Lawyers were horrified when Buffalo City Metro suddenly ended their contract to collect debt and demanded all their files be returned to the debt management department two years ago.
Each of three local firms had teams of six or more clerks and debtors secretaries working under an attorney to get court orders to force debtors to pay up – and were doing well, said attorney Mike Francis, of Bax Kaplan Russell Inc.
Francis was the only attorney from all three firms who would comment on how the firms had to collapse their teams and try to find other work for them.
His firm, and those of Gravett Schoeman Inc. and Smith Tabata Attorneys who were contracted to collect debt, had been shocked at the decision.
In 2014, “without any form of warning, we received notice at end of term that our contract would not be renewed and we were asked to return the files,” Francis said.
“We found that surprising because, in the past when contracts were terminated, attorneys were allowed to complete the collection process in those files in their possession.
“This time the files were uplifted. We had to return them but we want to know what happened to those files because we asked BCM if they had a plan and they said yes. We were given no reasons.
“We had to retrench six staff members and the other firms said they also had to retrench. We asked BCM to employ our retrenched staff as a practical solution as they knew what was going on in the files, but they said ‘no thanks’.”
Francis said there were a number of active court orders in the file.
“You need staff to process all these court documents. We were doing nicely and collecting money. But we had to pack our files in boxes, seal them and deliver them to BCM.”
Francis said money was still coming into his firm and being paid over but for no fee.
He said the threat of a cut-off of services had now become a matter of “political will” compared with law firms following a legal route.
He and partner John Bax estimated that the three law firms between them had 25 people “working flat-out” in teams under a “qualified attorney”.
Threats to attach goods and sell homes was effective, and actions taken by the local sheriff “was okay, not bad at all”. That had all been disbanded.
Pre-legal work had attracted a 16% cut of the debt, and once the matter was in court, the tariff agreement with BCM was “less than the tariff proscribed by the magistrate’s courts”.
Gravett and Schoeman partner Gary Gravett would only say: “All files in terms of our 2011 contract have been returned to BCM. We have no further knowledge of those files. We do have a few contested matters still in our possession.”
Mike Smith, senior director of Smith Tabata, confirmed they did collection work for BCM but declined to say more. — mikel@dispatch.coza
Debt collection in limbo as Metro ends contracts
Each of three local firms had teams of six or more clerks and debtors secretaries working under an attorney to get court orders to force debtors to pay up – and were doing well, said attorney Mike Francis, of Bax Kaplan Russell Inc.
Francis was the only attorney from all three firms who would comment on how the firms had to collapse their teams and try to find other work for them.
His firm, and those of Gravett Schoeman Inc. and Smith Tabata Attorneys who were contracted to collect debt, had been shocked at the decision.
In 2014, “without any form of warning, we received notice at end of term that our contract would not be renewed and we were asked to return the files,” Francis said.
“We found that surprising because, in the past when contracts were terminated, attorneys were allowed to complete the collection process in those files in their possession.
“This time the files were uplifted. We had to return them but we want to know what happened to those files because we asked BCM if they had a plan and they said yes. We were given no reasons.
“We had to retrench six staff members and the other firms said they also had to retrench. We asked BCM to employ our retrenched staff as a practical solution as they knew what was going on in the files, but they said ‘no thanks’.”
Francis said there were a number of active court orders in the file.
“You need staff to process all these court documents. We were doing nicely and collecting money. But we had to pack our files in boxes, seal them and deliver them to BCM.”
Francis said money was still coming into his firm and being paid over but for no fee.
He said the threat of a cut-off of services had now become a matter of “political will” compared with law firms following a legal route.
He and partner John Bax estimated that the three law firms between them had 25 people “working flat-out” in teams under a “qualified attorney”.
Threats to attach goods and sell homes was effective, and actions taken by the local sheriff “was okay, not bad at all”. That had all been disbanded.
Pre-legal work had attracted a 16% cut of the debt, and once the matter was in court, the tariff agreement with BCM was “less than the tariff proscribed by the magistrate’s courts”.
Gravett and Schoeman partner Gary Gravett would only say: “All files in terms of our 2011 contract have been returned to BCM. We have no further knowledge of those files. We do have a few contested matters still in our possession.”
Mike Smith, senior director of Smith Tabata, confirmed they did collection work for BCM but declined to say more. — mikel@dispatch.coza
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