, 181, 189208, 212 & 215).

In what many would interpret as a power play designed to intimidate, Investec hired major law firm Werksmans and no fewer than four advocates from the Johannesburg Bar, three of whom are senior counsel, to represent the bank in opposing an “interlocutory” application brought in March 2016 by the minority shareholders. Investec apparently set no limit to the fees their lawyers might charge for the service. (The application was argued before Judge Rabie in one-and-a-half hours on 19 August 2016, but, due to pressure of work, the judge delivered his judgment only eight months later, in April 2017.)

Tony Rubens

The high-powered Investec team successfully opposed the minority shareholders’ application, resulting in the shareholders’ being ordered to pay Investec’s legal costs.

In due course they were presented with the Investec legal team’s bill totalling R2,422,361.92. But when, on 29 January this year, the bill was presented to the taxing master for his independent assessment and final determination, he reduced it to just R305,550.28.

The inevitable conclusion: Investec and Werksmans had been happy to have their counsel charge eight times as much as they should reasonably have charged, possibly as another means of intimidating the Randgold minority into fleeing the battlefield.

The three senior counsel who led the fee rush are advocates A P Rubens SC, Johnnie Blou SC and S Stein SC.

A stand-out item on the list:  in addition to other particularised charges, Rubens billed a straight R52,000-a-day (R5,200 an hour) for 16 days spent in consultation or on preparation. At that rate, he rakes in more in one hour than the average South African earns in a month.

Application for Declaration and Variation by Standard Bank Nominees (Transvaal) (Pty) Ltd and nine others vs Investec and Randgold and Exploration Company Ltd. – case No. 19269/11.

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