Pay back the money: High Court finds Hlophe’s lawyer personally liable for R20million in legal fees

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Barnabas Xulu is seen in court for the Judicial Services Commission investigating a judicial misconduct complaint against him.

Nelius Rademan, Gallo Images, Foto24

  • Western Cape Judge John Hlophe’s attorney Barnabas Xulu has been embroiled in a long-standing battle with the Department of Environment, Forestry and Fisheries for more than R20 million in legal fees illegally paid to his company.
  • Judge Phillip Zilwa has now concluded that Xulu should be held personally responsible for repaying that money – and criticized him for flouting the law by spending money he knew was obtained illegally.
  • Zilwa’s move also allows the department to permanently seize funds and assets owned by Xulu, which he had successfully requested to be frozen, as part of his efforts to ensure he gets his money back.

Lawyer Barnabas Xulu will have to reimburse more than R20million in fees illegally paid to his law firm, following a scathing High Court ruling that found counsel for the Western Cape judge, John Hlophe, had “flouted the law”.

Eastern Cape Judge Phillip Zilwa’s ruling now gives the Ministry of Environment, Forests and Fisheries the power to sell the assets he had seized in Xulu, including his luxury vacation home on the coast of the dolphins, to recover the more than R20 million in legal fees he had illegally paid. to his business.

READ | State is extravagant in pursuit of R20million for lawyer Barnabas Xulu, court finds

Moegamat Abader, then the acting director general of the department, successfully argued last year that Xulu’s assets should be frozen because of the way he had “simply dissipated – and appropriated – funds” from the bank accounts of his law firm without taking into account his debts and obligations or the multiple court orders issued against him.

While the department had attempted to seize Xulu’s Porsche 911 Carrera as part of its efforts to recover legal fees, it has so far refused to hand it over – and has recently been found in contempt of court for it. refusal.

As Xulu now attempts to appeal that decision to the Supreme Court of Appeal, Zilwa has found that the Porsche, if and when it is ultimately salvaged, can be sold by the department.

READ | Xulu’s fee battle has nothing to do with targeting black law firm, Fisheries Department says

In an embarrassing development for Hlophe, who is currently awaiting a vote from the Judicial Services Commission on whether he could be indicted for serious misconduct, acting Judge Mas-Udah Pangarker’s contempt ruling against Xulu revealed that the lawyer had requested the intervention of the president of the judge in the case.

Xulu did so by writing to Hlophe and asking him to refer all cases related to his fee battle with the department to the Judicial Services Commission.

Judgments against him

Hlophe declined to intervene, but Xulu has already repeatedly used his association with the presiding judge to claim that he has been treated unfairly by the multiple judges who have ruled against him.

The Xulu Fee Saga grew out of a January 2020 ruling by Western Cape High Court Judge Owen Rogers who concluded that the Service Level Agreement and the Legal Fee Settlement Agreement The subsequent R20 million between Xulu law firm BXI and the department were both illegal.

Rogers ordered Xulu’s company to repay the R20 million and decided that Xulu should be asked to explain why he should not be held personally responsible for this money.

In a ruling on Thursday, Judge Zilwa has now concluded that the department had “succeeded in making a formal plea for the detention [Xulu] jointly and severally liable ”for fees.

Zilwa also criticized Xulu’s conduct in spending the money his company had obtained from the department by seizing his bank accounts, although he was informed that this execution process was illegal.

The judge pointed out that Xulu was told in June 2019 that his company’s legal fee settlement agreement with the department did not appear to be legal and, furthermore, that his efforts to recover the money he claimed was his business was owed did not comply with the State Liability Act.

Despite this, Xulu transferred this money from his company’s trust account and disbursed it in what Rogers would later describe as “excessive haste.”

Zilwa agreed with the department’s argument that “Xulu’s blatant disregard for the law by following a legal enforcement process makes his conduct as a lawyer faulty and negligent.”

“[Xulu] declared under oath that he knew that there had been no respect for the law but nevertheless considered that [his firm] BXI had the right to use the illegally obtained funds to fulfill its obligations and even if its conduct was unlawful, a court can still refuse to order the repayment of these funds, ”Zilwa said.

“As the controlling mind of BXI, [Xulu] chose to shell out the money and flout the law, “he said, adding that” most of the money “was spent after Xulu’s company was informed that its seizure of bank accounts of the department was invalid and violated the State Liability Act.

Zilwa also rejected Xulu’s argument that the ministry’s demand against him and his company was based on politics and innuendo, not the law.

He said this assertion was “unfounded”.

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