Recently, the High Court of Sabah & Sarawak in the case of Tekun Cemerlang Sdn Bhd v Vinci Construction Grands Project Sdn Bhd [2021] MLJU 466 has granted a stay of adjudication proceedings on the grounds that the solicitor firm which represented the Defendant is not Sabah Advocates. Although the Court has expressly cautioned that it makes no findings that Sabah advocates have the right to represent parties in adjudication proceedings to the exclusion of other professionals such as architects, engineers, or quantity surveyors1 , the said decision prompted a bigger question of whether advocates under the Advocates Ordinance (Sabah Cap. 2) or Legal Profession Act 1976 have the exclusive right to represent for parties in adjudication proceedings.
Facts of the case
Plaintiff is a company having its registered and business address at Sabah, whereas, Defendant is a company having its registered office at Kuala Lumpur. When a payment dispute arose between the parties out of a contract for construction works in Sabah, Defendant has through a law firm (“the Firm”) in Kuala Lumpur served a Payment Claim on the Plaintiff under the Construction Industry Payment & Adjudication Act 2012 (“CIPA Act”). Adjudication proceedings were subsequently initiated by a Notice of Adjudication issued by the Firm and an Adjudicator in Sabah was appointed by the Kuala Lumpur Regional Centre for Arbitration (KLRCA)[now known as Asian International Arbitration Centre (AIAC)].
After the Adjudication Claim was served, the Plaintiff filed the action in High Court seeking to stay the Adjudication proceedings on the ground that the Firm is an unauthorized person under Section 15 of the Advocates Ordinance (Sabah Cap. 2)2, are non-members of the Sabah bar and that it is illegal for the Firm to represent the Defendant in the Adjudication proceedings.
Plaintiff’s Argument
Plaintiff contended that the Adjudication proceedings is a Sabah proceeding. Hence, Sabah Advocates have the exclusive right to legal practice in cases arising in Sabah “in and outside” Courts3. The Firm is an unauthorized person under Section 15 of Advocates Ordinance and therefore, it is unconstitutional and illegal for the Firm to represent the Defendant in the Adjudication proceedings.
Defendant’s Argument
Defendant argued that the exclusive right under the Advocates Ordinance is territorial. The Firm has not performed its task in Sabah as there was no requirement given by the Adjudicator to have the adjudication proceeding physically heard, or witnesses to be called and for site visits in Sabah.
More importantly, Defendant contended that Section 8(3) CIPA Act4 confers rights to the parties to freely appoint any representation of their choice. Under Section 16(2) Advocates Ordinance, Section 16(1) Advocates Ordinance has no application.
Court’s Findings
The Court held inter alia, the following: –
- What amounts to “practice as an advocate” can be inferred from the acts that were prohibited to be carried out by an unauthorized person as set out in Section 16(1) of the Advocates Ordinance;
- Section 16(1) of the Advocates Ordinance is not an exhaustive list;
- The Court followed previously decided cases which held that foreign lawyers are prohibited to represent parties in arbitration proceedings5;
- The Firm has been practicing in Sabah in the adjudication proceedings because all elements (i.e., contracts, project works were carried out in Sabah, and the Adjudicator was appointed in Sabah). The matter is within the territorial jurisdiction of the High Court in Sabah and Sarawak.
- Section 8(3) of CIPA Act only gives liberty to a party to choose between self-representation or to be represented by another. It does not give a party a right to representation by another person which is prohibited by laws.
Exclusive Right of Advocates & Solicitors for representation in Adjudication proceedings
The learned judge has held the following at paragraph 47 of the grounds of judgment: –
“Considering the nature of claims of the Defendant in the adjudication proceedings, apart involving the technical assessment of the construction works allegedly carried out and assessment of the value thereof requiring skills of the professions such as architects, engineers and quantity surveyors in the building construction, they also require legal knowledge and advice in respect of the application and effect of the provisions of the contract made between parties relating to the legal rights and obligations thereunder and also the knowledge and if not, advice on legal requirements under the provisions of the CIPAA which functions, advocates customarily and habitually were providing.”
The learned judge has rightly held that the adjudication proceeding requires not only technical knowledge but also legal knowledge. The representative for a party in adjudication proceedings is expected to advise parties as to their rights and liabilities under the contract, drafting of documents for purpose of adjudication proceedings, tendering evidence for consideration of the adjudicator, and making submissions on facts and laws to the adjudicator. All these are acts are customarily within the function and responsibility of an advocate & solicitor.
This leads us to Section 37 of the Legal Profession Act 1976 which provides that it is an offence for an unauthorized person to perform the acts listed under the section. Particularly, Section 37(2A) of the Act which was introduced in the year 20146 provides that: –
“Any unauthorized person who does or solicits the right to do any act which is customarily within the function or responsibility of an advocate and solicitor, including but not limited to advising on law, whether Malaysian or otherwise, unless he proves that the act was not done for or in expectation of any fee, gain or reward, shall be guilty of an offence under this subsection.”
Although Section 8(3) of CIPA Act allows a party to adjudication proceedings to be represented by “any representative” appointed by the party, such appointment must conform with the existing laws. Hence, unless the representative represents the parties on a pro bono basis, the act of such representatives clearly runs foul to Section 37 Legal Profession Act and therefore, be illegal.
Conclusion
It is submitted that by virtue of Section 37 Legal Profession Act, advocates & solicitors shall have the exclusive right to represent parties in adjudication proceedings. The only exception is when the act was not done for or in expectation of any fee, gain, or reward. This is so bearing in mind the objective of the Legal Profession Act is to protect the public from the claim of legal services from unauthorized person. More importantly, it sets out rules and regulations to protect the public and for the solicitors to account for money received from clients as well as from the settlement of the disputes.
1 Paragraph 68 to 70 of the Judgment
2 Section 15(1) provides that: “subject to the provisions of this Ordinance, no person shall practice as an advocates or do any act as an advocates unless his name is on the roll and he has a valid certificate to practice authorizing him to do the act”.
3 Federal Court case of Samsuri bin Baharuddin & Ors v Mohamed Azahari bin Matiasin and Another Appeal [2017] 2 MLJ 141
4 Section 8(3) CIPA Act provides: “A party to the adjudication proceedings may represent himself or be represented by any representative appointed by the party”.
5 Turner (East Asia) Pte Ltd v Builders Federal (Hong Kong) Ltd & Anor [1988] 2 MLJ 280; Samsuri bin Baharuddin & Ors v Mohamed Azahari bin Matiasin and Another Appeal [2017] 2 MLJ 141
6 Legal Profession Act (Amendment) 2012, [PU(B) 262/2014]
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