AHTC lawsuit

How town council came to take legal action against own councillors

The Workers' Party-run Aljunied-Hougang Town Council (AHTC).
The Workers' Party-run Aljunied-Hougang Town Council (AHTC). PHOTO: ST FILE

At first glance, it might seem odd that the Aljunied-Hougang Town Council is bringing a lawsuit against its own town councillors.

But the turn of events is possible because the legal action was directed by an independent panel appointed by AHTC in February.

It was created to look into and help recover improper payments made by AHTC worth $6.9 million, which was uncovered by an extensive KPMG audit last year.

The panel is chaired by Senior Counsel Philip Jeyaretnam - whose father J.B. Jeyaretnam was the Workers' Party (WP) secretary-general from 1971 to 2001 and became the first opposition MP voted in after independence.

The other panel members are Senior Counsel N. Sreenivasan and KPMG managing partner Ong Pang Thye. It can act as agents of the town council under Section 32(2) of the Town Councils Act.

The law allows a town council to delegate its powers, functions and duties to an agent such as an independent panel. Under the panel's terms of reference, it can take actions it thinks are in the best interests of AHTC. This includes prosecuting, filing appeals and acting in legal disputes and suits.

The terms of reference thus allow the panel to take legal action in AHTC's name against town council chairman Pritam Singh, vice-chairman Sylvia Lim and WP party chief Low Thia Khiang.

The other defendants are appointed town council members Chua Zhi Hon and Kenneth Foo, Ms How Weng Fan, as owner of AHTC's former managing agent firm FM Solutions and Services (FMSS) and as the representative of the estate of her late husband Danny Loh, and FMSS itself.

According to initial case details, AHTC was claiming $622,593.78 in liquidated claims from multiple parties, as well as $4,167,501.71 in unliquidated claims. However, the full statement of claim shows that the monies in question in fact come up to more than $33 million.


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A version of this article appeared in the print edition of The Straits Times on July 27, 2017, with the headline 'How town council came to take legal action against own councillors'. Print Edition | Subscribe