Mr Satinder Singh, a businessman, is suing a lawyer who was recently suspended for a year, for the loss of $850,000 which was spent in the course of a property deal. The sum of over $1 million was deposited into an account by Mr Singh as his contribution to a joint plan to develop the property with some other parties. Mr Singh agreed to allow Louis Ang, an undischarged bankrupt to use the funds as he saw fit.
After discovering that only $50,000 was left in the bank account, he lodged a complaint against the lawyer, Mr Uthayasurian, who was alleged to have put himself in a conflict of interests, and failed to advise Mr Singh of the status of Louis Ang and of the dangers of giving Louis Ang the power to use the funds. The Court of Three Judges recently upheld Mr Singh's complaint and suspended Mr Uthayasurian for one year on the grounds that he had placed himself in a conflict of interests position. They stated that this was without prejudice to any finding in any civil lawsuit that Mr Singh might start against Mr Uthayasurian.
Now, Mr Singh's lawsuit has alleged that the lawyer had conspired with Louis Ang to defraud him. The lawyer's defence is first, a denial of the allegation of fraud; second, that Mr Singh was aware of Louis Ang's bankruptcy status and finally, that Mr Singh as an experienced businessman, was aware of the risks of the project.
The property, which is owned by the Brunei government, is a very valuable one in prime area Tanglin Hill.
Showing posts with label lawyers. Show all posts
Showing posts with label lawyers. Show all posts
Friday, September 18, 2009
Saturday, April 4, 2009
Horizon Towers en-bloc sale- possible negligence?
The Court of Appeal has finally put an end to the Horizon Towers en bloc sale saga which has lasted over 2 years. The court accepted that the collective sale process was flawed and therefore the collective sale was invalid.
Now that the court has decided that the sales committee has not performed their duties properly, today's Sunday Times newspaper mentions the possibility of lawsuits against them by the other owners. However, the report states that the collective sale agreement signed by all owners agreeable to the sale may contain exemption clauses preventing lawsuits against the committee and their professional advisers and estate agents.
The issue is whether such exemption clauses are valid. They are usually controlled under the Unfair Contract Terms Act and have to be reasonable. Contracts relating to the transfers of interests in land may be excluded from the application of the Act (see Schedule 1). It is not clear
whether the collective sale agreement will be within this exclusion.
Even if the Act does not apply, the next issue is whether any advisers whether real estate or legal owe a duty to explain the risks involving in including exemption clauses in the collective sale agreement.
(Note - the exact judgment of the Court of Appeal is not yet out so the exact breaches of duties on the part of the sale committee are not clear).
(To clarify to those not familiar with the en bloc sale process under Singapore law, for most apartment developments, once 80% of owners agree to sell their apartments collectively, the remaining 20% is bound by law to go along. Since the number of owners will often be more than a 100, (in some cases numbering even 500-1000), a sales committee of a small umber of owners is formed to represent all the owners and to handle the sale process including negotiation with buyers, liasing with lawyers, etc is elected.)
Now that the court has decided that the sales committee has not performed their duties properly, today's Sunday Times newspaper mentions the possibility of lawsuits against them by the other owners. However, the report states that the collective sale agreement signed by all owners agreeable to the sale may contain exemption clauses preventing lawsuits against the committee and their professional advisers and estate agents.
The issue is whether such exemption clauses are valid. They are usually controlled under the Unfair Contract Terms Act and have to be reasonable. Contracts relating to the transfers of interests in land may be excluded from the application of the Act (see Schedule 1). It is not clear
whether the collective sale agreement will be within this exclusion.
Even if the Act does not apply, the next issue is whether any advisers whether real estate or legal owe a duty to explain the risks involving in including exemption clauses in the collective sale agreement.
(Note - the exact judgment of the Court of Appeal is not yet out so the exact breaches of duties on the part of the sale committee are not clear).
(To clarify to those not familiar with the en bloc sale process under Singapore law, for most apartment developments, once 80% of owners agree to sell their apartments collectively, the remaining 20% is bound by law to go along. Since the number of owners will often be more than a 100, (in some cases numbering even 500-1000), a sales committee of a small umber of owners is formed to represent all the owners and to handle the sale process including negotiation with buyers, liasing with lawyers, etc is elected.)
Wednesday, January 28, 2009
Lawyers negligence - Chong Yeo and Partners
An old case involving lawyers' negligence is the case of Chong Yeo and Partners v Guan Ming Hardware and Engineering Pte Ltd.
Here, the solicitors failed to file certain documents in relation to a summary judgment application (a type of proceeding where the plaintiffs claim that the case against the defendant is clear and the defendant should be ordered to pay up without further legal proceedings) against their clients' debtor. This failure led to a delay in the proceedings. The debtor soon after went into liquidation.
The clients then sued the solicitors for the delay. However, the court held that although there was negligence, it was not proven that the negligence led to the loss. Even if there was no delay in the hearing of the summary judgment proceeding, there was no proof that the debtor would have been able to pay up.
This case once again shows the difficulty of claiming one's loss from one's professional advisers even where they are negligent. To be fair, we cannot make professional advisers liable for all losses - the losses must be proved to be caused by their negligence.
Here, the solicitors failed to file certain documents in relation to a summary judgment application (a type of proceeding where the plaintiffs claim that the case against the defendant is clear and the defendant should be ordered to pay up without further legal proceedings) against their clients' debtor. This failure led to a delay in the proceedings. The debtor soon after went into liquidation.
The clients then sued the solicitors for the delay. However, the court held that although there was negligence, it was not proven that the negligence led to the loss. Even if there was no delay in the hearing of the summary judgment proceeding, there was no proof that the debtor would have been able to pay up.
This case once again shows the difficulty of claiming one's loss from one's professional advisers even where they are negligent. To be fair, we cannot make professional advisers liable for all losses - the losses must be proved to be caused by their negligence.
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