A solicitor owes fiduciary duties to clients, which include acting loyally and not allowing personal interests to conflict with those of clients. Violations can invalidate subsequent transactions.

[1]This appeal involves interesting issues inter alia, those relating to the often tricky question of the extent in which a solicitors relationship with his client becomes fiduciary.

[2]This appeal saw copious amounts of materials with 93 exhibits, 33 witnesses, 157 documents and close to 1,000 pages of notes of evidence, making it appear more complex and formidable than it is.

[3]However out of the morass, in my view only three issues present themselves for consideration. They are:

(i) Whether the Plaintiffs and others, (now referred to as "Plaintiffs and sub-purchasers") claiming to represent 213 others as original purchasers of the said land, retained an equitable right thereof, which was not extinguished despite the various subsequent dealings with the land;

(ii) whether the 1st Defendant acted as solicitor for the Plaintiffs and thus had purchased the said land as their trustee - that the purchase was not done by the 1st Defendant in his personal capacity but on behalf of the Plaintiffs;

(iii) whether this suit amounts to a representative action.

[4]The appeal before us is against the decision of Abdull Hamid J (as His Lordship then was) made on 23 January 2006, where His Lordship dismissed the claim of the Plaintiffs after a full trial.

[5]As would be unfolded later, this appeal is fact-driven. In essence the Plaintiffs claimed that they had an equitable interest in the subject land ("the land") and that the Defendants had colluded with each other, to deprive them of their interest, causing them injury.

[6]The Plaintiffs contended that the 1st and 2nd Defendants action gave rise to a conflict of interest, since they were also solicitors for the Plaintiffs, and by conducting themselves in the manner they did in this matter they had enriched themselves at the Plaintiffs expense. It is also the Plaintiffs contention that as the 1st Defendant acted as their solicitor in this matter the relationship between solicitor and clients between them had in fact been established.

Background

[7]Though the facts of this case appear to be a scramble of sorts, they can be unraveled and simplified in this manner:

[8]That firstly, Nam Bee Rubber Estate Sdn Bhd ("Nam Bee") was the initial registered owner of a piece of land measuring approximately 1490 hectares held and title PN 35553 Lot No 9108 in the Mukim of Hutan Melintang Daerah Hilir Perak (hereinafter referred to "the said land"). Since it is rubber estate land, it was governed by inter alia, s 214 A of the National Land Code, 1965 ("NLC").

[9]A company called Syarikat Pembinaan Perusahaan Kemajuan Berhad ("SPPKB") established on 26 November 1979 and dealing in real estate, had a director called Reganathan (SP8).

[10]According to SP8, SPPKB bought the land from Nam Bee, on or about 5 December 1979, where SPPKB paid a deposit totaling RM51,000 which also formed part payment of the purchase price of the land - (see P38).

[11]The price of the land was RM3.2 million. Then for some incomprehensible reason, it was SP8s evidence that Nam Bee could not transfer the land to SPPKB. His contention was that Nam Bee was unable to do so on grounds that since SPPKB and Nam Bee had different or separate directors the transfer could only go through if Nam Bee establishes a subsidiary company. Thus Simpang Empat Plantations ("SEP") came into being, as Nam Bees subsidiary Company. Subsequently the directors of SPPKB became the directors of SEP. One such director was SP8.

[12]On 18 December 1981, a Declaration of Trust was executed between one Tan Ah Loong and SPPKB. The preamble of the said Declaration of Trust stated that Tan Ah Loong acted on behalf of Nam Bee.

[13]Preamble A to G of the Declaratio