Purchasers can name own solicitors
NST 21/11/2005

WE wish to clarify several matters raised by Charles Hector (NST, Nov 8).

Firstly, the Real Estate and Housing Developers’ Association (Rehda) Malaysia is an association of developers, and not real estate agents.

The latter are represented by the Malaysian Institute of Estate Agents.

Secondly, Rehda wishes to state that prior to the enforcement of the "No Discount Rule", discounts provided by solicitors were based on solicitors’ own competitiveness in running their firms taking into consideration the volume of conveyancing work from a particular project.

Rehda’s objections to the "No Discount Rule" under the Solicitors’ Remuneration Order is predicated on the view that healthy competition within the legal profession is good for the consumer and should not be stymied under the guise of claims of professional undercutting.

For primary housing transactions between purchasers and developers, the case for the "No Discount Rule" is especially not justified since such transactions are governed strictly by a standard sale and purchase agreement prescribed under the Housing Development (Control & Licensing) Act 1966 (Act 118) & Regulations, where the requirement for the solicitor’s input is to check purchaser’s particulars.

There is no requirement for the solicitor’s professional expertise in drafting or negotiating the terms and conditions of the S&P agreement for primary housing transactions.

There are serious implications in Hector’s conclusions about declining legal professional standards arising from discounts given by solicitors.

If this was indeed true, Rehda wishes to question the professional integrity of solicitors who provided such discounts.

Does a solicitor, as a professional, not owe a certain duty of care and professional standard to his client, be it the purchaser or the developer, whether or not discounts are given?

Rehda would like to clarify that developers in making available a list of solicitors and financiers for purchasers to choose from does not in any way deny purchasers of their right to appoint solicitors of their own choice.

Purchasers are not discouraged from appointing their own solicitors.

Developers provide a list of available solicitors to purchasers to help those who may not have solicitors of their own choice.

Once the solicitor is appointed by the purchaser, the purchaser pays his legal fees only, and not that of the developer, as claimed by Hector.

In fact, it is common for developers to absorb the solicitor’s fees for the S&P agreement as an incentive to the purchaser.

In the instance quoted by Hector where the solicitor is not keen to pursue late delivery charges for his client, Rehda would suggest that the purchaser seek recourse against the solicitor and take the matter up with the Bar Council.