SINGAPORE - A former private banker who was paid a visit at his Chancery Lane home by debt collectors hired by an ex-client, has been held by the High Court to be liable for the $6.5 million in investments he guaranteed the businessman.
Mr Karl Liew who is the son of founding president and former chief executive officer of CapitaLand Group Mr Liew Mun Leong, was sued by the businessman, Mr Alan Zhou, for breaching the personal guarantees.
The court also found Mr Liew liable for deceit in making false representations to Mr Zhou about the investments, which were in China.
In finding Mr Liew liable, Judicial Commissioner Audrey Lim said in judgment grounds last week that Mr Liew stood to gain by his fees and Mr Zhou had "relied on Liew's representations as Liew was his fund manager who had sourced for and recommended the investment products to Zhou."
Mr Liew had challenged the enforceability of the investment pacts and personal guarantees.
As he had been made a bankrupt last year, he was not sanctioned by the Official Assignee to defend the suit against him and was instead subpoenaed to testify in court by Mr Zhou's lawyer Eugene Quah from RHT Law Taylor Wessing.
A court default judgment had already been entered against a second defendant, Realm Capital (RCL), a British Virgin Islands company Mr Liew had set up to spearhead investments into China.
A default judgment was found for the $6.5 million sought as the company did not enter an appearance. This comprised the $6 million principal sum and interest.
Mr Liew claimed Mr Zhou had breached the agreements by not paying the investment funds to RCL but a third party, Ms Chen Jie, a Chinese national who was the contact point for the investment recipients in China.
The judge rejected Mr Liew's claim that Mr Zhou had transferred the investment funds to third parties without his approval finding that "Liew was aware of the transactions and money transfers ...as he was copied" on the relevant correspondences.
Judicial Commisioner Lim also disbelieved Mr Liew's claim that he had personally paid Mr Zhou $500,000 to help Ms Chen repay the monies, claiming she was on the run.
"Overall, I find Liew to be a dishonest and evasive witness, whose evidence was riddled with inconsistencies," said Judicial Commissioner Lim.
She ruled that as the agreements were valid and enforceable against RCL and as RCL had defaulted on them, Liew was liable for them.
It is understood that even if he is discharged from bankruptcy, it will not release him from this debt, since it involved deceit.
Mr Zhou had also sued for damages against the firm System Impact (SIPL), Ms Mah Mei Sin and Mr Gobindram Harjani, claiming they had wrongfully retained monies, among other things.
Under the investment pacts, Mr Zhou was required to transfer the funds to the account of SIPL and at times to Ms Mah.
Mr Zhou also found that Ms Mah and SIPL had allegedly transferred the investment funds to Mr Gobindram, the owner of Silk Rose, seen as a further intermediary in remitting funds.
Mr Gobind, defended by lawyer Lim Kim Hong, was cleared of the claim in its entirety with the judge noting he had remitted all monies received and there was no evidence he knew of the purpose of the funds entrusted to him.
Ms Mah was found liable for $247,689 and jointly with SIPL for another $1 million.