Raus Sharif JCA

On 13 February 2009, the Kuala Lumpur High Court granted the second and third defendants’ application to disqualify Miss Renu Zechariah (‘MRZ’) from acting for the plaintiff directly or indirectly in the High Court Suit No D4–22–1417 of 2008 (‘the D4 Suit’). Being dissatisfied, the plaintiff had appealed against the High Court decision. At the same time, the plaintiff had also filed a notice of motion to stay the High Court’s order.

The notice of motion dated 18 February 2009 was fixed before us on 23 February 2009. With the agreement of the parties, the notice of motion was treated as the appeal proper.

Having heard arguments of the parties, the matter was adjourned for our consideration and decision. I now give my decision and the reasons for the same.

What happened in this case is this. On 9 March 2008, MRZ and one Mr Ragumaran, both advocates and solicitors, attended a meeting of a company called Perunding Pakarmedia Sdn Bhd (‘the company’). The company is the seventh defendant. The plaintiff and the first to sixth defendants are directors and shareholders of the company.

The meeting on 9 March 2008 was convened for the purpose of advising the company and its board of directors in relation to an Anti-Corruption Agency’s (‘ACA’) investigation against the company.

At the meeting, each director narrated what he or she had said to the ACA. The narration was reduced into writing by Mr Ragumaran in a form of minutes of meeting.

Subsequently, MRZ, through her firm, Messrs Rosley Zechariah, appeared on record for the plaintiff in the D4 suit against the defendants. The case is essentially a shareholders’ dispute.

On 12 December 2008, the second and third defendants filed the application to disqualify MRZ. The application was filed after several applications had come up for hearing, disposed of, orders made thereon, with the defendants being present through their respective counsel at all times.

The application to disqualify MRZ was grounded on conflict of interest as it was alleged that MRZ had acted for the company previously and was now acting for the plaintiff against the company.

The learned High Court judge held that there is a potential conflict of interest if MRZ was to continue to represent the plaintiff in the D4 suit as MRZ who attended the meeting would be privy to the confidential information disclosed at the meeting. She also noted that the draft minutes of the meeting was seriously disputed by the parties, and in view of MRZ’s presence at the meeting, MRZ is a potential witness and should not appear as counsel in the D4 suit.

Before us, the complaint by Mr Harpal Singh, learned counsel for MRZ are two fold. First, the learned High Court judge failed to appreciate and apply the known principle of law with regard to disqualification of counsel. Secondly, the potential witness rule is a non-issue and has no application at the present stage of the proceeding.

Mr Alan Wong, learned counsel for the second and third defendants submission is premised on the grounds of conflict of interest and/or breach of confidence. It may be summarised as follows. MRZ and Mr Ragumaran were appointed as solicitors by the company to render legal advice to the company and its directors in relation to ACA investigation which involved the company. Both attended the meeting of the company on 9 May 2008, wherein various confidential information was disclosed to both solicitors through the second and third defendants in relation to ACA investigation.

Mr Alan Wong contended that the confidential information amounts to privileged communication and is protected under the law wherein it cannot be disclosed unless with the consent of the provider of the information. Thus, MRZ continued involvement in the D4 suit raises a position of conflict of interest as MRZ had been previously appointed by the company.

Mr Alan Wong further submitted that the continued involvement of MRZ in the D4 suit would disseminate confidential information obtained in MRZ capa