Law Society of Singapore v Kurubalan s/o Manickam Rengaraju [Court of Three Judges]

• Jurisdiction: Singapore
• Judgment Date: 18 July 2013
• Date: 18 July 2013
• Docket Number: Originating Summons No 1114 of 2012
• Court: Court of Appeal (Singapore)

Law Society of Singapore

Plaintiff

and

Kurubalan s/o Manickam Rengaraju

Defendant

[2013] SGHC 135

Sundaresh Menon CJ

,

Chao Hick Tin JA

and

Andrew Phang Boon Leong JA

Originating Summons No 1114 of 2012

Court of Three Judges

Legal Profession—Professional conduct—Grossly improper conduct—Fee agreement—Champerty—Sentencing—Advocate and solicitor of the Supreme Court of Singapore agreeing fee as proportion of sum recovered by client—Whether respondent’s attempt to evade liability was an aggravating factor in sentencing—Whether respondent’s conduct after client resisted paying his fee was an aggravating factor in sentencing—Whether fact that champertous agreement was in respect of litigation overseas was a mitigating factor in sentencing—Sections 107 (1) (b ) and 107 (3) Legal Profession Act (Cap 161, 2009 Rev Ed)

The respondent, an advocate and solicitor of the Supreme Court of Singapore, was engaged by his client to act in respect of a claim for personal injuries to be brought in Queensland, Australia. The respondent agreed to bear the costs of the action if it was not successful but if it was, he would be paid between 30% and 40% of the sum recovered. The agreement stated that the respondent was to act in his personal capacity. The claim in Queensland was eventually settled and the sum of A$3,250,000 was paid to the client. When the respondent sought to claim his share of the proceeds, the client demurred. The respondent persisted, going to the extent of threatening civil and criminal proceedings against the client. A complaint was then lodged with the Law Society of Singapore.

An Inquiry Committee rejected the respondent’s claim that he had been acting in his personal capacity and so that s 107 of the Legal Profession Act (Cap 161, 2009 Rev Ed) (“the Act”) did not apply to him. The respondent was charged for breaching s 107 (1) (b ) of the Act read with s 107 (3) and he pleaded guilty at a hearing before a Disciplinary Tribunal, which accordingly found cause of sufficient gravity for disciplinary action under s 83 (2) of the Act.

Held, suspending the respondent from practice for six months:

(1) The respondent had correctly admitted his liability before the Disciplinary Tribunal. The respondent’s claim that he had been acting in his personal capacity was bound to fail on the facts as it was plain that he had expected to be remunerated for his efforts and that he had not taken on the matter as a personal favour but rather as a professional undertaking. The fact that the agreement with the client had stated that the respondent was to act in his personal capacity was not determinative of the issue, which had to be decided with regard to all the available evidence rather than simply on the basis of the form of words contained in an agreement: at [11] and [35] .

(2) The rationales for s 107 of the Act were that champertous maintainers had a temptation to pervert the course of justice and that a lawyer should be able to maintain a sufficient sense of detachment so as to be able to discharge his duty to the court. This duty was paramount and trumped all other duties. The considerations most engaged by the offence of champerty were therefore those concerning the administration of justice and the related need to safeguard confidence in and the honour of the profession that was tasked with the vital role of assisting the judiciary in their mission; however these were not static principles but could develop with time: at [42] and [45] .

(3) In disciplinary proceedings as opposed to criminal proceedings, the court was minded to view mitigating factors in a qualitatively different light. A mitigating circumstance that would have weakened the case for punishment in a criminal case might not have the same effect in a disciplinary case because in the latter, the court had also to consider the equally if not more important consideration of the protection of public confidence in the administration of justice. This interest could trump the offender’s interest in having his punishment finely calibrated according to his precise degree of culpability. However where aggravating factors were concerned there was less need to draw this distinction because factors that aggravate culpability tended also to aggravate the adverse impact on confidence in the administration of justice, although there could be exceptions to this: at [49] .

(4) There were two factors that aggravated the gravity of the respondent’s misconduct. First, he had not fallen innocently into error; he had been fully aware that his actions were wrong but had attempted in a deliberate and calculated manner to circumvent the prohibitions of the Act. Second, when the client demurred at paying the respondent his share of the proceeds, the respondent had reacted inappropriately and had even threatened civil and criminal proceedings: at [50] to [52] .

(5) The fact that the respondent had helped the client to obtain a substantial settlement for the claim was not relevant in mitigation. The respondent had allowed the client to kick-start the process of pursuing the claim in Queensland but this could be said to be true to some degree in almost all cases of champerty. The respondent had also not expressed remorse despite his plea of guilt: at [55] and [58] .

(6) What was relevant in mitigation was that the champertous agreement in question had contemplated litigation in Queensland and there, the offence of champerty, if committed by a solicitor qualified in Queensland, was punishable by a relatively minor fine only. Even if an advocate and solicitor was subject to Singapore’s regulatory framework, it would be permissible and generally appropriate for the court also to have regard, for the purposes of sentencing, to the applicable public policy as reflected in the regulatory framework of the jurisdiction directly affected, where the champertous agreement had little impact in Singapore. However this was not a case where the agreement had no impact in Singapore at all: at [59] and [68] .

(7) The two local cases of champerty on record were dated and of little use. Foreign precedents featured sanctions that ran the gamut from a small fine to striking off and therefore were of limited assistance. A fine would be of little deterrent effect as it would tend to be treated as just another variable in the stakes and striking off was not called for in this case because the respondent had not acted dishonestly. In the circumstances, and taking into account the aggravating and mitigating factors identified, a six-month suspension from practice was appropriate and was ordered to begin one month from the date of judgment; the respondent was also to pay costs of the proceedings to be taxed: at [69] , [77] , [78] and [80] .

[Observation: If an advocate and solicitor of the Supreme Court of Singapore has examined a client’s case and concluded in all honesty that there was a good cause of action or defence which, but for the client’s impecuniosity, would likely be litigated, then he would be doing no wrong if he took on such an engagement. This was so even if he knew that he would likely not be paid his usual fees or even his disbursements unless the claim succeeded or a costs order was obtained. The Council of the Law Society’s practice directions should not be read to apply to such cases: at [86] and [89] .]

Angliss Singapore Pte Ltd v PP [2006] 4 SLR (R) 653; [2006] 4 SLR 653 (refd)

Clyne v NSW Bar Association [1960] HCA 40 (refd)

David John Bultitude v The Law Society [2004] EWCA Civ 1853 (refd)

Giles v Thompson [1994] 1 AC 142 (refd)

Hill v Archbold [1968] 1 QB 686 (refd)

HKSAR v Mui Kwok-keung [2013] HKDC 424 (refd)

Ladd v London Road Car Co (1900) 110 LT 80 (refd)

Lau Liat Meng v Disciplinary Committee [1965–1967] SLR (R) 641; [1965–1968] SLR 8 (refd)

Law Society of Singapore v Ang Chin Peng [2013] 1 SLR 946 (refd)

Law Society of Singapore v Chan Chow Wang [1974–1976] SLR (R) 237; [1972–1974] SLR 636 (refd)

Law Society of Singapore v Ong Lilian [2005] SGHC 187 (refd)

Law Society of Singapore v Ravindra Samuel [1999] 1 SLR (R) 266; [1999] 1 SLR 696 (refd)

Law Society of Singapore v Tham Yu Xian Rick [1999] 3 SLR (R) 68; [1999] 4 SLR 168 (refd)

Law Society of Singapore, The v Terence Tan Bian Chye [2007] SGDSC 10 (refd)

Legal Services Commissioner v Barrett (Legal Practice) [2012] VCAT 1800 (refd)

Linus Joseph, Re [1990] 2 SLR (R) 12; [1990] SLR 771 (folld)

Mui Kwok Keung Louie v The Bar Council [2011] HKCA 63 (refd)

Otech Pakistan Pvt Ltd v Clough Engineering Ltd [2007] 1 SLR (R) 989; [2007] 1 SLR 989 (refd)

R (Factortame Ltd) v Secretary of State for Transport (No 8) [2003] QB 381 (refd)

Stevens v Keogh (1946) 72 CLR 1 (refd)

Thai Trading v Taylor [1998] QB 781; [1998] EWCA Civ 370 (refd)

Trepca Mines Ltd (No 2) , Re [1963] Ch 199 (refd)

Twinsectra Ltd v Yardley [2002] 2 AC 164 (refd)

Wallersteiner v Moir (No 2) [1975] QB 373 (refd)

Winnie Lo v HKSAR [2012] HKCFA 23 (refd)

Legal Profession Act (Cap 161, 1985 Rev Ed) s 80 (2) (b)

Legal Profession Act (Cap 161, 2009 Rev Ed) ss 107 (1) (b) , 107 (3) (consd) ;ss 83 (1) , 83 (2) (b) , 85 (1) , 94 (1) , 98 (1)

Legal Profession (Professional Conduct) Rules (Cap 161, R 1, 2010 Rev Ed) r 37 (consd)

Courts and Legal Services Act 1990 (c 41) (UK)

Criminal Procedure Ordinance (Cap 221) (HK) s 101 I

Legal Practitioners Ordinance (Cap 159) (HK) s 64 (1) (b)

Legal Profession Act 2006 (ACT) s 285

Legal Profession Act 2004 (NSW) s 325

Legal Profession Act 2007 (Qld) ss 323, 324, 325, 325 (1)

Philip Fong Yeng Fatt and Kirsten Teo (Harry Elias Partnership LLP) for the applicant

Chelva R Rajah SC and Tham Lijing (Tan Rajah & Cheah) for the respondent.

Sundaresh Menon CJ

(delivering the grounds of decision of the court):

Introduction

1 This is an application by the Law Society of Singapore (“the Law Society”) for an order pursuant...