1. Is it true that parties can use the legal services of the same lawyer?
While it might seem convenient, ethically and legally, a lawyer should act for only one party in a transaction to avoid a conflict of interest. Whether in a property transaction, a share sale agreement, or any deal involving more than one party, each party shall appoint their own lawyer to safeguard and protect its rights.
Why is that necessary? It is because no one knows your rights better than your own lawyer. A lawyer’s duty of care is to act exclusively in your best interest, without compromise and most importantly without bias. It is our utmost responsibility to do so.
Sharing a lawyer may seem harmless at first. Still, there may be a risk of a conflict of interest, especially when issues arise later in the transaction, when the question becomes: Who is the lawyer actually representing? Well, who is to be blamed? If this happens, you will need to appoint a new lawyer, to fight for you over the same transaction that could have been managed correctly from the start.
2. Is it true that you can save some money from it?
At first glance, you might save on legal fees. But in the long run, the risks outweigh the savings so much more. Undoubtedly, there are always choices, and it is ultimately yours.
Even if it’s a friendly party or family transaction, it is wise to have your own lawyer to review the agreement or any relevant documents related thereto and to monitor the transaction and, most importantly, to ensure your interests are protected.
Unfortunately, many have taken the shortcut to save some money in the beginning to later discover that there is a dispute or delay due to insufficient scrutiny of the entire legal process. When such events happen, it may be too late; the only option to move forward will be legal action, which will cost significantly, financially and emotionally.
Real-life examples:
In property-related transaction, it is not uncommon for a vendor to be unrepresented. Often, problems only surface when there is a delay in payment terms, and the vendor realises the impact of not having his own lawyer.
Without legal guidance, the vendor may unknowingly agree to unfair clauses. As a consequence, some vendors have gone unpaid for years, without any compensation for late-payment interest incurred. All these occur because there are no lawyers to safeguard their rights.
In company transactions, such as a share sale, the agreement typically contains conditions precedent, which are essential requirements that must be satisfied before the deal proceeds as stipulated. Each party’s lawyer will act as the gatekeeper to ensure that the conditions precedent are fulfilled and that the procedures are followed correctly. Without legal supervision, critical steps can be overlooked, causing delays that might jeopardise the transaction.
A lawyer is not a judge.
The most essential principles of law is fairness. It’s crucial to understand that a lawyer is not a judge. A lawyer cannot and does not decide which party has the greater bargaining power.
A lawyer’s duty is singular: to protect and justify the fairness of their client’s position.
Each party deserves independent legal advice, not only to ensure their rights are protected but also to ensure the transaction terms are fair and reasonable from their perspective. Expecting a single lawyer to act reasonably for both sides is unrealistic and runs counter to the very nature of legal representation.
Appoint a lawyer to protect your legal rights
There are too many real-life cases that have occurred to demonstrate that legal knowledge is essential, and the minimum step to take is to appoint a lawyer to protect your legal rights. It is always better to prevent than cure, as the lack of legal representation causes significant loss, emotional distress and delays. In law and in life, prevention is always cheaper and easier than the cure.
“In business, prevention isn’t just cheaper than cure, it’s the only cure that works.”
Ellie Law, Ellie Law of Daphne Leong and Ellie Law Chambers
Ellie Law of Daphne Leong and Ellie Law Chambers is building a new kind of law firm—one grounded in empathy, education, and everyday people.
The views expressed in this article are those of the author. The content is provided for informational purposes only and should not be taken as professional advice. Readers are encouraged to consult a qualified professional before making any decisions.
