The members of Aljunied-Hougang Town Council's (AHTC) tenders and contracts committee - Mr Pritam Singh, Ms Sylvia Lim, Mr Chua Zhi Hon and Mr Kenneth Foo - had breached Town Councils Financial Rules for 10 construction projects costing between $71,500 and $1,668,711, a lawsuit against the members claims.
They had failed to call a tender for each project, and did not accept the lowest bid for seven projects, according to a statement of claim filed by AHTC at the High Court.
The Town Councils Financial Rules stipulate that tenders must be called for projects above $70,000 in value, and the reasons for not accepting the lowest bid must be spelt out carefully.
The tenders and contracts committee was chaired by Mr Singh, who is also the chairman of AHTC. Mr Chua was a former member of the Workers' Party (WP) Youth Wing executive committee, while Mr Foo was WP deputy organising secretary and a candidate in Nee Soon GRC in the 2015 General Election.
Outlining why it wants to take the four defendants to task, AHTC said that instead of issuing separate tenders for each project, the council had invited a tender for consultants on a "fixed fee basis".
These pre-approved consultants would be on a panel, and the town council would then choose from this panel consultants to manage projects.
The town council selected two architects - LST Architects and Design Metabolists - to provide services in such a manner.
The statement said that despite having decided to select consultants in this manner, the council was still required to pick the "lowest-priced consultant".
It pointed out that in all 10 projects, LST Architects was engaged despite it charging higher fees in seven of them.
In one instance, where a $1,668,711 contract was awarded to LST Architects, Design Metabolists had submitted a bid of $210,000.
AHTC said in its statement that the higher-priced contracts were awarded "without adequate justification and/or recording the circumstances and reasons for doing so".
The additional cost of hiring LST Architects over Design Metabolists amounted to $2,794,560.
AHTC alleges that the committee members had breached their duty to the town council as they had an obligation to comply with the Town Councils Financial Rules. It is demanding damages or "equitable compensation" from them for their failure to call separate tenders for the 10 projects.
Alternatively, the town council is demanding damages of $2,794,560 - which is the additional amount that AHTC spent when it hired LST Architects instead of Design Metabolists.
