The Law Society of Singapore v Ng Cher Yeow

JudgeChao Hick Tin JA
Judgment Date12 October 1999
Neutral Citation[1999] SGHC 268
Docket NumberOriginating Summons No 1198 of
Date12 October 1999
Published date19 September 2003
Plaintiff CounselJimmy Yap Neng Boo (Donaldson & Burkinshaw)
Citation[1999] SGHC 268
Defendant CounselLee Hong (Ng Cher Yeow & Partners)
CourtHigh Court (Singapore)
Subject MatterFailure of duty to client,Show cause action,Grossly improper conduct,Failure to inform client of fraudulent scheme,s 83(2)(b) Legal Profession Act (Cap 161),Legal Profession,Preparation of sham documents in sale and purchase of property

(delivering the grounds of judgment of the court): In these proceedings, the abovenamed, Ng Cher Yeow (`the respondent`), an advocate and solicitor of the Supreme Court, was ordered to show cause why he should not be dealt with under s 83 of the Legal Profession Act (Cap 161, 1997 Ed) (`the Act`). The proceedings arose from a determination of the Disciplinary Committee, appointed by the Chief Justice under s 90 of the Act, that in relation to a complaint dated 25 January 1996 made by one Madam Te An Nyah to the Law Society of Singapore (`the Law Society`), cause of sufficient gravity for disciplinary action existed under s 83 of the Act. The determination of the Disciplinary Committee (`the Committee`) was made on the basis of two charges (which we shall set out shortly) framed by the Law Society which the Committee found had been proved. At the conclusion of the hearing, we suspended the respondent from practice for a period of three years. We now give our reasons.

The facts

The respondent is an advocate and solicitor of some nine years` standing, having been admitted to the Bar on 14 March 1990. At all material times, he was practising as a partner in the law firm of M/s Ng Cher Yeow & Partners.

The complainant, Te An Nyah (`Te`) was a businesswoman, and until her divorce in 1991 was married to one Koh Seng Bee (`Koh`).
Te and Koh were the joint owners of a walk-up apartment known as 2A Robin Road, Singapore (`the property`). By an order made in their matrimonial proceedings, the property was directed to be sold after 5 March 1995 and the net proceeds of sale (less the refunds to their respective accounts with the Central Provident Fund Board) were to be divided equally between them.

Sometime in or around March 1995, Koh left Singapore to take up a new appointment in China.
Before he left, he signed two documents which he entrusted to Te. The first was a memorandum in which he confirmed his agreement to the sale of the property, provided that the price was not less than $700,000 and that his share of the net profit, less certain deductions, was not less than 25%. The second document was an undated option (`the original option`) for the sale of the property, with blank spaces provided for the name of the purchaser and the price to be inserted, when the option was to be issued. This document was obviously intended to facilitate the sale of the property by Te, while he was abroad.

Following that, Te found a prospective buyer for the property and in anticipation of the sale, the price of $700,000 was inserted in the original option.
However, negotiations between the parties broke down and the sale eventually fell through. During that time, the law firm of Hin Rai and Tan represented Te.

Thereafter, Te enlisted the assistance of her friend, Jenny Tan, who was a real estate agent with C & H Realty Pte Ltd, to find a buyer for the property.
After inspecting the property, Jenny Tan offered to buy the property herself. The two women agreed on a price of $838,000. However, Te did not want this price to be reflected in the option, as she wanted to keep the money in excess of $700,000 (ie $138,000) from Koh. It was agreed between Te and Jenny Tan that the option would state the purchase price of $700,000, and the balance of $138,000 would be paid by Jenny Tan to Te `under the table` in five unequal instalments over a certain period. It was also agreed that the instalments would be documented as repayments of a loan from Te. Jenny Tan suggested engaging the respondent to act for them in the sale and purchase of the property, as she was acquainted with him. Te agreed.

The two parties then met the respondent at his office on 25 May 1995.
The original option was shown to him. The respondent agreed to act for both Te and Jenny Tan in the sale and purchase of the property, and in the process, also agreed implicitly to act for Koh. Jenny Tan`s name, the date and expiry date of the option and the agreed completion date were inserted in the option by the respondent`s secretary. Te then signed the original option at the space beside Koh`s earlier signature. On instruction from Te and Jenny Tan, the respondent also prepared a document expressed to be an `Acknowledgement of Debt`, which provided that Jenny Tan had received a friendly interest-free loan of $138,000 from Te on 8 February 1995, and that Jenny Tan undertook to repay the loan to Te in five unequal instalments over a period of slightly more than three months. This document was signed by Jenny Tan.

Subsequently, Jenny Tan encountered difficulty in obtaining adequate financing for the purchase of the property.
This was due mainly to the fact that the banks or finance companies which she had approached for a loan were prepared to grant a loan only up to a certain percentage of the purchase price as declared in the option. Jenny Tan therefore tried to persuade Te to amend the price in the original option to $838,000 but the latter refused, because she was insistent on not disclosing to Koh the true selling price of the property.

Faced with the possibility of not being able to purchase the property and of losing the money paid for the option, Jenny Tan informed the respondent of her predicament.
According to her, it was at this point in time that she told the respondent that the interest-free loan was `under the table` money, and that the true purchase price was in fact $838,000. The respondent was surprised to learn of this and commented that if he had known of this arrangement on 25 May 1995, he would not have agreed to it as it was illegal. Nevertheless, the respondent informed Jenny Tan that she had no choice now but to complete the purchase of the property, failing which Te could bring an action against her on the `Acknowledgement of Debt` which she had earlier signed and for not completing the purchase of the property.

Jenny Tan then suggested that there be put in place an intervening sub-sale so that Te would sell the property to a buyer for $700,000 and the buyer would then sub-sell it to Jenny Tan for $838,000.
Jenny Tan suggested that the intervening buyer be her mother-in-law, but the respondent advised that his conveyancing secretary, Soh Hwee Tin (`Soh`) should be the intervening buyer instead. Arising from these discussions, the respondent prepared two fresh options. The first option (`option A`) was for a sale of the property by Te and Koh to Soh at the price of $700,000, and the second option (`option B`) was for a sub-sale by Soh to Jenny Tan and her husband at the price of $838,000. The intention was to arrive at the resulting price of $838,000 with the intent that option B could be shown to a bank to enable Jenny Tan to obtain a loan based on a sale price of $838,000. At the same time, Te`s demand that the option granted by her and Koh should reflect a purchase price of $700,000 only would also be met.

Te agreed to the arrangement.
In preparing option A, the respondent made use of the original option with only the following changes. As both Te and Koh had previously signed the original option, he substituted the first page thereof with a new page inserting Soh`s name to replace Jenny Tan`s name. Te then initialled on option A, while Soh signed...

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2 cases
  • Law Society of Singapore v Chan Chun Hwee Allan
    • Singapore
    • Court of Appeal (Singapore)
    • 30 January 2018
    ...a two-year suspension on those facts (see Leong Pek Gan at [8]). Finally, in the case of Law Society of Singapore v Ng Cher Yeow [1999] 3 SLR(R) 596 (“Ng Cher Yeow”), the respondent-solicitor acted for both the vendors (a couple who had divorced) and the purchaser in a sale and purchase of ......
  • Law Society of Singapore v Leong Pek Gan
    • Singapore
    • Court of Appeal (Singapore)
    • 7 November 2016
    ...was ordered to be suspended from practice for one year. In another decision of this court, Law Society of Singapore v Ng Cher Yeow [1999] 3 SLR(R) 596, the respondent solicitor acted for both the vendors (a couple who had divorced) and the purchaser in a sale and purchase of property. The p......

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