The Law Society of Singapore v Khushvinder Singh Chopra

• Jurisdiction: Singapore
• Judge: Chao Hick Tin J
• Judgment Date: 21 September 1998
• Neutral Citation: [1998] SGHC 313
• Docket Number: Originating Summons No 686 of 1998
• Date: 21 September 1998
• Published date: 19 September 2003
• Year: 1998
• Plaintiff Counsel: Sundaresh Menon and Deanna Seow (Rajah & Tann)
• Citation: [1998] SGHC 313
• Defendant Counsel: Michael Hwang SC and Francis Xavier (Allen & Gledhill)
• Court: High Court (Singapore)
• Subject Matter: Conflict of interest,s 83 Legal Profession Act (Cap 161, 1994 Ed),Persuading clients to execute statutory declaration upholding transaction and absolving him of impropriety,Grossly improper conduct,Disciplinary Committee's finding that one charge not made out,ss 94(3) and 97 Legal Profession Act (Cap 161, 1994 Ed),Legal Profession,Whether court may determine show cause proceedings of its own volition when correct procedure not followed by Council,Appropriate punishment for misconduct,Whether to proceed under s 97 or s 94(3) Legal Profession Act (Cap 161),Solicitor purchasing clients' property and acting for client and on own behalf,Council at odds with Disciplinary Committee's findings,Failure to advise clients to seek independent legal advice,Show cause action,Professional conduct,Whether solicitor guilty of grossly improper conduct

The Law Society of Singapore applied under s 98(1) of the Legal Profession Act (Cap 161) (`the Legal Profession Act`) for the respondent, Khushvinder Singh Chopra, an advocate and solicitor of the Supreme Court, to show cause before this Court of Three Judges as to why he should not be dealt with under s 83(1) of the same Act. The respondent was at all material times the sole proprietor of the firm M/s Khush Chopra. He was a lawyer with four years standing at the date of the complaint resulting in the present proceedings against him, having been admitted to the Bar on 12 April 1989.

Facts

The facts leading to the complaint against the respondent were set out comprehensively in two decisions, one in the High Court ([1996] 2 SLR 379) (`the High Court`s decision`) and one in the Court of Appeal ([1996] 3 SLR 457) (`the Court of Appeal`s decision`). Both decisions arose when the respondent tried to enforce a sale and purchase agreement relating to a piece of property (`the property`) against the complainant, his son (`Rajendran`) and daughter-in-law (`Silva`) (collectively known as `the vendors`). This in turn led to the complaint against the respondent. The vendors were the joint owners of the property, it being a property at 91 Jalan Seaview, Singapore.

In addition, we were referred to a Statement of Undisputed Facts, which the Law Society relied on throughout the course of the hearing.

For convenient reference, it was useful to replicate the facts leading to the dispute between the complainant and the respondent and the subsequent events culminating in this hearing against the respondent.

The respondent`s solicitor-client relationship with the vendors started sometime in May 1993. Then, Rajendran ran into some financial difficulties, as a result of which the vendors, through one Rocky Selvarajoo (`Rajoo`), engaged the services of the respondent to act on their behalf with respect to a re-mortgage for the property. Unfortunately, this proved futile. It was therefore decided that the property should be sold.

Sometime on 11 October 1993, Rajoo found a prospective purchaser for the property. The respondent was instructed to prepare an option for the sale of the property at S$1.3m. For some reason which is unnecessary to dwell into, this transaction fell through and the sale was subsequently aborted. On 13 October 1993, Rajoo informed Rajendran that he had procured a new purchaser. It was a matter of some dispute whether Rajoo expressly informed Rajendran who this new purchaser was but it turned out to be the respondent himself. On the same day, the respondent met the complainant and was told by the complainant, in very vague terms, that all matters relating to the property were to be referred to Rajendran. Therefore, at about 11.45pm that same night, the respondent together with Rajoo met Rajendran and Silva at their home to discuss the purchase details.

After some `hard bargaining and lengthy negotiations`, Rajendran and Silva agreed, in the early hours of the morning of 14 October 1993, to grant an option for the sale of the property to the respondent at a price of S$1.25 million, out of which the sum of S$50,000 was to be paid later at an unspecified date. During the negotiations, the respondent had persuaded Rajendran that the price of S$1.3m for the property was excessive and unrealistic. He thereafter produced an option (`the option`) which he had earlier prepared in favour of himself as purchaser of the property and which both Rajendran and Silva signed. In fact, the respondent had pre-prepared two options, one with a stated price of S$1.3m and the other with a price of S$1.2m when he was negotiating with Rajendran and Silva. The option was also expressed to have been given by the complainant but it was not signed by him, as he was neither present during the negotiations nor privy to any communications or discussions between the respondent, Rajendran and Silva. In their report investigating the complaint against the respondent (`the DC report`), the Disciplinary Committee took the view, consistent with the Court of Appeal`s decision, that the complainant did not at any time then or thereafter consent to the option nor did he authorise Rajendran or Silva to consent on his behalf. It was also not disputed that the respondent did not at any time advise Rajendran or Silva to seek independent legal advice regarding the sale of the property to him, whom the Court of Appeal held was their solicitor at the material time the option was granted. The option provided for a purchase price of S$1.2m and stipulated that the respondent`s firm M/s Khush Chopra was to be the solicitors for the vendors and purchaser for the transaction. Consequently, the respondent paid by cheque an amount of S$12,000 representing the option money to Rajendran.

It was common ground that the terms of the option were more favourable to the respondent as purchaser of the property as compared to the one prepared earlier by him for the vendors for the aborted sale. The price contained in the option for the sale of the property was lower by S$100,000 (S$1.3m as compared to S$1.2m) and so too was the option fee payable to the vendors upon the grant of the option (S$12,000 as compared to S$30,000 for the aborted sale). Further, it was unspecified when the amount of S$50,000 which was to be paid later would be paid. This was in sharp contrast to the earlier option, which stated that all outstanding amounts were to be paid on completion.

After the grant of the option, the respondent wasted no time in lodging a caveat No CV/2843D (`the first caveat`) against the property, by which he claimed an interest in fee simple in the property as the holder of the option. He also prepared and signed a typewritten note which Rajendran collected from his office and this note stipulated that the sum of S$50,000, being the commission to Rajendran for the sale of the property, would be paid by 25 July 1994. This typewritten note was intended to replace an earlier note which the respondent had written the day before the date on which the option was initially granted by Rajendran and Silva.

On the same day, 14 October 1993, the complainant, who did not know of the events which had transpired earlier between Rajendran, Silva and the respondent, met and negotiated to sell the property to one Raveentheran (`Ravi`) and his wife Pushparanee Somasundram (`Pushparanee`) for a price of S$1.3m. Rajendran soon after informed the complainant of his meeting with the respondent. The complainant was adamant that the option should not be granted to the respondent, since he had received a better offer. This led Rajendran to try and return the S$12,000 option fee to the respondent and revoke the option but the respondent refused to take the money back.

On 15 October 1993, Rajendran consulted another solicitor, Mr Bannirchelvam of M/s Bannir & Associates, and was advised that the option which he and Silva signed in favour of the respondent was invalid, since it lacked the signature of the complainant. As a result, on 18 October 1993, unaware that the first caveat had been lodged by the respondent on the property, a new option (`the new option`) was executed in favour of Ravi and Pushparanee. Originally M/s Pereira & Netto were named as the solicitors for both parties in this new option but this was later replaced by M/s Bannir & Associates on 20 October 1993. It was then that the first caveat came to light. That very day, the respondent had a meeting with Rajendran to settle matters relating to the option but nothing was resolved.

As a finding of fact made by the Disciplinary Committee in the DC report which was not challenged by either party during the hearing before us, it was stated that despite the complainant indicating to the respondent to refer all matters relating to the sale of the property to Rajendran on 13 October 1993, the respondent became aware on a date between 15 and 22 October 1993 that the complainant did not wish to sell the property to him.

In spite of this, the respondent pressed on with the purchase of the property. On 22 October 1993, he wrote to the vendors seeking to `put straight` the events relating to the granting of the option by Rajendran and Silva. He also stated that he would exercise the option and asked the vendors to nominate new solicitors if they did not wish to retain him as their lawyer in the transaction. As this letter is important we shall set it out in full:

Dear Sirs,

Re: Option to purchase No 91 Jalan Seaview

I refer to [the option] to purchase the abovecaptioned property granted to me on 14 October 1993 by you.

I write to put on record the fact that [Rajendran] and [Silva] had represented to me and [Rajoo] at the time of granting the option that they had the express and irrevocable authority of [the complainant] to grant the abovesaid option. Assurances were given to me by [Rajendran] that he had the absolute authority to sign and grant an option on behalf of his father [the complainant] and that [the complainant] had delegated the task of finalising the option to him.

Also [Rajoo] who was also present in fact insisted prior to your granting the option that [Rajendran] confer with [the complainant] on the telephone to confirm the terms of the option which you did.

Earlier that evening when I had visited 91 Jalan Seaview, [the complainant] and a person identifying himself as [Rajendran`s] brother expressly told me that we were to discuss the sale with [Rajendran] who had the authority to grant the option on [the complainant`s] behalf.

In reliance of the aforesaid representations, I had made payment of S$12,000 being the option money and had foregone other options in respect of offers to me of certain properties.

In consideration of my payment of a sum of S$12,000 by way of a cheque in favour of [Rajendran] the option in issue was granted to me.

I intend to

...