Pretoria - A couple who paid more than R2.9 million into what they believed to be the bank account of their attorneys for the purchase of a house – only to find out that it was paid into a fraudulent account – is holding their bank responsible for their loss.
Ian and Annelie Ross turned to the Gauteng High Court, Johannesburg, in a bid to force the bank to reimburse them. The bank, however, said if the court found that it was to blame, the attorney’s firm, into whose account the money should have been paid, should also be held accountable.
In a special plea to the court, Nedbank asked that the law firm be added as a defendant in the matter.
The couple instituted action against the bank in which they advanced a claim for damages on account of the bank’s alleged negligent breach of a duty of care owed to them.
They said the bank should not have allowed withdrawals from the fraudulent account when it became aware of the fraud.
The couple had entered into an agreement of sale for a house, and they appointed a law firm as the conveyancers to attend to the transfer of the property into their names.
On February 8, 2019, the couple received an email purporting to originate from their attorneys, in which they were instructed to make payment of the purchase price into the bank account bearing the account number reflected in the email.
This was an account held with Nedbank.
Unbeknown to the plaintiffs, the email was fraudulent in that it did not originate from their attorneys.
The account reflected in the email (fraudulent account) did not belong to and was not operated by the attorneys.
A few days later, the plaintiffs paid R2 800 000 and R140 000 respectively, into the fraudulent account.
The fraud was soon discovered, and the payments that were electronically made into the fraudulent account were reported to the bank that same day.
The bank informed the plaintiffs that the fraudulent account would be suspended (frozen) and that no transaction from or against the account would be allowed.
The couple said despite this, the bank allowed amounts to the total value of R2 940 000 to be withdrawn from the fraudulent account.
In their application that the law firm should also be added to the proceedings, Nedbank said the firm should have ensured that its communication via email with the couple was secure and not compromised. The bank said it was apparent that the fraudsters had somehow gained knowledge of the communication between the plaintiffs and the attorneys and thereby generated the fraudulent email.
The bank said if it was found that it was negligent, it would argue that both the couple and the law firm were equally negligent.
Judge Avrille Maier-Frawley said – as suggested by the bank – the plaintiffs could also have preferred a claim for damages against the attorneys.
But the fact remains that the couple sought relief only against the bank, as they were entitled to do by law.
She added that while a claim may lie against the attorneys in law, which, if pursued against them, could possibly render such party a joint wrongdoer, this does not oblige the plaintiffs to have joined the attorneys as a party to the action.
She pointed out that the plaintiffs, in their legal action, do not allege that the attorneys were under a legal duty to prevent them from suffering economic loss.
Thus, the judge said, the law firm is not part of the case before the court, as set out by the Ross couple in their summons.
She turned down the bank’s special plea, which means the bank will now have to face the music alone.
Pretoria News