The Supreme Court of Appeal ruled in 2014 that professional bodies have a right and an obligation to enforce disciplinary hearings against members.
The case that reaffirmed this right was Elizabeth Coetzee versus the Financial Planning Institute (FPI) of South Africa.
Coetzee had previously been stripped of her accreditation as a Certified Financial Planner by the FPI for unprofessional conduct, which included over-charging of commissions and ignoring a client’s advice to invest in a portfolio of low-risk shares. Coetzee earned commissions of R900,000 from the sale of the client’s shares, and did not move R25 million worth of investment into low-risk shares as instructed. The client lodged a complaint against Coetzee with the FPI.
The FPI found that Coetzee had failed to exercise reasonable and prudent professional judgment when providing financial services and that the remuneration charged was not fair and equitable.
Aggrieved at the outcome, Coetzee appealed to the appeal tribunal of FPI, which set aside the findings of the disciplinary committee but substituted those findings with a finding that she was guilty on two of the charges advanced against her. The sanction imposed was varied to the suspension of her membership in FPI for a period of two years.
In 2013, Coetzee then approached the Western Cape High Court for relief and ask the court to find her not guilty on all charges against her. The court found against her, so she then took the matter to the Supreme Court of Appeal, which also found against her.
The Supreme Court of appeal found that Coetzee had had been properly summoned by the FPI and given an opportunity to respond to the charges against her.
This court case makes it abundantly clear that professional bodies are empowered in law to enforce their codes of conduct on members.
There has been considerable debates amongst voluntary professional bodies over the years as to the enforceability of these codes of conduct. The Coetzee versus FPI case has settled the matter once and for all. Professionals who fail to act in accordance with the professional body’s code of conduct are therefore subject to the disciplinary powers of the professional body. This case also reaffirms the right of bodies such as the SA Institute of Business Accountants (Saiba) to take disciplinary measures in the public interest.