Professionalism goes beyond instruction taking (Wills) Part 2

Last Updated on 10, April 2014

In a recent high court case of Soh Eng Beng (as executor and trustee of the Estate of Soh Kim Poo, deceased) v Soh Eng Koon was a case with regard to an ambiguous clause in a Will. The judge has to decide the exact meaning of the clause. But as I read the case, my opinion is that it could simply be a genuine human error which all humans are not immune. Anyway I will not dwell on the human error but the process in which the Will was written. According to the link above, I gather that the Will under dispute was written in the following circumstances:

1. Although the cover page of the Will shows that the Will was written by a particular law firm, it turns out that the lawyer was not involved because of some personal family matters. The person who drafted the Will was the secretary (paragraph 19).
2. The secretary took instructions, drafted the Will, make the necessary amendments and explained the contents of the Will in Hokkien to the testator.
3. There was no attendance notes and hence no evidence of fact finding and analysis.
4. The secretary made a spelling error in one of the beneficiary’s name and was responsible for one of the ambiguous clause under dispute.
5. The testator may not have understood English and relied on the Hokkien translation. If this is the case, the testator must had fully relied on the Will Writer professionalism to do the right thing.

Although majority of Singaporeans have never written their Wills, those whom I had seen written their Wills previously wrote nonsensical Wills. Okay, the word “nonsensical” is too strong of a word but the problems of ambiguous clause is quite common. Sometime the Will’s content has no ambigiouity but it comes with many practical issues and potential unfair distribution. I mentioned previously in one of my blog post that I have to compensate for my client for a rubbish Will written by my recommended lawyer. I have since sack that lawyer. So new clients do not need to worry because I’ll not be referring them to that law firm.

In order for a Will to be properly written, the Judge state in paragraph 25 that "The preparation of a will involves serious professional responsibilities, which solicitors must uncompromisingly observe and discharge. Regrettably, it seems to us that, all too often nowadays, solicitors appear to consider the preparation of a will to be no more than a routine exercise in form filling. This is wrong. Before preparing a will, the solicitor concerned ought to have a thorough discussion with the testator on all the possible legal issues and potential complications that might arise in the implementation of the terms of the will. The solicitor ought to painstakingly and accurately document his discussions with and his instructions from the testator. He should also confirm with the testator, prior to the execution of the will, that the contents of the will as drafted accurately express the latter’s intention. A translation, if required, must be thoroughly and competently done. Half measures or the cutting of corners in the discharge of these serious professional responsibilities will not do."

In my opinion, such job requires thorough investigation (fact finding) into the testator’s background and a thorough analysis is also required so that the recommended Will can be properly drafted. But the question remains: How could a solicitor spent so much time doing this for a Will that cost only $200 or $300? I know of one law firm charges $120. There is no need to be a genius to guess why Will writing has been reduced to mere form filling. There is a saying – pay penults and you will get monkey.

To be fair, this problem of mere “form filling” is most widespread in the financial industry. In most financial advisory relationship the following is normally what happens (mirroring and following the above points):

1. All documents will point out that the firm involved practices financial advisory and financial planning but in reality the firm hire salesmen to sell products. In other words, it is the salesman (unqualified) and NOT the true financial planner that meets the client. Sometimes, the entire firm does not even have a qualified financial planner.
2. The salesman will meet the client, sell whatever products he is interested and explain the products – often omitting important negative details – to the client.
3. There is little fact finding and analysis. But these days, firms are smart and have developed template fact finding and analysis forms which the salesman will fill up just to make MAS happy with the nice statistics. The nice statistics actually contradict itself because in a recent LIA statistics, despite majority of the insurance cases were conducted with some fact find, the average sum assured sold continues to be low indicating that these salesman are still doing the same old con-job of selling everything except to meet the needs of their clients.
4. Although most people these days are English educated, they still have to rely on the professionals to help them fully because financial products have become incomprehensible to the man-in-the-street. That is why doctors, lawyers, accountants, teachers are all not immure to be cheated by financial salesmen.

But the question is this: Will clients be willing to pay to get good advice? In a recent question posed to me HERE, that person bought 4 regular premium insurance policies which I estimate to have paid together $6000 in commissions to the agent. Like most people, they think their advisor works for free but actually they are being paid huge commissions if they can convince the client to buy such products. But I know very few are willing to pay this same figure to get good advice. Therefore, the industry continues to reward product sellers and punish professionals who prefer to charge fees through consultation rather than product sales. That is why, many insurance agents and adviser continue to achieve the Million Dollar Round Table (MDRT).

Once in a while, I will have the honour to meet aspiring financial advisers who want to do the right thing to become a true professional rather than product sellers. I will tell them that my fee-based financial planning practice does not have a significant high volume. Every month I will get 1 to 3 cases of fee-based planning. For each case, I charge about $4000 - $5000. After these advisers do their sums and deduct expenditures and business cost, they figured that they cannot survive with such low volume of business and decided to continue their product selling. At least in product sellings, it is possible to earn $25,000 in commissions for each ILP easily. Becoming MDRT, TOT or COT isn’t a big problem to them.

Related article: Professionalism goes beyond instruction taking (Wills) Part 1

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