In the wake of the High Court ruling on City Harvest Church founder Kong Hee and five others, a district judge has acquitted a company director of criminal breach of trust (CBT) as an agent, and convicted him of the least aggravated form of CBT.
District Judge Lee-Khoo Poh Choo, who found Ng Kee Wee guilty in April, jailed him for 30 months last month for unlawfully transferring company shares to himself.
The judge, in decision grounds issued last week, said the prosecution and defence referred her to the High Court decision on the case of Lam Leng Hung and five others which considered the scope of Section 409 of the Penal Code.
Lam was one of the five convicted with Kong Hee earlier this year. The six had their charges reduced from the aggravated charge of CBT under Section 409 of the Penal Code - which is CBT by a public servant, or by a banker, merchant or agent - to a simpler CBT charge under Section 406.
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Judge Lee-Khoo said that in the City Harvest case, the High Court held that "a director who was entrusted with the property of the company by virtue of his capacity as a director did not fall within Section 409". She added: "Bound by the High Court's decision, I acquitted the accused of the offence under Section 409 and convicted him of the offence of CBT simpliciter under Section 406 of the Penal Code."
The prosecution is appealing against the judge's decision to switch charges, a move that may entail a potential review of the relevant law as interpreted by the High Court in the City Harvest Church case.
Ng's case is the first involving a charge reduction for CBT after the High Court decision.
Ng, 49, was managing director of Singalab, a wholly owned subsidiary of Singalab International (SIPL), a joint venture investment company. He was entrusted to manage SIPL as its sole director from June 2005 to August 2009.
In July 2006, he passed a resolution for SIPL to transfer three million Singalab shares to himself. This meant Singalab was no longer owned by SIPL but by himself.
Deputy Public Prosecutor Joel Chen said Ng transferred the shares without the knowledge and approval of other SIPL shareholders and that his subsequent conduct showed he enriched himself with no regard for other shareholders.
Ng's lawyer Lim Chee San countered that Ng held the shares in trust for SIPL, having declared the trust status three years after the share transfer. This was after the shareholders found out the shares were in his name.
District Judge Lee-Khoo said Ng's claims were "absurd". She found "(Ng) raised the sham defence that he was holding the shares in trust after he ran out of excuses".
The judge also took issue with Ng's evidence, noting it was "riddled with lies, inconsistencies and unbelievable excuses". "He flip-flopped, then re-flipped and re-flopped in many aspects of his testimony."
The judge found that, among other things, Ng had withdrawn large sums of money from Singalab's bank account, transferred assets and talent from Singalab to a company incorporated in his mother's name, then sold the company to another firm for $5.46 million.
Based on the evidence, District Judge Lee-Khoo found Ng guilty of dishonestly misappropriating the Singalab shares for his own benefit. Ng is appealing against this.