An alleged unsettled loan given to a mutual friend led two investment consultancies to sue a lawyer for US$2.5 million (S$3.5 million), alleging fraudulent misrepresentation and breach of fiduciary duties.
Lawyer Then Feng, 37, when pressed for the return of the monies, claimed in court papers filed last month that Mr Andrew Ling, who controlled both firms, had agreed not to start this lawsuit while both took steps to recover the funds from a mutual friend to whom it was loaned.
The US$2.5 million is the subject of a High Court suit by the two firms - Providence Asset Management and another firm named 5 and 2 - against Mr Then, a former counsel in the Singapore office of global law firm Walkers, and two other parties related to him. Both the plaintiffs and defendants have given differing accounts of events.
Mr Ling, director of the two investment services firms, understood last year that Mr Then could arrange for Walkers to provide services for facilitating business deals. It also emerged that Mr Then also ran Walkers Professional Services (WPS), a name he allegedly chose for its similarity to the Walkers law firm.
In the middle of last year, Mr Then told Mr Ling about a bank in Curacao, a Caribbean island off the Venezuelan coast, that was available for purchase at US$8.5 million and that Walkers could represent the buyers.
Mr Then said he would also be a partner in the new venture.
He used his Walkers law firm e-mail account to correspond with the Curacao party, who later agreed to sell two banks for US$8.5 million. Last October, around US$5.5 million was transferred to WPS for the potential purchases.
One deal was inked but the other fell through and the two companies, represented by lawyers Daniel Chia and Ker Yanguang, sued for the refund of an unused US$2.5 million.
In court papers filed last month, they alleged, among other things, that Mr Then made "fraudulent misrepresentations" to induce them to transfer the funds.
Mr Then, in contesting the claims, argued that the plaintiffs were at all times aware WPS was distinct, separate and free of any control by Walkers.
He said, in defence papers filed by Senior Counsel Siraj Omar and lawyer Audie Wong, that the standing arrangement with Mr Ling was for Providence to hire Walkers for legal advice on any of its deals, but Mr Then would help Providence in his personal capacity on non-legal matters and for services Walkers did not provide.
Mr Then said the remaining funds sought were loaned to Swiss national Frederick Gaillard, a mutual friend of his and Mr Ling, who was shown evidence of the debt.
Both agreed to work together to expedite repayment by Mr Gaillard and agreed no steps would be taken to recover the funds from Mr Then or WPS while this was being done. This "hold-hands" pact precluded the two companies from starting this suit, claimed Mr Then.
Mr Then said that as in all past matters, it was clear Mr Ling was authorised to speak for the firms.
A High Court pre-trial conference is due this month.