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2021 MarsdenLR 3324
HIGH COURT MALAYA SHAH ALAM
PANETRA PARKING SERVICES SDN BHD & ORS – Appellant
Versus
TTDI HARTA SDN BHD & ANOTHER APPLICATION – Respondent
[Civil Suit No: BA-22NCC-36-03-2020]
Law firms cannot act against former clients in related cases due to inherent conflicts of interest and obligations to uphold client confidentiality.
Headnote:(A) Legal Profession (Practice and Etiquette) Rules 1978 – Rules 3, 4, 5, 28, and 35 – Application to disqualify solicitors on grounds of conflict of interest and professional embarrassment in representation in related litigation – The court found that Law Firm ASSC's prior representation of Platinum Parking created an inherent conflict, warranting disqualification, while Law Firm MHI did not present such issues – The principles of preserving client confidentiality and maintaining professional independence were emphasized throughout the ruling. (Paras 6, 55, 60)
Facts of the case: The Plaintiffs sought to disqualify Law Firm ASSC from representing the Defendant due to previous representation of a party in the same litigation context, while the Defendant’s counter-application to disqualify Law Firm MHI was dismissed as unfounded. (Paras 1-4, 60)
Findings of Court: Law Firm ASSC disqualified from acting for Defendant; Law Firm MHI allowed to continue representing Plaintiffs in this Suit. (Paras 60)
Issues: Whether Law Firm ASSC had conflict of interest and whether Law Firm MHI could continue representation without issues of embarrassment or conflict. (Paras 6, 61)
Ratio Decidendi: The court ruled that Law Firm ASSC’s former client relationship created a conflict that would impede their ability to represent the Defendant with professionalism and independence. (Paras 51-55)
Result: Plaintiff's application allowed; Defendant's application dismissed.
(Enclosures 9 And 12)
Introdution
[1] These two appeals involve an application by the Plaintiff in encl 9 to disqualify the Defendant's solicitors from acting for the Defendant in this Suit and a counter-application by the Defendant in encl 12 to disqualify the Plaintiffs' solicitors from acting for the Plaintiffs in this Suit.
[2] Enclosure 9 is the Plaintiffs' application under rr 3, 4, 5 and 35 Legal Profession (Practice and Etiquette) Rules 1978 and under O 92 r 4 Rules of which is the application to order for MESSRS AZLAN SHAH SUKHDEV & CO ("Law Firm ASSC") to withdraw from representing the Defendant in Civil Law case No: BA-22NCC-36- 03/2020 and any matter or action related to Civil Law case No: BA- 22NCC-36-03/2020.
[3] Enclosure 12 is the Defendant's application under rr 3, 4, 5, and 35 of the Legal Profession (Practice and Etiquette) Rules 1978 and O 92 r 4 of the Rules of 2012, namely application for an order for TETUAN MOHAJI HAZURY & ISMAIL ("Law Firm MHI") to withdraw from representing the Plaintiffs for Civil Suit No: BA-22NCC- 36-03 / 2020 and any matter or action related to Civil Suit No: BA- 22NCC- 36-03/2020.
[4] In respect of encl 9 the following cause papers were filed and exchanged:
a. Plaintiffs' Notice of Application dated 14 July 2020;
b. Plaintiffs' Affidavit in Support sworn by Hashim bin Mahmud dated 14 July 2020;
c. Defendant's Affidavit in Reply sworn by Dato' Suhkdev Singh Randhawa dated 27 July 2020 ("Defendant's Affidavit in Reply");
d. Plaintiff's Affidavit in Reply sworn by Hashim bin Mahmud dated 10 August 2020;
e. Defendant's Answer Affidavit (1) sworn by Dato' Sukhdev Singh Randhawa dated 25 August 2020;
f. Plaintiff's Affidavit in Reply (Plaintiff (1) sworn by Hashim bin Mahmud.
[5] In respect of encl 12 the following cause papers, which were filed and exchanged, are relevant:
a) Writ dated 2 March 2020 (hereinafter referred to as "the Writ")
b) Plaintiff's Statement of Claim dated 2 March 2020 (hereinafter referred to as "the Statement of Claim");
c) Defendant's Defence and Counter Claim dated 28 May 2020;
d) Reply to Defence and Defence to Defendant's Counter Claim dated 19 June 2020;
e) Defendant's Notice of Application;
f) Defendant's Affidavit-in-support affirmed by Dato' Sukhdev Singh Randhawa on 27 July 2020;
g) Plaintiffs' Affidavit-in reply affirmed by Hashim bin Mahmud on 17 August 2020;
h) Defendant's Affidavit-in-reply affirmed by Dato' Sukhdev Singh Randhawa on 2 September 2020;
i) Plaintiffs' Affidavit-in reply (2) affirmed by Hashim bin Mahmud;
[6] On 25 November 2020 this Court allowed the Plaintiffs' application in encl 9 with costs and dismissed the Defendant's application in encl 12 with costs.
[7] The Defendant has appealed against both the decisions of this Court in encls 9 and 12.
Background Facts
[8] This Suit No BA-22NCC-36-03/2020 ("this 2020 Suit") can be considered as a continuation of or sequel to two earlier proceedings in the courts. The three inter-related proceedings are:
(a) Shah Alam High Court Originating Summons No BA-24NCC-30- 04/2017 ("the 2017 OS");
(b) Court of Appeal Civil Appeal No B-02(NCC)(A)-729-04/2018 ("2018 Appeal"); and
(c) this Suit No BA-22NCC-36-03/2020 ("this 2020 Suit").
[9] At all material times TTDI Harta Sdn Bhd (the sole Defendant in this 2020 Suit) had a Carpark Operating Contract with Platinum Parking Sdn Bhd as the carpark operator at TTDI Harta's property. Alunan Rancak Sdn Bhd is the majority shareholder with 70% shares in Platinum Parking, while Panetra Parking Sdn Bhd (the 1st Plaintiff in this 2020 Suit) holds 30% shares in Platinum Parking.
[10] In the 2017 OS, the 1st to 3rd Plaintiffs herein (1) applied for leave to file derivative action on behalf of Platinum Parking Sdn Bhd (the 1st Defendant in the 2017 OS and the 4th Plaintiff in this 2020 Suit) against TTDI Harta Sdn Bhd (the sole Defendant in this 2020 Suit but not cited as a co-defendant in the 2017 OS) for alleged share of income collections and for alleged damages for
