Legal Profession

AuthorLAI Yew Fei LLB (Hons) (National University of Singapore); Advocate and Solicitor (Singapore); Partner, Rajah & Tann LLP.
Date01 December 2013
Published date01 December 2013
Citation(2013) 14 SAL Ann Rev 452

21.1 This SAL Ann Rev covers a wide variety of cases. They include a case in which a lawyer was struck off the roll for accepting a gift from a client, cases in which lawyers seeking excessive remuneration were disciplined, and a case in which a lawyer misappropriated clients' money and issued cheques which he knew would be dishonoured. There were also a number of cases touching on the formation of disciplinary tribunals (‘DT's’) and the jurisdiction of the court vis-à-vis disciplinary proceedings.

21.2 The year 2013 also saw the first reported decisions on applications for ad hoc admission of foreign counsel, as well as two decisions on the restoration to the roll, of lawyers who had been previously struck off.

Excessive remuneration and dishonesty

21.3 A number of cases relating to the remuneration of lawyers were reported in 2013.

21.4 In Law Society of Singapore v Ang Chin Peng[2013] 1 SLR 946, the respondent solicitors were engaged to handle two estates and entered into oral agreements for their legal fees to be fixed at 5% and 3% of the gross value of the two estates respectively. The respondents issued invoices for $489,267.17 and $150,640 for the two estates respectively. The respondents declined requests for taxation but the executors and trustees eventually obtained an order of court for the bills to be taxed. Upon review, the amount of legal fees allowed were $120,000 and $50,000 respectively.

21.5 A law society complaint was lodged and the matter eventually went to the DT and the High Court. The High Court suspended each of the respondents for three months and held that:

(a) An oral fee agreement was valid although unenforceable. Although s 109(4) of the Legal Profession Act (Cap 161, 2009 Rev Ed) requires agreements with respect to remuneration for non-contentious business to be in writing and signed, the lack of a written agreement affected only the enforceability but not the validity of the fee agreement. The oral fee agreements could therefore be assessed to see if they afforded a defence to a charge of overcharging: at [27]–[29].

(b) For non-contentious matters, there is nothing wrong with agreements for fees based on a percentage of the value of the estate. However, the agreement is always subject to review by the court to ensure that the fees are fair or reasonable relative to the work done: at [31]–[34].

(c) There was overcharging as the invoices had no correlation to the actual work done and the solicitors admitted that the work done was neither factually nor legally complex: at [51]–[52].

(d) While not all cases of overcharging amounted to grossly improper conduct, the respondents' conduct was grossly improper considering (i) the extent of the overcharging; (ii) their refusal to have their bills taxed; (iii) their filing of grossly inflated bills of costs for the taxation proceedings; and (iv) they had misled their clients to think that the percentage fees were the norm: at [54]–[67].

21.6 Percentage fees were also the issue in Law Society of Singapore v Kurubalan s/o Manickam Rengaraju[2013] 4 SLR 91. In this case, the respondent entered into a fee agreement with a client under which he was to act in respect of a claim for personal injury to be brought in Australia. The respondent agreed to bear the costs of his client's claim in Australia if the claim was not successful; however, if the claim was successful, the respondent would be paid between 30% and 40% of the recovered sum. The claim was eventually settled for A$3,250,000 and the respondent sought to claim fees of A$1,200,000 from the client.

21.7 A law society complaint was lodged and the matter eventually went to the DT and the High Court. The High Court suspended the respondent for six months and held that the fee agreement was champertous and in breach of the Legal Profession Act as well as the Legal Profession (Professional Conduct) Rules (Cap 161, R 1, 2010 Rev Ed) (‘Professional Conduct Rules’): at [33]–[35]. The champertous conduct was wrong even though the litigation was in a foreign court: at [60]. There were also aggravating circumstances: at [50]–[53].

21.8 The High Court did note, however, in obiter, that it would be permissible and honourable for an advocate and solicitor to act for an impecunious client in the knowledge that he would likely only be able to recover his fees or disbursements if the claim was successful or costs were ordered in his client's favour: at [82]–[89].

21.9 The clear message from these cases is that lawyers cannot expect to obtain a windfall from fee agreements for excessive remuneration which is not commensurate with the actual work done. Champerty remains prohibited.

21.10 There were also two decisions of the DT which involved an advocate and solicitor who misappropriated various sums of money, being Law Society of Singapore v Mustaffa bin Abu Bakar[2013] SGDT 1 and Law Society of Singapore v Mustaffa bin Abu Bakar[2013] SGDT 2. The clients had entrusted the solicitor with sums of money for ‘safekeeping’, and he was to repay the sums of money, but he did not do so. The advocate and solicitor also issued a number of cheques which he knew would be dishonoured. Furthermore, the advocate and solicitor had advised a client to conceal matrimonial assets and subverted the course of justice.

21.11 The advocate and solicitor did not participate in the DT proceedings. The DT found that cause of sufficient gravity for disciplinary action existed against the advocate and solicitor under s 83 of the Legal Profession Act. Parenthetically, the advocate and solicitor in question has been convicted of criminal breach of trust in Public Prosecutor v Mustaffa bin Abu Bakar[2013] SGDC 60.

Relationship with clients

21.12 Advocates and solicitors should also be extremely cautious when it comes to gifts from clients. In Law Society of Singapore v Wan Hui Hong James[2013] 3 SLR 221, the respondent accepted a gift of $460,000 from a client, being part of the proceeds from the sale of a property for $960,000. The respondent was struck off the roll. The Court of Three Judges held (at [63]) that the respondent had dishonestly misled the client, who had a history of mental health problems, into believing that the property would not fetch much more than $500,000. The Court of Three Judges also provided a number of timely reminders to advocates and solicitors:

(a) It is prudent to maintain contemporaneous attendance notes, even in routine matters, as a lack of attendance notes may lead to an adverse inference being drawn against the advocate and solicitor: at [64].

(b) For the purposes of r 46 of the Professional Conduct Rules, a ‘significant gift’ means a gift which is significant in absolute terms, as well as a gift which is significant having regard to the client's means and the reasonable expectations of other prospective beneficiaries: at [10].

(c) When the client intends to make a significant gift, the advocate and solicitor cannot merely tell his client to seek independent advice. He or she should take a whole plethora of steps to ensure that the client obtains independent advice, and decline the gift if the client refuses to be advised: at [18].

(d) The advocate and solicitor cannot act for the client in respect of the gift (such as by drawing up the instrument of transfer) (at [20]) but can otherwise continue to act for the client: at [19] and [22].

(e) Even more stringent obligations apply where the client is not a fully competent adult: at [24].

(f) Even if the advocate and solicitor has complied with the Professional Conduct Rules, the gift...

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