JUDGMENT

Collin Lawrence Sequerah JCA:

A) Introduction

[1] This appeal raises matters which are of critical importance to the legal profession in that it concerns the issue of whether a person who acts on behalf of an entity to appoint external legal counsel and performs functions normally associated with an in-house legal counsel for that entity, can claim the benefit of the fruits of litigation in the form of consultancy fees on a contingency basis in the event of a successful outcome of the litigation, whether in respect of a matter resolved favourably in court or by way of an out of court settlement.

[2] Consequently, this appeal also determines whether there results from the above factual matrix, a contravention of s 37 and/or s 40 of the Legal Profession Act 1976.

B) Pertinent And Material Facts

[3] The Appellant is an Advocate and Solicitor of the High Court of Malaya and practices at the law firm named Bhavanash Sharma in Kuala Lumpur.

[4] The Respondent is not an Advocate and Solicitor qualified under the Legal Profession Act 1976 ("LPA").

[5] A company named Martech Consultants ("Martech") appointed the Respondent as a "consultant" in respect of a debt recovery dispute that the former had with a company known as E-Pay.

[6] The Respondent's appointment with Martech was on the following terms, amongst others:

(1) Martech agreed to pay a total sum of RM20,000.00 as an upfront retainer fee and 10% of any sum recovered from E-Pay in the dispute;

(2) The Respondent was required to recommend and appoint solicitors to act on behalf of Martech in the debt recovery suit; and

(3) The Respondent would settle the legal fees of the lawyers appointed for Martech in the suit from the sums agreed in (1) above.