LAURENTIUS VAN KESSEL, THROUGH HIS ATTORNEY JAYAWICKRAMA v. SHOBHA SAMARAT

014-SLLR-SLLR-2002-V-2-LAURENTIUS-VAN-KESSEL-THROUGH-HIS-ATTORNEY-JAYAWICKRAMA-v.-SHOBHA-SAMARAT.pdf


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Laurentius Van Kassel, through His Attorney Jayawicrama v.Shobha Samaratunga and Another, Attorneys-at-Law
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LAURENTIUS VAN KESSEL,THROUGH HIS ATTORNEY JAYAWICRAMAv.
SHOBHA SAMARATUNGA AND ANOTHER,ATTORNEYS-AT-LAW
SUPREME COURTPERERA, J.
BANDARANAYAKE, J. ANDEDUSSURIYA, J.
SC RULE NO. 6/99 (D)
FEBRUARY 26 AND 27. 2001MARCH 05, 13, 19 AND 28, 2001MAY 25, 2001
Attorney-at-law – Misappropriation of money entrusted for specific purposes -Deceipt and / or malpractice – Section 42 of the Judicature Act, No. 2 of 1978.
The complainant, a German national, sought the services of the two respondentsAttorneys-at-law, inter alia, to purchase lands in Sri Lanka. The complainantestablished contact with the respondents with the help of one Indralal Perera whohad been working with him in Abu Dhabi. The 1st respondent was at the materialtime in 1990-1991 an Attorney-at-law of about 3 years' experience working asa junior under the 2nd respondent, an Attorney-at-law who had been practisingfrom about 1969. The respondents located two lands. They represented that theprice of the first land would be Rs. 880,000 and the second land with a housewould cost Rs. 725,000. The complainant also selected a quantity of antiquefurniture priced at Rs. 215,000 according to the seller.
Pursuant to the said arrangement it was agreed that the complainant should remitfunds for encashment by the 1st respondent at Deutsche Bank in Colombo tofinance the contemplated purchases. Accordingly, between January and May, 1991,the complainant remitted a sum of DM 98,000 which the 1 st respondent encashed.This amount was approximately Rs. 2,500,000. Those monies were admittedlyhanded over to the 2nd respondent by the 1st respondent.
The first land was sold by the owner to Indralal Perera for a sum of Rs, 320,000only, paid by the 2nd respondent, on a deed attested by the 1st respondent.Regarding the second land, its price was in fact Rs. 525,000 and not Rs. 725,000.The respondents paid two advances of Rs. 25,000 and Rs. 75,000 for that landbut nothing more, with the result that the complainant had to pay a sum of
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Rs. 450,000 to complete the purchase having had to forfeit the advance ofRs. 215,000 for antique furniture which sum the complainant himself paid tothe owner Nandasena before purchasing the same.
In the result, the 2nd respondent failed to make due payments of moniesprovided by the complainant and received by the 2nd respondent forspecific purposes and failed to render a true and proper account of the moniesremitted by the complainant.
A Rule was issued against the respondents in terms of section 42 (2) of theJudicature Act, No. 2 of 1978 on the grounds of deceit / and or malpractice.
Held:
The charges against the 1st respondent had not been made out to thesatisfaction of the Court. But, the 2nd respondent is guilty of deceit andmalpractice under section 42 of the Judicature Act.
If the conduct of the attorney-at-law is also criminal in character, as inthis case, the Attorney-at-law will be disenrolled even though there is noconviction.
Cases referred to :
Dematagodage Don Harry Wilbert – (1989) 2 SRI LR 18.
Re Donald Dissanayake – Rule3/79 SC minutes of31st October,1980.
Re Rasanathan Nadesan – Rule 2/87 SC minutesof 20th May,1988.
Chandrartilake v. Moonesinghe- (1992) 2 SRI LR303.
In the matter of an applicationfor readmittance asa Proctor – (1925)
39 NLR 517 at 518.
Re Fernando – (1959) 63 NLR 233 at 235.
Rule under section 42 (2) of the Judicature Act, No. 2 of 1978 against an attorney-at-law of the Supreme Court.
Aloy Rathnayake, PC with A. S. M. Perera, PC and N. Ananda for 1st respondent.Mohan Peiris with Nuwanthi Dias for 2nd respondent.
S. K. Gamalath, Senior State Counsel with U. Egalaheva, State Counsel forAttorney-General.
Rohan Sahabandu for the Bar Association of Sri Lanka.
Cur. adv. vult.
sc
Laurentius Van Kessel, through His Attorney Jayawicrama v.
Shobha Samaratunga and Another, Attorneys-at-Law
(Shirani A Bandaranayake, J.)
87
June 20, 2001
SHIRAN! A. BANDARANAYAKE, J.
The complainant, Laurentius Van Kessel, a German national and an 1Engineer by profession, was working in the United Arab Emirates in1990. There he had met one Indralal Perera, a Sri Lankan, who wasworking with him in Abu Dhabi. By 1990, Van Kessel had workedfor a period of over 4 1/2 years in Abu Dhabi and-had known IndralalPerera throughout that period. The complainant developed an interestin Sri Lanka and visited the country for the first time on 14. 02. 1990.
He left Sri Lanka on 23. 02. 1990, but returned again for a brief holidaywith his wife on 22. 12. 1990. The purpose of the second visit wastwo-fold : firstly, to spend his annual vacation in a country he liked 10most and secondly to “look for land” with a view to purchasing.For the latter purpose, Indralal Perera had introduced the 1strespondent, Shoba Samaratunga, who was a sister of Indralal Perera’sfiancee. Through the 1st respondent, the complainant met PatrickWickramasinghe, the 2nd respondent, while the complainant wasstaying at Ocean Beach Hotel, Dodanduwa. The complainant requestedthe 1st and 2nd respondents to look into the possibility of locatinga land for him to purchase.
The 1st and 2nd respondents, had shown several lands inDodanduwa area to the complainant and finally he had settled on a 20land in extent one acre and nine point two-five perches (hereinafterreferred to as the 1st land). The 2nd respondent informed thecomplainant that the purchase price of the land would be Rs. 880,000.
On a request made by the complaiant, the 1st and 2nd respondentshad located a 2nd land with a house adjacent to the aforesaid firstland. The purchase price of this land, which was 1/2 acre in extent,was given to the complainant as Rs. 725,000. The complainant wasaware that as a foreigner, he had to pay 100% of the vlaue of theland as taxes to the Department of Inland Revenue. The complainanthad also selected and reserved a few items of antique furniture from 30
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12002/ 2 Sri LR.
a dealer by the name, M. Nandasena and had wanted the 1strespondent to make the payment to him.
In order to make the payments for the aforementioned transactions,the complainant agreed to remit money to Sri Lanka. The 2nd respondenthad advised the complainant to give a letter of authorisation to the1st respondent to withdraw the money from the complainant’s account.The letter of authorisation was given on 02. 01. 1991. During theperiod 02. 01. 1991 to 03. 05. 1991, the complainant had remitteda total sum of 98,000 Deutsche Marks to his account at the DeustcheBank branch in Colombo.40
The complainant had, however, received information fromNandasena, the antique dealer, that he had not received any moneysince August, 1991. The complainant then became suspicious as the1st respondent had requested a further sum of Rs. 250,000 anddecided to come to Sri Lanka in September, 1991. On that occasionhe had met Indralal Perera and the 1st respondent and discoveredthat although the money had been paid to the 1st respondent, theregistration of the land had not been effected and that no paymenthad been made to the Department of Inland Revenue as a non-resident, to purchase a land in Sri Lanka. In respect of the 2nd land, sothe owner had received only Rs. 25,000 and the antique dealer'samount had not been settled.
When the complainant questioned the 1st respondent why she didnot utilise the money sent by him for the specific purposes, the 1strespondent informed him that she had to hand over the money tothe 2nd respondent as he was “her boss”. Though the 1st respondent,with the support of her father, had also endeavoured to settle theoutstanding matters before December, 1991, even by the end ofDecember, 1991, only an additional down payment of Rs. 75,000 hadbeen paid to the owners of the 2nd land and therefore the complainant 60had made a complaint to the Criminal Investigation Department.Simultaneously, he had complained to the Supreme Court informing
SC Laurentius Van Kassel, through His Attorney Jayawicrama v.
Shobha Samaratunga and Another, Attorneys-at-Law
(Shirani A. Bandaranayake, J.) 89
that “the culprits are still carrying on their profession” and addingthat “they still can do more harm to credulous people and thereputation of this country”.
The observations of the 1st and 2nd respondents were called forand they failed to satisfactorily explain their conduct to this Court.Therefore, on 15.07.1999, a Rule was issued directing both respondentsto show cause why they should not be suspended from practice orbe removed from the office of Attorneys-at-law of the Supreme Court 70for acts of deceit and / or malpractice they had committed in termsof section 42 (2) of the Judicature Act, No 2 of 1978.
The complainant, Swarnalatha de Silva, one of the owners of the1st land, M. Nandasena, the antique dealer, R. A. M. Rajakaruna, theowner of the 2nd land and the two respondents gave evidence at thepresent inquiry.
The Rule issued on each of the respondents stated as follows :
you did receive money from the complainant for the purchaseof two properties and some antique furniture; and
you did purchase only one property with the said money; and ao
you have failed and neglected to render a true and properaccount in respect of a sum of Rs. 2,580,676/90 remitted bythe complainant; and
you have thereby caused pecuniary loss to the complainant.
On 02nd January, 1991, the complainant had authorised the 1strespondent to purchase the 1st land on his behalf and had madearrangements to transfer the money from his Bank, so that the1st respondent could withdraw the money in his absence. Theagreement entered into between the complainant and 1strespondent reads thus :90
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“I, the undersigned, Laurentius Antonius Maria Van Kessel ofAM Meilwale 15, 8520, Evlangess, Germany and presently ofOcean Beach Club, Dodanduwa, nave on this 2nd day of January,1991, authorised Miss S. R. A. S. P. K. Samaratunga, Attorney-at-law and Notary Public of No. 341, Galle Road, Mount Lavinia,to purchase on my behalf the land depicted in plan No. 2180bearing Lot No. 10 in extent one acre and nought nine decimaland five perches at or for the price of rupees eight hundred andeighty thousand (Rs. 880,000).
I further authorise Miss S. R. A. S. P. K. Samaratunga to 100withdraw monies from the Deutsche Bank in Colombo and makethe necessary payments for the purchase of the said land andobtain a Deed of Transfer in my favour and to attend to all mattersconnected with the said purchase.” (vide P6)
The complainant, as agreed upon, had sent the following amountsto his Bank in Colombo :
01.1991-DM18,000
18. 01.1991-DM30,000
07. 02.1991-DM19,000
22. 04.1991-DM15,000
05.1991-DM16,000
Total- DM 98,000 (vide P3, P4, P5 and P6)
This amount is approximately equivalent to Rs. 2,500,000. The 1strespondent admitted that the money sent by the complainant set outabove was withdrawn by her on the authority given to her by thelatter and the total amount was handed over to the 2nd respondent.The 2nd respondent in the course of his evidence at this inquiryadmitted the receipt of this money from the 1st respondent.
SC Laurentius Van Kassel, through His Attorney Jayawicrama v.
Shobha Samaratunga and Another, Attorneys-at-Law
(Shirani A. Bandaranayake, J.)91
Witness Swarnalatha de Silva, in her evidence stated that the landreferred to as the 1st land belonged to her mother, sister and herself.This particular land was situated at Ratgama although they werepresently residing at Kottawa. She emphasised the fact that after thedeath of her father, they had lost interest in this land. The 2ndrespondent had visited her at Kottawa with her uncle, one NormanMendis, in 1990 and had given her an advance of Rs. 25,000 forthe purchase of the said land. The land was sold to Indralal Pereraand the deed was attested by the 1st respondent. She admitted thatthey could well have sold the land for Rs. 320,000. This money waspaid to her by the 2nd respondent. With regard to the 2nd land,it transpired that the total amount that had to be paid was Rs. 525,000and not Rs. 725,000 as was mentioned to the complainant. Initially,a deposit of Rs. 25,000 was paid to the owner and the 1st and 2ndrespondents had paid a further sum of Rs. 75,000. However, untilthe complainant met Rajakaruna, the owner of the 2nd land, he hadnot got any further payment and the owner had, in fact, thought ona subsequent occasion that the complainant had lost interest in thepurchase of the land. Later the complainant had paid the balancesum of Rs. 450,000, to Rajakaruna, which included an additionalsum of Rs. 25,000 for the delay in paying the full purchase price.
For the antique furniture selected by the complainant, a sum ofRs. 215,000 was to be paid to Nandasena and this was to be paidby the 1st respondent, Nandasena, in his evidence substantiatedthe position that the 1st respondent had not paid him any money,although the complainant had instructed her to do so and had demandedfrom the latter, the amount due. The antique dealer conceded thatlater the complainant had paid this amount to him.
Therefore, upon the evidence of the 1st respondent it is clear thatthe complainant had transferred the money to his Bank in Colomboand had granted authorisation to her to withdraw the money from thesaid account. Her position was that the 2nd respondent, with whomshe was working and who was her senior (partner), wanted her to
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handover the money to him whenever it was credited and encashed.
Out of this whole transaction, the 1st respondent was paid onlyRs. 50,000 and that was a payment on account of Notarial fees.
It was the evidence of the 1st respondent that in or around June,1991, at a time when the full amount of money was taken by the2nd respondent, she had proceeded to Dodanduwa on her own, andpaid an advance to the owner of the 2nd land. The material placedbefore this Court clearly demonstrated that the 1st respondent hadworked under the directions of the 2nd respondent and was under160severe pressure from him. At the time of this transaction, the 2ndrespondent had just started her work as an Attorney-at-law and hadonly 3 years of experience. It was a common ground that she wastotally dependent on the 2nd respondent. The correspondence betweenthe father of the 1st respondent and the complainant indicate thateven an attempt was made to sell a property belonging to the 1strespondent’s family, in order to settle the monies taken from thecomplainant. In fact, a letter sent by the complainant to the 2ndrespondent discloses that the complainant had taken notice of the factthat the 1st respondent is not solely responsible for the misuse of uohis money. The aforesaid letter stated that :
“. . . I decided to check into the matter myself. As a resultI found out that you personally requested from Miss Shoba tohandover the money transferred by me, with the argument that youwanted to take care of it personally . . . Until now Miss Shobasolely had to bear all the problems in connection with the contractshe has with me. I hope that it is not your style to misuse thelovaltv of vour employer/partner and that vou will not ignore : onecannot oo on with the normal wav of life, while destroying thename and future of another family." [emphasis added],iso
It was the 1st respondent’s evidence that she was a hapless victimin a helpless situation where she was torn between the trust reposedon her by the complainant and the necessity to comply with the
SC Laurentius Van Kassel, through His Attorney Jayawicrama v.
Shobha Samaratunga and Another, Attorneys-at-Law
(Shirani A. Bandaranayake, J.)93
directions given to her by the 2nd respondent who was her seniorin the profession with whom she was practising. She, while acceptingher mistake, prayed for forgiveness having regard to the circumstancesshe was placed in. Her version also finds strong support in the storynarrated by the complainant. She has also expressed her unqualifiedregret for the part she played in the transaction without any intentionwhatsoever to defraud the complainant.190
Having regard to all the material placed before this Court in supportof the charges and the admission made by the 2nd respondent inthe course of his evidence at this inquiry, I hold that the chargesagainst the 1st respondent have not been made out to the satisfactionof this Court. Therefore, I hold that the charges against the 1strespondent, Shoba Pathmakumari Samaratunga, have not beenproved and I make order that the Rule issued against her in theseproceedings be discharged.
Now, I propose to deal wtih the evidence adduced against the 2ndrespondent at the inquiry. In the earlier part of this judgment I have 200set out in detail the evidence of the complainant and the testimonyof the other witnesses against both respondents in respect of thecharges set out in the Rule. It would be unnecessary therefore tonarrate the evidence once again at this stage. The complainant wascross-examined at length by both counsel appearing for the 1st and2nd respondents. The version of the complainant in my view has notbeen discredited. Having regard to the demeanour of this witnessand the substance of the evidence he has given at this inquiry, heimpressed me as a truthful witness.
The 2nd respondent opted to testify at this inquiry under oath. It 210was the 2nd respondent’s position that he had commenced his practiceas an Attorney-at-law in 1969 and had been working in Mount Laviniasince 1976. He stated that he had met the complainant in 1990 andthat the complainant sought his services to purchase a land in SriLanka. The 2nd respondent admitted that in his view, dealings relating
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to purchases of land would not be an appropriate function for anAttorney-at-law. However, he had taken the complainant to inspecta land at Dodanduwa. The 2nd respondent's position is that thecomplainant was willing to spend Rs. 1 million for the purchaseof this land. The 2nd respondent met the owner and he had agreed 220to sell a portion of the land for Rs. 320,000. Accordingly, the purchaseprice of a perch was fixed for Rs. 2,000. It was the 2nd respondent’sevidence that he had decided to add the cost of his professionalservices to the value of this land. Therefore, he had decided toquote a sum of Rs. 5,500 per perch which amounted to a total ofRs. 880,000 for the 1st land. The 2nd respondent had thus decidedto increase the price of a perch of this land by Rs. 3,500 therebyappropriating this additional amount for his services. This included theservices he had rendered in searching and identifying the land, thepayment for his assistant who functioned as the driver and assisted 230him in other connected matters. The 2nd respondent contended thatfixing the price of Rs. 880,000 for a land which was ultimately soldfor Rs. 320,000 was proper and reasonable for two reasons : firstly,his position was that the complainant wanted to purchase a land witha price limit of Rs. 1 million and secondly, he stressed the point thatif not for him, the complainant would not have been able to purchasethis land in any event at that price.
The 2nd respondent further submitted that initially, the complainanthad wanted to purchase the land in his name. However, when the2nd respondent obtained the money sent by the complainant through 240the 1st respondent, the complainant was not in a position to makethe purchase and pay the Department of Inland Revenue, the relevantamounts, due to lack of funds. The 2nd respondent admitted that the1st respondent had given the money to him. He further admitted thatafter he collected the money from the 1st respondent he had givena sum of Rs. 850,000 out of those proceeds to a Chinese couplewho had wanted to borrow money from him. The balance amount,according to the 2nd respondent, had been appropriated for his use.
He conceded that there was no receipt obtained by him from the
SC Laurentius Van Kessel, through His Attorney Jayawicrama v.
Shobha Samaratunga and Another, Attomeys-at-Law
(Shirani A. Bandaranayake, J.)95
Chinese couple to account for the money taken and that he cannotremember whether he had made any notes relating to this transactionin his diary which he maintained at that time. His position was thatwhen he tried to obtain the money given to the Chinese couple, hehad learnt that they had left the country. He had visited China to meetthe couple unsuccessfully. The complainant informed the Court thathe has his Passport in his possession to show that he had visitedChina. However, he had not thought it necessary to produce theentries made, if any, in his diary relating to the transactions. Norecords, pertaining to any of the transactions, were produced. Hespecifically admitted that the money which was entrusted to him bythe complainant for the purposes specified by the complainant wasutilised by him for a different purpose.
The 2nd respondent had admitted that; he had misappropriatedthe money entrusted to him by the complainant for a very specificpurpose, namely as consideration for the purchase of the aforesaidlands and payment to the antique dealer, Nandasena.
It is indeed an imperative requirement that, Attorneys-at-law mustnecessarily be persons of integrity and honesty. Justice Dr. A. R. B.Amerasinghe in his book titled “Professional Ethics and Responsibilitiesof Lawyers”, (1993 – pg. 158) states thus :
“Any act or default in or related to his professional practice,any professional misconduct which, though unrelated to his practicedemonstrates a disregard for the standards or principles essentialto the notion of fitness of an attorney, or any impropriety indicativeof his failure to understand or to practise the precepts of honestyor fair dealing in relation to the Courts, fellow-practitioners, hisclients or the public or any failure to meet the demanding testsimposed by law and custom by which the profession is regulated,will make an attorney amenable to the discipline of the SupremeCourt.”
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If and when the conduct of the Attorney-at-law is criminal in nature,our Courts have taken the view that the Attorneys-at-law would bedisenrolled, even though there is no conviction. Thus, in DematagodageDon Harry Wilbert’> an Attorney-at-law who had given forged documentsto gain admission to the Sri Lanka Law College was disenrolled.Similarly, in Re Donald DissanayakeP* and Re Rasanathan Nadesan,p»the Attorney-at-law’s name was struck off for misappropriation anddeceit. In Chandratilake v. MoonasinghdA) for breach of trust of acriminal nature and deceit, the Attorney-at-law was disenrolled.
The responsibility cast upon Attorneys-at-law, when they deal with 290funds belonging to a third party was described in detail by Bertram,
CJ. in the matter of an application for readmittance as a Proctoi<S).
In this case it was stated that :
“The Proctor in question found himself in this position becausewhen he was entrusted with funds in a fiduciary capacity he didnot keep those funds separate from his own money, but used themfor his own purposes with the result that when they were requiredthey were not available. There is no principle which is moreimportant to press upon persons entering the legal professionthan a strict regard to the principles of trust accounts.”300
Although the nature of the testimony of the 2nd respondent underoath at this inquiry was of a fanciful nature and not worthy ofconsideration by this Court, we have given our careful considerationto the evidence of the 2nd respondent and all the facts and evidencebefore us. There can be no doubt that the 2nd respondent’s participationin this particular transaction constitutes criminal offences of criminalmisappropriation and or criminal breach of trust. For the aforementionedreasons, I am of the view that the 2nd respondent is guilty of allcharges laid in the Rule. We are compelled, by the facts proved andthose admitted by the 2nd respondent in the course of this inquiry 310to observe that the 2nd respondent is not a person who is fit andproper to be permitted to function as an Attorney-at-law of this Court.
sc
Laurentius Van Kassel, through His Attorney Jayawicrama v.
Shobha Samaratunga and Another, Attorneys-at-Law
(Shirani A. Bandaranayake, J.)
97
The principles that should guide this Court in determining thesentence imposed on an Attorney-at-law have been discussed inseveral decisions of this Court. In Re Fernanda/® Basnayake, CJ. wasof the view that :
“The power to remove or suspend a proctor from his officeis one that is meant to be exercised for the protection of theprofession and the public and for the purpose of maintaining a highcode of conduct among those whom this Court holds out as its 320officers to whom the public may entrust their affairs with confidence.
If a proctor is adequately to perform the functions of his office andserve the interests of his clients, he should be able to commandthe confidence and respect of Judges, of his fellow practitionersand of his clients.”
For the reasons aforesaid, I find the 2nd respondent guilty of deceitand malpractice under section 42 of the Judicature Act. The Rulerelating to the 2nd respondent is, therefore, made absolute andwe make order directing that the 2nd respondent, Patrick PrabawanshaWickramasinghe, be removed from the office of an Attorney-at-law 330of this Court and that his name be struck off the Roll of Attorneys-at-Law.
Registrar of this Court to take steps accordingly.
I would like to express our sincere appreciation of the assistancerendered by all Counsel.
PERERA, J. – I agree.
EDUSSURIYA, J. – I agree.
Rule against 2nd respondent made absolute and he is disenrolled.