SINGAPORE - The High Court has ruled that ongoing arbitration proceedings between Aljunied-Hougang Town Council (AHTC) and its former managing agent firm be suspended pending a separate lawsuit against members of AHTC.
The case was heard in chambers by Justice Kannan Ramesh on Monday (Sept 25).
When approached outside the courtroom, lawyers from both sides declined to comment, citing the confidentiality of arbitration proceedings.
However, The Straits Times understands that the arbitration proceedings have been suspended.
In this case, AHTC is represented by Shook Lin & Bok, while AHTC's former managing agent, FM Solutions and Services (FMSS) is represented by Netto & Magin.
AHTC, acting on the direction of an independent panel, had initiated legal action in July seeking a court order for the arbitration action against it to be put on hold.
The arbitration is over payments that FMSS is claiming from AHTC for services it provided under two contracts.
The first contract was from July 2011 to July 2012, and the second from July 2012 to July 2015.
Soon after the second contract ended, FMSS sent the town council a letter of demand asking for the money it said it was owed.
The parties entered mediation talks in October 2015 and, when mediation did not succeed, arbitration proceedings after that.
The court order to suspend arbitration leaves the way clear for the suit brought against AHTC's own town councillors - which includes Workers' Party (WP) chief Low Thia Khiang, WP chair Sylvia Lim and WP assistant secretary-general Pritam Singh - to proceed.
That separate suit, which AHTC filed in July this year on the direction of its appointed panel, alleged that all payments made to FMSS are void, as town councillors Mr Low and Ms Lim had acted in breach of their fiduciary duties in signing the contracts.
Also named in that suit are FMSS, the firm's owner Ms How Weng Fan, and two other town councillors Mr Chua Zhi Hon and Mr Kenneth Foo.
AHTC wants the town councillors to account for some $33 million paid to FMSS and a related service provider between July 2011 and July 2015, and repay any money which was wrongfully paid out.