Lawyer should have been clear about fees

July 3, 2007

Lawyer should have been clear about fees

WHEN my son's estate was ready for en bloc sale, the appointed sales committee engaged a property agent to market the property and a lawyer to represent the owners in the documentation. However, this lawyer adopted a 'didn't ask, don't mention' attitude while vetting the contract that the owners had to sign with the property agent.

As a result, the contract was worded in favour of the agent, e.g., the agency fee was pegged at 5 per cent of the reserve price and any price above the reserve price would incur a fee of 6 per cent. Laymen would assume that the commission would be calculated at 5 per cent up to the reserve price and the balance thereafter at 6 per cent.

As the sale was concluded above the reserve price, the agent charged the owners 6 per cent of the total sale proceeds. When they approached the lawyer for advice, he confirmed that it was correct. Why didn't the lawyer explain it clearly in the first place?

Then the lawyer quoted a fee of 2 per cent on the sale proceeds and an additional charge for bank redemption. The quotation for the additional charge was not included in the documentation and subsequently the bill consisted of a charge for handling the bank redemption, $X, and a charge to the lending bank for handling the case, $Y (which the bank claimed back from my son.)

When he queried the lawyer about the four separate charges (including the CPF Board's lawyer's fee), he claimed that they were standard charges and the fees were based on a scale.

Why do we have to engage a lawyer to redeem a mortgage loan? Would not the CPF lawyer be sufficient? Why was there a double charge - imposed on the borrower as well as the lending bank - when the lawyer handled the same document?

Elaine Tong Siew Lam (Mdm)