Muhammad Alif Iqbal Bin Mohd Rodi (Sebagai Pentadbir Harta Pusaka Mohd Rodi Bin Shari) v Norfazilawati Binti Che Harun (TA-17D-1-04/2025)

NORFAZILAWATI BINTI CHE HARUN

MOHD NASIR BIN ABDULLAH (NRIC NO.: 700222-03-5119) (practising under the name and style of MESSRS NASIR & CO) … RESPONDENTS GROUNDS OF JUDGMENT

This is the decision of the Court in respect of the Originating Summons filed by the Appellant against the decision of the Advocates and Solicitors Disciplinary Board ("the DB") dated 15 February 2025, which dismissed the complaint of the deceased, Mohd Rodi bin Shari, against the First Respondent, Norfazilawati binti Che Harun, under Complaint No. DC/21/0452. The appeal against the Second Respondent under Complaint No. DC/21/0451 was withdrawn on 9 July 2025.

The Appellant appeals under Section 103E of the Legal Profession Act 1976 ("the LPA") and Order 55A of the Rules of Court 2012 ("the Rules"), seeking to set aside the DB's decision and reinstate the findings of the Disciplinary Committee ("the DC") which had recommended a suspension of two years and a fine of RM10,000.00 against the First Respondent pursuant to its powers under Section 103C(1)(c)(ii) and (iii) of the LPA.

This case brings to mind the moral lesson from John Grisham's legal thriller, The Firm. The novel tells the story of a young lawyer who discovers that the firm he joined is not what it appears to be. At its heart, The Firm reminds us that a lawyer's true worth is measured not by success or reward, but by fidelity to the principles of honesty, integrity, and justice. In the present case, the court is called upon to examine whether the First Respondent remained faithful to those principles in her role as a stakeholder. The court has considered all affidavits, submissions, and authorities, and now makes the following findings.

The factual matrix of this case is complex and involves a joint venture arrangement entered into around 2008 between Tuan Kalthom binti Tuan Sulong ("Tuan Kalthom") and Tengku Harunarashid bin Tengku Ismail ("Tengku Harun"), who carried on business under the name of Bintang Dahlia Sdn Bhd ("BDSB"). The joint venture was for the development of Tuan Kalthom's 28/84 portion of the master title known as PT425, H.S(M), Mukim Tujoh, Jajahan Tumpat, Kelantan.

5.

As consideration for the joint venture, Tengku Harun and BDSB agreed to construct and deliver four units of single-storey bungalow houses to Tuan Kalthom, while retaining eleven commercial lots and two residential lots for themselves.

The First Respondent was appointed as the solicitor handling all conveyancing matters relating to the subdivision and transfer of the lots. Her firm was also appointed as the stakeholder to hold the original documents, including the Form 14A for the transfer of the commercial lots, and to oversee the transfer process.

The deceased, Mohd Rodi bin Shari, and his father, Shaari bin Jaafar, purchased five commercial lots from Tengku Harun and BDSB through an oral agreement, with payment made by instalments. The lots were:

GM 1547, Lot 10034 (PT 486, H.S(M) 357);

GM 1548, Lot 10035 (PT 487, H.S(M) 358);

GM 1549, Lot 10036 (PT 488, H.S(M) 359);

GM 1550, Lot 10037 (PT 489, H.S(M) 360); and

GM 1551, Lot 10038 (PT 490, H.S(M) 361).

The deceased also purchased one residential lot, PT 506, H.S(M) 377, at a price of RM50,000.00. The First Respondent's firm prepared the Sale and Purchase Agreement dated 10 November 2010 for this transaction and was appointed as the stakeholder to handle the transfer and to hold the original documents.

On every material time, the deceased and his father made full payment for the lots, and this was within the knowledge of the First Respondent's firm. They entered into possession of the lots and carried on business there while awaiting the transfer.

On 14 September 2014, Tuan Kalthom filed Civil Suit No. MT(1)22- NCVC-75-09/2014 ("Suit 75") at Kota Bharu High Court against BDSB, the deceased, and his father concerning the three residential lots that Tuan Kalthom claimed had not been completed by Tengku Harun and BDSB. In the Statement of Claim, Tuan Kalthom acknowledged that the commercial lots had been purchased by the deceased and his father.

The Second Respondent, Mohd Nasir bin Abdullah, practising under the name and style of Tetuan Mohd Nasir & Co, acted as the solicitor for Tuan Kalthom in Suit 75. His firm prepared the writ and statement of claim and represented Tuan Kalthom in the proceedings.

On 9 February 2015, a Judgment in Default was obtained against the deceased and his father. On 23 June 2015, a Writ of Possession was executed. On 25 June 2015, the deceased and his father filed applications to set aside the Judgment in Default and to stay execution. On 28 March 2016, the court ordered that the Judgment in Default be set aside. On 16 November 2016, Tuan Kalthom withdrew Suit 75 against the deceased and his father, and the court struck out the action with no liberty to file afresh.

On the very same day that the deceased and his father filed their applications to set aside the Judgment in Default (25 June 2015), Tuan Kalthom executed a second Power of Attorney ("Power of Attorney 2") in favour of the First Respondent. This Power of Attorney was prepared by the Second Respondent's firm and authorised the First Respondent to deal with the remaining commercial lots that should have been transferred to the deceased and his father (Exhibit MAI-14 of Enclosure 5).

Power of Attorney 2 was witnessed by Norazira binti Che Hak, a legal assistant of the First Respondent's firm. Her signature was subsequently disputed and alleged to have been forged, and she lodged a police report on 7 January 2020 concerning this matter (Exhibit MAI-15 of Enclosure 5).

At the behest of the Second Respondent, a forensic examination was conducted by the Chemistry Department of Malaysia. The report concluded that the first questioned signature was "probably" written by Norazira, while the possibility of the second being written by her "could not be ruled out" (Exhibit FAZ-9 of Enclosure 17). Due to the limited number of samples provided, the report issued only qualified findings, which fall short of conclusive proof of authenticity.

On 13 October 2015, the First Respondent entered into a Sale and Purchase Agreement with Tuan Kalthom for the purchase of three of the disputed lots: Lot 10036, GM 1549; Lot 10037, GM 1550; and Lot 10038, GM 1551. The Agreement recorded a consideration of RM1,224,000.00. However, the Form 14A dated 19 October 2015, which is the instrument of transfer registered at the land office, stated that the transfer was made "tolak percuma" (without consideration). The First Respondent subsequently charged these properties to Public Islamic Bank Berhad for personal financing.

On 10 March 2020, the Plaintiffs in Kota Bharu High Court Civil Suit No. DA-22NCVC-16-03/2020 ("Suit 16") – comprising BDSB, Tengku Harun, the deceased, and his father – filed Statement of Claim against seven defendants, including the First and Second Respondents. The Statement of Claim pleaded that the deceased and his father had purchased the lots and made full payment, that the First Respondent had acted unprofessionally by instructing Tuan Kalthom to execute Power of Attorney 2 while Power of Attorney 1 was still valid, and that the First Respondent had transferred three lots to herself without consideration. The Second Respondent was alleged to have conspired with the First Respondent. The Statement of Claim further alleged that Norazira binti Che Hak had denied signing the document and lodged a police report. However, on 27 October 2020, the Plaintiffs withdrew Suit 16 with liberty to file afresh.

In September 2021, the deceased lodged complaints against both Respondents. The complaint against the First Respondent (DC/21/0452) concerned her failure to complete the transfer of the lots to the deceased and her subsequent acquisition of three of the lots for herself. The complaint against the Second Respondent (DC/21/0451) arose from his role in Suit 75, his preparation of Power of Attorney 2, and the allegation that he had conspired with the First Respondent. Both Respondents denied the allegations. The First Respondent contended there was no solicitor-client relationship and that she was a bona fide purchaser, while the Second Respondent maintained that he had acted only on Tuan Kalthom's instructions and had no knowledge of any irregularity.

The complaints against both Respondents were considered by the Jawatankuasa Tatatertib Peguambela dan Peguamcara Negeri Terengganu ("the DC"). Upon consideration of the evidence and submissions, the DC found that the First Respondent had breached her professional duties as a stakeholder and solicitor, had acquired properties for herself, and had failed to protect the interests of the deceased and his father. The DC recommended a suspension of two years and a fine of RM10,000.00 against the First Respondent. The DC found no liability on the part of the Second Respondent and recommended that the complaint against him be dismissed. The deceased complainant passed away on 24 February 2024.

The DB, through its Order dated 15 February 2025, rejected the DC's findings and dismissed the complaint against the First Respondent. The DB accepted the DC's recommendation and dismissed the complaint against the Second Respondent. The DB did not provide detailed reasons for its decisions.

The Appellant, in his capacity as administrator of the deceased's estate, originally pursued appeals against both Respondents. On 9 July 2025, however, the Appellant withdrew the appeal against the Second Respondent, leaving only the appeal against the First Respondent to be determined.

The Originating Summons was filed on 10 April 2025, following receipt of the DB's decision on 13 March 2025; wherein the Appellant seeks the following orders:

That the appeal against the DB's decision be allowed;

That the DB's decision dismissing the complaint against the First Respondent be set aside;

That the DC's findings and recommendations against the First Respondent be reinstated; and

That costs be awarded. PRELIMINARY OBJECTIONS

The First Respondent raised several preliminary objections which this court must first address before considering the merits of the appeal.

The First Respondent contended that the appeal should have been filed at the Kuala Lumpur High Court, as the DB's decision was made in Kuala Lumpur where the DB is situated. Counsel relied on Order 55A Rule 1(1) of the Rules, which provides that an appeal under any written law "shall be made to the High Court in the State where the decision was given."

This court is not persuaded by this submission. The DB is not a body that sits in a fixed "state" for the purpose of appeals. The DB's functions under the LPA are centralised, and its decisions are made by the Board as a whole, wherever its members may convene. The proper interpretation of Order 55A Rule 1(1) in the context of appeals from the DB should be purposive and practical. The LPA does not specify the venue for filing appeals, and there is no rule requiring an appeal to be filed in Kuala Lumpur simply because the DB has its registered office there.

More fundamentally, this court observes that the disciplinary proceedings in this case originated from DC hearing conducted by the Jawatankuasa Tatatertib Peguambela dan Peguamcara Negeri Terengganu (Terengganu State Disciplinary Committee). The affidavit evidence clearly establishes that the DC had made findings that the First Respondent had liability and recommended a penalty of suspension for two years and a fine of RM10,000.00. The DB subsequently rejected these findings. However, the substantive proceedings were conducted within the jurisdiction of the Terengganu Bar Committee. The subject land is situated in Kelantan, and the parties reside in Kelantan. Filing the appeal in the Kuala Terengganu High Court, which is geographically proximate to Kelantan and is the High Court with supervisory jurisdiction over the Terengganu Bar Committee, is entirely logical and practical. The fact that the DB subsequently made its decision based on the DC's findings does not alter the reality that the substantive proceedings and the evidence were heard and evaluated in Terengganu.

This court also notes that under Section 3 of the Courts of Judicature Act 1964, the "local jurisdiction of the High Court in Malaya" means the territory comprised in all the States of Malaya, which includes both Kelantan and Terengganu. The High Court of Malaya is a single court with various branches located in different states, including branches in Kota Bharu, Kuala Terengganu, and Kuala Lumpur. Each branch is but a branch of the same High Court of Malaya, not a separate court with exclusive jurisdiction over its respective state.

The High Court in Sova Sdn Bhd v Kasih Sayang Realty Sdn Bhd [1988] 2 MLJ 268 (HC) affirmed this principle, holding that the High Court located at Penang or at Alor Setar is but a branch of the High Court of Malaya, and each branch located in any state has concurrent jurisdiction to entertain any civil proceedings regardless of whether the cause of action arose in another state. Similarly, in Lt Kdr V Balakrishnan v Menteri Pertahanan Malaysia & Satu Lagi [1993] MLJU 605 (HC), the court held that the phrase "local jurisdiction" should not be interpreted as creating separate jurisdictions according to the states listed in the provision. These cases clearly establish that all branches of the High Court of Malaya have concurrent jurisdiction over the entire Peninsular Malaysia.

Applying these principles to the present case, the Kuala Terengganu High Court has jurisdiction to hear this appeal even though the DB's registered office is in Kuala Lumpur. The Appellant's filing in the Kuala Terengganu High Court is supported by several compelling factors:

Geographical Practicality: The parties reside in Kelantan, and the subject land is situated in Kelantan. The Kuala Terengganu High Court is the nearest High Court branch to the parties and is significantly more accessible than the Kuala Lumpur High Court.

Supervisory Nexus: The DC hearing was conducted by the Terengganu State Disciplinary Committee, and the evidence was evaluated within the supervisory jurisdiction of the Terengganu High Court. This creates a logical and practical connection between the proceedings and the Kuala Terengganu High Court.

Absence of Prejudice: The First Respondent has not demonstrated any prejudice arising from the appeal being heard in this court rather than in Kuala Lumpur. Both courts are branches of the same High Court of Malaya and possess coordinate jurisdiction.

The court further notes that appeals from the DB are generally brought under Order 55A of the Rules by way of an originating summons, as was done in the present case. Where the High Court exercises its original jurisdiction, the venue for filing the appeal is a matter of procedural convenience rather than substantive jurisdictional limitation. It is also significant that the First Respondent has submitted to the jurisdiction of this court by filing her Affidavit in Reply (Enclosure 10) and Written Submissions (Enclosure 17) without any application to transfer the matter to the Kuala Lumpur High Court. She has instead raised a jurisdictional objection, hoping that this court would dismiss the application in toto on the grounds of wrong venue. This court is of the view that a party cannot actively participate in proceedings by filing substantive pleadings and thereafter argue that the court lacks jurisdiction. The First Respondent's conduct amounts to a submission to the jurisdiction of this court, and her objection on jurisdiction is therefore without merit.

The First Respondent's argument, if accepted, would lead to the absurd outcome that every appeal against a DB decision must be filed in Kuala Lumpur regardless of the parties' connection to that location or the origin of the disciplinary proceedings. Such a construction would impose unnecessary hardship on appellants and defeat the legislative intent of facilitating access to justice. In any event, the First Respondent has submitted to this court's jurisdiction by filing her Affidavit in Reply and Written Submissions without seeking a transfer. Her jurisdictional objection is therefore untenable.

For all the above reasons, this court finds that it has jurisdiction to hear the appeal. The preliminary objection on jurisdiction is accordingly dismissed.

The First Respondent submitted that the orders sought in the Originating Summons are unclear and/or vague because the Appellant did not pray for a "consequential order." Reliance was placed on Ching Suet Yeen v Mageswaran Rajangom & Ors [2025] 3 MLRA 535 (CA), where the Court of Appeal held that an originating summons was defective when the appellant failed to seek a consequential relief.

This court finds this objection to be without merit. The Appellant's prayer clearly seeks to set aside the DB's decision and to allow the appeal against the decision. In an appeal under Section 103E of the LPA, the court has the power to allow or dismiss the appeal and to make any consequential orders as justice requires. The fact that the Appellant did not specifically pray for a consequential order does not render the Originating Summons fatally defective. The court is not bound by the precise wording of the prayer and may grant such relief as is appropriate in the circumstances.

The present case can be distinguished from Ching Suet Yeen v Mageswaran Rajangom & Ors (supra) where the appellant failed entirely to identify the statutory basis for the appeal and the nature of the relief sought. In the instant case, the Appellant has clearly identified the DB's Order dated 15 February 2025 as the decision being appealed and has specifically prayed that the appeal be allowed and the said decision be set aside.

The First Respondent argued that the Originating Summons is defective because it fails to state the grounds of appeal, contrary to Order 55A Rule 1(1) of the Rules. Reliance was placed on Saraswathy Devi a/p Nadchatiram v Vijayalakshmi Devi a/p Nadchatiram [1998] 1 MLJ 89 (CA).

This court has perused the Originating Summons and finds that while the grounds of appeal are not extensively detailed, the nature of the appeal is clear from the context. The Originating Summons refers to the DB's decision dated 15 February 2025 and seeks to set it aside. The supporting affidavit sets out the factual basis of the appeal in considerable detail over 51 paragraphs, with 15 exhibits. The grounds of appeal are sufficiently discernible from the affidavit.

The court is mindful that procedural technicalities should not be allowed to defeat substantive justice, particularly where no prejudice is caused to the respondent. As was stated in Saraswathy Devi a/p Nadchatiram v Vijayalakshmi Devi a/p Nadchatiram (supra), the originating summons must show the cause of action and the basis for the relief sought. In the present case, the Originating Summons, read together with the supporting affidavit, sufficiently discloses the Appellant's case against the First Respondent. The preliminary objection on this ground is accordingly dismissed.

The First Respondent alleged that the supporting affidavit is defective for failing to comply with Order 41 Rule 9(2) of the Rules. Order 41 Rule 9(2) provides that every affidavit shall be endorsed with a note showing on whose behalf it is filed and the dates of swearing and filing, and an affidavit which is not so endorsed may not be filed or used without the leave of the court.

Upon examination, this court is satisfied that both affidavits are in full compliance with Order 41 Rule 9(2). The Appellant filed two affidavits in these proceedings: the Supporting Affidavit (Enclosures 3, 4 & 5) and the Affidavit in Reply (Enclosure 11). Each affidavit bears a clear endorsement identifying that it is filed on behalf of the Appellant. The date of swearing for the Supporting Affidavit is expressly stated in the jurat as 24 April 2025. The Affidavit in Reply similarly states the date of swearing as 6 July 2025.

As for the date of filing, the court observes that although the physical copies of the affidavits do not bear an endorsement of the filing date, the official Court Management System ("CMS") record printed on the first page of each document confirms that Enclosures 3, 4 and 5 were filed on 25 April 2025, and Enclosure 11 was filed on 6 July 2025. The CMS filing date printed on these documents is the official record of the court, of which this court may take judicial notice. The filing dates are therefore readily ascertainable and constitute clear evidence of proper filing.

The First Respondent did not elaborate upon the specific nature of the alleged non-compliance in her submissions. In the absence of any demonstrated contravention of Order 41 Rule 9(2), and given that the affidavits are properly endorsed with the party on whose behalf they are filed and the dates of swearing, and have been duly filed with the Registry as evidenced by the CMS records, this objection must fail and is accordingly dismissed.

The First Respondent contended that the appeal was filed out of time. Order 55A Rule 1(3) of the Rules provides that an appeal must be filed within one month from the date the decision was given or the date the decision was notified to the person appealing, whichever is the later date.

The DB's decision was dated 15 February 2025. The letter notifying the parties of the decision was dated 20 February 2025. The Appellant's solicitors received the decision on 13 March 2025 by way of a "certificate of posting" (Exhibit MAI-6 of Enclosure 5). The Originating Summons was filed on 10 April 2025.

The relevant date for the commencement of the limitation period is the date of notification to the person appealing. The Appellant was notified on 13 March 2025 when the decision was received by his solicitors. The one-month period under Order 55A Rule 1(3) therefore expired on 13 April 2025. The Originating Summons was filed on 10 April 2025, which is within the one-month period. The appeal is therefore not out of time.

This court notes that the First Respondent's reliance on the date of the letter (20 February 2025) as the notification date is misplaced. The Rules refer to the date on which the decision was "notified to the person appealing," not the date on which the decision was sent by the Board. The actual receipt of the decision by the party is the relevant date, as it is only upon receipt that the party is aware of the decision and can meaningfully exercise the right of appeal.

The First Respondent raised two related arguments on this point: first, that the Appellant, as the administrator of the deceased's estate, does not have the capacity to bring this appeal as the Letter of Administration (Form F) does not specifically authorize the filing of such proceedings; and second, that the Appellant was not the "Pengadu" (complainant) in the original disciplinary proceedings.

This court finds these objections to be without merit. The Letter of Administration appointed the Appellant as the administrator of the deceased's estate, which includes the power to take all necessary steps to protect and recover the estate's assets. The complaints before the DB concerned the deceased's property rights and the alleged professional misconduct arising from the handling of the deceased's transactions. The Appellant, as administrator, is the proper person to pursue the appeal on behalf of the deceased's estate.

The fact that the Appellant was not the original complainant does not oust his locus standi to pursue the appeal. The right of appeal under Section 103E of the LPA is available to "any party aggrieved" by the DB's decision. The Appellant, as the administrator of the estate that has a direct interest in the subject matter of the complaint, is clearly a party aggrieved by the DB's decision to dismiss the complaint against the First Respondent.

Having found that the preliminary objections are without merit, the court will now proceed to consider the merits of the appeal.

The Appellant submitted that the First Respondent, as the solicitor who handled the conveyancing transactions and acted as stakeholder for the relevant properties, owed fiduciary duties to the deceased and his father. The Appellant contended that the First Respondent breached these duties by:

Failing to complete the transfer of the remaining commercial lots to the deceased and his father despite full payment having been made;

Failing to act as a neutral stakeholder and protect the interests of all parties, including the deceased;

Entering into a Sale and Purchase Agreement with Tuan Kalthom for the three lots that the deceased had already purchased and paid for, without obtaining the consent of the deceased or his father;

The transfer of the said lots to the First Respondent being inconsistent and irregular, as the Form 14A stated the transfer was "tolak percuma" (without consideration)

The First Respondent having knowledge of the ongoing dispute between Tuan Kalthom, Tengku Harun, and the deceased, yet proceeding with the transfer to herself while the civil suit was pending; and

Charging the properties to Public Islamic Bank Berhad for personal financing.

The Appellant relied on Section 112(1)(a) of the LPA, which prohibits an advocate and solicitor from purchasing "either directly or indirectly an interest or any part of the interest which is the subject matter of his client or that of the other party in the same suit, action or other contentious proceeding." The Appellant contended that the First Respondent, being the stakeholder for the conveyancing transactions, was in a fiduciary position and was therefore prohibited from acquiring the very properties that were the subject of her professional duties.

The Appellant further submitted that the First Respondent's actions constituted "misconduct" under Section 94(3) of the LPA, specifically:

Section 94(3)(c) – dishonest or fraudulent conduct in the discharge of her duties;

Section 94(3)(n) – gross disregard of her client's interests; and

Section 94(3)(o) – conduct unbefitting of an advocate and solicitor or which brings the legal profession into disrepute.

The Appellant argued that the First Respondent, as stakeholder for the properties, similarly held the title documents and was in a position of trust. Her failure to protect the deceased's interests and her decision to acquire the properties for herself were breaches of that trust.

The First Respondent denied any professional misconduct and contended that:

There was no solicitor-client relationship between her firm and the deceased. She was not instructed by the deceased but by Tengku Harun and BDSB. The Sale and Purchase Agreement for the deceased's purchase of PT 506, H.S(M) 377 was prepared on instructions from Tengku Harun, and the deceased had no direct contractual relationship with her firm;

She had no fiduciary duty to the deceased as he was not her client. The only parties she represented were Tengku Harun and BDSB, and subsequently, Tuan Kalthom;

The disputed three lots (Lot 10036, GM 1549; Lot 10037, GM 1550; and Lot 10038, GM 1551) were purchased by her from Tuan Kalthom, who was the registered proprietor at the material time. The purchase was for valuable consideration (RM1,224,000.00), and she was a bona fide purchaser for value without notice;

Suit 75 had resulted in a Judgment in Default against the deceased and his father on 9 February 2015, followed by a Writ of Possession executed on 23 June 2015. This effectively determined that the deceased and his father had no legal interest in the properties; and

The DB was correct in dismissing the complaint against her as there was no evidence of professional misconduct.

The First Respondent relied on the case of Gana Muthusamy v Tetuan Lim Ong & Co [1998] 2 MLRA 208 (CA), where the court emphasized that it is primarily for members of the Bar to determine what amounts to conduct unbecoming of an advocate and solicitor, and that courts must exercise caution when entertaining appeals where the central question is whether particular conduct is unprofessional.

The First Respondent further relied on Majlis Peguam Malaysia v Norsiah Ali [2020] 4 CLJ 149 (CA), where the Court of Appeal held that a solicitor's actions, even if wrongful, may not necessarily amount to professional misconduct if the conduct does not reach the threshold of dishonesty or grave impropriety.

Having carefully considered the submissions and the evidence, this court is of the view that the appeal must be allowed.

At the outset, this court reminds itself that its role in these proceedings is strictly confined to the disciplinary appeal. The court is not determining the substantive property rights between the parties. Those are matters for the civil courts. The court's task is to determine whether the First Respondent's professional conduct fell below the standards expected of an advocate and solicitor, and whether the DB was correct in dismissing the complaint against her.

The court is of the view that the First Respondent's actions constituted a clear breach of her fiduciary duties as a stakeholder and solicitor handling the conveyancing transactions, regardless of the ultimate determination of property ownership in the civil suits.

The First Respondent argued that there was no solicitor-client relationship between her firm and the deceased. This court is unable to accept this contention. The evidence shows that:

The First Respondent's firm prepared Power of Attorney 1, which was the foundational document for the entire development project;

The First Respondent's firm prepared the Sale and Purchase Agreement dated 10 November 2010 between the landowners and the deceased for PT 506, H.S(M) 377;

The First Respondent's firm prepared the Building Contract dated 10 November 2010 between the deceased and BDSB;

The First Respondent's firm was appointed as the stakeholder to hold the title documents and to oversee the transfer process; and

The deceased made full payment for the properties, which was within the knowledge of the First Respondent's firm.

The fact that the First Respondent may not have been directly instructed by the deceased does not absolve her of her professional duties. A solicitor acting as a stakeholder is in a position of trust not only to the party who gave instructions but also to all parties whose interests are affected by the transaction. When the deceased made payments and entered into agreements prepared by the First Respondent's firm, the First Respondent implicitly undertook duties to act in good faith and to protect the legitimate interests of all parties. The First Respondent’s Defences

The First Respondent placed significant reliance on the Judgment in Default obtained against the deceased and his father on 9 February 2015 in Suit 75, and the subsequent execution of the Writ of Possession on 23 June 2015, to argue that the deceased and his father had no legal interest in the properties. This court finds this argument to be without merit.

The Judgment in Default was set aside by Ahmad Bin Bache JC (as His Lordship then was) on 28 March 2016. On 16 November 2016, Tuan Kalthom withdrew Suit 75, and the same Judicial Commissioner struck out the action with no liberty to file afresh. The effect of these events is that the proceedings were effectively a nullity. The deceased and his father cannot be said to have been finally determined as having no interest in the properties. The First Respondent's reliance on a judgment that was subsequently set aside is therefore misplaced and cannot justify her acquisition of the properties.

More significantly, the First Respondent's conduct must be viewed in light of the chronology of events. At the time Power of Attorney 2 was issued on 25 June 2015, the deceased and his father had, on that very day, filed applications to set aside the Judgment in Default and to stay execution. By 11 October 2015, while those applications remained unresolved, the First Respondent had already secured financing from Public Islamic Bank Berhad, effectively committing herself to the purchase. On 13 October 2015, with the applications still pending, she entered into the Sale and Purchase Agreement. Finally, on 19 October 2015, while the deceased and his father were still pursuing their challenge, she registered the Form 14A and completed the transfer of the properties into her name. At every critical juncture i.e. securing financing, signing the agreement, and registering the transfer, the First Respondent pressed forward with her scheme, undeterred by the unresolved litigation. This persistent and calculated pursuit of her own interests, in the face of ongoing legal proceedings that directly concerned the very properties she was acquiring, demonstrates a clear and flagrant breach of her fiduciary duties. A stakeholder in her position was duty-bound to remain neutral and to await the final determination of the dispute. She did the opposite.

The court also takes note of the Statement of Claim filed in Suit 16, which corroborates the Appellant's narrative. The Plaintiffs in that suit – which include the deceased – specifically pleaded that the First Respondent had breached her duties as a solicitor and stakeholder, had wrongfully transferred the properties to herself, and had acted in a manner that constituted a breach of trust. The Plaintiffs also pleaded that the Second Respondent had conspired with the First Respondent by preparing Power of Attorney 2. While this court is not determining the civil suit, the Statement of Claim in Suit 16 reinforces the consistency and credibility of the Appellant's case and demonstrates that the issues raised are not merely afterthoughts but have been the subject of ongoing legal proceedings.

The First Respondent placed reliance on Power of Attorney 2 dated 25 June 2015 to justify her acquisition of the properties. This court is unable to accept that reliance. The validity of Power of Attorney 2 is itself shrouded in doubt. The witness signature of Norazira binti Che Hak was disputed, and she lodged a police report on 7 January 2020 alleging forgery.

The forensic examination was conducted at the request of the Second Respondent’s firm, which also furnished the specimen signatures. The report produced only qualified findings: the first signature was "probably" written by Norazira, while the possibility of the second being written by her "could not be ruled out." Critically, the examiner qualified both conclusions with the phrase "due to limited contemporaneous specimens" – a limitation directly attributable to the samples provided by the Second Respondent’s firm. This is not a definitive exoneration; it is a qualified opinion constrained by the very material furnished by the party requesting the examination. The First Respondent cannot elevate these inconclusive findings into conclusive proof of authenticity.

The First Respondent's assertion that the forensic report "proven" the allegation to be "untruth and malicious" is a gross overstatement unsupported by the report's language. In any event, even if Power of Attorney 2 was valid, it did not authorise the First Respondent to breach her fiduciary duties. A stakeholder cannot use a power of attorney obtained from one party to defeat the rights of another party whose interests she was duty-bound to protect.

The First Respondent was appointed as the stakeholder to hold the original documents, including the Form 14A for the transfer of the commercial lots. This is a fiduciary role. As held in Datuk M. Kayveas & Anor v Bar Council [2013] 7 CLJ 533 (FC), a stakeholder holds funds or documents as a trustee and is not merely a contractual agent. The breach of a stakeholder's duty is a breach of trust and constitutes professional misconduct. The court in that case stated: “[31] …. When solicitors hold funds as stakeholders, they hold those funds as trustees and not in a contractual or quasi-contractual capacity (see Alimand Computer Systems Ltd v Radcliffes & Co, (1991) Times, 6 November, QBD). ‘If an estate agent or solicitor, being duly authorised in that behalf, receives a deposit ‘as stakeholder’, he is under a duty to hold it in medio pending the outcome of a future event. He does not hold it as agent for the vendor, nor as agent for the purchaser. He holds it as trustee for both to await the evidence: see Skinner v The Trustee of Property of Reed and Others [1967] 2 All ER 1286 at p 1287[1967] Ch 1194 at p 1200) per Cross J. Until the event is known, it is his duty to keep it in his own hands; or to put it on deposit at the bank …’ (Burt v Claude Cousins & Co Ltd [1971] 2 QB 426 per Lord Denning MR in his dissenting judgment, which statement of the law was accepted by the House of Lords in Sorrell v Finch [1977] AC 728, and referred in Kuldip Singh v Lembaga Letrik Negara & Anor, Dato Seri Au Ba Chi v Malayan United Finance Bhd & Anor and OCBC Bank (Malaysia) Bhd v Lee Lee Fah & Ors and another appeal, amongst others). ‘Once a solicitor holds money in trust for his client or any other party for a purpose, it does not matter whether the amount is sufficient to be utilised for that purpose. The money remains to be in trust’ (Selvaratnam a/l Vellupillai v Dr Jayabalan Karrupiah [2009] 1 MLJ 794 per Zaki Azmi CJ, delivering the majority judgment of the court). Therefore, it is beyond argument that a stakeholder is a trustee and that the breach of a stakeholding term is not just a breach of undertaking but also a breach of trust. [32] And ‘failure to honour an undertaking is prima facie evidence of professional misconduct …’ (Butterworth’s Corderey on Solicitors para 903). The breach of an undertaking has also been variously held as grossly improper conduct (Law Society of Singapore v Lim Kiap Khee), as misconduct (Corderey on Solicitors (8th Ed), at p 319), and as conduct unbefitting an advocate and solicitor (Au Kong Weng v Bar Committee, Pahang [1980] 2 MLJ 89).”

In addressing a previous complaint initiated by Tengku Harun to the DB, the First Respondent's own letter dated 6 November 2016 (Part B of First Respondent’s Written Submission in Enclosure 17 & Exhibit FAZ-10 of Enclosure 4) reveals that she had taken sides in the dispute. In that letter, she expressly stated that she had "helped" Tuan Kalthom, "protected" Tuan Kalthom, and issued notices against the deceased and his father on Tuan Kalthom's instructions.

More tellingly, the First Respondent admitted that she had assisted Tuan Kalthom in completing the construction of the houses that BDSB and Tengku Harun had failed to complete. She explained that Tengku Harun was dissatisfied with her precisely because she had helped Tuan Kalthom. This admission is significant. It shows that the First Respondent was not merely a stakeholder holding documents in trust; she was actively involved in the physical completion of the very project at the heart of the dispute. By so doing, she stepped beyond the boundaries of her role as a stakeholder and became a participant in the dispute itself. Her personal involvement inevitably coloured her judgment and led her to view the matter not as a neutral custodian, but as an ally of Tuan Kalthom. A stakeholder who becomes entangled in the underlying dispute cannot remain impartial, and the First Respondent's conduct in this regard constitutes a clear breach of her fiduciary duties.

The evidence reveals that the First Respondent failed to perform her stakeholder duties in four critical respects: she held the Form 14A signed by Tuan Kalthom for the transfer of the commercial lots; she knew that the deceased and his father had paid for the lots and were entitled to the transfer; instead of completing the transfer to the deceased, and she became the ultimate recipient of three of the four lots.

This court is of the view that the First Respondent's conduct fell far below the standard expected of an advocate and solicitor. A solicitor in the position of stakeholder must remain neutral and must not allow personal sympathies or a desire to assist one party to override her duty to protect the interests of all parties. By her own admission, the First Respondent aligned herself with Tuan Kalthom, effectively abandoning her role as a neutral custodian. Good intentions do not cure a breach of fiduciary duty. The law does not permit a fiduciary to favour one party over another, regardless of motive. She did not await the final determination of the litigation; she pressed forward with her scheme while the deceased and his father were actively challenging the Judgment in Default. The fact that she acquired the properties while holding the documentation for the transfer to the deceased, and did so with remarkable speed and deliberation, constitutes a fundamental and egregious breach of her fiduciary duties.

This court finds that the First Respondent's purchase of the three lots fell within the prohibition under Section 112(1)(a) of the LPA, which provides: "112. (1) Except as expressly provided in any written law, or by rules made under this Act, no advocate and solicitor shall—

purchase or agree to purchase either directly or indirectly an interest or any part of the interest which is the subject matter of his client or that of the other party in the same suit, action or other contentious proceeding brought or to be brought or maintained."

This provision is designed to prevent solicitors from taking advantage of their position to acquire interests in matters where they act professionally. It would be absurd to hold that the First Respondent could be the solicitor who prepared the agreements and acted as stakeholder, but was not bound by this prohibition when acquiring the very properties that were the subject of the transaction.

This court finds that the First Respondent's actions were not bona fide. The stark inconsistency between the Sale and Purchase Agreement (RM1,224,000.00) and the Form 14A ("tolak percuma") raises serious questions about the regularity of the transaction. Her failure to explain this discrepancy reinforces the inference of irregularity and an intent to defeat the deceased's interests.

Compounding this, she exploited a temporary procedural advantage – the Judgment in Default and Writ of Possession – while knowing that the deceased and his father had immediately challenged it. She did not await the outcome; she moved with haste to secure the properties for herself.

Critically, she had also admitted to assisting Tuan Kalthom in completing the construction of the houses, thereby immersing herself in the very dispute she was supposed to neutrally oversee. Her personal involvement and alignment with Tuan Kalthom compromised her judgment and led her to favour one party at the expense of another. A fiduciary may not profit from a procedural windfall while substantive rights remain in dispute, nor may she allow personal allegiances to override her professional duties.

The DC, after examining the evidence, found that the First Respondent had liability and recommended a penalty of suspension for two years and a fine of RM10,000.00. The DB, however, rejected this finding and dismissed the complaint, ordering as follows: “In the exercise of the powers conferred by Section 103D of the Legal Profession Act 1976 (the Act), the Disciplinary Board having on 15 February 2025, considered the report made by the Disciplinary Committee on the complaint against the Respondent, rejected the Disciplinary Committee’s finding of liability and its recommendation on punishments for suspension of two (2) years and a fine of Ringgit Malaysia Ten Thousand (RM10,000.00), instead IT IS HEREBY ORDERED pursuant to Section 103D(3) of the Act that the complaint against the Respondent be dismissed.”

Section 103D of the LPA governs the DB's powers upon receiving the DC's report. Subsection (1) empowers the DB to affirm or reject the DC's finding or recommendation, but mandates that the DB "shall record the reason for the rejection" if it chooses to do so. Subsection (2) allows the DB to impose a different penalty, while subsection (3) permits the DB to make such other order as it deems just. Subsection (4) requires the DB to afford the advocate and solicitor an opportunity to be heard before making an adverse order.

The requirement under Section 103D(1) to record reasons is not a mere formality; it is a statutory imperative that serves two important purposes. First, it ensures transparency and accountability in the DB's decision-making process. Second, it safeguards the right of appeal under Section 103E of the LPA, as an appellant cannot effectively challenge a decision without knowing the basis upon which it was made. This is especially critical where the DB departs from the DC's findings and recommendation, as the appellant is entitled to understand the rationale for the departure.

This court is guided by the principles set out in Gana Muthusamy v. Tetuan Lim Ong & Co (supra), where the court held that: "It is primarily for members of the Bar to decide what amounts to conduct unbecoming of an advocate and solicitor in particular circumstances, according to standards established by members of that honourable profession. Courts must necessarily exercise caution when entertaining an appeal in which the central question is whether particular is unprofessional and cases meriting crucial interference will be rare."

However, the DB's decision cannot be sustained. The DC had before it substantial evidence of irregularity: the glaring inconsistency between the Sale and Purchase Agreement (RM1,224,000.00) and the Form 14A ("tolak percuma"), the First Respondent's failure to discharge her duties as a stakeholder, the haste with which she executed her scheme (from Power of Attorney 2 to registration of transfer in just 116 days), and her own admission that she had assisted Tuan Kalthom in completing the construction while simultaneously acquiring the properties for herself. These factors point to a possible motive – the First Respondent, having aligned herself with Tuan Kalthom, stood to benefit personally from the transaction. Yet the DB, without any reasoned justification, dismissed the complaint and effectively endorsed this conduct.

In the absence of any reasoned justification, the DB's decision is irrational and perverse in the Wednesbury sense (Associated Provincial Picture Houses Ltd. v Wednesbury Corporation [1948] 1 KB 223 (CA)). A decision that ignores compelling evidence, violates a statutory requirement to provide reasons, and offers no explanation for doing so cannot be allowed to stand. This court therefore finds that the DB's decision was both procedurally flawed and substantively irrational. The appeal must be allowed, and the DC's findings and recommendations restored.

For the reasons set out above, this court finds that the First Respondent committed professional misconduct by:

Breaching her fiduciary duties as a stakeholder and solicitor;

Acquiring properties for herself that were the subject of the conveyancing transaction in which she acted professionally, in violation of Section 112(1)(a) of the LPA;

Failing to protect the interests of the deceased and his father, who had paid for the properties;

Failing to act with honesty, transparency, and integrity in the discharge of her professional duties; and

Engaging in conduct that brings the legal profession into disrepute.

The actions of the First Respondent constitute a grave breach of the trust that clients and the public place in the legal profession. Solicitors are expected to act with the highest standards of honesty and integrity, yet the First Respondent exploited her position to acquire properties that were the subject of her professional duties. Her conduct falls far short of these standards and cannot be countenanced.

Accordingly, this court makes the following orders:

The appeal by the Appellant against the decision of the Advocates and Solicitors Disciplinary Board dated 15 February 2025 in respect of Complaint No. DC/21/0452 is allowed;

The decision of the Advocates and Solicitors Disciplinary Board dated 15 February 2025 dismissing the complaints against the First Respondent is set aside;

The findings of the Disciplinary Committee that the First Respondent has liability for professional misconduct are hereby restored;

The matter is remitted to the Disciplinary Board for the necessary process before an appropriate penalty is imposed on the First Respondent, having regard to the findings of this court and the recommendations of the Disciplinary Committee; and

Costs of RM4,000.00 are payable by the First Respondent to the Appellant, subject to allocator. Dated: 13 July 2026 Yusrin Faidz Bin Yusoff Judge High Court of Malaya Kuala Terengganu Counsel for the Appellant: Zahari Affendi Bin Abdul Kadir (together with Iffah Jalilah Binti Ithnin @ Jasmin) Messrs Zahari Affendi & Partners Suite D-20-04, Jalan Atmosphere 7, The Atmosphere, 43300 Seri Kembangan, Selangor Darul Ehsan. Counsel for the First Respondent: Nor Atikah Binti Ibrahim Messrs Salina Fazilawati & Co. 3512-E, Tingkat 2, Jalan Sultanah Zainab, 14050 Kota Bharu, Kelantan Darul Naim. CASE REFERENCE:

Sova Sdn Bhd v Kasih Sayang Realty Sdn Bhd [1988] 2 MLJ

Lt Kdr V Balakrishnan v Menteri Pertahanan Malaysia & Satu Lagi [1993] MLJU 605 (HC).

Ching Suet Yeen v Mageswaran Rajangom & Ors [2025] 3

Saraswathy Devi a/p Nadchatiram v Vijayalakshmi Devi a/p Nadchatiram [1998] 1 MLJ 89 (CA).

Gana Muthusamy v Tetuan Lim Ong & Co [1998] 2 MLRA 208

Majlis Peguam Malaysia v Norsiah Ali [2020] 4 CLJ 149 (CA).

Datuk M. Kayveas & Anor v Bar Council [2013] 7 CLJ 533

Associated Provincial Picture Houses Ltd. v Wednesbury Corporation [1948] 1 KB 223 (CA).

Sections 94(3)(c), 94(3)(n), 94(3)(o), 103C(1)(c)(ii) & (iii), 103D, 103E, & 112(1)(a) of the Legal Profession Act 1976.

Order 41 Rule 9(2), Order 55A Rule 1, & Order 94 Rule 2(3) of the Rules of Court 2012.

Section 3 of the Courts of Judicature Act 1964.