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DISPUTE RESOLUTION
NG SIEW LAN v JOHN LEE TSUN VUI & ANOR [2017] 2 CLJ 245
A solicitor has a duty not to act in a position of conflict of interest. The issue before the Federal Court was whether it was incumbent on a solicitor to disclose material facts which may affect the decision of his client at the time of the execution of a disclaimer by the solicitor’s client.
Facts
The plaintiff in this case retained the first defendant, a lawyer and partner in the second defendant's law firm (the first defendant and the second defendant are collectively referred to as “the solicitors”), to represent her in a sale and purchase transaction for a purchase of a piece of land and to prepare all the necessary documentation. The plaintiff paid the purchase price in full upon signing the sale and purchase agreement (“SPA”).
Despite being instructed by the plaintiff, the solicitors did not make the application to transfer the land. Unbeknown to the plaintiff, while the solicitors were acting for her, they were also acting for a company called NCT Forwarding & Shipping (Sabah) Sdn Bhd ("NCT") which was desirous of buying the same land. Subsequently, the plaintiff and the third defendant (as attorney to deal with the land on behalf of the registered owner) jointly signed a letter of disclaimer discharging the second defendant from "all liabilities or responsibilities" under the SPA.
Decision
The Federal Court prevented the solicitors from relying on the letter of disclaimer for two reasons. First, by acting for both the plaintiff and NCT, the solicitors had placed themselves in a situation of conflict of interest. It was imperative for the solicitors to disclose this material fact to the plaintiff and the solicitors failed to do so. The Federal Court emphasised the well-established principle that where a solicitor is placed in that position, he has a duty to inform his client that he acts as a common solicitor for the parties in the transaction and to advise the client on the risk related thereto.
Second, despite being instructed in writing by the plaintiff to apply to the land office for permission to transfer the land, the solicitors failed to do so. Such conduct was tantamount to “misrepresentation by silence” and the solicitors had clearly acted in breach of their contractual and fiduciary duties to the plaintiff.
For further information regarding dispute resolution matters, please contact
Datin Jeyanthini Kannaperan
jeyanthini@shearndelamore.com
Robert Lazar
rlazar@shearndelamore.com
FINANCIAL SERVICES
Changes to Up-Tick rule for Regulated Short Selling and Additional purpose for securities borrowing under the Negotiated Transactions Framework
With effect from 27 February 2017:
- For regulated short selling ("RSS") orders, order price must be at prevailing best ask/selling price or higher (the "Up-Tick Rule"). In the event of a circuit breaker (as defined in the rules of Bursa Malaysia Securities Berhad), upon resumption of trading, the execution of RSS orders must comply with the Up-tick Rule where the order price must be higher than the Last Done Price or Reference Price (each as defined in the rules of Bursa Malaysia Securities Berhad).
- the purposes for which an approved securities borrowing and lending negotiated transaction ("SBLNT") borrower may borrow securities were expanded by the inclusion of “to facilitate the settlement of a sale of eligible securities where there are no securities or insufficient securities in the securities account of the seller as will enable the seller to meet its delivery obligations to the purchaser in accordance with the rules of Bursa Malaysia Securities Berhad relating to delivery and settlement ('potential failed trade') as a result of a mistake howsoever made when executing the sale provided always that the mistake was made in good faith and discovered only after the sale has been executed”. The relevant Approved SBLNT borrower which borrowed for this purpose must return the loaned securities within the time prescribed by Bursa Malaysia Securities Clearing Sdn Bhd.
For further information regarding financial services matters, please contact
Christina S C Kow
christina@shearndelamore.com
Pamela Kung Chin Woon
pamela@shearndelamore.com
INTELLECTUAL PROPERTY
Malaysia and the Madrid Protocol — coming Soon
The Malaysian Government’s commitment and emphasis in the protection and enforcement of Intellectual Property ("IP") can be seen through the introduction of legislative reform, government enforcement initiatives and the creation of IP policies and incentives. IP laws in Malaysia are regularly reviewed and updated in order to conform with international standards and practices. In line with this, Malaysia is in the process of amending its trade mark laws in order to incorporate provisions for acceding to the Madrid Protocol.
Expanding business ventures, economic growth and globalisation have resulted in the need to expand trade mark protection beyond geographical boundaries and to an extent worldwide. Currently, trade mark registration outside Malaysia is carried out by filing individual national registrations whereby trade mark owners are confronted with varying trade mark practices of each country. Once Malaysia becomes a designated country under the Madrid Protocol, Malaysian brand owners who have international presence will be able to take advantage of filing International Registrations through the Madrid Protocol which is a mechanism that offers a cost effective route to trade mark protection in more than 90 countries in one single procedure, using one language and paying only one set of fees.
The Madrid Protocol offers potential advantages including cost savings, streamlined administration through central filing of renewals and recordals and the reduction of formality requirements such as the submission of Power of Attorneys. However, the Madrid system is not without its complications and vulnerabilities. One of the more serious limitations of the Madrid Protocol system is the risk of "central attack". This occurs when a basic application, which an International Registration ("IR") is based on, becomes abandoned or cancelled anytime during the first five years of an IR. In such a situation, all the foreign applications and registrations that are dependent on the IR will automatically be cancelled. These registrations can however be transformed/converted into national marks but with additional expense. Another limitation is that the owner of an IR under the Madrid Protocol would not be able to assign/transfer the rights of the trade mark to an owner who is not a member of the Madrid Protocol.
Understanding the Madrid system and in particular its limitations and particularities is crucial when deciding on the right filing strategy for acquiring trade mark protection in multiple jurisdictions. The nature and strength of the mark, the number of countries that are being designated and the need to vary the mark and the goods/services based on the peculiarities of the countries/regions concerned are factors which would need to be taken into account before deciding whether to use the Madrid system.
For the above reasons, brand owners would need to weigh up the cost-efficiency and benefits of using the Madrid Protocol system against individual national filings as in all cases, adopting a one-size-fits-all filing strategy for trade mark protection may not always be the right solution.
For further information regarding intellectual property law matters, please contact
Karen Abraham
karen@shearndelmore.com
Indran Shanmuganathan
indran@shearndelamore.com
TAX & REVENUE
GOODS AND SERVICES TAX ("GST")
The General Guide revised as at 25 January 2017 has been withdrawn and replaced with the General Guide as at 13 February 2017.
The revised versions of the following Specific Guides have also been published on the Royal Malaysian Customs Department’s GST website:
- Employee Benefit (revised as at 23 January 2017);
- Free Zone (revised as at 1 January 2017); and
- Supply (revised as at 13 February 2017).
CUSTOMS DUTY
The Customs Duties Order 2017 has been gazetted on 3 January 2017 and it will come into operation on 1 April 2017.
For further information regarding tax and revenue law matters, please contact
Goh Ka Im
kgoh@shearndelamore.com
Anand Raj
anand@shearndelamore.com
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