By Emmanuel Samarathisa
FIVE former partners of legal firm Lee Hishammuddin Allen & Gledhill (LHAG) have set up a new outfit called Rosli Dahlan Saravana (RDS) Partnership and are hiring 10 pupils and 15 associates, according to a message sent out to clients on social media.
This follows a notice on Feb 14 by LHAG that the five – Datuk DP Naban (or Palpanaban Devarajoo), Rosli Dahlan, Saravana Kumar, Ooi Bee Hong and Ong Eu Jin – “have ceased to practise as partners” of the firm.
Excerpts of the message sighted by FocusM from Saravana Kumar read:
“Our new law firm, RDS (Rosli Dahlan Saravana) is operational as of today. Our Senior Partner is Datuk DP Naban.
“We are happy to continue to manage your tax file and we have the expertise and resources to continue to serve you with our 110% commitment.
“You may also retain your file at LHAG where another lawyer will manage your file or appoint another law firm. Please be assured of my commitment as I have been involved in your tax dispute from the first day.
“If you wish to continue to engage Datuk Naban and I at our new law firm, RDS, please inform LHAG of your decision and I can take over conduct immediately.”
A similar message, including a hiring call, was also posted on Saravana Kumar’s Facebook page:
Saravana Kumar, Naban, Rosli, Ooi and Ong are caught in a legal tussle with 12 other LHAG lawyers.
On Feb 11, FocusM reported that LHAG had taken action to stop the fire from dissolving the firm.
In a statement on Feb 10, LHAG Partners Committee said it has obtained an interim order from the Kuala Lumpur High Court against Saravana, Ong, Rosli, Naban and Ooi, restraining them from attempting to dissolve the firm.
On Feb 7, from 5pm, Saravana, Rosli and Ong emailed, to the firm’s over 200 employees, their purported notices to dissolve the firm immediately. One of the Notices of Dissolution was circulated on social media.
Naban also, in the same evening, issued a notice informing the firm that he regarded the firm as dissolved while Ooi also sent a notice purporting to accept the Notices of Dissolution.
Under the partnership agreement, the partnership can only be dissolved by a resolution passed by 75% of the equity partners.
According to LHAG in a statement on Feb 9, no such resolution has been passed. Nor was there any risk of such a resolution being passed, as the vast majority of partners oppose it.
LHAG pointed out that the three partners collectively represent about only 11% of the equity in the firm.
“If any steps are taken to dissolve the firm, the process of reviewing the appropriate tax treatment of these large sums of moneys may be delayed or even frustrated,” the firm said.
Attempts to dissolve the partnership stemmed from disputes between the partners that were supposed to have been resolved in the agreed dispute resolution process: mediation and arbitration, but Naban and Ooi decided to take this matter to the court.
According to LHAG’s statement on Feb 9, the duo claimed that there is an attempt by young partners to illegally change the agreed profit distribution scheme.
But LHAG refuted the claim, stating that the dispute was over the treatment of over RM20 mil received by the firm mainly on files opened and managed by Saravana and Naban – both are partners from the tax practice group – from clients between 2009 to 2019.
The sum of over RM20 mil came to the attention of the newly-elected Partners Committee, which is the highest managing body of LHAG, in September last year as the money was received by the firm but was yet to be reflected accordingly.
According to LHAG, numerous attempts were made to ascertain the full facts from Naban and Saravana but to no avail. – Feb 19, 2020