Law Society v K Jayakumar Naidu: Solicitor's Duty of Care & Loyalty

The Law Society of Singapore applied for K Jayakumar Naidu to be sanctioned for failing to adequately protect his client, Hay Choo Soon's, interests in the sale of his Housing and Development Board flat. The High Court found that Naidu had breached his duty of care and loyalty to his client, particularly in relation to the release of the sale proceeds, and ordered that he be suspended for three months. The court found that Naidu failed to properly advise his vulnerable client and acted deliberately to prevent another solicitor from protecting the client's interests.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

The respondent is suspended for a period of three months.

1.3 Case Type

Regulatory

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Disciplinary action against solicitor K Jayakumar Naidu for failing to protect his vulnerable client's interests in a property sale, resulting in misappropriation.

1.7 Decision Date

2 October 2012

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Law Society of Singapore	Applicant	Statutory Board	Application granted	Won	Abraham Vergis, Clive Myint Soe, Adam Daniel Giam
K Jayakumar Naidu	Respondent	Individual	Suspension from practice	Lost	R S Wijaya, Zero Nalpon, Teresa Chan
Hay Choo Soon	Other	Individual

3. Judges

Judge Name	Title	Delivered Judgment
Chan Sek Keong	Chief Justice	Yes
Andrew Phang Boon Leong	Justice of the Court of Appeal	Yes
V K Rajah	Justice of the Court of Appeal	Yes

4. Counsels

Counsel Name	Organization
Abraham Vergis	Drew & Napier LLC
Clive Myint Soe	Drew & Napier LLC
Adam Daniel Giam	Drew & Napier LLC
R S Wijaya	R S Wijaya & Co
Zero Nalpon	Nalpon & Co
Teresa Chan	C Teresa & Co

4. Facts

HCS suffered from a chronic neurodegenerative disorder and had limited education.
HCS appointed his brother, HBS, as his attorney via a power of attorney.
HBS obtained a loan using the sale proceeds of HCS' flat as security.
Wong, another solicitor, warned the respondent of the risk of misappropriation by HBS.
The respondent failed to adequately advise HCS regarding the third letter of authority.
The respondent released the sale proceeds to a joint account of HCS and HBS.
HBS misappropriated the sale proceeds.

5. Formal Citations

Law Society of Singapore v K Jayakumar Naidu, Originating Summons No 57 of 2012, [2012] SGHC 200

6. Timeline

Date	Event
2002-01-01	Respondent admitted to the roll.
2008-01-01	HCS inherited the flat from his mother.
2009-09-01	HCS suffered a serious fall and was admitted to Singapore General Hospital.
2009-11-23	HCS executed a power of attorney, appointing HBS to act in the sale of the flat.
2009-12-06	Option to purchase the flat was granted by HBS, as attorney, to a purchaser.
2009-12-16	HBS, Chan, and Tan visited the respondent’s office and signed a loan agreement.
2009-12-29	HBS arranged for HCS to be discharged from SGH and warded at Windsor Convalescent Home.
2010-01-18	A letter arrived at the flat from the Singapore Land Authority notifying the addressee that a caveat had been lodged against the flat.
2010-01-23	HCT discovered the letter from the Singapore Land Authority.
2010-01-25	HCT visited the respondent and was shown the power of attorney, the option to purchase the flat and the first letter of authority.
2010-01-26	HCT and HJS visited Wong.
2010-01-27	Wong visited HCS together with HCT and HJS.
2010-01-28	Wong wrote to the respondent.
2010-02-01	The respondent replied to Wong’s letter.
2010-02-04	Wong visited HCS with HCT and HCS' right thumbprint was affixed to both documents, which were sent to the respondent the same day.
2010-02-08	The respondent commented on the documents by letter.
2010-02-10	Wong replied to the respondent.
2010-03-01	HBS approached the respondent regarding the release of the sale proceeds.
2010-03-03	HBS brought HCS for a consultation with Dr Nelson Lee.
2010-03-04	HCS, HBS and Chan went to the respondent’s office and HCS executed the third letter of authority.
2010-03-05	Sale proceeds were deposited into the OCBC account.
2010-03-08	Sale proceeds were deposited into the OCBC account.
2010-03-10	The respondent wrote to Alpha Law.
2012-10-03	Judgment reserved.

7. Legal Issues

Breach of Duty of Care
- Outcome: The court found that the respondent breached his duty of care to his client by failing to adequately advise him and protect his interests.
- Category: Substantive
- Sub-Issues:
  - Failure to adequately advise client
  - Failure to protect client's interests
  - Failure to make adequate inquiries
Breach of Duty of Loyalty
- Outcome: The court found that the respondent breached his duty of loyalty to his client by failing to act in his best interest and favouring the interests of a third party.
- Category: Substantive
- Sub-Issues:
  - Placing self in a position of conflict
  - Favouring interests of a third party
  - Failure to act in client's best interest
Professional Misconduct
- Outcome: The court found the respondent guilty of professional misconduct.
- Category: Substantive
- Sub-Issues:
  - Improper conduct in discharge of professional duty
  - Misconduct unbefitting an advocate and solicitor

8. Remedies Sought

Disciplinary Action
Suspension from Practice

9. Cause of Actions

Professional Negligence
Breach of Fiduciary Duty

10. Practice Areas

Disciplinary Proceedings
Professional Conduct

11. Industries

Legal Services

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Law Society of Singapore v Ahmad Khalis bin Abdul Ghani	High Court	Yes	[2006] 4 SLR(R) 308	Singapore	Cited for the principle that the standard of professionalism an advocate and solicitor ought to display is an objective one as determined by the court.
Bolton v Law Society	Unknown	Yes	[1994] 1 WLR 512	England and Wales	Cited for the principle that any solicitor who is shown to have discharged his professional duties with anything less than complete integrity, probity and trustworthiness must expect severe sanctions to be imposed upon him.
Law Society of Singapore v Tan Phuay Khiang	High Court	Yes	[2007] 3 SLR(R) 477	Singapore	Cited for the principle that a solicitor's responsibility goes beyond the essentially perfunctory role of preparing a power of attorney and witnessing its execution to taking reasonable care to advise and ensure that his clients understood the implications of their actions.
Law Society of Singapore v Uthayasurian Sidambaram	High Court	Yes	[2009] 4 SLR(R) 674	Singapore	Cited for the principle that a solicitor ought to tailor his advice to suit the needs of his client and not be afraid to ask probing questions and that solicitors cannot be content with simply following the instructions of their clients blindly.
Law Society of Singapore v Ravindra Samuel	High Court	Yes	[1999] 1 SLR(R) 266	Singapore	Cited for the principle that three factors were relevant in a determination of the appropriate penalty: (a) protection of the public, (b) the need to safeguard the collective interests and reputation of the legal profession as an honourable one, and (c) punishment of the offender.

13. Applicable Rules

Rule Name
Legal Profession (Professional Conduct) Rules (Cap 161, R 1, 2010 Rev Ed)
Professional Conduct Rules
Professional Conduct Rules
Professional Conduct Rules
Professional Conduct Rules
Professional Conduct Rules
Professional Conduct Rules
Professional Conduct Rules

14. Applicable Statutes

Statute Name	Jurisdiction
Legal Profession Act (Cap 161, 2009 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Duty of care
Duty of loyalty
Professional misconduct
Power of attorney
Misappropriation
Vulnerable client
Informed consent
Letter of authority
Sale proceeds
Disciplinary proceedings

15.2 Keywords

Solicitor
Disciplinary action
Duty of care
Duty of loyalty
Professional conduct
Singapore
Legal Profession Act

16. Subjects

Professional Ethics
Solicitor's Duties
Client Care

17. Areas of Law

Legal Ethics
Professional Responsibility
Regulatory Law