WP MPs plotted to reward supporters: Plaintiffs

The Workers' Party (WP) MPs who are being sued for allegedly breaching their fiduciary duties went to their court hearings last October with "scripted and dishonest answers in a pitiful attempt to hide the truth", lawyers said in their written closing submissions.

Party chairman Sylvia Lim, one of the defendants in the multimillion-dollar lawsuits, was also an "evasive witness willing to make untruthful and misleading statements in the face of difficult questions", the lawyers alleged.

Among the arguments they put forth were observations of how the WP MPs allegedly behaved on the stand when being cross-examined.

These were in the two closing submissions, each 150 pages long, submitted to the High Court last Friday by lawyers representing Aljunied-Hougang Town Council (AHTC) and Pasir Ris-Punggol Town Council (PRPTC).

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AHTC and PRPTC are suing five WP town councillors - including Ms Lim, WP's secretary-general Pritam Singh and its former chief Low Thia Khiang - over alleged improper payments made to a former managing agent and other contractors when the councillors ran AHTC.

PRPTC is suing to recover its share of losses incurred when Punggol East constituency was run by AHTC from 2013 to 2015.

The submissions, which come after a 17-day trial last October, noted how Mr Low and Ms Lim "recklessly" appointed a new managing agent for AHTC in 2011 without a tender and any regard for the interests of residents. The WP had won Aljunied GRC in the 2011 General Election.

Their move was allegedly to benefit WP supporters How Weng Fan and her husband, the late Mr Danny Loh, who were the main shareholders of the new agent, FM Solutions & Services (FMSS), said the lawyers.

Ms How, Mr Loh and FMSS are the other defendants in the suits.

AHTC is seeking compensation of $33.7 million in fees paid by the town council to managing agent FMSS and its service provider between 2011 and 2015.

Its lawyers from Shook Lin & Bok listed several ways in which the defendants breached their fiduciary duties, like Ms Lim failing to call a tender for the Essential Maintenance Service Unit contract and giving it to FMSS.

They said "a particularly disturbing consequence of the appointment of FMSS, and the fact that Ms How, Mr Loh and FMSS were effectively given carte blanche over AHTC's payment process, was that FMSS enjoyed extraordinary profits (an increase of more than 300 per cent) in the period between 2011 and 2015".

Mr Low and Ms Lim also made the decision to appoint FMSS as AHTC's managing agent despite being aware of the severe conflicts of interest, and failed to disclose the shareholding of FMSS at a town council meeting in August 2011, the lawyers added.

Mr Low, Ms Lim, Ms How and Mr Loh also set up and allowed a system that let conflicted persons approve payments to themselves.

PRPTC'S lawyers from Drew & Napier, in disputing the defendants' claims that they were not fiduciaries, gave five reasons for rejecting them. These include the fact that the defendants had custody and control over the assets and property of AHTC, and a legitimate expectation by the residents that they would abide by their obligations under the town council laws.

PRPTC lawyers also flagged Mr Singh's testimony in October, when he said he could not recall certain things, such as when he was told about the incorporation of FMSS, and details of a May 2011 meeting the WP MPs had.

It was during this meeting that the MPs decided a managing agent would be appointed, despite being aware that Aljunied Town Council had an incumbent agent - CPG Facilities Management. Mr Low sent out an e-mail on the decision and copied it to Ms How.

Both Mr Low and Ms Lim, who took the stand before Mr Singh did, were grilled on the e-mail.

PRPTC's lawyers, led by Senior Counsel Davinder Singh, wrote: "Realising that the e-mail was devastating and that Mr Low and Ms Lim's evidence about that meeting and the e-mail was not credible, he took sanctuary in memory loss."

The lawyers also said: "Once they (the WP MPs) won the trust of the voters, they promptly set out to thwart those very interests by sinister scheming and blatant breaches of the law.

"They plotted to reward their supporters, who, driven by naked financial self-interest, happily played along. They appointed people who they viewed as cat's paws, and who failed miserably to discharge their duties to AHTC."

"The elected members operated furtively, engaged in wilful misdirection, and constructed an alternative reality not just to avoid getting caught for breaking the law, but to create scapegoats of innocent people," they added.

Lawyers from both sides are expected to reply to each other's written submissions next month. After that, a court date will be set for oral submissions before Justice Kannan Ramesh delivers his judgment.

This article was first published in The Straits Times. Permission required for reproduction.