Disciplinary Tribunal Reports
Pursuant to section 93(5) of the Legal Profession Act, the Council of the Law Society is required to publish the findings and determination of the Disciplinary Tribunal in the Singapore Law Gazette or in such other media as the Council may determine to adequately inform the public of the same.
This summary is published pursuant to the requirement of s 93(5) of the Legal Profession Act.
In the Matter of Thirumuthy Ayernaar Pambayan (the “Respondent”), Advocate and Solicitor
Pursuant to section 93(1)(c) of the Legal Profession Act (the “Act’) the Disciplinary Tribunal (‘DT’) determined that cause for sufficient gravity exists for disciplinary action against the Respondent under section 83 of the Act.
The Respondent’s client complained that the Respondent had entered into a prohibited borrowing transaction with him.
The Charges
The Society tendered the following charges against the Respondent:
1st Charge
“You, Thirumurthy Ayernaar Pambayan, an advocate and solicitor are charged that on or about 26 January 2012, you did enter into a prohibited borrowing transaction by virtue of which the sum of $3,000 was borrowed by you from your client, one Chandran s/o Eruthi Yanathan, and such conduct by you amounts to a breach of Rule 33(a) of the Legal Profession (Professional Conduct) Rules and you have thereby breached a rule of conduct made by the Council of the Law Society (the “Council”) under the provisions of the Legal Profession Act, as amounts to improper conduct or practice as an advocate and solicitor within the meaning of section 83(2)(b) of the Legal Profession Act (Chapter 161)”
2nd Charge
“You, Thirumurthy Ayernaar Pambayan, an advocate and solicitor are charged that on or about 26 June 2012, you did enter into a prohibited borrowing transaction by virtue of which the sum of $8,000 was borrowed by you from your client, one Chandran s/o Eruthi Yanathan, and such conduct by you amounts to a breach of Rule 33(a) of the Legal Profession (Professional Conduct) Rules and you have thereby breached a rule of conduct made by the Council of the Law Society (“the Council”) under the provisions of the Legal Profession Act, as amounts to improper conduct or practice as an advocate and solicitor within the meaning of section 83(2)(b) of the Legal Profession Act (Chapter 161)”
Findings of the Disciplinary Tribunal (“DT”)
The DT accepted that only two loans of $3,000 and $8,000 were obtained from the complainant. The DT accepted that the complainant was carrying on a business as an unlicensed moneylender.
The DT considered the decision of the Court of Three Judges in Law Society of Singapore v Yap Bock Heng Christopher [2014] SGHC 188 where the Court noted that breach of Rules 33(a) and (34(a) of the PCR “is one that will be viewed extremely seriously by this court. The rationale for prohibiting solicitors from borrowing from their clients (except where the clients have obtained independent legal advice) should be apparent. A client is vulnerable vis-a-vis his solicitor because the latter enjoys a position of influence over the client and the client may find it difficult to deny a loan simply because of the trust and confidence he has reposed in the solicitor. … Whilst a solicitor who borrows from his client who is not independently advised may not be considered dishonest in the usual sense, he is certainly taking advantage of his position to obtain a benefit for himself in breach of his duty of fidelity.”
The Council’s Decision
Council accepted and adopted the findings of the DT and proceeded to apply for the Respondent to show cause before the Court of Three Judges pursuant to section 98 of the Act.
The Court of Three Judges
The Court of Three Judges ordered that the Respondent be suspended for a period of two months noting that:
“A term of suspension was warranted despite the absence of aggravating factors in order to send a consistent and strong message to the profession that a breach of the rule against prohibited borrowing transactions was viewed seriously by the court, and that a solicitor should under no circumstances borrow from his client unless any of the prescribed exceptions apply. Balancing the need for general deterrence with the particular facts and circumstances of this case – in particular the lack of aggravating factors and the fact that the
Respondent was remorseful, a relatively short term of suspension of two months was appropriate.”
In the Matter of Krishna Morthy S V (the “Respondent”), an Advocate and Solicitor
The disciplinary proceedings against the Respondent arose from a complaint from a client that the Respondent permitted his employee, one Ebrahim Marican Batcha Sahib (“Ebrahim”) to misappropriate an amount of $108,000, which payment was for completion of the purchase of a HDB flat.
The Charges
The DT found the Respondent guilty of the following charges:
3rd Charge
“You, Krishna Morthy S V, are charged that you are guilty of grossly improper conduct in the discharge of your professional duties within the meaning of section 83(2)(b) of the Legal Profession Act (Cap.161), by breaching Rule 8(1) of the Legal Profession (Professional Conduct),Rules, being a rule of conduct made by the Council under section 71 of the Legal Profession Act, in that from 1 July 2008 to November 2010, you surrendered the management and control of Frontier Law Corporation, a law firm of which you were at all material times the sole director, to one Mr Mohd Sadique bin Ibrahim Marican, and one Mr Anand Kumar s/o Toofani Beldar, including but not limited to the surrender of control over the said law firm’s banking accounts, and by so doing, failed to exercise any or any reasonable supervision over the employees and/or staff of Frontier Law Corporation, to wit, you had admitted to the Inquiry Committee of the Law Society of Singapore, by way of your solicitor’s letter dated 4 November 2014 that the said Mohd Sadique and Anand Kumar whilst employed as “legal assistants” of the law firm, were, in fact, the “controlling partners” of Frontier Law Corporation since its inception on 1 July 2008 till November 2010 when they left the firm and that the said Mohd Sadique and Anand Kumar “were running the firm at that time as any files which came to the firm was controlled by them and all profits and monies taken by them”.
4th Charge
“You, Krishna Morthy S V, are charged that you are guilty of grossly improper conduct in the discharge of your professional duties within section 83(2)(b) of the Legal Profession Act (Cap.161), by breaching Rule 8(1) of the Legal Profession (Professional Conduct), being a rule of conduct made by Council under section 71 of the Legal Profession Act in that from November 2010 to date, you surrendered the control and management of Frontier Law Corporation, a law firm of which you were at all material times the sole director, to one Mr Ebrahim Marican Batcha Sahib, including but not limited to the surrender of control over the said law firm’s banking accounts, and by so doing, failed to exercise any or any reasonable supervision over the employees and/or staff of Frontier Law Corporation, to wit, you had admitted to the Inquiry Committee of the Law Society of Singapore, by way of your solicitor’s letter dated 4 November 2014 that the said Ebrahim, together with Mohd Sadique and Anand Kumar was a “controlling partner” of the Frontier Law Corporation, and, that the said Mohd Sadique and Anand Kumar left the firm in late November 2010 “leaving Ebrahim as office manager, in charge of everything”, which includes the said Ebrahim taking possession of the ATM cards in respect of the firm’s account thereby facilitating the said Ebrahim’s misappropriation of the sum of $108,000 that was deposited with the firm by the Complainant.
5th Charge
“You, Krishna Morthy S V, are charged that you are guilty of grossly improper conduct in the discharge of your professional duties within section 83(2)(b) of the Legal Profession Act (Cap.161), by breaching Rule 5(1) of the Conveyancing and Law of Property (Conveyancing) Rules 2011, being a rule regulating the receipt, holding and distribution of conveyancing money made by the Minister under section 73D of the Conveyancing and Law of Property Act (Cap. 61), in that you failed to ensure that, on or about 19 April 2013, the sum of $108,000 paid by one Lim Yeok Chong to facilitate the purchase and completion of a property at Block 444 Ang Mo Kio Avenue 10 #02-1609, was not to be paid into the office account of Frontier Law Corporation, a law firm of which you were at all material times the sole director.”
Additional Alternative 5th Charge
“You, Krishna Morthy S V, are charged that you are guilty of grossly improper conduct in the discharge of your professional duties within section 83(2)(b) of the Legal Profession Act (Cap.161), by breaching Rule 3(1) of the Legal Profession (Solicitors’ Accounts) Rules, being a rule regulating the keeping of accounts by solicitors made by Council under section 72 of the Legal Profession Act, in that you failed to ensure that on or about 19 April 2013, the sum of $108,000 paid by one Lim Yeok Chong to facilitate the purchase and completion of a property at Block 444 Ang Mo Kio Avenue 10 #02-1609, was not to be paid into the office account of Frontier Law Corporation, a law firm of which you were at all material times the sole director.”
The Law Society’s Case
The complainant was a client of Frontier Law Corporation (“FLC”) and the Respondent, the sole director of FLC. In effect, the Respondent was not the proprietor of FLC, but actually employed by one Mohd Sadique bin Ibrahim Marican (“Sadique”) and one Anand Kumar s/o Toofani Beldar (“Anand”) to manage FLC in 2009. The Respondent was paid a sum of $7,500 per month by them. The manager of FLC was Ebrahim Marican Batcha Sahib (‘Ebrahim’), who was not an advocate and solicitor. Both Sadique and Anand subsequently left FLC and the Respondent left the control and management of FLC entirely to Ebrahim.
In February 2013, the complainant instructed FLC to act in the purchase of a property and signed a Warrant to Act. On the face of it, the Respondent was the signatory to the Warrant to Act. However, the complainant never met the Respondent at all although the Respondent appeared in court for the complainant to successfully obtain specific performance against the vendor. In fact, by this time, the Respondent had ceased to practice at FLC and was acting as “instructed counsel’ in another law practice. The Respondent very much left matters at FLC under Ebrahim’s care.
On 19 April 2013, the complainant paid the sum of $108,000 to FLC ostensibly to “facilitate completion of the property”. FLC acknowledged receipt of the moneys but failed to complete the purchase. Subsequently investigations revealed that the monies had been withdrawn from FLC through a series of ATM and cheque withdrawals. These withdrawals were traced to Ebrahim.
Findings of the Disciplinary Tribunal (“DT”)
Before dealing with each specific charge, the DT made a general observation regarding the duty of an Advocate and Solicitor in relation to his duty to supervise his practice.
Rule 8(1) of the Legal Profession (Professional Conduct) Rules (2010 Ed) (the “PCR”) provides:
“8(1) An advocate and solicitor shall exercise proper supervision over his employees and other staff.”
The Tribunal accepted the cases of Law Society of Singapore v Tan Chwee Wan Allan [2007] 4 SLR(R) 669 and Law Society of Singapore v Zulkifli Bin Mohd Amin & Anor [2011] 2 SLR 620 in which the court stated that the responsibility to supervise is “unyielding” (Allan Tan at page 430) “and in the court stated that a solicitor is “not to abdicate such responsibility … by delegating … without any adequate system or periodic checks”. (Zulkifli at page 38)
A solicitor can delegate his work to his employee and mere delegation is not, ipso facto, breach of Rule 8(1) of the PCR. However, that does not absolve the solicitor from his overall responsibility to ensure there is proper supervision of what goes on in the practice. A particular act performed by an employee in a law firm must be viewed in the totality of the circumstances for one to decide if the solicitor in allowing that act has been negligent in allowing it. In most instances the test lies not in the act itself (unless the act is obviously illegal, improper or in breach of the rules), but in whether or not there is in place a system to ensure that the solicitor knows about it.
DT’s Findings on the Charges
The 3rd charge accused the Respondent of surrendering the management and control of FLC to Sadique and Anand from July 2008 to November 2010. The DT found the 3rd Charge proved. The DT found that the two Letters amounted to a confession by the Respondent that he had surrendered the management and control of the practice to Sadique and Anand during this period. It was wrong for the Respondent not to have any control at all over the files brought into the firm, including those brought in by Sadique and Anand. The Respondent owed an obligation to all clients of FLC.
The 4th Charge accused the Respondent of not exercising control and management of FLC by allowing Ebrahim from November 2010 to have full rein of the management of FLC. The DT found this charged proved. Despite knowing that Sadique and Anand were disbarred, he took no steps to acquaint himself with the running of FLC, and to take over the reins of management. In cross-examination the he admitted that he did not supervise Ebrahim and was in breach of the Rules. The Tribunal found that the failure of the Respondent to supervise the Ebrahim was complete. The lack of control enable Ebrahim to embezzle money deposited by the complainant. The lack of management of the practice was egregious and systematic and such complete failure started in July 2008 and continued right up to 2010.
The 5th Charge accused the Respondent of not ensuring that the complainant’s $108,000 would not be deposited into the office account. This payment into the office account is a breach of Rule 3(1) of Legal Profession (Solicitors’ Accounts) Rules and Rule 5(1) of the Conveyancing and Law of Property (Conveyancing) Rules 2011. These are strict liability offences and the DT found the charge proved. The Respondent’s failure to ensure that the $108,000 was not paid into FLC’s office account took place in the context of a complete lack of supervision by the Respondent and resulted in its theft of the money by Ebrahim.
Accordingly, the DT determined under section 93(1)(c) of the Legal Profession Act (the “Act’) that cause for sufficient gravity exists for disciplinary action against Krishna Morthy S V under section 83 of the Act.
The Council’s Decision
Council adopted the findings and recommendations of the DT and accordingly proceeded to apply for leave under section 98 of the Act for the Respondent to show cause as to why he should not suffer sanctions set out in section 83 of the Act.
The Court of Three Judges
The Respondent was subsequently ordered to be struck off the roll of advocates and solicitors by the Court of Three Judges.
