In property transactions involving multiple co-owners, clear written consent from all parties is essential for a valid sale agreement, and solicitors must ensure proper verification of authority.

JUDGMENT

Roz Mawar Rozain JC:

[1] There are times when inheriting a gem of a property brings with it legal trouble, and this case is one instance of such an example. Before this Court is a disputed sale of inherited prime property located at No 10 Lorong Raja Uda 2, Kampung Baru, Kuala Lumpur (the Property). The First to Eighth Defendants (D1-D8) are co-owners following the death of one Salmah binti Puteh. The Plaintiff claims to have entered into an agreement to purchase the Property from the Defendants for RM3,300,000.00.

[2] The dispute centres on whether all eight Defendants had actually consented to sell the Property. The Second Defendant (D2) had taken the lead in communications where the First Third Party (TP1) was appointed as solicitors to handle the transaction. The other Defendants denied authorising the sale or appointing TP1 as their solicitors.

[3] Important issues were raised regarding the scope of authority among co-owners, the professional responsibilities of solicitors, whether the agreement was valid and enforceable, and if at all what remedies the Plaintiff is entitled to.

Background Facts

[4] The Property was originally owned by Salmah binti Puteh, who passed away. The Property then came under the administration of Amanah Raya Berhad (ARB) as the estate administrator. On 20 July 2022 pursuant to a High Court order, the property was registered in the names of the Defendants. D1 to D4 are the late Salmah binti Puteh's adult children. D5 is her daughter-in-law who had married her son (now deceased) whilst D6 to D8 are her grandchildren from that marriage. Prior to this, there were negotiations for the sale of the Property to the Plaintiff and a price of RM3,310,000.00 was agreed upon with the earnest deposit paid.

[5] The Plaintiff, 78 years of age, granted a Power of Attorney to her son PW1 to enter into the transaction for the purchase of the Property under her name. PW1 had the power to liaise and instruct lawyer pertaining to the transaction and given a free hand to make decisions without referring to her. She had also authorised him to appear on her behalf as he was the one with full personal knowledge of the negotiations and transactions.

[6] Between November 2021 and December 2022, D2 had liaised with the estate agent about the sale of the Property.

[7] On 5 January 2022, the Plaintiff paid RM66,200.00 as an Earnest Deposit to the TP1, believed to have been acting for the Defendants. The terms for the earnest deposit payment were contained in a letter dated 5 January 2022, which included: (a) the purchase price of RM3,310,000.00 (although the Plaintiff's pleadings stated the figure of RM3,200,000.00) (b) the Property to be free from encumbrances and liabilities (c) subject to agreement on the terms of the sale and purchase agreement (SPA).

[8] On 6 January 2022, TP1 acknowledged receipt of the earnest deposit via email.

[9] On 27 January 2022, the first draft of the SPA was provided by the Plaintiff's solicitors to TPl. Between 14 February 2022 and 20 May 2022, there were various communications between the lawyers (TP1 and the Plaintiff's solicitors) regarding the draft agreement and necessary documents.

[10] On 17 February 2022, TP1 had forwarded a draft SPA to D2 via email.

[11] Between 28 February 2022 and 1 March 2022, TP1 had liaised with ARB for confirmation and approval for the beneficiaries (all the Defendants) to sign an SPA before a Transfer Order of the Property to them.

[12] On 1 March 2022, D2 met with the lawyer from TP1 to discuss the terms of the SPA at Hilton Hotel Kuala Lumpur.

[13] On 11 March 2022, TP1 forwarded a copy of the appointment letter executed by D2 to ARB via email. The appointment letter confirmed that TP1 was authorised to act on behalf of the Defendants pertaining to the administration and transfer of the Property to them.

[14] On 31 May 2022, the Plaintiff's lawyer sent four signed copies of the SPA, two copies of Form 14A (Memorandum of Transfer), and a CIMB cheque no. 119991 fo