Managing agent's legal obligation, and more

KPMG's Mr Owen Hawkes (left) and PwC's Mr Goh Thien Phong testified for their respective firms.
KPMG's Mr Owen Hawkes (left) and PwC's Mr Goh Thien Phong testified for their respective firms.ST PHOTOS: KHALID BABA

MR OWEN HAWKES

Executive director of auditing firm KPMG, which was tasked to look into AHTC's accounts

Senior Counsel Chelva Rajah, the WP town councillors' lawyer, put to Mr Hawkes that AHTC had to terminate the contract of managing agent CPG early, because the ruling People's Action Party (PAP) had a track record of making "things difficult for opposition town councils".

Mr Hawkes said the PAP-appointed CPG had legal obligations to fulfil.

He also said AHTC was so "obviously concerned" by a major accounting lapse by FMSS that it withheld $250,000 in fees, showing it was "not happy" with its services. But FMSS' lawyer Leslie Netto disputed this and said there was no such thing as a "perfect contract".

Another issue Mr Netto put to Mr Hawkes was how AHTC and FMSS had maintained the estates well. But Mr Hawkes said repeatedly that his concern was about how the town council manages itself. "Having been to Hougang many, many times, it is not my place to suggest it is some sort of Mad Max style wasteland," he told Mr Netto at one point, referring to the movie about a dystopian future.

MR GOH THIEN PHONG

Partner at PwC, which was hired by PRPTC to look into AHTC's books

While PwC's report said AHTC had chosen higher-priced contractors that cost the town council more, defence lawyer Chelva Rajah said this was justified.

In the case of a contractor for refuse chute and roller shutter maintenance, the lower-priced firm told AHTC it did not have resources to take on extra work. Mr Goh replied that these reasons were not captured in the tender evaluation report.

Defence lawyer Leslie Netto put to Mr Goh that the PwC's report was "prejudiced" and did not consider other issues, like the political nature of town councils. Mr Goh disagreed and said the report was based on all available evidence.

Mr Netto said the PwC report was speculative in saying that appointing FMSS gave it an edge in a subsequent tender.

Mr Goh pointed out that other service providers had approached town councillors but were turned down, and since a tender was waived, these companies may have the impression it was not worth putting in a bid.

 
A version of this article appeared in the print edition of The Sunday Times on November 04, 2018, with the headline 'Managing agent's legal obligation, and more'. Print Edition | Subscribe