JUDGMENT

Vazeer Alam Mydin Meera JCA:

Introduction

[1] The appellants claimed for compensation from the Advocates and Solicitors Compensation Fund ("Compensation Fund") established under the Legal Profession Act 1976 ("LPA"). The respondent informed the appellants that they were ineligible to make their claim, and thus refused to consider the appellants' application. The appellants then appealed that decision to the High Court vide an Originating Summons.

[2] The High Court found that the appellants' appeal had no merit and that the respondent had acted within its powers under s 80 of the LPA in rejecting the appellants' claim. Accordingly, the High Court dismissed the appellants' appeal.

[3] The appellants appealed that decision to this Court. We allowed the appeal for the following reasons.

Background Facts

[4] The appellants and their two other siblings had beneficial interest in their parents' house in Ipoh ("Property"). The Property was sold to Kawan Properties Sdn Bhd at the sale price of RM2,524,410.00.

[5] Shan a/l Theivanthiran ("Shan") who at the material time was an advocate and solicitor practicing as a partner in the firm of Messrs Thevin Chandran & Associates acted for the appellants and their two siblings in that sale transaction.

[6] On 2 May 2014, a cheque for the sum of RM2,145,748.50, being the balance purchase price, was forwarded by the purchaser's solicitors to Messrs Thevin Chandran & Associates. In due course, that cheque was cleared and payment was received by Messrs Thevin Chandran & Associates.

[7] Each of the four beneficiaries, including the appellants were to receive RM521,427.00 as their share of the balance purchase price. Shan then drew out two Public Bank Berhad cheques dated 17 March 2016 each for the sum of RM521,427.00 in the respective names of the appellants and gave them to the appellants. However, Shan subsequently notified the appellants not to cash the cheques until he notified them to do so.

[8] On 31 March 2016, Shan deposited a cheque in the sum of RM1,042,854.00 into the 1st appellant's Maybank account, which was the total payment due to the appellants. However, Shan then instructed his bank to stop payment on the said cheque.

[9] Shan, and by extension the firm of Messrs Thevin Chandran & Associates, failed to make payment of the sum of RM1,042,854.00 to the appellants despite repeated assurance that it would be paid.

[10] The appellants then lodged a complaint to the Advocates & Solicitors Disciplinary Board ("Disciplinary Board") against Shan for professional misconduct occasioned by his dishonesty, ie failure to make payment of the stakeholder sums of RM521,427.00 to each of the appellants.

[11] After due inquiry, the Disciplinary Board found Shan guilty of professional misconduct and by Order dated 18 July 2020 ordered that Shan be struck off the Roll of Advocates and Solicitors of the High Court in Malaya ("Roll").

[12] The Disciplinary Board further ordered that Shan make restitution in the sum of RM521,427.00 to each of the appellants within one month from the date of the Order. Shan, however, failed to comply with that Order.

[13] The appellants through their solicitors then wrote to the respondent via email dated 21 September 2020 informing the respondent of the Order and further enquired if the appellants were entitled to be compensated for their loss from the Compensation Fund.

[14] The respondent via email dated 22 September 2020 replied in the negative and stated as follows:

"We regret to inform you that the Bar Council is unable to entertain any claim made against Shan A/L Theivanthiran as he was practicing as a partner in Messrs Theivin Chandran & Assoc. Please find attached herewith the Compensation Fund brochure that provides the guideline in relation to eligibility.

In the circumstances, kindly advise your client on the remedies available in respect of Shan A/L Theivanthiran."

[Emphasis Added]

[15] The respondent's decision was based on the "Guidelines On Making A Claim For Compensa