Re Teo Choo Hong

• Jurisdiction: Singapore
• Judge: Karthigesu JA
• Judgment Date: 31 May 1995
• Neutral Citation: [1995] SGHC 138
• Docket Number: Originating Summons No 110 of 1995
• Date: 31 May 1995
• Year: 1995
• Published date: 19 September 2003
• Plaintiff Counsel: VK Rajah, Eric Chan and Chandra Mohan (Rajah & Tann)
• Citation: [1995] SGHC 138
• Defendant Counsel: Michael Hwang and Lim Wee Teck (Allen & Gledhill)
• Court: High Court (Singapore)
• Subject Matter: s 90(1), (6) & (7) Legal Profession Act (Cap 161, 1994 Ed),Whether disciplinary proceedings void because of member's absence,s 90(7) Legal Profession Act (Cap 161, 1994 Ed),Words and Phrases,Lay member not having power of vote in committee,'Transaction of any business',Procedure,Natural justice,Whether constituting improper conduct,Absence of lay member of committee for greater part of hearing,Absence of lay member of disciplinary committee during greater part of hearing,Whether allegation proved beyond reasonable doubt,Whether there was nevertheless a breach of natural justice,s 90(6) Legal Profession Act (Cap 161, 1994 Ed),Legal Profession,Giving false evidence in court,Administrative Law,ss 83 & 85 Legal Profession Act (Cap 161, 1994 Ed),Hearing by disciplinary committee,Show cause action,'Meeting',Professional conduct,Whether the 'transaction of any business' included meetings as well as hearings,Whether 'meeting' encompassed 'hearing',Backdating of option by lawyer

Cur Adv Vult

The facts

Teo Choo Hong (the respondent) is an advocate and solicitor practising as a sole proprietor under the name and style of Teo Choo Hong & Co. Sometime in 1975, the respondent and his father conveyed No 8 Lorong H, Telok Kurau (the property) to two brothers Heng Teo Meng (Meng) and Heng Teo Bong (Bong). Subsequently, Meng borrowed money from Malayan Banking Bhd (the bank) and the loans were secured by a mortgage of the property dated 9 July 1982 and executed by Meng and Bong as co-owners.

In September 1984 or thereabout, Meng was in serious financial difficulties and defaulted in repayment of the amount owing to the bank. He approached the respondent who suggested that the property be sold to pay off the amount owing. On 20 September, M/s Shook Lin & Bok, on behalf of the bank, wrote to Meng demanding payment of the outstanding balance. The respondent replied on behalf of Meng on 28 September, informing the bank that his client was in the process of negotiating a sale of the property and that, if the negotiations were successful, the initial deposit of 10% would be paid to them forthwith. The bank replied on 22 October indicating their interest in the prospective sale and asked to be kept informed of the negotiations.

Meanwhile, on 19 October 1984, Meng committed an act of bankruptcy. On 9 November 1984, M/s Shook Lin & Bok wrote to Bong giving notice of their clients` intention to exercise their power of sale and also giving him the requisite one month`s notice. On 3 January 1985, the respondent wrote to the bank informing them that his client was once again concluding negotiations for the sale of the property and asked for an extension of one month to make payment. However, the negotiations did not materialise. On 5 January 1985, M/s Shook Lin & Bok wrote to the respondent stating that the bank were agreeable to a private sale as long as the sale price was sufficient to cover the amount due and owing to the bank including all the expenses which had been incurred by the bank. Moreover, the full details of the proposed sale had to be finalized before 17 January 1985 and in the meantime the bank would be proceeding with their arrangements for a public auction. As no sale was concluded by that date, M/s Shook Lin & Bok on 23 January 1985 wrote to the respondent demanding that his client deliver vacant possession of the property within five days and stating that they would commence legal proceedings, if necessary, to recover vacant possession.

On 8 February 1985, Meng and Bong agreed, in principle, to sell the property to one Ng Soo Khim (Ng) for the sum of $650,000. However, Meng and Bong requested that the full purchase price should not be reflected in the sale but that part of it be paid by way of a loan which was to be non-refundable if the sale and purchase was successfully completed. Ng issued a cheque for $5,000 being in payment of a deposit and in return, Meng gave Ng a receipt on which it was stated, inter alia, that the agreed purchase price was $650,000. An option was subsequently prepared by the respondent and signed by both Bong and Meng. The option was dated 8 February 1985 and was expressed to expire on 1 March 1985.

On 13 February 1985, M/s Shook Lin & Bok informed Meng and Bong that the property was scheduled to be sold at a public auction on 7 March 1985 and demanded vacant possession by 28 February 1985. The respondent was also sent a copy of this letter. Ng subsequently exercised the option on 1 March at the respondent`s office by signing the form of acceptance attached to the option and handing to the respondent a cheque for $47,000 being the balance of the 10% deposit. He also handed over $130,000 in cash to Meng and/or Bong the receipt of which was acknowledged only by Meng as a loan.

On 2 March 1985, the respondent duly sought the bank`s approval for the sale of the property. However, the bank did not consent to the sale and Ng stopped payment on the cheque for $47,000. The property was subsequently sold by the bank as the mortgagee at a public auction on 7 March 1985. On 15 March 1985, Meng was adjudicated a bankrupt. The respondent wrote to M/s Shook Lin & Bok on 3 May 1985 on behalf of Bong asking for the latter`s half share of the balance of the purchase price.

On 20 March 1985, Ng`s then solicitors M/s Hock Cheong & Harold Seet sent a letter of demand to Meng and Bong for recovery of the loan of $130,000 and the deposit of $5,000. Shortly after, Ng commenced proceedings against Bong in S 4722/85 to recover the said sums. The case was heard before Goh Phai Cheng JC, and at the trial the respondent gave evidence for Bong. At the conclusion, the learned judicial commissioner gave judgment for Ng in the sum of $135,000 and costs. In the course of his judgment, the learned judicial commissioner made certain findings against the respondent. He said as follows:

(c) Was Mr Teo telling the truth when he said that:

(i) the option was prepared by him and released to his client HTM on 8 February 1985 and it was returned to him after it was executed by the defendant and HTM;

(ii) on 2 March 1985 his client HTM handed the cheque for the $47,000 to him; and

(iii) he did not see the documents PB1 and DB2 at his office on 1 March 1985?

In his written submission, counsel for the defendant [Bong] submitted that the plaintiff`s [Ng] testimony reeks of untruthfulness. I do not agree. On the contrary, having heard the parties in the witness box, I find that the plaintiff and his brother, Ng Soo Thiang, are truthful witnesses. The same could not be said of the defendant, his brother Heng Teo Meng and Mr Teo Choo Hong, all of whom I have carefully observed when they were giving evidence. From their answers and their demeanour, I am of the opinion that they were not telling the truth ...

In my judgment, Mr Teo Choo Hong was not telling the truth when he said he prepared the option on 8 February 1985 and released to Heng Teo Meng on that day. If the option was in fact prepared by him on 8 February 1985, why did he wait until 2 March 1985 to seek the bank`s approval for the option? ...

M/s Chan Kam Foo & Associates wrote to Teo Choo Hong & Co on 27 February 1985 stating that they were acting for the plaintiff and asked TCH & Co `to forward the draft agreement for sale and purchase together with the title deeds` for their perusal as soon as possible. If the option was in fact prepared by Mr Teo on 8 February 1985, I have no doubt that the plaintiff would have handed it to his lawyer Mr Chan Kam Foo and the latter would not have written the said letter of 27 February. I do not accept Mr Teo`s interpretation of Mr Chan`s letter, namely, that Mr Chan was asking Mr Teo whether his client would agree to enter into a sale and purchase agreement. In his testimony, Mr Teo Choo Hong did not give evidence in a frank and straightforward manner.

After the conclusion of the trial, the learned judicial commissioner wrote to the Law Society of Singapore (the Law Society), forwarding a copy of his judgment and stating that he found that the respondent had acted improperly in the property transaction. Pursuant to s 85(2) of the Legal Profession Act (Cap 161, 1994 Ed) (the Act), the Council of the Law Society referred the matter to the chairman of the inquiry panel and as a result an inquiry committee was duly empanelled on 16 November 1993 to hear and inquire into the complaint. On 15 April 1993, the inquiry committee recommended that there should be a formal investigation by a disciplinary committee. Pursuant to this recommendation, the Council determined that there should be a formal investigation by a disciplinary committee and accordingly applied to the Chief Justice to appoint a disciplinary committee. On 1 October 1993 the Chief Justice appointed a disciplinary committee (the disciplinary committee) to hear and investigate the complaint against the respondent.

Before the disciplinary committee, the Law Society formulated three charges against the respondent and they were as follows:

First charge

That you, Teo Choo Hong, are guilty of fraudulent or grossly improper conduct in the discharge of your professional duty within the meaning of s 83(2)(b) or alternatively of conduct within the meaning of s 83(2)(h) of the Legal Profession Act (Cap 161) in that you, in or about February 1985, whilst acting as the solicitor for the vendors, Heng Teo Meng and Heng Teo Bong, in the attempted sale of the property known as No 8 Lorong H, Telok Kurau, Singapore, to Ng Soo Khim, participated in or were privy to an agreement between the vendors and the purchaser to have [sic] to evade stamp duty and to defraud the mortgagee, Malayan Banking Bhd, by causing, inter alia, the option to purchase to reflect a purchase price of only $520,000 when in fact the purchase price agreed was $650,000.

Second charge

That you, Teo Choo Hong, are guilty of fraudulently or grossly improper conduct in the discharge of your professional duty within the meaning of s 83(2)(b) of the Legal Profession Act (Cap 161) in that you, on or about 1 March 1985, whilst acting as the solicitor for the vendors, Heng Teo Meng and Heng Teo Bong, in the attempted sale of the property known as No 8 Lorong H, Telok Kurau, Singapore, to Ng Soo Khim, falsely dated or caused to be falsely dated the option to purchase to reflect that the option was granted on 8 February 1985 when in fact the option was only granted on 1 March 1985.

Third charge

That you, Teo Choo Hong, are guilty of fraudulent or grossly improper conduct in the discharge of your professional duty within the meaning of s 83(2)(b) or alternatively of conduct within the meaning of s 83(2)(h) of the Legal Profession Act (Cap 161) in that you did lie on oath, whilst giving evidence in your capacity as a solicitor at the trial of S 472/85 before the Honourable Judicial Commissioner Mr Goh Phai Cheng, in asserting that the

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