'Inflated' condo loans: UOB drops suit against some

Five defendants removed; bank sets sights on developer over allegedly inflated loans to buyers of Sentosa units

There has been a significant development in the civil suit that United Overseas Bank (UOB) took out against developer Lippo Marina Collection (LMC) and seven individuals.

UOB has dropped five defendants from its suit - over allegedly inflated loans to buyers of condominium units on Sentosa that involved mortgages totalling about $180 million.

While it has not withdrawn its suit against property agents Rick Goh and Aurellia Ho, UOB will forgo any judgment that it may win against the pair, after the duo struck a settlement with the bank. That leaves just LMC in the bank's sights.

The settlement with the property agents involves Mr Goh's affidavit. The court document is expected to shore up the bank's allegations that buyers of units at the high-end Marina Collection condominium were given discounts of between 22 per cent and 34 per cent.

UOB alleges that LMC and the other defendants failed to inform it of the "very substantial" discounts.

As a result, the 38 purchasers were each granted loans of between $4.2 million and $5 million.

UOB had sued the two agents for alleged deceit and conspiracy over the inflated loans.The bank also sued LMC for conspiracy, with damages to be assessed.

LMC, defended by lawyers Siraj Omar and Teng Po Yew from Premier Law, has vigorously denied the bank's claims. It said the financing of the units was a matter solely between UOB and the buyers.

In judgment grounds issued last week by the High Court, it emerged that Mr Goh had affirmed an affidavit that relates to the alleged nature and extent of LMC's involvement in the transactions.

He did this as part of a deal with UOB. In the deal, Mr Goh will also provide for the use of the affidavit when the case goes to trial.

In exchange for Mr Goh giving "truthful testimony" in court, UOB will forgo any judgment that it may win against him and Ms Ho in the case.

LMC's lawyers had gone to court late last year to seek access to the documents.

But UOB, represented by Tan Kok Quan Partnership lawyers Eddee Ng and Cheryl Nah, opposed disclosure. They argued that the papers were protected by litigation privilege.

Such privilege exists for confidential documents prepared in circumstances where a case is expected to go to court. Ms Nah said the affidavit was prepared when the case was ongoing and given to the bank in confidence.

High Court Assistant Registrar Bryan Fang ruled that there was clear evidence that disclosure was made in confidence, and found that "privilege is not waived beyond the recipient".

He added that Lippo will have access to the affidavit at a later stage, when the evidence-in-chief of both parties is exchanged.

A pre-trial conference for the ongoing main suit was held on Monday.

A version of this article appeared in the print edition of The Straits Times on January 25, 2017, with the headline ''Inflated' condo loans: UOB drops suit against some'. Subscribe