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JOHOR BAHRU: Last week, on January 17 and 18, 2008, seven members from the Solicitors Remuneration Enforcement Committee (SREC) visited 4 legal firms in Johor Bahru, to verify information contained in the firms’ returns for 2005 and 2006 transactions.

One team was led by SREC Chairman Haji Asmadi Awang who was assisted by Haji Abdul Murad Bin Che Chik, Puan Zalina Abidin and Anuwar Bin Mohd, and another team was led by Tony Woon who was assisted by Ms. Helen Ng Soong Ling and Ms. Sumathi Murugiah.

When contacted, team leader Asmadi Awang commented that in one firm, his team noted that the files in the return submitted to the Bar Council were only for transactions relating to discharge of charge and perfection of charge. His team will investigate further on why no sale and purchase or loan transactions were reported in the return, as the firm which they visited are reputed conveyancing lawyers and are on the panel of a major foreign bank with a branch in Johor Bahru.

In the other firm, Asmadi Awang said that all files examined by his team contained evidence of overcharging of disbursements and the partner in charge also admitted to such overcharging. The team advised the firm to return to the respective clients all unused disbursements, without prejudice to any disciplinary action that may be taken against the firm, and the firm agreed to do so.

Team leader, Tony Woon, commented that in one firm his team uncovered many instances of overcharging of disbursements averaging RM300-RM500 per file. Also, disbursements which were not utilised were not refunded to the client and were instead, paid into the firm’s office account.

In another firm, Tony Woon said that the partner in charge admitted that, for transactions under the Housing Development (Control & Licensing) Act 1966, the firm was paid only RM500 by the developer for each transaction. For loan transactions, the partner in charge admitted that the firm did not collect full scale fees. In addition, unused disbursements averaging RM300 per file were not refunded to the client and still remained in the client account even though the matter had been completed for quite some time.

What was alarming to the team was that the partner in charge admitted that, in connection with some loan transactions where the firm acted for a bank, the firm had paid commissions to an employee of the bank. In one transaction, the firm paid a commission of RM700 to an agent. These commissions were paid directly from the firm’s client account.

Both team leaders will be submitting a full report of their visits to the SREC at its next meeting, for a decision on the next course of action.

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