Then Khek Khoon v Arjun Samtani: Injunction & Solicitors' Conflict of Interest
Then Khek Khoon and another sued Arjun Permanand Samtani and another for breach of fiduciary duties related to the Horizon Towers litigation. The 2nd defendant, Mr. Tan Kah Ghee, applied for an injunction to restrain the plaintiff's solicitors, Tan Kok Quan Partnership (TKQP), from acting for the plaintiffs, alleging a conflict of interest and potential violation of Legal Profession (Professional Conduct) Rules. The High Court dismissed the application, finding no compelling reasons to exercise its inherent jurisdiction and no actual breach of the rules.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Application dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Application to restrain Plaintiff's solicitors due to conflict of interest allegations. The court dismissed the application, finding no breach.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Arjun Permanand Samtani | Defendant | Individual | No order as against Mr Samtani | Neutral | |
| Then Khek Khoon | Plaintiff | Individual | Application to restrain Plaintiff's solicitors dismissed | Won | |
| Tan Kah Ghee | Defendant, Applicant | Individual | Application dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Quentin Loh | Judge | Yes |
4. Counsels
4. Facts
- Plaintiffs opposed the collective sale of Horizon Towers.
- TKQP represented the plaintiffs before the STB and the High Court.
- Mr. Tan seeks an injunction to restrain TKQP from acting as solicitors.
- Plaintiffs claim damages in the form of solicitor and client costs.
- Mr. Tan challenges the reasonableness of TKQP’s invoices.
- TKQP's invoices were rendered in 2007 and have been paid.
- Plaintiffs will give credit for any taxed party-and-party costs recovered.
5. Formal Citations
- Then Khek Khoon and another v Arjun Permanand Samtani and another, Suit No 1084 of 2009 (Summons No 5469 of 2011/F), [2012] SGHC 17
6. Timeline
| Date | Event |
|---|---|
| Court of Appeal judgment setting aside the order of the Horizon Board for the collective sale of the property | |
| Suit No 1084 of 2009 filed | |
| Mr Tan represented by Mr Glenn Knight | |
| Collin Ng Partners instructed to represent Mr Tan | |
| Mr Tan introduced the defence relating to the propriety of TKQP’s invoices | |
| Application filed just before the court vacation | |
| Hearing fixed but adjourned | |
| Hearing before Quentin Loh J | |
| Decision given with brief grounds | |
| Consolidated action fixed for hearing | |
| Consolidated action fixed for hearing | |
| Decision Date |
7. Legal Issues
- Conflict of Interest
- Outcome: Court found no conflict of interest on the evidence presented.
- Category: Substantive
- Sub-Issues:
- Solicitor's personal interest vs. client's interest
- Independence of legal advice
- Advocate-Witness Rule
- Outcome: Court found no breach of the advocate-witness rule on the facts of the case.
- Category: Procedural
- Sub-Issues:
- Solicitor likely to be a witness on a material question of fact
- Scope of rule extending to other solicitors in the firm
- Inherent Jurisdiction of the Court
- Outcome: Court held that there were no strong or compelling reasons for the court’s inherent jurisdiction to be invoked.
- Category: Jurisdictional
- Sub-Issues:
- Power to regulate and supervise the conduct of Advocates and Solicitors
- Exercise of discretion in cases involving breaches of LPPCR
- Equitable Compensation for Breach of Fiduciary Duty
- Outcome: Court stated that the level of fees TKQP charged the plaintiffs is not a material issue because his clients’ claim is for equitable compensation for breach of fiduciary duty.
- Category: Substantive
- Sub-Issues:
- Causation
- Foreseeability
- Remoteness
8. Remedies Sought
- Injunction to restrain solicitors from acting
- Monetary damages
9. Cause of Actions
- Breach of Fiduciary Duty
10. Practice Areas
- Professional Conduct
- Litigation
11. Industries
- Legal
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Eng Ghee and others v Mamata Kapildev Dave and others (Horizon Partners Pte Ltd, intervener) and another appeal | Court of Appeal | Yes | [2009] 3 SLR(R) 109 | Singapore | The judgment sets aside the order of the Horizon Board for the collective sale of the property. |
| Wee Soon Kim Anthony v Law Society of Singapore | Court of Appeal | Yes | [2001] 2 SLR(R) 821 | Singapore | Cited for the principle that the court's inherent jurisdiction should only be exercised where there is a clear need and the justice of the case so demands. |
| Roberto Building Material Pte Ltd and others v Oversea-Chinese Banking Corp Ltd and another | Court of Appeal | Yes | [2003] 2 SLR(R) 353 | Singapore | Cited for the principle that inherent jurisdiction should only be invoked in exceptional circumstances where there is a clear need for it and the justice of the case so demands. |
| Ong Jane Rebecca v Lim Lie Hoa and others | High Court | Yes | [2002] 1 SLR(R) 798 | Singapore | Cited for the view that a declaration of propriety by measure of the LPPCR could only be made by the Law Society after a full enquiry. |
| The Law Society of Singapore v Tan Chun Chuen Malcolm | Singapore Disciplinary Committee | Yes | [2006] SGDSC 11 | Singapore | Cited for the principle that any possible breach of the LPPCR was a matter between the Law Society and the respondent. |
| Alrich Development Pte Ltd v Rafiq Jumabhoy | High Court | Yes | [1994] 3 SLR 1 | Singapore | Discussed the issue of a possible conflict of interest due to a law firm’s employment of a solicitor who had been an employee of the firm acting for the opposing party. |
| Vorobiev Nikolay v Lush John Frederick Peters and others | High Court | Yes | [2011] 1 SLR 663 | Singapore | Granted an injunction to restrain solicitors from acting for the client on account of breach of r 31(1) LPPCR. |
| The Law Society of Singapore v Seah Li Ming Edwin and another | Court of Three Judges | Yes | [2007] 3 SLR(R) 401 | Singapore | Observed that behind r 31(1) was a larger public interest, viz, the trust between lawyer and client should not be compromised. |
| David Lee & Co (Lincoln) Ltd v Coward Chance (a firm) and others | Chancery Division | Yes | [1991] Ch 259 | England | Opined that the Law Society was the right forum to determine breaches of professional rules of conduct. |
| In Re a Firm of Solicitors | Queen's Bench Division | Yes | [1992] 1 QB 959 | England | Limited itself to the common law and only applied rules from the conduct rules which were within the boundaries of existing obligations owed at law. |
| Prince Jefri Bolkiah v KPMG (a firm) | House of Lords | Yes | [1999] 2 AC 222 | England | Emphasized the limited situations in which an injunction will be granted to restrain solicitors from acting. |
| In Re a Firm of Solicitors | Chancery Division | Yes | [1997] 1 Ch 1 | England | Emphasized that the basis of intervention was not a possible perception of impropriety, but the protection of confidential information. |
| Kooky Garments Ltd v Charlton | High Court | Yes | [1994] 1 NZLR 587 | New Zealand | Observed that where the possible acts or omissions of a law firm are at the heart of the question in issue, that firm is, in a real sense, defending its advice and/or its actions. |
| Brogue Tableau Pty Ltd v Tottle Partners (a firm) | Supreme Court of Western Australia | Yes | [2006] WASC 273 | Australia | Rejected most arguments to restrain solicitors from representing their client in s 140 proceedings. |
| Bowen v Stott | Supreme Court of Western Australia | Yes | [2004] WASC 94 | Australia | The very fact in issue depended on the lawyers who were the ones negotiating the settlement, their client not being present, and there was potential liability in settling the matter if they failed to obtain the apology their client required before she was prepared to settle her case. |
| Tricontinental Corporation Ltd v Holding Redlick | Supreme Court of Victoria | Yes | Tricontinental Corporation Ltd v Holding Redlick (VSC, Mandie J, 22 December 1994) | Australia | Held that it is a serious matter to prevent a party from retaining the legal representative of its choice, particularly upon the application not of a former client but of an adverse party. |
| Kalenik v Apostolidis | Supreme Court of Victoria | Yes | [2005] VSC 27 | Australia | Followed the reasoning of the court in Tricontinental. |
| The Law Society of Singapore v Koh Lee Kheng Florence | Singapore Disciplinary Committee | Yes | [2005] SGDSC 7 | Singapore | Stated that the purpose of r 25(a) is the protection of the client. |
| Ho Kon Kim v Betsy Lim Gek Kim & Ors | High Court | Yes | [2001] SGHC 75 | Singapore | Held that r 64(2) of the LPPCR would still be breached where the advocate-witness passed the file to another partner in the firm, not involved in the matter in issue, to handle the litigation. |
| Law Society of Singapore v Tan Phuay Khiang | Court of Appeal | Yes | [2007] 3 SLR(R) 477 | Singapore | Held that it is the spirit and intent, rather than just the plain letter, of the professional ethical rules that breathe life and legitimacy into the standards that are relevant in assessing whether a lawyer has discharged his professional obligations. |
| Rondell v Worsley | House of Lords | Yes | [1969] 1 AC 191 | England | Discussed the duty of counsel to court. |
| Commissioner for Corporate Affairs v P W Harvey | Supreme Court of Victoria | Yes | [1980] VR 669 | Australia | The court found that an advocate must be able to promise the court, singularity of interest. |
| Davies v Clough | N/A | Yes | (1837) 8 Sim 262 | N/A | Where a solicitor acted against a former client using personal information gained in the original matter, the court found that as the firm was conceived under the traditional partnership model, any act of one partner was that of another. |
| Firstlink Energy Pte Ltd v Creanovate Pte Ltd and another action | High Court | Yes | [2007] 1 SLR(R) 1050 | Singapore | Held that for a breach of fiduciary claim, full restitution and compensation was the entitlement of the wronged party to whom the fiduciary obligation was owed. |
| Kumagai-Zenecon Construction Pte Ltd v Low Hua Kin | Court of Appeal | Yes | [1999] 3 SLR(R) 1049 | Singapore | Held that for a breach of fiduciary claim, full restitution and compensation was the entitlement of the wronged party to whom the fiduciary obligation was owed. |
| John While Springs (S) Pte Ltd and Another v Goh Sai Chuah Justin and others | High Court | Yes | [2004] 3 SLR 596 | Singapore | Held that for the errant fiduciary to avoid making restitution, he must be able to show that the wronged party would have incurred those losses even if there was no breach of duty. |
| Target Holdings Ltd v Redferns and another | House of Lords | Yes | [1996] 1 A.C. 421 | England | Held that even if the immediate cause of the loss was the dishonesty or failure of a third party, the trustee would be liable to make good that loss to the trust estate if, but for the breach, such loss would not have occurred. |
| Nocton v Lord Ashburton | House of Lords | Yes | [1914] AC 932 | England | Confirmed that in its exercise of its exclusive equitable jurisdiction over fiduciaries, the court had the jurisdiction to make an award of equitable compensation for a breach of fiduciary duty. |
| Markwell Bros Pty Ltd v CPN Diesels Pty Ltd | N/A | Yes | (1982) 7 ACLR at 437 | N/A | The origin of the power to award equitable compensation is part of the long established power of a court of equity to award compensation for breach of trust, and a manifestation of the court’s power over a fiduciary |
| Re Dawson (deceased) | N/A | Yes | [1966] 2 NSWR 211 | New South Wales | Gave reasons in support of distinguishing damages claimed in a breach of fiduciary action from one in contract or tort. |
| Brickenden v London Loan and Savings Co. et al. | Privy Council | Yes | [1934] 2 D.L.R 465 | N/A | Took a very strict view in relation to the applicable rules of causation in relation to the loss claimable as a result of the breach of fiduciary duties owed by a solicitor to his client in failing to disclose a material fact and to reveal a conflict of interest in relation to the transaction in issue. |
| Maguire v Makaronis | High Court of Australia | Yes | (1997) 188 CLR 490 | Australia | Stated courts in the Commonwealth had developed three approaches to “mollify the absoluteness of the Brickenden rule”. |
| Canson Enterprises Ltd v Boughton & Co | Supreme Court of Canada | Yes | (1991) 85 DLR (4th) 129 | Canada | Compensation is an equitable monetary remedy which attempts to restore to the plaintiff what has been lost as a result of the breach, ie, the plaintiff’s lost opportunity. |
| Bristol and West Building Society v Mothew | N/A | Yes | [1996] 4 All ER 698 | England | This approach has found some approval in the decision of Bristol and West Building Society v Mothew [1996] 4 All ER 698 at 710 – 713. |
| Swindle v Harrison | English Court of Appeal | Yes | [1997] 4 All ER 705 | England | Stated that the restitutionary obligation imposed on those who owed fiduciary duties is more stringent than the common law obligations to pay damages for breach of contract or negligence and although foreseeability and remoteness of damages are not relevant, it was still necessary to show that the loss suffered has been caused by the relevant breach of the fiduciary duty. |
| Rakusen v Ellis, Munday and Clarke | N/A | Yes | [1912] 1 CH 831 | N/A | In my opinion the public interest in the administration of justice is sufficiently safeguarded on the test of ‘reasonable anticipation of mischief’ or in other words ‘reasonable likelihood of mischief’. |
| Dana-West Hotels Ltd v Royal Bank of Canada | N/A | Yes | (1984) 37 SASK R. 81 | N/A | An application by defendant to restrain counsel for acting for plaintiff was dismissed as the court was not satisfied that the mischief would probably result if counsel was allowed to continue to represent his client. |
| In re A Solicitor | N/A | Yes | (1987) 131 S J 1063 | N/A | The threshold required to be met to restrain counsel from continuing to act was intentionally high as it is not desirable that the right of a client to have the services of the solicitor of his choice should be unnecessarily restricted. |
| Emperor v Dadu Rama Surde | N/A | Yes | AIR 1939 BOM 150 | N/A | The inherent jurisdiction of the court should be invoked in a r 64 scenario only when the party applying for solicitor to be discharged establishes that the trial will be materially embarrassed if the advocate continued to appear. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Rules of Court (Cap 322, R 5, 2006 Rev Ed) | Singapore |
| Legal Profession Act (Cap 161, Rev Ed 2009) | Singapore |
| Legal Profession (Professional Conduct) Rules (Cap 61, R1, 2010 Rev Ed) | Singapore |
| Supreme Court Judicature Act, (Cap 322 Rev Ed 2007) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Conflict of interest
- Advocate-witness rule
- Inherent jurisdiction
- Equitable compensation
- Breach of fiduciary duty
- Legal Profession (Professional Conduct) Rules
- Solicitor-client costs
- Reasonableness of invoices
- Material fact
- Injunction
15.2 Keywords
- Conflict of interest
- Injunction
- Legal ethics
- Singapore
- Solicitors
- Professional conduct
17. Areas of Law
16. Subjects
- Legal Profession
- Civil Procedure
- Equity