Then Khek Khoon v Arjun Permanand Samtani

CourtHigh Court (Singapore)
Judgment Date14 February 2012
Docket NumberSuit No 1084 of 2009 (Summons No 5469 of 2011)
Date14 February 2012

High Court

Quentin Loh J

Suit No 1084 of 2009 (Summons No 5469 of 2011)

Then Khek Khoon and another
Arjun Permanand Samtani and another

Philip Jeyaretnam SC (Rodyk & Davidson), Edde Ng, Cheryl Koh and Ho Xin Ling (Tan Kok Quan Partnership) for the plaintiff

N Sreenivasan and Shankar A S (Straits Law) for the first defendant

Subramanian Pillai, Luo Ling Ling and Edwin Chia (Colin Ng & Partners) for the second defendant.

Alrich Development Pte Ltd v Rafiq Jumabhoy [1994] 3 SLR (R) 38; [1994] 3 SLR 1 (distd)

Bowen v Stott [2004] WASC 94 (distd)

Brickenden v London Loan & Savings Co [1934] 3 DLR 465 (refd)

Bristol and West Building Society v Mothew [1998] Ch 1; [1996] 4 All ER 698 (refd)

Brogue Tableau Pty Ltd v Tottle Partners (a firm) [2006] WASC 273 (distd)

Canson Enterprises Ltd v Boughton & Co (1991) 85 DLR (4 th) 129 (refd)

Commissioner for Corporate Affairs v P W Harvey [1980] VR 669 (refd)

Dana-West Hotels Ltd v Royal Bank of Canada (1984) 37 SASK R 81 (folld)

David Lee & Co (Lincoln) Ltd v Coward Chance (a firm) [1991] Ch 259 (folld)

Davies v Clough (1837) 8 Sim 262; 59 ER 105 (refd)

Dawson (deceased) , Re [1966] 2 NSWR 211 (refd)

Emperor v Dadu Rama Surde AIR 1939 BOM 150 (refd)

Firm of Solicitors, Re A [1992] QB 959 (folld)

Firm of Solicitors, Re A [1997] Ch 1 (folld)

Firstlink Energy Pte Ltd v Creanovate Pte Ltd [2007] 1 SLR (R) 1050; [2007] 1 SLR 1050 (refd)

Ho Kon Kim v Betsy Lim Gek Kim [2001] SGHC 75 (refd)

Ho Kon Kim v Betsy Lim Gek Kim [2001] SGCA 64 (refd)

John While Springs (S) Pte Ltd v Goh Sai Chuah Justin [2004] 3 SLR (R) 596; [2004] 3 SLR 596 (refd)

Kooky Garments Ltd v Charlton [1994] 1 NZLR 587 (distd)

Kumagai-Zenecon Construction Pte Ltd v Low Hua Kin [1999] 3 SLR (R) 1049; [2000] 2 SLR 501 (refd)

Law Society of Singapore, The v Koh Lee Kheng Florence [2005] SGDSC 7 (folld)

Law Society of Singapore, The v Tan Chun Chuen Malcolm [2006] SGDSC 11 (refd)

Law Society of Singapore v Seah Li Ming Edwin [2007] 3 SLR (R) 401; [2007] 3 SLR 401 (refd)

Law Society of Singapore v Tan Phuay Khiang [2007] 3 SLR (R) 477; [2007] 3 SLR 477 (folld)

Mantonella P/L v Thompson [2009] QCA 80 (refd)

Maguire v Makaronis (1997) 188 CLR 449 (refd)

Markwell Bros Pty Ltd v CPN Diesels (Qld) Pty Ltd (1982) 7 ACLR 425 (refd)

Ng Eng Ghee v Mamata Kapildev Dave [2009] 3 SLR (R) 109; [2009] 3 SLR 109 (refd)

Nocton v Lord Ashburton [1914] AC 932 (refd)

Ong Jane Rebecca v Lim Lie Hoa [2002] 1 SLR (R) 798; [2002] 2 SLR 493 (folld)

Pearlbran Pty Ltd v Win Mezz No 19 Pty Ltd [2009] QSC 292 (folld)

Prince Jefri Bolkiah v KPMG (a firm) [1999] 2 AC 222 (refd)

Rakusen v Ellis, Munday & Clarke [1912] 1 Ch 831 (folld)

Roberto Building Material Pte Ltd v Oversea-Chinese Banking Corp Ltd [2003] 2 SLR (R) 353; [2003] 2 SLR 353 (folld)

Rondel v Worsley [1969] 1 AC 191 (refd)

Solicitor, Re A (1987) 131 SJ 1063 (folld)

Swindle v Harrison [1997] 4 All ER 705 (refd)

Target Holdings Ltd v Redferns (a firm) [1996] AC 421 (refd)

Tricontinental Corp Ltd v Holding Redlich (22 December 1994) (SC, Vic) (folld)

Vorobiev Nikolay v Lush John Frederick Peters [2011] 1 SLR 663 (distd)

Wee Soon Kim Anthony v Law Society of Singapore [2001] 2 SLR (R) 821; [2001] 4 SLR 25 (folld)

Zorica Kalenik v John Ioannis Apostolidis [2005] VSC 27 (refd)

Legal Profession Act (Cap 161, 2009 Rev Ed)

Legal Profession (Professional Conduct) Rules (Cap 161, R 1,2010 Rev Ed) rr 25, 64 (consd) ; rr 29, 25 (a) , 31, 31 (1) , 64 (2)

Rules of Court (Cap 322, R 5, 2006 Rev Ed) O 59 r 8, O 92 r 4

Supreme Court of Judicature Act (Cap 322, 2007 Rev Ed) Schedule 1 para 1

Transfer of Land Act 1893 (WA) s 140

Civil Procedure—Jurisdiction—Inherent—Second defendant sought to persuade court to exercise its inherent jurisdiction to restrain plaintiff's counsel and firm from continuing to act as solicitors or to give legal advice in all court matters arising from Suit No 1084 of 2009—Whether court had inherent jurisdiction to hear application based on breaches of Legal Profession (Professional Conduct) Rules (Cap 161, R 1, 2010 Rev Ed) (‘LPPCR’)—If so, when should it exercise its discretion—Could adverse party make application for court to exercise its inherent jurisdiction—Was court proper forum to determine breach of LPPCR—If so, was evidence in support of allegation of overcharging upon which breach of r 64 was premised, sufficient to trigger court's exercise of its inherent jurisdiction—Rule 64 Legal Profession (Professional Conduct) Rules (Cap 161, R 1, 2010 Rev Ed)

Equity—Remedies—Equitable compensation—Whether reasonableness of invoices rendered to plaintiffs by their solicitors was material fact in issue where claim was for equitable compensation for breach of fiduciary claim

Legal Profession—Professional conduct—Breach—Second Defendant alleged plaintiff's counsel in breach of rr 25 and 64 LPPCR—Nature, extent and facts in support of alleged breaches of rr 25 and 64 LPPCR—Whether scope of r 64 extended beyond testifying solicitor to all solicitors from testifying solicitor's firm—Rules 25 and 64 Legal Profession (Professional Conduct) Rules (Cap 161, R 1, 2010 Rev Ed)

The second defendant, sought an injunction to restrain the plaintiff's solicitors, Messrs Tan Kok Quan Partnership (‘TKQP’) from acting as solicitors for the plaintiffs and/or giving legal advice in all court matters arising out of Suit No 1084 of 2009 (‘S 1084/2009’), the main action. By way of background, the plaintiffs were part of a group of subsidiary proprietors who had opposed the collective sale of Horizon Towers, succeeding in setting aside the order of the Horizon Board at the Court of Appeal in 2009 (‘the 2009 Judgment’). The plaintiffs were consistently represented by TKQP before the Strata Titles Board (‘STB’), the High Court in relation to orders made by the STB and in the judicial review application in the High Court (‘STB matters’). TKQP did not represent the plaintiffs before the Court of Appeal. Subsequent to the 2009 Judgment, in S 1084/2009, the plaintiffs founded their claim against the defendants for breach of fiduciary duties which the Court of Appeal had found to be owed by the defendants to the plaintiffs in the 2009 Judgment, due to a possible conflict of interest which the defendants should have disclosed to the plaintiffs. The plaintiffs pleaded that they had suffered loss and damage as a result of the defendant's breaches in the form of the solicitor and client costs incurred by the STB matters in the sum of $752,665.15. In his defence, the second defendant challenged the quantum of loss and damage suffered by the plaintiffs, in particular, the above-mentioned sum of $752,665.15. As such, the reasonableness of TKQP's invoices to the plaintiffs (which were paid by the plaintiffs), in connection with the STB matters, was identified by the second defendant as a material fact in issue in S 1084/2009. In the present application, the second defendant argued that TKQP should be restrained from representing the plaintiffs due to their alleged breach of r 25 (a) (ie, conflicts of interest between the advocate and solicitor and client) and r 64 (ie, rule preventing the acting advocate and solicitor from testifying on a material question of fact) of the LLPCR. The second defendant argued that the rr 25 (a) and 64 of the LPPCR were breached because the reasonableness of the impugned invoices was a material fact in issue which created a conflict of interest between TKQP and their clients, the plaintiffs, and also would require TKQP to testify as witnesses.

Held, dismissing the application:

(1) The court's inherent jurisdiction under O 92 r 4 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (‘the Rules’) should only be exercised where there was a clear need and where the justice of the case so demanded. Strong and compelling reasons had to be identified by the party in support of such an application. The present case did not meet the necessary threshold for the court to intervene: at [14] and [15].

(2) The Law Society was the proper forum for determination of breaches of the LPPCR. Where the court was concerned only with breaches of the LPPCR, which did not trigger any concurrent breach of legal obligations owed by the counsel to the court or the client at Common Law, the proper forum for investigation and determination of the breach was the Law Society rather than the court: at [17] and [22].

(3) However, where matters impinged on the proper administration of justice, due process and wider public interest issues, the court should intervene, either on its own initiative or pursuant to a complaint by the other party. The Court had to not allow confidence in the administration of justice to be undermined: at [22].

(4) Where the application was made by an opposing party to restrain lawyers the court would look carefully into the grounds for doing so and if necessary carry out a balancing exercise,a fortiori, if the application was made at a late stage. A court would therefore have to balance the mischief that was to be prevented against the right of a party to be represented by a lawyer of his choice. This involved a balancing of all the facts and circumstances including the alleged breach, the bona fides of the opposing-party-applicant, the time at and circumstances under which the application was made and the mischief the rule was intended to prevent: at [28].

(5) In relation to the alleged breach of r 25 (a) of the LPPCR, it was first crucial to note that the impugned invoices were rendered and paid well before any finding of breaches of fiduciary duty was made by the Court of Appeal. Secondly, TKQP's fees were not in some way contingent upon recovery from the plaintiffs. Thirdly, there were no allegations or even hints of fraud or collusion on the part of TKQP and the plaintiffs...

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